Foreword

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Foreword
This is the second edition of this commentary. In the first edition we stated that there
is hardly any need to provide a justification for a new commentary on such an
important topic as the United Nations Convention on Contracts for the International
Sales of Goods (“Vienna Convention” or “CISG”). The Convention was signed in 1980,
currently has 89 Contracting States and is potentially applicable to up to two thirds of
international trade in goods; sales contracts are a daily occurrence and the fundamental
agreement in international commerce.
There are many good publications on the topic, predominately in continental Europe
or the United States, but we do hope that this commentary offers some new dimensions.
First, this commentary aims to be an international approach to the CISG: it brings
together 22 authors from sixteen countries in four continents with a wide range of
profound academic and practical expertise. They include some very well established
names in the field and few very promising newcomers. Second, the coverage is
consistent in addressing the general principles and drafting history of each article before
providing a detailed commentary and discussion of comparable rules in other instru-
ments, namely the UNIDROIT Principles of International Commercial Contracts
(“PICC”), and various regional instruments such as the Principles of European Contract
Law (“PECL”), as well as Incoterms where necessary. Finally, this commentary high-
lights all the main commercial law aspects of international sales as well as covering civil
law dimensions. Private international law and “procedural” aspects, such as burden of
proof, are also consistently addressed. While we reflect on the doctrinal discussion on
the CISG, we have made every effort to also be practical and give due regard to case law
with the hope to make this a book useful for both academics and practitioners.
We have considered all reviews of the first edition and various comments and
recommendations we have received formally and informally. We hope that the second
edition not only receives the same positive response as the first one, but also proves to
be an improvement rather than a mere update. Not only the text but also the indices
have been thoroughly updated.
The three editors got to know each other and became friends through the Willem C
Vis International Commercial Arbitration Moot. It has been a great experience to work
with one another and solidify a long-standing academic friendship. The editors have a
strong interest in international sales ignited and supported by a number of mentors and
friends; these include Professor Eric Bergsten, Professor Norbert Horn, Professor Rafael
Illescas, the late Professor Albert Kritzer and the late Professor Oskar Hartwieg. Warm
thanks and appreciation are due to them for the enthusiastic and professional way in
which they inspired us to work in this area of international commercial law.
Thanks are also due to all contributors for their submissions and embracing the
project with great motivation, drive and the necessary regard to the international
application of the CISG and the need to promote uniformity in the application of the
Convention. They have all worked to keep the project alive and bring it to fruition.
Friendships were enhanced and strengthened through this project. Deadlines are not
easy to keep in such large-scale projects but the gestation of the book remained within
set targets and every effort was made to state the law as of October 2017.
We also want to extend our thanks to our publisher and in particular, Dr Wilhelm
Warth who worked with us on the first edition and Thomas Klich who supported us in
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Foreword
the second edition who patiently encouraged us through deadlines and spared no effort
to ensure the quality of editing and publishing one would expect from Beck.
The editing co-ordination and the lion share of language and consistency editing fell
on Dr Metka Potocnik, at the School of International Arbitration Queen Mary
University of London. We thank her for the dedication, commitment and contribution
to this publication.
We hope you find this commentary useful and we are happy to receive any feedback.
A book is almost never perfect, even in its second edition, so any suggestions for
improvement in future editions are welcome and may be sent to any of three editors or
to the following email address: Thomas.Klich@beck.de.
Stefan Kröll, Loukas Mistelis, Pilar Perales Viscasillas

Cologne, London and Madrid
February 2018
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How to use this Commentary
To make the commentary as user-friendly as possible the comments on each article

follow the same structure. The first part (I) gives a short overview on the content of the
article, its drafting history and its role in the context of the CISG where appropriate.
The second part (II) contains the detailed commentary of the article while the third part
(III) contains references to comparable rules in other legal instruments which may be
useful in interpreting and applying the article
There is wealth of resources relating to the CISG. We have made every effort to
ensure that all major authorities are referred to, but in a fashion which keeps the book
in a manageable size and points the user to readily available online resources. In
particular:
– Often cited sources are listed in the abbreviated bibliography section and hence in the
commentary only the names of the authors and short titles are listed in the footnotes;
moreover, whenever articles are also available through the Pace University Albert H
Kritzer CISG Database (www.cisg.law.pace.edu) we have indicated that through the
following reference: (Pace)
– We do not use the full citation of judicial decisions or arbitration awards where there
is a freely accessible online publication of the same: in such cases, we refer wherever
appropriate to the case with the number provided by the CISG Online database
maintained by the Global Sales Law project of the University of Basel (http://
www.globalsaleslaw.org/index.cfm?pageID=28) and indicate if an English translation
of the case exists on the Pace University Albert H Kritzer CISG Database (www.cis-
g.law.pace.edu) by the reference: (Pace). Full texts and English translations (typically
through the Queen Mary Translation Programme) are readily available on these free
access databases. As both of them are very user-friendly and cases can easily be
retrieved by the date of the decisions, we have refrained from giving the exact web-
address for every case.
There are a few very good free access databases on the CISG. These include:
– The award winning Albert H Kritzer CISG Database: http://www.cisg.law.pace.edu/
(comprehensive collection of case law, academic commentary, guides and an article-
by-article collection of resources)
– CISG Online: http://www.globalsaleslaw.org/index.cfm?pageID=28
– CISG Advisory Council: http://www.cisgac.com/
– UNCITRAL: www.uncitral.org and more specifically: http://www.uncitral.org/unci-
tral/en/case_law/digests.html (CISG Digest) and http://www.uncitral.org/uncitral/en/
case_law/abstracts.html (CLOUT abstracts)
– UNILEX: http://www.unilex.info/
– CISG Spain and Latin America: https://www.cisgspanish.com and autonomous net-
work: http://www.cisg.law.pace.edu/network.html#cp
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List of Contributors
Yes˛im M. Atamer
Yes˛im M. Atamer (LLB, LLM, PhD, Istanbul University) is Professor of Private Law and Comparative
Private Law, and Vice Director of the European Institute at Istanbul Bilgi University. She is a member of
the CISG Advisory Council. [Arts 78–80]
Ivo Bach
Ivo Bach is professor of Law at Georg August University Göttingen (Germany) where he has held the
chair for German and European Private Law since 2016. He teaches and researches in the fields of
national and international contract law and international dispute resolution. [Arts 49–52]
Gary F. Bell
Gary F. Bell is Associate Professor at the National University of Singapore, Director of its LL.M.
Programme in Arbitration and Director of the Asian Law Institute (ASLI). He teaches the CISG,
Arbitration, and Indonesian Law. He acts regularly as an arbitrator. He is trained in both common law
and civil law at McGill and is an editor of the Asian Journal of Comparative Law and is on the Executive
Editorial Board of the American Journal of Comparative Law. [Arts 61-65]
Andrea Björklund
Andrea Björklund is Full Professor and L. Yves Fortier Chair in International Arbitration and Interna-
tional Commercial Law at McGill University Faculty of Law. An expert in international commercial and
investment arbitration, she serves as arbitrator and is on the arbitration panels of the ICDR and NAFTA
Chapter 19. [Arts 25–29]
Stavros Brekoulakis
Stavros Brekoulakis is a Professor in International Arbitration at Queen Mary University of London. He
is the Co-Chair of the ICCA-Queen Mary Task Force on Third-Party Funding, member of the
International Law Association, member of the ICC Task Force on Emergency Arbitrator Proceedings,
Member of the ICC Commission on Arbitration, General Editor of the Journal of International Dispute
Settlement and Editor-in-Chief of the (CIArb’s) International Journal of Arbitration, Mediation and
Dispute Management. Brekoulakis has been involved in international arbitration for more than 20 years
as counsel, arbitrator and expert. [Art. 10]
Michael Bridge
Michael Bridge, a Fellow of the British Academy, Queen’s Counsel (honoris causa), Bencher of the Middle
Temple and Chair Elect of the CISG Advisory Council, is a Professor of Law at the National University of
Singapore, Senior Research Fellow at Harris Manchester College, University of Oxford, Visiting Professor at
Queen Mary University of London, and Emeritus Professor at the London School of Economics. He is the
author of numerous books on Sale, International Sale, Personal Property and Secured Credit. [Arts 81–84]
Petra Butler
Dr Petra Butler is professor at Victoria University of Wellington, co-director of the Centre for Small
States, Queen Mary University of London, a German qualified lawyer and a New Zealand barrister. Petra
specialises in domestic and international human rights, comparative law, and private international law
with an emphasis on international commercial contracts. She has published extensively in those areas.
Petra is New Zealand’s CLOUT correspondent for the CISG and Convention on the Use of Electronic
Communications in International Contracts. [Arts 53–60, jointly with Arjun Harindranath]
Milena Djordjević
Milena Djordjević is a Vice-Dean for International Cooperation, Director of the Center for Legal Skills,
General Secretary of the Belgrade Open Pre-Moot and an Assistant Professor at the University of
Belgrade Faculty of Law where she teaches International Commercial Law, International Commercial
Arbitration, Foreign Investment Law, EU Trade Policy and Legal English. She has published extensively
in those areas. Milena holds an LL.B. (U. Belgrade), LL.M. (U. Pittsburgh), and a Dr. iur. (U. Belgrade)
degrees. She regularly acts as arbitrator or expert witness in arbitration, both domestic and international.
Milena is also a CLOUT correspondent for Serbia. [Arts 4, 74–77]
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Johan Erauw
Johan Erauw is Dr. Iuris (1980), Dr.h.c. (Shanghai 2005) and Professor Emeritus of law at University of
Gent (Belgium), where he still teaches International Business Transactions. An active member of the Ghent
bar until November 2017, is now active in international commercial arbitration (ICC, CEPANI, ad hoc,
NAI, SCC, CIETAC, Belgian Sports Arbitration), having also served as Vice-President of CEPANI-Brussels.
He was a member of various academic institutions, including American University (Washington D.C.),
University of Florida (Gainesville) and East China University (Shanghai) and China University (Beijing).
Equally he was an expert advisor to UNCITRAL, the Belgian Ministry of Justice, the Parliament and WTO.
He is member of the Institut de Droit International. He has published numerous books and articles,
primarily on international business transactions. [Arts 66–67, 70]
Franco Ferrari
Professor Ferrari, formerly Legal Officer at the United Nations Office of Legal Affairs/International Trade
Law Branch (UNCITRAL) and Professor of Law at Tilburg University School of Law (the Netherlands),
Bologna University School of Law (Italy) and Verona University School of Law, is Professor of Law and
Director of the Center for Transnational Litigation and Commercial Law at NYU School of Law. [pre Arts
14–24, Arts 14–24]
Arjun Harindranath
Arjun Harindranath has a BA (1st class hon) in philosophy and an LLB from Victoria University of
Wellington. He now lives in Medellin, Colombia and work as an editor and writer. [Arts 53–60, jointly
with Petra Butler]
Johnny Herre
Johnny Herre is a justice at the Supreme Court of Sweden. He received a degree in economics and
business administration from the Stockholm School of Economics (SSE), a degree in law from Stockholm
University and a PhD in civil law from the SSE. Before joining the Supreme Court in 2010, he was a
Professor in civil law at the SSE, teaching and researching in the fields of contract law, the law of
obligations and international trade law. [Arts 89–101]
Peter Huber
Peter Huber is professor of Law at Johannes Gutenberg University Mainz (Germany) where he has held
the chair for private law, conflict of laws and comparative law since 2000. He publishes in private law,
international arbitration and international commercial law. [Arts 45–48]
Stefan Kröll
Stefan Kröll is an independent arbitrator in Cologne, Director of the Center for International Dispute
Resolution at Bucerius Law School in Hamburg and one of the directors of the Willem C Vis Arbitration
Moot. In addition, he is a visiting professor at the School of International Arbitration, Queen Mary London.
He received his education at the Universities of Marburg, Geneva and Cologne, holds a LL. M. from the
University of London (LSE) and a doctorate from the University of Cologne (www.rechtsanwalt-kroell.de).
[Introduction, jointly with Loukas Mistelis and Pilar Perales Viscasillas, pre Arts 35–44; Arts 35–44]
Loukas Mistelis
Loukas Mistelis is the Clive M Schmitthoff Professor of Transnational Commercial Law and Arbitration
and the Director of the School of International Arbitration, Centre for Commercial Law Studies, Queen
Mary University of London. He also teaches at NYU in London. He was educated at Athens (LLB),
Strasbourg, Hannover (MLE), and Keio. He regularly sits as an arbitrator. He has published extensively in
international commercial law, private international law, comparative law and international arbitration.
[Introduction, jointly with Stefan Kröll and Pilar Perales Viscasillas; Preamble; Art. 1; Art. 3, jointly with
Anjanette Raymond; Art. 6]
Pilar Perales Viscasillas
Pilar Perales Viscasillas is the Chair of Commercial Law at the University Carlos III of Madrid, where she
is also the Director of the School of Law. Member of the CISG-AC Advisory Council. Director of the
Madrid Moot and author of several books and articles in the area of international commercial contracts
and arbitration. She is also an arbitrator in both domestic and international matters. [Introduction, jointly
with Stefan Kröll and Loukas Mistelis; Arts 7, 9, 11–13]
Burghard Piltz
Professor Dr. Piltz studied law at Münster, Munich, Buenos Aires and London. He is Partner at Ahlers &
Vogel Rechtsanwälte, Hamburg and since 1997 Professor honoris causae at the University of Bielefeld,
Germany. His areas of expertise and publications include International Sales, Distribution and related
transactions, Incoterms and Latin American Law, in particular Argentinian Law. He is member of the
ICC Incoterms 2020 Drafting Group [Arts 30–34].
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Anjanette (Angie) Raymond
Angie Raymond is an Associate Professor in the Department of Business Law and Ethics, at the Kelley
School of Business and an Adjunct Associate Professor at Maurer School of Law (Indiana). She is the
Program Director of the Ostrom Workshop Data Management and Information Governance. Angie is a
US National Consultant delegate to UNCITRAL reporting on the Electronic Commerce related issues and
has previously attended the Online Dispute Resolution Working Group. [Art. 3, jointly with Loukas
Mistelis, Arts 68–69]
John Ribeiro
John Ribeiro holds a Ph.D. in international commercial arbitration from Osaka University and specialises
in international commercial arbitration and other forms of dispute resolution at Herbert Smith Freehills
(Tokyo and London). His experience includes advising business conglomerates, pharmaceutical and
technology companies in a number of arbitration cases under, for example, the ICC, LCIA, JCAA, AAA
and UNCITRAL rules. He is fluent in both written and spoken Japanese and has published on topics
including international commercial arbitration, international sales law and cross-border intellectual
property disputes. [Art. 5]
Djakhongir Saidov
Djakhongir Saidov is Professor of Commercial Law at Dickson Poon School of Law (King’s College
London), with an LLB degree from University of World Economy and Diplomacy (Uzbekistan), and LLM
and PhD degrees from University of East Anglia (UK). His research interests and publications are in the
law of sale of goods, international commercial law and the law relating to international oil and gas
operations. He is a Reporter to CISG Advisory Council, Editor of the English Sale of Goods Law section
in the LMCLQ Yearbook of International Maritime and Commercial Law, an Academic Fellow at Centre
for Maritime Law in the National University of Singapore and a Member of the Education Advisory
Board of the Association of International Petroleum Negotiators (AIPN). [Arts 71–73]
Hiroo Sono
Hiroo Sono is Professor of Law at Hokkaido University, Japan. He is a member of the CISG Advisory
Council (CISG-AC) and the Global Private Law Forum (GPLF) of Japan. He also serves as the Japanese
delegate to UNCITRAL Working Group VI (Security Interests). [Arts 85–88]
Frank Spohnheimer
Frank Spohnheimer is a Researcher at FernUniversity in Hagen and a Lecturer at the University of
Kaiserslautern (both Germany). He teaches civil law, civil procedure and international business transac-
tions and focusses in his research on broker agreements, civil procedure, international commercial
arbitration, conflict of laws and the CISG. [Art 2, Index].
Alberto L. Zuppi
Alberto L. Zuppi, JD Universidad Buenos Aires, PhD Universität des Saarlandes, is former Robert &
Pamela Martin Associate Professor of Law, Paul M. Hebert Law Center, Louisiana State University, and
Professor of International Business Transactions at Europa-Institut, Universität des Saarlandes, Universi-
dad de Buenos Aires and Universidad Austral, Buenos Aires. He is arbitrator at the Buenos Aires Bar
Association and co-author with Alejandro Garro, La Compraventa Internacional de Mercaderı́as (2012)
and also co-author together with the former and Fernando Breda Pessoa of “Compra e venda
internacional de Mercadorias – Convença|˘o de Viena de 1980”, Juruá, Curitiba (2016) and several articles
related to CISG in US and Argentine law journals. [Art. 8]
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Table of Cases
International Courts
Court of Justice of the European Union (CJEU, previously ECJ)
25 February 2010 (airbag systems), Car Trim GmbH v Key Safety Systems SRL, case C-381/08, CISG-
Online 2351 (Pace) – Art. 3, para. 1; Art. 57, para. 5
3 May 2007, Color Drack GmbH v LEXX International Vertriebs GmbH, case C-386/05 (Pace) –
Art. 57, para. 5
16 March 1999, Transporti Castelleti Spedizioni Internazionali S. p. A. v. Hugo Trumpy S. p. A.) (Pace)
– Art. 9, para. 35
20 February 1997 (Pace), Mainschiffahrts-Genossenschaft eb (MSG) v. Les Gravihres Rhinanes SARL –
Art. 9, para. 35
9 December 1987, SAR Schotte v Parfums Rothschild, case C-218/86, [1987] ECR 819
6 April 1995, Lloyd’s Register of Shipping v Soc Campenon Bernard, case C- 439/93, [1995] ECR I-961
– Art. 10, para. 21
Iran – United States Claims Tribunal
28 July 1989, Watkins – Johnson v. Islamic Republic of Iran, No. 370, CISG-Online 9 (Pace) – Art. 88,
paras 20, 36
McCollough & Co. Inc. v Ministry of Post, Tel. & Tel., 11 Iran-U. S. Cl. Trib. Rep. 3 (1986) – Art. 78,
para. 11
Argentina
Cámara Nacional de Apelaciones en lo Comercial
31 May 2007 (almonds), Sr. Carlos Manuel del Corazón de Jesús Bravo Barros v Salvador Martı́nez
Gares, CISG-Online 1517 (Pace) – Art. 4, para. 46; Art. 7, para. 55
21 July 2002 (barley/malt), Cervecerı́a y Malteria Paysandú S. A. v Cervecerı́a Argentina S. A., CISG-
Online 803 (Pace) – Art. 7, para. 55, Art. 28, para. 2; Art. 35, para. 170
24 April 2000 (coal), CISG-Online 699 (Pace) – Art. 1, para. 51; Art. 7, para. 55; Art. 35, para. 170
31 October 1995, CISG-Online 299 (Pace) – Art 67, para. 35
14 October 1993 (machinery), Inta v Officina Meccanica, CISG-Online 87 (Pace) – Art. 4, para. 32;
Art. 8, para. 13; Art. 9, para. 30; Art. 11, para. 12; Art. 18, para. 8
Juzgado Commercial Buenos Aires
17 March 2003, Wacker-Polymer Systems GmbH v Quiebra v Glaube S. A. et al., CISG-Online 1844
(Pace) – Art. 4, para. 46
Juzgado Nacional de Primera Instancia en lo Comercial Buenos Aires
2 July 2003, Arbatax S. A. Reorganization Proceeding, (Pace) – Art. 9, para. 38
6 October 1994 (looms), Bermatex v Valentin Rius, CISG-Online 378 (Pace) – Art. 6, para. 8; Art. 9,
para. 38; Art. 78, para. 21
23 October 1991, Aguila Refractarios S.A. v Conc. preventivo, CISG-Online 460 – Art. 78, para. 21
20 May 1991, Elastar Sacifia v Bettcher Industries, CISG-Online 461 (Pace) – Art. 9, para. 38
Australia
Federal Court of Australia
20 April 2011 (electrical appliances), Castel Electronics Pty Ltd v Toshiba Singapore Pte Ltd, CISG-
Online 2219 (Pace) – Art. 35, paras 156, 157, 162
28 September 2010 (electrical appliances), CISG-Online 2158 (Pace) – Art. 35, para. 75
20 May 2009 (machinery for the processing of olive oil), Olivaylle Pty Ltd v Flottweg GMBH & Co
KGAA, CISG-Online 1902 (Pace) – Art. 6, para. 10
24 October 2008 (cherries), Hannaford (t/as Torrens Valley Orchards) v Australian Farmlink Pty Ltd,
CISG-Online 1782 – Art. 7, para. 42; Art. 93, para. 3
Supreme Court of Queensland
12 October 2001, Downs Investments v Perwaja Steel, CISG-Online 955 (Pace) – Art. 25, para. 44;
Art. 54, paras 3, 15; Art. 71, para. 9; Art. 72, paras 19, 31
17 November 2000 (scrap steel), Downs Investments v. Perwaja Steel, CISG-Online 587 and 859 (Pace)
– Art. 1, paras 37, 51; Art. 6, para. 18; Art. 54, paras 3, 15; Art. 75, para. 24
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Table of Cases
Supreme Court of Western Australia
17 January 2003, Ginza Pte Ltd v Vista Corporation Pty Ltd, CISG-Online 807 (Pace) – Art. 50,
para. 48
Supreme Court of New South Wales
30 January 2012 (glass bottles), Fryer Holdings v Liaoning MEC Group, CISG-Online 2325 (Pace) –
Art. 35, para 75
13 October 2006 (capers, semi-dried tomatoes, eggplant and capsicum), Italian Imported Foods Pty Ltd
v Pucci S. r. l., CISG-Online 1494 (Pace) – Art. 6, para. 10
Federal Court of Australia, South Australian District, Adelaide
28 April 1995 (tent hall structures), Roder Zelt- und Hallenkonstruktionen GmbH v Rosedown Park
Pty Ltd et al., CISG-Online 218 (Pace) – Art. 4, paras 18, 28; Art. 25, paras 29, 58; Art. 26, para. 8;
Art. 41, para. 23
Austria
Oberster Gerichtshof
16 December 2015 (silkscreen), CISG-Online 2663 (Pace) – Art. 45, para. 9
15 January 2013 (glass mosaic tiles), CISG-Online 2398 (Pace) – Art. 74, para. 11
13 December 2012 (insulating material), CISG-Online 2438 – Art. 18, paras 2, 8, 9, 17, 21
15 November 2012 (fashion), CISG-Online 2399 (Pace) – Art. 25, para. 42
28 June 2012 (seat belts), CISG-Online 2569 (Pace) – Art. 38, paras 20, 35, 41, 50, 145
14 February 2012 (paprika powder), CISG-Online 2308 (Pace) – Art. 40, paras 1, 11, 28, 30
22 November 2011 (video surveillance system), CISG-Online 2239 – Art. 49, para. 20
31 August 2010 (old timber), CISG-Online 2236 (Pace) – Art. 39, paras 35, 76, 82, 89
2 April 2009 (boiler), CISG-Online 1889 (Pace) – Art. 6, paras 16, 18; Art. 39, para. 109; Art. 82, paras
9, 12
3 April 2008 (violins), CISG-Online 1680 (Pace) – Art. 57, para. 5
19 December 2007 (laminated glass), CISG-Online 1628 (Pace) – Art. 39, paras 16, 97; Art. 44, para. 10
4 July 2007 (car), CISG-Online 1560 (Pace) – Art. 6, para. 18
19 April 2007 (scaffold hooks), CISG-Online 1495 (Pace) – Art. 35, paras 3, 88
12 September 2006 (CD media), CISG-Online 1364 (Pace) – Art. 4, para. 35; Art. 42, paras 9, 12, 49,
54; Art. 43, paras 15, 28; Art. 74, para. 15
29 November 2005, CISG-Online 1227 (Pace) – Art. 18, para. 7
8 November 2005 (glass recycling machine), CISG-Online 1156 (Pace) – Art. 7, para. 58
31 August 2005 (tantalum powder), CISG-Online 1093 (Pace) – Art. 4, para. 24; Art. 8, para. 29; Art. 9,
paras 2, 9, 10, 11, 34; Art. 14, paras 38, 39
21 June 2005 (software), CISG-Online 1047 (Pace) – Art. 1, para. 40; Art. 25, para. 39; Art. 51, paras
10, 53
24 May 2005 (grinding stock), CISG-Online 1046 (Pace) – Art. 27, para. 19
23 May 2005, CISG-Online 1041 (Pace) – Art. 7, paras 18, 33; Art. 50, paras 34, 48; Art. 82, para. 2;
Art. 83, para. 3
2 March 2005 (pork meat), CISG-Online 774 (Pace) – Art. 9, para. 34
26 January 2005 (mushrooms), CISG-Online 1045 – Art. 6, para. 18
17 December 2003 (tantalum powder), CISG-Online 828 (Pace) – Art. 4, paras 24, 30, 39; Art. 9,
para. 2; Art. 14, para. 38; Art. 38, paras 12, 43, 81, 91, 101, 103; Art. 39, paras 38, 79, 82, 120
27 February 2003 (frozen fish), CISG-Online 794 (Pace) – Art. 9, para. 34; Art. 35, paras 54, 134;
Art. 40, para. 31
18 December 2002, CISG-Online 1279 (Pace) – Art. 1, para. 3
14 January 2002 (cooling system), CISG-Online 643 (Pace) – Art. 4, paras 30, 39; Art. 8, para. 25;
Art. 6, para. 18; Art. 38, paras 12, 43, 81, 91, 101, 103; Art. 39; Art. 46, para. 53; Art. 48, para. 26;
Art. 74, paras 2, 11, 21, 28, 29, 30, 33, 42, 43, 63
22 October 2001 (gasoline and gas oil), CISG-Online 614 (Pace) – Art. 4, paras 7, 17, 18, 27, 30; Art. 6,
paras 16, 20, 24; Art. 7, para. 55; Art. 14, para. 24
22 October 2001 (fruits and vegetables), CISG-Online 613 (Pace) – Art. 4, paras 17, 18, 27, 30; Art. 7,
13 September 2001, CISG-Online 644 (Pace) – Art. 19, para. 15
5 July 2001 (Intel Pentium II/300 processors), CISG-Online 652 (Pace) – Art. 26, para. 4; Art. 39,
para. 109; Art. 49, para. 63
7 September 2000 (tombstones), CISG-Online 642 (Pace) – Art. 1, para. 47; Art .4, paras 25, 30, 46;
Art. 7, para. 55
28 April 2000 (jewellery), CISG-Online 581 (Pace) – Art. 1, para. 47; Art. 26, para. 4; Art. 64, para. 10;
Art. 74, paras 3, 40, 53, 74, 75; Art. 75, paras 12, 14, 20; Art. 76, paras 3, 15, 19; Art. 77, para. 26
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13 April 2000 (machines), CISG-Online 576 (Pace) – Art. 1, para. 47; Art. 4, para. 22; Art. 9, para. 1;
introductory remarks Arts 35–44, para. 9; Art. 35, paras 25, 52, 85, 88, 89, 120, 204
21 March 2000 (wood), CISG-Online 641 (Pace) – Art. 1, para. 46; Art. 4, paras 27, 39; Art. 6, para. 8;
Art. 9, paras 14, 23, 26, 34; Art. 35, paras 29, 54; Art. 38, para. 25; Art. 39, paras 18, 55, 113, 124;
Art. 40, para. 7
9 March 2000 (roofing material), CISG-Online 573 (Pace) – Art. 14, paras 2, 4; Art. 19, para. 10;
Art. 74, paras 2, 63; Art. 75, para. 7
27 August 1999 (trekking shoes), CISG-Online 485 (Pace) – Art. 26, para. 3; Art. 38, paras 18, 25, 32,
39, 55, 91; Art. 39, paras 7, 43, 78, 129
28 July 1999 (pipes), CISG-Online 2021 (Pace) – Art. 4, para. 46
29 June 1999 (plates/dividing wall panels), CISG-Online 483 (Pace) – Art. 11, para. 1; Art. 26; Art. 35,
para. 29; Art. 81, paras 8, 16, 23, 30, 32; Art. 82, para. 18
11 March 1999 (frames for mountain bikes), CISG-Online 524 (Pace) – Art. 35, paras 120, 129
19 January 1999, CISG-Online 1233 (Pace) – Art. 81, para. 4
15 December 1998 (construction material), CISG-Online 1535 (Pace) – Art. 79, paras 50, 92
12 November 1998 (cellulose), CISG-Online 645 – Art. 9, paras 14, 23, 26, 34
15 October 1998 (timber), CISG-Online 380 (Pace) – Art. 4, para. 27; Art. 6, para. 8; Art. 9, para. 34;
Art. 38; Art. 39; Art. 44
30 June 1998 (pineapple), CISG-Online 410 (Pace) – Art. 27, paras 19, 28 31
25 June 1998 (gravestones), CISG-Online 352 (Pace) – Art. 4, paras 30, 46
10 March 1998, CISG-Online 356 (Pace) – Art. 4, para. 10; Art. 7, para. 55; Art. 57, para. 28; Art. 81,
para. 10
12 February 1998 (umbrellas), CISG-Online 349 (Pace) – Art. 1, paras 26, 51; Art. 4, para. 46; Art. 71,
para. 19
18 June 1997, CISG-Online 292 (Pace) – Art. 14, paras 7, 11
26 April 1997 – Art. 13, para. 11
24 April 1997 (processing plant), CISG-Online 291 (Pace) – Art. 4, para. 46
20 March 1997 (mono ammonium phosphate), CISG-Online 269 (Pace) – Art. 1, paras 45, 47; Art. 4,
paras 18, 21; Art. 14, paras 2, 5, 22; Art. 19, paras 10, 13, 18, 24
27 February 1996, CISG-Online 648 – Art. 53, para. 5
6 February 1996 (propane gas), CISG-Online 224 (Pace) – Art. 1, paras 31, 32, 37, 39; Art. 2, para. 52;
Art. 7, para. 27; Art. 9, para. 10; Art. 14, paras 1, 2, 4, 17, 25, 38, 39; Art. 41; Art. 49, paras 62, 63;
Art. 53, paras 10, 14; Art. 54, paras 3, 7; Art. 58, para. 25; Art. 71, paras 13, 37; Art. 74, para. 46;
Art. 76, para. 7; Art. 77, paras 11, 32, 35, 36; Art. 80, para. 6
24 October 1995 (galvanized wire), CISG-Online 166 (Pace) – Art. 4, para. 30
10 November 1994 (chinchilla furs), CISG-Online 117 (Pace) – Art. 1, paras 25, 37, 42, 43; Art. 6,
para. 7; Art. 8, para. 25; Art. 14, paras 1, 2, 21, 24, 26, 28, 30; Art. 55, paras 3, 4; Art. 57, paras 10, 11, 23
27 October 1994 (brushes and brooms), CISG-Online 133 (Pace) – Art. 3, para. 17
2 July 1993, CISG-Online 527 (Pace) – Art. 13, para. 11
Oberlandesgericht Graz
19 June 2013 (heavy oil), CISG-Online 2461 – Art. 35, para. 127
22. November 2012 (machine), CISG-Online 2459 – Art. 46, para. 53
29 July 2004 (construction equipment), CISG-Online 1627 (Pace) – Art. 10, para. 17; Art. 25, para. 40;
Art. 26, paras 6, 9; Art. 75, para. 8; Art. 76, paras 7, 10, 13
16 September 2002, CISG-Online 1198 (Pace) – Art. 88, paras 16, 18
7 March 2002, CISG-Online 669 (Pace) – Art. 9, para. 9; Art. 14, para. 2; Art. 18, para. 10
24 January 2002 (excavator), CISG-Online 801 Pace) – Art. 76, para. 13
15 June 2000 (ski shoes), CISG-Online 799 (Pace) – Art. 4, para. 18
24 February 1999 (military weapons) CISG-Online 797 (Pace) – Art. 4, paras 7, 18
11 March 1998 (wood/timber), CISG-Online 670 (Pace) – Art. 27, paras 15, 20; Art. 39, paras 28, 33,
52, 59; Art. 44, para. 24; Art. 50, para. 11
9 November 1995 (marble slabs), CISG-Online 308 (Pace) (Unilex) – Art. 9, para. 27; Art. 35, para. 48
Oberlandesgericht Innsbruck
18 December 2007 (steel bars), CISG-Online 1735 (Pace) – Art. 3, paras 5, 20
1 February 2005, CISG-Online 1130 – Art. 14, paras 38, 39
1 July 1994 (garden flowers), CISG-Online 107 (Pace) – Art. 4, para. 35; Art. 25, para. 41; Art. 35, paras
71, 191; Art. 38, para. 52; Art. 74, para. 15
Oberlandesgericht Linz
8 February 2012 (safety belts), CISG-Online 2444 (Pace) – Art. 38, paras 12, 20; Art. 74, para. 11
24 September 2007 (resin laminated glass), CISG-Online 1583 (Pace) – Art. 3, para. 5; Art. 36, para. 9
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23 January 2006 (car), CISG-Online 1377 (Pace) – Art. 6, paras 16, 17, 18, 23; Art. 36, para. 8; Art. 69,
para. 2; Art. 82, paras 11, 12, 22
8 August 2005 (spacers for insulation glass), CISG-Online 1087 (Pace) – Art. 4, para. 30; Art. 9, para. 2;
Art. 14, para. 39
23 March 2005 (conveyor band), CISG-Online 1376 (Pace) – Art. 4, paras 24, 39; Art. 19, paras 11, 13
Handelsgericht Wien
1 June 2004, CISG-Online 954 (Pace) – Art. 81, para. 23
4 March 1997, CISG-Online 743 – Art. 6, para. 8
Belarus
Supreme Economic Court of the Republic of Belarus
20 May 2003 (fish flour), CISG-Online 1040 – Art. 7, para. 61
Belgium
Court of Cassation
19 June 2009 (steel tubes), CISG-Online 1963 (Pace) – Art. 7, para. 61; Art. 79, paras 82, 84
Rechtbank van Koophandel Hasselt
28 June 2006, Drukkerij Moderna NV v IVA Groep BV, (Pace) – Art. 35, para. 105
10 May 2006, Scanlift Nederland NV v Belgium Coach Service BVBA, CISG-Online 1259 (Pace) –
Art. 78, para. 25
19 April 2006 (doors), CISG-Online 1389 (Pace) – Art. 4, paras 21, 22; Art. 35
20 September 2005 (bread), CISG-Online 1496 (Pace) – Art. 74, para. 17; Art. 78, para. 25
14 September 2005 (printed media) CISG-online 2001(Pace) – Art. 49, para. 35
25 February 2004 (carpet), K BVBA v BV, CISG-Online 831 (Pace) – Art. 4, para. 42; Art. 74, para. 87;
Art. 78, para. 23
6 January 2004 (polo shirts), CISG-Online 829 (Pace) – Art. 38, para. 132
22 May 2002 (packaging for vegetables), CISG-Online 703 (Pace) – Art. 11, para. 16
2 June 1999, CISG-Online 762 (Pace) – Art. 10, paras 19, 36
5 May 1999, Leithauser G. M. B. H. & CO v Willem van Praet, CISG-Online 1340 (Pace) – Art. 61,
para. 8
21 January 1997 (neon light signs), Epsilon v Interneon, (Pace) CISG-Online 360 (Pace) – Art. 4,
paras 2, 26; Art. 74, para. 38
2 May 1995 (frozen raspberries), CISG-Online 371 (Pace) – Art. 1, para. 25; Art. 12, para. 7; Art. 66,
para. 29; Art. 79, para. 78; Art. 96, para. 5
1 March 1995, JPS BVBA v Kabri Mode BV, CISG-Online 373 (Pace) – Art. 71, para. 20
Rechtbank van Koophandel Ieper
18 February 2002 (pork meat), Lavameat v SA Cointa, CISG-Online 764 (Pace) – Art. 66, para. 35;
Art. 74, para. 38; Art. 78, para. 23
29 January 2001 (cooling installations), CISG-Online 606 (Pace) – Art. 4, para. 30
Rechtbank van Koophandel Kortrijk
3 October 2001, CISG-Online 757 (Pace) – Art. 85, para. 25
4 April 2001 (shoes), (Pace) – Art. 11, paras 16, 17
6 October 1997 (crude yarn), CISG-Online 532 (Pace) – Art. 1, para. 51; Art. 35, para. 174
Cour d’Appel de Liège
28 April 2003, CISG-Online 944 – Arts 14–24 introductory remarks, para. 4; Art. 18, para. 7
Rechtbank van Koophandel Oudenaarde
10 July 2001 (textiles), CISG-Online 1785 (Pace) – Art. 14, para. 1; Art. 23, para. 1; Art. 78, para. 25
Rechtbank van Koophandel Tongeren
25 January 2005 (steel), CISG-Online 1106 (Pace) – Art. 9, para. 24; Art. 11, para. 1; Art. 14, paras 1,
11; Art. 15, paras 1, 12; Art. 18, para. 6; Art. 19, para. 1
Rechtbank van Koophandel Veurne
25 April 2001 (diesel tram), CISG-Online 765 – Art. 1, para. 44; Art. 38, paras 60, 90, 104; Art. 39;
Art. 78, para. 23
Tribunal Commercial de Bruxelles
13 November 1992, Maglificio Dalmine Srl v S C Covires, CISG-Online 458 (Pace) – Art. 71, para. 20
Tribunal Commercial de Namur
15 January 2002 (Flexivit n 3/milling machine), CISG-Online 759 (Pace) – Art. 74, para. 11
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Tribunal de commerce de Nivelles
19 September 1995 (extrusion press), S.A. Gantry v. Research Consulting Marketing, CISG-Online 366
– Art. 8, para. 22; Art. 14, para. 39; Art. 19, para. 18
Hof van Beroep Antwerpen
24 April 2006 (wood), GmbH Lothringer Gunther Grosshandelsgesellschaft für Bauelemente und
Holzwerkstoffe v NV Fepco International, CISG-Online 1258 (Pace) – Art. 9, para. 4; Art. 75,
para. 19; Art. 77, para. 17; Art. 78, para. 29; Art. 85, para. 25; Art. 88, para. 12
27 June 2001 (tiles), CISG-Online 2342 (Pace) – Art. 7, para. 27
18 June 1996 (clothes), CISG-Online 758 (Pace) – Art. 4, para. 26; Art. 74, para. 38
Hof van Beroep Gent
24 March 2010 (unpublished) – Art. 34, para. 10
24 November 2004 (computer hardware and software), CISG-Online 966 (Pace) – Art. 3, para. 20;
Art. 14, para. 24; Art. 19, para. 10; Art. 23, para. 1
10 May 2004 (plastic film), CISG-Online 991 (Pace) – Art. 77, para. 13, 15
28 January 2004 (breeding sows and cages), CISG-Online 830 (Pace) – Art. 39, paras 31, 126, 127;
Art. 40, para. 29
11 September 2003 (digital archive), (Pace) – Art. 84, para. 12
15 May 2002 (design of pagers), CISG-Online 746 (Pace) – Art. 1, para. 52; Art. 6, para. 18; Art. 7,
paras 28, 32; Art. 9, para. 29; Introduction to Arts 14–24, para. 7; Art. 29, para. 8; Art. 74, para. 38
31 January 2002 (candy), CISG-Online 1349 (Pace) – Art. 1, para. 47; Art. 4, para. 46
26 April 2000, BV BA JP v S Ltd, CISG-Online 1316 (Pace) – Art. 71, para. 43
Brazil
Tribunal de Justiça Rio Grande do Sul (Appellate Court)
30 March 2017 (electric motors), CISG-Online 2819 – Art. 7, paras 25, 27, 61; Art. 9, para. 36
14 February 2017 (chicken feet), CISG-Online 2818 – Art. 7, paras 25, 27; Art. 9, para. 36; Art. 11,
20 May 2009 (electrical discharge machine), Prakasa Indústria e Comércio de utilitades do lar Ltda v.
Mercomáquinas Insdústria Comércio e Representações Ltda, CISG-Online 2368 (Pace) – Art. 7,
Tribunal de Contas da União
7 December 2011 (Unilex) – Art. 79, para. 78
Canada
Supreme Court of Canada
3 October 1978, Asamera Oil Corp. Ltd. v. Sea Oil & General Corp. et al.; Baud Corp., N. V. v. Brook, 1
SCR. 633 – Art. 77, para. 2
Supreme Court of British Columbia
13 May 2015 (steel), CISG-Online 2734 – Art. 4, para. 28
21 August 2003, Mansonville v Kurtz, CISG-Online 1017 (Pace) – Art. 71, paras 7, 20, 40, 57
Supreme Court of Justice Ontario
6 October 2003 (vacuum panel insulation), Diversitel Communications Inc. v Glacier Bay, Inc. CISG-
Online 1436 (Pace) – Art. 25, para. 6
Ontario Superior Court of Justice
28 October 2005 (wine corks), Chateau des Charmes Wines Ltd v Sabaté USA, Inc. et al., CISG-Online
1139 (Pace) – Art. 11, para. 13; Art. 29 para. 7
31 August 1999 (picture frame mouldings), CISG-Online 433 (Pace) – Art. 1, para. 47; Art. 35, paras
20, 22, 28, 73, 75
Ontario Court of Appeal
26 January 2000 (molds used in manufacture of automobiles), CISG-Online 582 (Pace) – Art. 4,
para. 39
Ontario Court (General Division)
16 December 1992 (molds used in manufacture of automobiles), CISG-Online 572 (Pace) – Art. 74,
para. 43
Court d’Appel de Quebec
12 April 2011(frozen lobster), Mazetto Company Ilc c Dégust-Mer Inc, CISG-Online 2278 (Pace) –
Art. 8, para. 31; Art. 57, para. 10
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Canadian International Trade Tribunal
6 October 2005, Cherry Stix Ltd. v President of the Canada Borders Services Agency, CISG-Online
1140 (Pace) – Art. 14, para. 29; Art. 23, para. 1
China
Supreme Court of the People’s Republic of China
21 September 2005 (furniture), CISG-Online 1611 (Pace) – Art. 4 para. 11, Art. 55, para. 4
11 January 2001 (electricity generators and boilers), CISG-Online 1635 (Pace) – Art. 7, para. 19
Guangdong Higher People’s Court
1 January 2005 (ferromanganese and silicomanganese), CISG-Online 1966 (Pace) – Art. 9, para. 10
Shanghai High Court
21 September 2011 (electronic equipment), Comac SpA v. Shanghai Swift Mechanical & Electronic
Equipment Co., Ltd, CISG-Online 2318 (Pace) – Art. 7, para. 28
Shanghai No. 1 Intermediate People’s Court
23 March 2004 (chemical products), CISG-Online 1497 – Art. 4, para. 18
Jiangsu Higher People’s Court
19 February 2001 (excavating machines), CISG-Online 1636 (Pace) – Art. 7, para. 28
Zhejiang High People’s Court
24 April 2008 (garments), CISG-online Case No. 2058 (Pace) – Art. 62, para. 6
High People’s Court Ningxia, Autonomous Region
Rizhao Intermediate People’s Court, Shandong Province
17 December 1997 (Pace) – Art. 84, para. 14; Art. 88, para. 26
Xiamen Intermediate People’s Court
5 September 1994 (fish powder/meal), CISG-Online 464 (Pace) – Art. 6, para. 27
31 December 1992 (fish meal), (Pace) – Art. 74, para. 74
Beihai Maritime Court, Guangxi Zhuang Autonomous Region
5 March 2002, Sino-Add PTE. Ltd. v Karawasha Resources Ltd, CISG-Online 1383 (Pace) – Art. 74,
para. 59
Dalian Maritime Court
29 June 2005 (magnesia chromite clinker), CISG-Online 2030 (Pace) – Art. 35, para. 197
Czech Republic
Supreme Court
25 June 2008 (manufactured paint) (Pace) – Art. 55, para. 4
Denmark
Højesteret (Supreme Court)
17 October 2007 (motorcycles), CISG-Online 2014 (Pace) – Art. 75, para. 19; Art. 77, paras 17, 35
3 May 2006 (casting moulds), CISG-Online 2630 (Pace) – Art. 27, para. 18
Østre Landsret
23 April 1998 (women’s clothing), CISG-Online 486 (Pace) – Art. 1, paras 49, 51; Arts 14–24
introductory remarks, para. 20; Art. 92, para. 5
Vestre Landsret
10 November 1999 (Christmas trees), CISG-Online 704 (Pace) – Art. 49, para. 77
Randers County Court
8 July 2004 (mobile grain dryer case), CISG-Online 2152 (Pace) – Art. 69, para. 2
Danish Maritime and Commercial Court
31 January 2002 (fish (mackerel)), CISG-Online 679 (Pace) – Art. 9, para. 23; Art. 35, para. 54; Art. 38,
paras 49, 50, 53
Sø Og Handelsretten
1 July 1992 (plastic gloves), CISG-Online 459 – Art. 57, para. 4
Egypt
Court of Cassation
11 April 2006 (marble), (Pace) – Art. 13, para. 6
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Estonia
Harju County Court, Tartu mnt Court House
23 February 2009 (wood), CISG-Online 2644 (Pace) – Art. 11, para. 8
Tallinna Ringkonnakohus
5 March 2010 (peat), CISG-Online 2642 (Pace) – Art. 11, para. 19
19 February 2004 (tomato paste), Novia Handelsgesellschaft mbH v AS Maseko, CISG-Online 826
(Pace) – Art. 76, paras 6, 7, 10, 13
Finland
Helsinki Court of Appeal
31 May 2004 (chemicals), (Pace) – Art. 74, paras 15, 18; Art. 77, para 11
26 October 2000 (plastic grass carpets), CISG-Online 1078 (Pace) – Art. 4, para. 36; Art. 7, para. 27;
30 June 1998 (skin care products), CISG-Online 1304 (Pace) – Art. 71, para. 53; Art 72, paras 10, 19;
Art 73, paras 7, 19, 29
29 January 1998 (steel plates), CISG-Online 1302 (Pace) – Art. 9, para. 23; Art. 38, paras 25, 130
Turku Court of Appeal
12 April 2002 (forestry equipment), CISG-Online 660 (Pace) – Art. 4, para. 42; Art. 9, para. 10; Art. 36,
18 February 1997 (packages), CISG-Online 1297 (Pace) – Art. 33, para. 27
Helsinki Court of First Instance
11 June 1995 (skin care product), confirmed by Helsinki Court of Appeal, 30 June 1998, CISG-Online
1304 (Pace) – Art. 73, para. 24
Korkein oikeus
14 October 2005 (log house), CISG-Online 1882 – Art. 2, para. 14
Kuopio Käräjäoikeus
5 November 1996, CISG-Online 869 (Pace) – Art. 74, para. 17; Art. 84, para. 12
France
Cour de Cassation
2 November 2016 (floor tiles), Société Bois et matériaux vs. Société Ceramiche Marca Corona,
CISG-Online 2804 – Art. 39, para. 99; Art. 40, para. 30
21 June 2016 (engines), Caterpillar Energy Solutions GmbH contre SA Allianz IARD et SA Electricité
industrielle JP Fauche et SA Circleprinters Europe, CISG-Online 2762 – Art. 39, para. 120
17 February 2015 (radiators), CISG-Online 2598 (Pace) – Art. 79, para. 78
4 November 2014 (christmas trees), CISG-Online 2563 (Pace) – Art. 40, para. 29
27 May 2014 (paving stones), CISG-Online 2514 (Pace) – Art. 19, para. 10
17 December 2013 (lamb meat), Socinter v. Wallace, CISG-Online 2478 – Art. 25, para. 38
13 February 2013 (bags), Solodem v. Codefine, CISG-Online 2435 (Pace) – Art. 39, para. 121
27 November 2012 (cooking unit), SMEG v. Rothelec, CISG-Online 2403 (Pace) – Art. 35, para. 205;
Art. 39, paras 40, 61, 93, 94, 124, 128
8 November 2011 (press breaks), CISG-Online 2310 – Art. 49, para. 77
22 March 2011 (rolls), CISG-Online 2246 – Art. 31, para. 34
8 April 2009, Société Bati-Seul v Société Ceramiche Marca Corona (floor tiles), CISG-Online (Pace) –
Art. 39, para. 95
2 April 2008 – Art. 93, para. 3
20 February 2007 (perfume), CISG-Online 1492 (Pace) – Art. 1, paras 28, 33; Art. 71, para. 18
13 February 2007 (computer components), CISG-Online 1561 – Art. 4, para. 46; Art. 74, para. 38
30 June 2004 (cases made from polyurethane foam), CISG-Online 870 (Pace) – Art. 1, para. 28; Art. 7,
para. 44
24 September 2003, Aluminum and Light Industries Company v Saint Bernard Miroiterie Vitretie
(decorated laminated glass panels), CISG-Online 791 (Pace) – Art. 35, para. 141, 142; Art 36, para. 9
19 March 2002 (footwear), CISG-Online 662 (Pace) – Art. 42 para. 38
26 June 2001 (auto parts), CISG-Online 600 (Pace) – Art. 6 paras 16, 20
26 May 1999 (rolled sheets metal), Société Karl Schreiber GmbH v Société Thermo Dynamique Service
et al, CISG-Online 487 (Pace) – Art. 1, para. 47; Art. 25, para. 41; Art. 49, para. 39; Art. 84, para. 10
5 January 1999 (cooling plant), Thermo King v Cigna Insurance, CISG-Online 431 (Pace) – Art. 4,
para. 9
16 July 1998 (aluminium hydrate), CISG-Online 344 (Pace) – Art. 1, para. 47; Art. 19, paras 11, 15
27 January 1998 (hooks, sockets/cartridges for fitting to electrical connectors), CISG-Online 309 (Pace)
– Art. 1, para. 51; Art. 18, para. 8
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17 December 1996 (ceramic ovenware), Ceramique v Musgrave; CISG-Online 220 (Pace) – Art. 6,
para. 18; Art. 35, para. 103
23 January 1996 (wine), Sacovini/M Marrazza v Les fils de Henri Ramel, CISG-Online 159 (Pace) –
4 January 1995 (electronic components), CISG-Online 138 (Pace) – Art. 1, para. 51; Art. 10, para. 17;
Cour d’appel d’Aix-en-Provence
Cour d’appel de Bordeaux
12 September 2013 (tiles). Wolseley France Bois v Ceramiche Marca Corona, CISG-Online 2552 (Pace)
– Art. 40, paras 19, 30
Cour d’appel de Chambéry
25 May 1993 (connectors), CISG-Online 223 (Pace) – Art. 3, paras 5, 14
Cour d’appel de Colmar
5 May 2017 (wooden deck boards), NEZ vs. SAS TCP et al., CISG-Online 2817 – Art. 40, para. 11 (fn 16)
26 February 2008 (printed products), CISG-Online 1657 (Pace) – Art. 3, para. 15
13 November 2002 (printed textile fabric), CISG-Online 792 (Pace) – Art. 42, para. 38
12 June 2001 (air-conditioning system for trucks), CISG-Online 694 (Pace), approved by Cour de
cassation (France) 30 June 2004, CISG-Online 870 (Pace) – Art. 7, para. 28; Art. 61, para. 4; Art. 79,
paras 72, 78
26 September 1995 (ceramic baking dishes/cake pans, soufflé pans, etc.), CISG-Online 226 (Pace) –
Art. 6, para. 18
Cour d’appel de Douai
6 February 2014 (press brake), CISG-Online 2548 (Pace) – Art. 26; Art. 82, para. 16
Cour d’appel de Grenoble
28 November 2002 (machinery), CISG-Online 787 (Pace) – Art. 11, para. 8
21 October 1999 (footwear), CISG-Online 574 (Pace) – Art. 1, para. 47; Art. 8, para. 3
4 February 1999 (orange juice), CISG-Online 443 (Pace) – Art. 63, para. 4; Art. 75, para. 14
4 March 1998 (industrial machines), CISG-Online 535 – Art. 46, para. 52
23 October 1996 (stock equipment), CISG-Online 305 (Pace) – Art. 50, para. 56; Art. 57, para. 28
15 May 1996 (cooling plant), Thermo King v Cigna Insurance Company of Europe et al., CISG-Online
13 September 1995 (cheese), Caito Roger v Société francaise de factoring, CISG-Online 157 (Pace) –
Art. 4, para. 46; Art. 7, para. 55; Art. 9, para. 12; Art. 35, paras 25, 91, 93, 98
26 April 1995 (second hand metallic hangar), Marques Roque v Manin Reviere, CISG-Online 154
(Pace) – Art. 1, para. 37; Art. 3 para. 17; Art. 11, para. 12
26 April 1995 (candy), CISG-Online 153 (Pace) – Art. 6, para. 7; Art. 8, para. 22
29 March 1995 (grain), CISG-Online 156 (Pace) – Art. 78, para. 16
22 February 1995 (jeans), S.a.r.l. Bri Production “Bonaventure” v. Société Pan African Export, CISG-
Online 151 (Pace) – Art. 1, para. 26; Art. 7, para. 28; Art. 25, para. 42; Art. 73, para. 22
Cour d’appel de Lyon
18 May 2017 (steel sheets), Manitowoc Crane Group France vs. Commercio Materie Prime SPA, CISG-
Online 2917 – Art. 38, para. 53; Art. 39, para. 68
18 October 2012 (Christmas trees), CISG-Online 2402 (Pace) – Art. 39, para. 78; Art. 40, para. 22
Cour d’appel de Nancy
6 November 2013 (tractors), O. v P., CISG-Online 2549 (Pace) – Art. 25, para. 24
Cour d’appel de Paris
19 November 2010 (make-up chairs), CISG-Online 2206 – Art. 31, para. 59
4 June 2004, CISG-Online 872 – Art. 51, para. 45
10 September 2003, Société H. H. GmbH & Co. v SARL MG, CISG-Online 788 (Pace) – Art. 8,
6 November 2001 (cables), CISG-Online 677 (Pace) – Art. 4, para. 30, Art. 6, para. 18; Art. 38, para. 89;
Art. 7, para. 55
21 May 1999 (electronic equipment), CISG-Online 498 (Pace) – Art. 1, para. 47
4 March 1998 (industrial machines), CISG-Online 535 – Art. 46, para. 41
14 January 1998 (elephants), CISG-Online 347 (Pace) – Art. 1, para. 37; Art. 57, para. 28; Art. 81,
paras 23, 26; Art. 84, para. 10
13 December 1995 (outer wrappings of packets of biscuits), CISG-Online 312 (Pace) – Art. 9, para. 30
6 April 1995, CISG-Online 139 (Pace) – Art. 84, para. 12
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Table of Cases
22 April 1992 (electronic components), Société Fauba France FDIS GC Electronique v. Société Fujitsu
Mikroelectronic GmbH, CISG-Online 222 – Art. 1, para. 43; Art. 14, para. 29; Art. 35, para. 22
Cour d’appel d’Orléans
29 March 2001 (high tension neon transformers), CISG-Online 611 (Pace) – Art. 1, para. 47
Cour d’appel de Reims
30 April 2013 (light decorations), CISG-Online 2479 – Art. 1, para. 33
Cour d’appel de Rennes
13 May 2016 (roofing), CISG-Online 2743 (Pace) – Art. 4, para. 9
27 May 2008 (brassiere cups), CISG-Online 1746 (Pace) – Art. 75, para. 17; Art. 77, para. 20
Cour d’appel de Rouen
26 September 2013 (glue), CISG-Online 2551 – Art. 6, para. 16
19 December 2006 (potato seedling), CISG-Online 1933 (Pace) – Art. 4, para. 9
Cour d’appel de Versailles
13 October 2005 (plush caterpillar toys for infants), CISG-Online 1433 (Pace) – Art. 4, paras 18, 30 ;
Art. 7, para. 55
Tribunal de Grande Instance de Strasbourg
22 December 2006, CISG-Online 1629 (Pace) – Art. 63, paras 7, 9
Tribunal de Commerce de Besançon
19 January 1998 (sweat suits), CISG-Online 557 (Pace) – Art. 79, para. 12
Germany
Bundesgerichtshof
25 March 2015 (replacement parts for ships), CISG-Online 2588 (Pace) – Art. 4, para. 32; Art. 14,
para. 12
24 September 2014 (tools), CISG-Online 2545 (Pace) – Art. 4, para. 39; Art. 46, para. 53; Art. 48, paras
9, 10, 15; Art. 49, paras 34, 35, 37, 38; Art. 51, para. 42
28 May 2014 (bowling alleys), CISG-Online 2513 (Pace) – Art. 1, para. 26; Art. 7, para. 27; Art. 8,
para. 26
14 May 2014 (coffee products), CISG-Online 2493 (Pace) – Art. 4, para. 39; Art. 7, para. 55
07 March 2013, BeckRS 2014, 20904 – Art. 2, para. 9
7 November 2012 (glass fibre cables), CISG-Online 2374 (Pace) – Art. 30, para. 40; Art. 31, paras 14,
16, 59, 65
26 September 2012 (clay), CISG-Online 2348 (Pace), Art. 7, paras 27, 58; Art. 35, paras 37, 48, 67, 69,
72, 160; Art. 40, para. 11; Art. 58, para. 6; Art. 77, para. 10; Art. 80, para. 10
23 June 2010 (wooden goods), CISG-Online 2129 (Pace) – Art. 4, para. 39
11 May 2010 (aluminium rings), CISG-Online 2125 (Pace) – Art. 1, para. 53; Art. 6, para. 18
27 November 2007 (glass bottles), CISG-Online 1617 (Pace) – Art. 8, para. 17; Art. 71, para. 20
7 June 2006, NJW 2006, 2839 – Art. 46, para. 37
26 January 2006 (automobile), CISG-Online 1200 (Pace) – Art. 41, para. 6; Art. 43, paras 3, 9, 13, 14;
Art. 44, para. 6
2 March 2005 (Belgian frozen pork) CISG-Online 999 (Pace) – Art. 7, paras 18, 19; Art. 35, paras 14,
96, 97, 98, 99; Art. 50, para. 48
3 November 2004, VIII ZR 275/03 – Art. 2, para. 28
30 June 2004 (paprika), CISG-Online 847 (Pace) – Art. 38, para. 56
9 January 2002 (powdered milk), CISG-Online 651 (Pace) – Art. 4, paras 24, 34, 35, 37, 39, 46; Art. 7,
para. 27; Art. 19, para. 13; Art. 35, paras 170, 187; Art. 50, para. 60; ; Art. 74, para. 8; Art. 79, para. 76
31 October 2001 (machinery), CISG-Online 617 (Pace) – Art. 1, para. 44; Art. 2, para. 8; Art. 4,
para. 24; Art. 7, paras 27, 28; Art. 8, paras 17, 25; Art. 14, para. 39; Art. 77, para. 29; Art. 80, para. 7
3 November 1999 (hygienic tissues), CISG-Online 475 (Pace) – Art. 1, para. 47; Art. 38, paras 83, 89;
Art. 39, paras 39, 59, 71, 81
24 March 1999 (vine wax), CISG-Online 396 (Pace) – Art. 1, para. 47; Art. 77, paras 20, 28, 32; Art. 79,
para. 76
25 November 1998 (surface protective film), CISG-Online 353 (Pace) – Art. 5, para. 17; Art. 6, para. 18;
Art. 8, para. 28; Art. 35, paras 52, 105, 144; Art. 39, paras 106, 109, 110; Art. 44, para. 9; Art. 74,
para. 48
12 February 1998 (air cleaning installation), CISG-Online 343 (Pace) – Art. 1, para. 26; Art. 3, para. 15;
23 July 1997 (Benetton II), CISG-Online 276 (Pace) – Art. 1, para. 33; Art. 4, paras 11, 16; Art. 6, paras
18, 22
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Table of Cases
25 June 1997 (stainless steel wire), CISG-Online 277 (Pace) – Art. 51, para. 10; Art. 74, para. 45;
Art. 82, para. 21
5 February 1997 (containers for plants), (Pace) – Art. 35, para. 148
11 December 1996 (marzipan), CISG-Online 225 (Pace) – Art. 1, para. 47
4 December 1996 (printing system and software), CISG-Online 260 (Pace) – Art. 39 paras 39, 44
3 April 1996 (cobalt sulphate), CISG-Online 135 (Pace), VIII ZR 51/95 – Art. 7, para. 18; Art. 8, para
33; Art. 25, para. 11; Art. 35, paras 25, 30, 32, 37; Art. 45, para. 6; Art. 49, paras 2, 3, 13, 34, 37, 45, 46,
81; Art. 51, paras 42, 44; Art. 57, para. 26; Art. 58, para. 29
8 March 1995 (New Zealand mussels), CISG-Online 144 (Pace) – Art. 35, paras 52, 88, 89, 91, 120;
Art. 39; Art 46, para. 54; Art. 50, para. 60; Art. 49, para. 81; Art. 58, para. 3
15 February 1995 (key press machine), CISG-Online 149 (Pace) – Art. 4, para. 28, 46; Art. 49, paras 67, 77
10 November 1994, IPRax (1996) 137 – Art. 57, para. 11
26 March 1992 (doors and windows), CISG-Online 67 (Pace) – Art. 9, para. 30; Art. 57, para. 4
10 October 1991, BGHZ 115, 324 (326) – Art. 38, para. 21
27 June 1990, NJW (1990) 3077 – Art. 55, para. 8
25 January 1988, BGHZ 103, 143 – Art. 57, para. 12
21 January 1987, NJW 1987, 2435 – Art. 58, para. 8
24 September 1986, BGHZ 98, 263 (272) – Art. 57, para. 28
22 October 1980, NJW (1981) 1158 – Art. 50, para. 55; Art. 57, para. 28
4 April 1979, NJW (1979) 1782 – Art. 57, paras 19, 22, 23
28 March 1979, NJW (1979) 1779 – Art. 57, para. 22
23 March 1964, BGHZ 41, 215 – Art. 58, para. 8
Oberlandesgericht Bamberg
13 January 1999 (fabrics), CISG-Online 516 (Pace) – Art. 74, paras 28, 29, 32; Art. 75, para. 7; Art. 77,
para. 16
Oberlandesgericht Berlin
24 January 1994 (wine), CISG-Online 130 (Pace) – Art. 1, para. 45; Art. 4, para. 18; Art. 7, para. 55;
Art. 54, para. 9
Oberlandesgericht Brandenburg
8 April 2016 (car), CISG-Online 2727 – Art. 2, para. 31
3 July 2014 (cuttings), CISG-Online 2543 (Pace) – Art. 31, para. 38; Art. 35, paras 19, 182; Art. 38,
para. 118; Art. 39, paras 34, 41, 82
5 February 2013 (beer), CISG-Online 2400 – Art. 49, para. 32; Art. 80, para. 17
18 November 2008 (beer), CISG-Online 1734 (Pace) – Art. 53, para. 2; Art. 73, paras 27, 29; Art. 74,
para. 15
Oberlandesgericht Braunschweig
28 October 1999 (frozen meat), CISG-Online 510 (Pace) – Art. 4, paras 24, 30, 32; Art. 57, para. 28;
Art. 77, paras 15, 29; Art. 88, paras 26, 27, 28
Oberlandesgericht Celle
29 January 2015 (equipment for laboratory), CISG-Online 2618 (Pace) – Art. 4, para. 39
24 July 2009 (broadcasters/multimedia recorders), CISG-Online 1906 (Pace) – Art. 4, para. 24; Art. 7,
10 March 2004 (commercial vehicles), CISG-Online 824 (Pace) – Art. 39, paras 19, 43
2 September 1998 (vacuum cleaners and watches), CISG-Online 506 (Pace) – Art. 74, para. 11; Art. 76,
paras 9, 11; Art. 77, paras 5, 14
24 May 1995 (printing machine), CISG-Online 152 (Pace) – Art. 6, paras 16, 19; Art. 7, para. 28;
Art. 47, paras 10, 23, 24; Art. 49, paras 32, 77; Art. 84, para. 12
2 September 1991 (vacuum cleaners), (Pace) – Art. 76, para. 4
Oberlandesgericht Dresden
27 May 2010 (car), CISG-Online 2182 – Art. 35, para. 166
8 November 2007 (funnel covers), CISG-Online 1624 (Pace) – Art. 38, paras 58, 126
11 June 2007 (airbag systems), CISG-Online 1720 – Art. 3, para. 20
21 March 2007 (stolen automobile case), CISG-Online 1626 (Pace) – Art. 41 paras 5, 11, 37, 42
10 November 2006 (meat), CISG-Online 1625 (Pace) – Art. 9, paras 7, 10, 12
27 December 1999 (chemical products), CISG-Online 511 (Pace) – Art. 1, para. 42; Art. 6, para. 16
9 July 1998 (terry cloth), CISG-Online 559 (Pace) – Art. 4, para. 27; Art. 9, para. 34
Oberlandesgericht Düsseldorf
23 March 2011 (loin ribs), CISG-Online 2218 – Art. 8, para. 25
24 July 2007 (coils), CISG-Online 1531 – Art. 57, para. 4
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Table of Cases
22 July 2004 (shoes), CISG-Online 916 (Pace) – Art. 26, para. 9; Art. 27, para. 19; Art. 72, para. 6;
Art. 75, para. 7
28 May 2004 (television sets), CISG-Online 850 (Pace) – Art. 4, para. 39; Art. 29, para. 4; Art. 60,
para. 8; Art. 81, para14; Art. 84, para. 12
21 April 2004 (car phones), CISG-Online 915 (Pace) – Art. 4, paras 24, 28; Art. 7, para. 28; Art. 8,
para. 25; Art. 13, para. 6; Art. 14, paras 38, 39, 41, 42, 43; Art. 49, para. 29
30 January 2004 (generators), CISG-Online 821 (Pace) – Art. 4, para. 24; Art. 8, para. 25
23 January 2004 (stainless steel plates), CISG-Online 918 (Pace) – Art. 38, para. 130
25 July 2003 (rubber sealing parts), CISG-Online 919 (Pace) – Art. 4, para. 39; Art. 7, paras 28, 55;
24 April 1997 (shoes), CISG-Online 385 (Pace) – Art. 4, para. 39; Art 25., paras 33, 34; Art. 47, paras 8,
29; Art. 49, paras 28, 30, 32; Art. 71, para. 31
11 July 1996 (lawn mower engines), CISG-Online 201 (Pace) – Art. 1, para. 33, Art. 4, paras 11, 39;
Art. 74, para. 90
10 February 1994 (shirts), CISG-Online 116 (Pace) – Art. 1, para. 53; Art. 25, para. 45; Art. 38, paras 77,
103; Art. 45, para. 6; Art. 49, para. 50
10 February 1994 (fabrics), CISG-Online 115 (Pace) – Art. 25, para. 45; Art. 35, paras 32, 110; Art. 51,
para. 10
14 January 1994 (shoes), CISG-Online 119 (Pace) – Art. 72, para. 9; Art. 74, paras 70, 72; Art. 75, paras
17, 19; Art. 77, para. 15; Art. 78, paras 12, 14
2 July 1993 (veneer cutting machine), CISG-Online 74 (Pace) – Art. 5, paras 9, 12; Art. 6, para. 17;
Art. 7, para. 60; Art. 50, para. 56; Art. 57, paras 28, 29; Art. 74, paras 67, 68, 94; Art. 81, para. 26
12 March 1993 (textiles), CISG-Online 82 (Pace) – Art. 1, para. 53; Art. 39, paras 113, 114
8 January 1993 (tinned cucumbers), CISG-Online 76 (Pace) – Art. 1, para. 52; Art. 4, para. 17, Art. 6,
para. 18; Art. 38, paras 71, 116; Art. 39, paras 100, 123; Art. 51, para. 25
Oberlandesgericht Frankfurt am Main
24 March 2009 (low carbon – iron manganese), CISG-Online 2165 – Art. 75, para. 8
26 June 2006 (printed goods), CISG-Online 1385 (Pace) – Art. 4, paras 24, 33
29 January 2004 (pork meat), CISG-Online 822 (Pace) – Art. 35, paras 14, 71
30 August 2000 (yarn), CISG-Online 594 (Pace) – Art. 1, para. 47; Art. 6, para. 18; Art. 14, para. 2;
Art. 18, paras 2, 7, 8
15 March 1996 (fashion textiles), 25 U 187/95, CISG-Online 275 (Pace) – Art. 6, para. 18
15 March 1996 (fashion textiles), 25 U 100/95, CISG-Online 284 (Pace) – Art. 6, para. 22
5 July 1995 (chocolate products), CISG-Online 258 (Pace) – Art. 9, para. 30; Art. 11, para. 17; Arts 14–
24 introductory remarks, para. 9
23 May 1995 (shoes), CISG-Online 185 (Pace) – Art. 11, para. 17; Art. 18, para. 8; Art. 19, para. 10
20 April 1994 (New Zealand mussels), CISG-Online 125 – Art. 1, para. 3; Art. 4, para. 46; Art. 7,
para. 18
4 March 1994 – introductory remarks to Articles 14–24, para. 2; Art 14, paras 17, 28; Art 19, paras 8,
10; Art 92, para. 5
18 January 1994 (shoes), CISG-Online 123 (Pace) – Art. 25, para. 37; Art. 49, paras 37, 38; Art. 58,
17 September 1991 (shoes), CISG-Online 28 (Pace) – Art. 3, paras 5, 14; Art. 25, paras 12, 42, 49;
21 December 1982 – Art. 51, paras 10, 20
Oberlandesgericht Hamburg
15 July 2010 (medical equipment), CISG-online 2448 (Pace) – Art. 7, para. 27; Art. 39, paras 34, 40
25 January 2008 (café inventory), CISG-Online 1681 (Pace) – Art. 4, paras 26, 46; Art. 7, para. 55;
Art. 49, para. 42; Art. 51, paras 10, 23; Art. 74, para. 38; Art. 78, para. 7; Art. 79, para. 15
26 November 1999 (jeans), CISG-Online 515 (Pace) – Art. 1, para. 51; Art. 4, para. 40; Art. 7, para. 55;
Art. 49, para. 39; Art. 74, paras 13, 62; Art. 76, para. 13; Art. 84, para. 8; Art. 88, paras 20, 36, 37
5 October 1998 (circuit boards/electronic parts), CISG-Online 473 (Pace) – Art. 4, paras 23, 30; Art. 9,
4 July 1997 (tomato concentrate), CISG-Online 1299 (Pace) – Art. 4, para. 39; Art. 72, para. 21; Art. 76,
paras 23
28 February 1997 (iron-molybdenum), CISG-Online 261 (Pace) – Art. 7, para. 28; Art. 25, para. 35;
Art. 26, para. 7; Art. 47, para. 5; Art. 49, paras 28, 32, 62; Art. 75, paras 8, 11, 18, 19; Art. 77, paras 16,
18, 35; Art. 79, paras 44, 56, 64, 69, 70, 78, 82
9 July 1980, 5 U 122/80 – Art. 9, para. 30
Oberlandesgericht Hamm
30 November 2010 (pigs), CISG-Online 2217 – Art. 35, paras 26, 39, 54, 59, 88
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Table of Cases
2 April 2009 (car), CISG-Online 1978 (Pace) – Art. 1, para. 43
12 November 2001 (computer parts – memory modules), CISG-Online 1430 – Art. 7, para. 28; Art. 49,
para. 30
23 June 1998 (furniture), CISG-Online 434 (Pace) – Art. 4, para. 46; Art. 66, paras 2, 25; Art. 67,
para. 16; Art. 71, paras 10, 26, 41
5 November 1997 (inline skates), CISG-Online 381 (Pace) – Art. 1, para. 33; Art. 50, para. 55
9 June 1995 (window elements), CISG-Online 146 (Pace) – Art. 4, paras 30, 39; Art. 6, para. 18; Art. 46,
paras 40, 52
8 February 1995 (socks), CISG-Online 141 (Pace) – Art. 4, para. 46; Art. 7, para. 55; Art. 24, paras 6, 8;
Art. 27, para. 30; Art. 78, para. 22
22 September 1992 (pork bacon), CISG-Online 57 (Pace) – Art. 1, paras 34, 37; Art. 19, para. 13;
Art. 25, para. 38; Art. 75, paras 6, 17, 29; Art. 76, paras 4, 13, 15, 22; Art. 77, para. 35
15 November 1979 (2 U 78/79) – Art. 9, para. 30
Oberlandesgericht Karlsruhe
14 February 2008, CISG-Online 1649 (Pace) – Art. 63, para. 9; Art. 82, para. 13
8 February 2006 (Hungarian wheat), CISG-Online 1328 (Pace) – Art. 35, para. 198; Art. 60, para. 6
20 July 2004 (shoes), CISG-Online 858 (Pace) – Art. 4, paras 24, 41; Art. 8, para. 25; Art. 14, paras 38,
39; Art. 71, paras 6, 10, 31, 38, 43, 57
19 December 2002 (machine), CISG-Online 817 (Pace) – Art. 26, para. 4; Art. 31, para. 25; Art. 49,
25 June 1997 (surface protective film), CISG-Online 263 (Pace) – Art. 4, para. 46; Art. 6, para. 18;
Art. 7, para. 27; Art. 38, paras 21, 58, 65, 81; Art. 40, para. 12; Art. 44, para. 9
20 November 1992 (frozen chicken), CISG-Online 54 (Pace) – Art. 31, para. 34
Oberlandesgericht Koblenz
15 August 2015 (capsules), IHR 2017, 211, 213 – Art. 35, para. 135; Art. 38, para. 54; Art. 39, para. 68
10 September 2013 (hauler), CISG-Online 2472 (Pace) – Art. 35, para. 96; Art. 74, paras 13, 62
3 June 2013 (chemical bases for ice cream production and labels), CISG-Online 2469 (Pace) – Art. 39,
paras 21, 31, 40
19 December 2012 (generator), CISG-Online 2470 (Pace) – Art. 35, paras 39, 158
24 February 2011 (clay), CISG-Online 2301 – Art. 7, para. 27; Art. 30, para. 29; Art. 35, paras 203, 205;
Art. 74, para. 15
21 November 2007 (shoes), CISG-Online 1733 – Art. 49, para. 72; Art. 51, paras 10, 45
14 December 2006, CISG-Online 1408 (Pace) – Art. 66, paras 13, 21; Art. 67, para. 29
19 October 2006 (T-shirts), CISG-Online 1407 (Pace) – Art. 38, para. 66; Art. 39, para. 52; Art. 50,
paras 34, 48; Art. 77, para. 20
14 September 2006 (bottles), CISG-Online 1408 (Pace) – Art. 35, paras 137, 147; Art. 36, para. 9;
Art 39, para. 35
18 November 1999 (fiberglass fabric for filters), CISG-Online 570 (Pace) – Art. 38, paras 68, 81, 89
11 September 1998 (chemical substance (dryblend) used for production of plastic (PVC) tubes), CISG-
31 January 1997 (acrylic blankets), CISG-Online 256 (Pace) – Art. 25, paras 47, 48; Art. 35, para. 19;
Art. 48, para. 41; Art. 49, paras 20, 48, 77; Art. 50, para. 23; Art. 78, para. 23; Art. 80, para. 5
17 September 1993 (computer chip), CISG-Online 91 (Pace) – Art. 1, paras 33, 39, 40, 52; Art. 4,
paras 11, 39; Art. 6, para. 18; Art. 54, para. 13; Art. 57, para. 1; Art. 61, para. 3; Art. 74, para. 11;
Art. 78, para. 11
20 November 1992 (frozen chicken), CISG-Online 54 (Pace) – Art. 8, para. 25
16 January 1992 (motor yacht), CISG-Online 47 (Pace) – Art. 4, para. 28
27 September 1991, CISG-Online 30 (Pace) – Art. 82, para. 11; Art. 82, para. 22
18 May 1984 – Art. 51, paras 10, 44
21 January 1983 – Art. 54, para. 13
Oberlandesgericht Köln
24 April 2013 (printing job), CISG-Online 2480 – Art. 79, para. 92
21 November 2012 (chemicals), CISG-Online 2401 – Art. 1, para. 26
19 May 2008 (pesticide), CISG-Online 1700 (Pace) – Art. 4, para. 39; Art. 7, paras 55, 58; Art. 71,
14 January 2008 (shoes), CISG-Online 1730 (Pace) – Art. 53, para. 2
2 July 2007 (cutter head), CISG-Online 1811 – Art. 8, para. 31
24 May 2006, CISG-Online 1232 – Art. 19, para. 15
3 April 2006 (strawberry plants), CISG-Online 1218 (Pace) – Art. 74, para. 90
13 February 2006 (woollen cloth), CISG-Online 1219 (Pace) – Art. 4, paras 30, 39
21 December 2005, CISG-Online 1201 (Pace) – Art. 9, para. 26; Art. 57, para. 5; Art. 77, para. 31
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Table of Cases
14 October 2002 (designer clothes), CISG-Online 709 (Pace) – Art. 26, para. 4; Art. 49, paras 2, 20, 21,
37, 63; Art. 84, para. 8
13 November 2000 (plug couplings), CISG-Online 657 (Pace) – Art. 1, para. 45; Art. 10, para. 22;
Art. 38, paras 50, 65
21 August 1997 (aluminium hydroxide), CISG-Online 290 (Pace) – Art. 38, paras 15, 49, 89, 93; Art. 39
9 July 1997 (video camera case), CISG-Online 495 (Pace) – Art. 58, para. 13; Art. 69, para. 2
8 January 1997 (tannery machines), CISG-Online 217 (Pace) – Art. 71, para. 36; Art. 74, paras 43, 44
21 May 1996 (used car), CISG-Online 254 (Pace) – Art. 1, paras 37, 42; Art. 4, para. 23; Art. 7, para. 27;
16 November 1995 (used car), CISG-Online 265 (Pace) – Art. 1, para. 37
26 August 1994 (market research study), CISG-Online 132 (Pace) – Art. 1, paras 37, 38, 40; Art. 3,
paras 5, 24; Art. 6, para. 22; Art. 7, para. 34
22 February 1994 (rare hard wood), CISG-Online 127 (Pace) – Art. 6, para. 18; Art. 9, para. 30; Art. 11,
para. 17; Art. 29, para. 8; Art. 38; Art. 49, para. 50
16 October 1992 (computers), CISG-Online 50 (Pace) – Art. 3, para. 24
27 November 1991 (tickets for the Soccer World Cup Final), CISG-Online 31 (Pace) – Art. 1, para. 44
Oberlandesgericht München
10 January 2017 (shoes), CISG-Online 2800 (the final decison in CISG-Online 2799 (decision of
26 October 2016) – Art. 39, para. 124
12 October 2009 (valve assembly), CISG-Online 1997 (Pace) – Art. 92, para. 4
14 January 2009 (metal cover materials), CISG-Online 2011 (Pace) – Art. 8, paras 17, 25
5 March 2008 (stolen car), CISG-Online 1686 (Pace) – Art. 4, para. 28; Art. 7, para. 8; Art. 74, paras 11,
90; Art. 79, para. 74
17 November 2006 (dust ventilator), CISG-Online 1395 (Pace) – Art. 27, para. 31; Art. 35, para. 104;
Art. 39, para 52
19 October 2006 (cars), CISG-Online 1394 (Pace) – Art. 4, para. 40; Art. 26, para. 7; Art. 55, para. 4;
Art. 49, para. 54; Art. 81, para. 14
15 September 2004 (leather for furniture), CISG-Online 1013 (Pace) – Art. 7, para. 27; Art. 16, para. 22;
Art. 26; Art. 55, para. 7; Art. 75, para. 8; Art. 76, para. 7s
13 November 2002 (barley), CISG-Online 786 (Pace) – Art. 35, para. 26
1 July 2002 (shoes), CISG-Online 656 (Pace) – Art. 25, para. 31; Art. 80, para. 3
11 March 1998 (cashmere sweaters), CISG-Online 310 (Pace) – Art. 4, para. 39; Art. 38, paras 21, 45,
50, 53; Art. 39, paras 16, 114
28 January 1998 (leather goods), CISG-Online 339 (Pace) – Art. 4, paras 11, 39; Art. 74, para. 23;
Art. 81, para. 11
21 January 1998 (thermal insulation material), CISG-Online 536 (Pace) – Art. 1, paras 26, 33; Art. 4,
para. 30; Art. 6, para. 18; Art. 58, paras 2, 16, 26; Art. 59, para. 2
9 July 1997 (fitness equipment), CISG-Online 281 (Pace) – Art. 3, para. 17; Art. 4, para. 11; Art. 6,
para. 18
9 July 1997 (leather goods), CISG-Online 282 (Pace) – Art. 1, para. 33; Art. 4, paras 11, 39; Art. 6,
para. 16; Art. 7, para. 55; Art. 57, paras 9, 12, 13, 17; Art. 59, paras 2, 3; Art. 79, para. 3
8 March 1995 (nickel-copper cathodes), CISG-Online 145 (Pace) – Art. 11, paras 8, 16; Arts 14–24
introductory remarks, paras 2, 7; Art. 14, paras 33, 35; Art 23 para. 2; Art. 53, paras 2, 16; Art. 92,
para. 5
8 February 1995 (automobiles), CISG-Online 143 (Pace) – Art. 1, para. 26; Art. 4, paras 10, 26; Art. 62,
para. 6; Art. 74, para. 38; Art. 80, para. 6; Art. 84, para. 12
8 February 1995 (polypropolene plastic granulate), CISG-Online 142 (Pace) – Art. 3, para. 5; Art. 6,
para. 18; Art. 38, paras 68, 122; Art. 39, paras 19, 79
2 March 1994 (coke), CISG-Online 108 – Art. 25, para. 16; Art. 49, paras 14, 35, 77; Art. 50, paras 29,
32
Oberlandesgericht Naumburg
13 February 2013 (cereal), CISG-online 2455 (Pace) – Art. 7, para. 27; Art. 14, paras 38, 39
27 April 1999 (automobile), CISG-Online 512 – Arts 14–24 introductory remarks, para. 2; Art. 19,
Oberlandesgericht Oldenburg
20 December 2007 (industrial tools), CISG-Online 1644 – Art. 3, para. 5; Art. 4, para. 24; Art. 6,
para. 23
5 December 2000 (tiller (subsoiler)), CISG-Online 618 (Pace) – Art. 38, para. 5; Art. 39
28 April 2000 (furniture), CISG-Online 683 (Pace) – Art. 39, paras 34, 47; Art. 40, paras 18, 19; Art. 44,
para. 18
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22 September 1998 (raw salmon), CISG-Online 508 (Pace) – Art. 49, paras 72, 77; Art. 66, para. 42;
8 September 1998, CISG-Online 1887 (Pace) – Art. 66, para. 42; Art. 67, para. 38; Art. 68, para. 38
1 February 1995 (furniture), CISG-Online 253 (Pace) – Art. 25, para. 49; Art. 84, para. 15
Oberlandesgericht Rostock
27 October 2003 (trucks), CISG-Online 815 (Pace) – Art. 11, para. 16
25 September 2002 (frozen food), CISG-Online 672 (Pace) – Art. 35, paras 19, 22; Art. 39, para. 20;
Art. 52, para. 33
10 October 2001 (frozen food), CISG-Online 671 (Pace) – Art. 14, para. 29; Art. 55, para. 7
27 July 1995 (flowers), CISG-Online 209 (Pace) – Art. 1, para. 49; Arts 14–24 introductory, para. 2;
Oberlandesgericht Saarbrücken
12 May 2010 (window parts), CISG-Online 2155 (Pace) – Art. 53, para. 16
17 January 2007 (natural stone marble panels), CISG-Online 1642 (Pace) – Art. 7, para. 8; Art. 35,
paras 34, 53, 141, 196; Art. 39, para. 31
14 February 2001, CISG-Online 610 (Pace) – Art. 9, para. 30
3 June 1998 (flowers), CISG-Online 354 (Pace) – Art. 38, para. 91; Art. 39, para. 55
13 January 1993 (doors), CISG-Online 83 (Pace) – Art. 6, para. 22; Art. 9, paras 19, 33; Art. 18, para. 8;
Art. 38, para. 22; Art. 39, paras 34, 112, 130
Oberlandesgericht Schleswig-Holstein
24 October 2008 (shop furnishings), CISG-Online 2020 (Pace) – Art. 4, para. 18; Art. 7, para. 55
29 October 2002, CISG-Online 717 (Pace) – Art. 18, para. 8; Art. 66, para. 5; Art. 67, para. 28; Art. 69,
para. 2
22 August 2002 (live sheep), CISG-Online 710 (Pace) – Art. 35, paras 69, 72; Art. 36, paras 6, 13;
Art. 38, paras 81, 91; Art. 39, para. 37; Art. 40, para. 20; Art. 66, para. 15; Art. 74, paras 7, 63
Oberlandesgericht Stuttgart
18 April 2011 (fire trucks), CISG-Online 2226 (Pace) – Art. 31, para. 35
31 March 2008 (automobile), CISG-Online 1658 (Pace) – Art. 2, para. 18; Art. 8, para. 26; Art. 49,
paras 77, 79
20 December 2004 (decorative paper), CISG-Online 997 (Pace) – Art. 4, paras 39, 46
12 March 2001, CISG-Online 841 (Pace) – Art. 74, para. 32; Art. 82, para. 23
28 February 2000 (floor tiles), CISG-Online 583 (Pace) – Art. 1, para. 43; Art. 9, para. 30
21 August 1995 (machinery), CISG-Online 150 (Pace) – Art. 4, para. 39
Thüringisches Oberlandesgericht
26 May 1998 (live fish), CISG-Online 513 (Pace) – Art. 1, paras 27, 37; Art. 4, para. 10; Art. 35,
para. 203; Art. 38, para. 26; Art. 38, paras 41, 63, 65, 145; Art. 39, paras 26, 77, 129
Oberlandesgericht Zweibrücken
2 February 2004 (milling equipment), CISG-Online 877 (Pace) – Art. 35, paras 30, 188; Art. 40, paras
9, 11, 12, 15; Art. 44, paras 10, 24
31 March 1998 (vine wax), CISG-Online 481 (Pace) – Art. 14, para. 42; Art. 74, para. 15
Landgericht Aachen
14 May 1993 (electronic ear device), CISG-Online 86 (Pace) – Art. 4, paras 21, 22, 46; Art. 5, para. 19;
3 April 1990, CISG-Online 12 (Pace) – Art. 61, para. 4; Art. 78, para. 16
Landgericht Aurich
8 May 1998, CISG-Online 518 – Art. 18, para. 2
Landgericht Baden-Baden
14 August 1991 (wall tiles), CISG-Online 24 (Pace) – Art. 19, para. 13; Art. 25, paras 45, 47
Landgericht Bamberg
13 April 2005 (furnishing), CISG-Online 1402 (Pace) – Art. 2, para. 8
Landgericht Berlin
21 March 2003 (fabric), CISG-Online 785 (Pace) – Art. 38, paras 59, 100, 103; Art. 78, para. 25
24 March 1998 (knitwear), CISG-Online 742 (Pace) – Art. 1, para. 53; Art. 4, paras 18, 39, 46
15 September 1994 (shoes), CISG-Online 399 (Pace) – Art. 25, para. 37; Art. 26, para. 5; Art. 35, paras
42, 76, 129, 174; Art. 71, paras 4, 22, 41
30 September 1992 (shoes), CISG-Online 70 (Pace) – Art. 72, paras 7, 19; Art. 75, paras 25, 26
Landgericht Bielefeld
12 December 2003 (frozen salmon), CISG-Online 905 (Pace) – Art. 4, para. 39
15 August 2003 (strapping machine), CISG-Online 906 (Pace) – Art. 4, para. 39; Art. 39, para. 51
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Table of Cases
24 November 1998 (agency for sanitary products), CISG-Online 697 (Pace) – Art. 9, para. 10; Art. 57,
para. 9
2 August 1996 (Pace) – Art. 74, para. 23
18 January 1991, CISG-Online 174 – Art. 18, paras 7, 8, 32
Landgericht Coburg
12 December 2006 (plants), CISG-Online 1447 (Pace) – Art. 8, para. 25; Art. 35, para. 91, 103, 122,
124; Art. 39, paras 16, 34
Landgericht Darmstadt
12 March 2013 (shoes), CISG-Online 2446 (Pace) – Art. 66, para. 30
29 May 2001, CISG-Online 686 (Pace) – Art. 50, para. 11; Art. 71, paras 16, 38, 43
9 May 2000 (video recorders and other electrical appliances), CISG-Online 560 (Pace) – Art. 35,
para. 51; Art. 38, para. 143; Art. 74, paras 83, 85; Art. 77, para. 31
Landgericht Duisburg
17 April 1996 (textiles), CISG-Online 186 – Art. 4, para. 39; Art. 11, para. 12; Art. 53, para. 10; Art. 57,
para. 17
Landgericht Düsseldorf
11 October 1995 (generator), CISG-Online 180 (Pace) – Art. 4, para. 30; Art. 81, para. 10
25 August 1994 (fashion goods), CISG-Online 451 (Pace) – Art. 4, para. 35; Art. 39, para. 53; Art. 74,
para. 15
23 June 1994 (engines for hydraulic presses and welding machines), CISG-Online 179 (Pace) – Art. 38,
paras 53, 63, 92; Art. 39, para. 62
Landgericht Ellwangen
15 September 2006, BeckRS 2010, 06236 – Art. 31, para. 54
21 August 1995 (Spanish paprika), CISG-Online 279 (Pace) – Art. 1, para. 26; Art. 35, para. 91; Art. 73,
paras 10, 12, 19, 29; Art. 79, para. 76
Landgericht Erfurt
29 July 1998 (shoe soles), CISG-Online 561 (Pace) – Art. 39, paras 33, 38
Landgericht Flensburg
19 January 2001 (sheep), CISG-Online 619 – Art. 1, para. 37
24 March 1999 (meat), CISG-Online 719 (Pace) – Art. 66, para. 22; Art. 67, para. 28; Art. 78, para. 16
Landgericht Frankfurt
11 April 2005 (used shoes), CISG-Online 1014 (Pace) – Art. 38, paras 87, 119, 128, 129, 137, 140;
Art. 39, para. 1, 59, 150; Art. 44, para. 16
13 July 1994 (shoes), CISG-Online 118 (Pace), confirmed by Oberlandesgericht Frankfurt am Main
(Germany), 23 May 1995, CISG-Online 185 (Pace) – Art. 11, para. 17; Art. 26, para. 3;
6 July 1994 (chocolate products), CISG-Online 257 (Pace) – Art. 4, para. 35; Art. 74, para. 15
9 December 1992 (shoes), CISG-Online 184 (Pace) – Arts 14–24 introductory remarks, para. 9; Art. 23,
16 September 1991 (shoes), CISG-Online 26 (Pace) – Art. 78, para. 25
Landgericht Freiburg
22 August 2002 (car), CISG-Online 711 (Pace) – Art. 41, paras 5, 26, 41; Art. 49, para. 77; Art. 79,
paras 49, 74; Art. 81, para. 21; Art. 82, para. 19; Art. 84, para. 15
Landgericht Fulda
29 September 2015 (car), CISG-Online 2716 – Arts 14–24, para. 5; Art. 14, paras 38, 39, 40
Landgericht Gießen
18 March 2003, CISG-Online 951 – Art. 50, paras 11, 30, 48
17 December 2002, CISG-Online 766 (Pace) – Art. 50, para. 56; Art. 81, para. 26
5 July 1994 (women’s clothes), CISG-Online 111 (Pace) – Art. 6, para. 7
Landgericht Hagen
15 October 1997 (socks), CISG-Online 311 (Pace) – Art. 4, para. 39,
Landgericht Halle
27 March 1998 (car), CISG-Online 521 – Art. 49, para. 31
Landgericht Hamburg
6 September 2004 (containers), CISG-Online 1085 (Pace) – Art. 35, paras 56, 188
26 November 2003 (phtalic anhydride), CISG-Online 875 (Pace) – Art. 75, para. 8
10 September 2003, CISG-Online 874 – Art. 58, para. 12
21 December 2001 (stones), CISG-Online 1092 (Pace) – Art. 21, para. 10; Art. 74, para. 47
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Table of Cases
19 June 1997 (hazelnuts), CISG-Online 283 – Art. 4, para. 33; Art. 19, para. 17
5 November 1993 (cobalt sulphate), CISG-Online 215 (Pace) – Art. 62, para. 6
26 September 1990 (fashion textiles), CISG-Online 21 (Pace) – Art. 1, paras 26, 45; Art. 4, paras 17, 18;
Art. 8, paras 2, 8; Art. 10, para. 40; Art. 29, para. 8; Art. 53, para. 10; Art. 58, para. 2, Art. 74, para. 10;
Art. 78, para. 11
Landgericht Heidelberg
2 November 2005 (natural stones), CISG-Online 1416 (Pace) – Art. 4, para. 46; Art. 78, para. 25
3 July 1992 (computer components), CISG-Online 38 (Pace) – Art. 1, para. 40; Art. 25, para. 45
27 January 1981 [ULIS precedent] (Pace) – Art. 54, para. 13; Art. 74, para. 70
Landgericht Heilbronn
15 September 1997 (film coating machine), CISG-Online 562 – Art. 1, para. 3; Art. 4, para. 25, 30
Landgericht Karlsruhe
23 October 1981, 7 O 530/80 – Art. 9, para. 30
Landgericht Kassel
15 February 1996 (marble steps), CISG-Online 191 (Pace) – Art. 1, para. 52; Art. 6, para. 18; Art. 8,
para. 35; Art. 27, paras 32, 33; Art. 53, para. 16
21 September 1995, CISG-Online 192 (Pace) – Art. 71, paras 1, 7, 11, 20; Art. 54, para. 3; Art. 72,
para. 9
22 June 1995 (clothes), CISG-Online 370 (Pace) – Art. 1, para. 45; Art. 11, para. 17; Art. 26, para. 3;
Art. 39; Art. 78, para. 23
14 July 1994, CISG-Online 194 – Art. 18, para. 2
Landgericht Konstanz
3 June 1983 (construction materials) [ULIS precedent], (Pace) – Art. 74, para. 70
Landgericht Köln
29 May 2012 (printed works), CISG-Online 2476 – Art. 74, para. 90
29 March 2011 (glass fibre cables), CISG-Online 2534 – Art. 31, para. 65
5 December 2006 (plastic faceplates for mobile telephones), CISG-Online 1440 (Pace) – Art. 39,
30 November 1999 (stones for facades), CISG-Online 1313 (Pace) – Art. 39, paras 36, 40
Landgericht Krefeld
20 September 2006 (charcoal), CISG-Online 1459 (Pace) – Art. 57, para. 4; Art. 58, para. 12
28 April 1993 (shoes), CISG-Online 101 (Pace) – Art. 75, para. 24
24 November 1992, CISG-Online 62 (Pace) – Art. 81, paras 12, 24
Landgericht Landshut
12 June 2008 (metallic slabs), CISG-Online 1703 (Pace) – Art. 4, paras 18, 24, 39; Art. 7, para. 55;
Art. 8, para. 25
5 April 1995 (clothes), CISG-Online 193 (Pace) – Art. 6, para. 16; Art. 25, para. 38; Art. 35, paras 19,
24, 190; Art. 38, paras 2, 16, 49, 55, 77, 98; Art. 40, paras 9, 15, 23, 31; Art. 74, para. 45; Art. 78,
Landgericht Lübeck
30 December 2010 (chairs), CISG-Online 2292 – Art. 38, para. 82
Landgericht Mainz
26 November 1998 (cylinder for the producion of tissue-paper), CISG-Online 563 (Pace) – Art. 3,
paras 8, 19, 20
Landgericht Marburg
12 December 1995 (agricultural machine), CISG-Online 148 (Pace) – Art. 39, para. 40
22 April 1982, 4 O 22/82 – Art. 9, para. 30
Landesgericht Memmingen
1 December 1993 (granite stones), CISG-Online 73 (Pace) – Art. 11, para. 18
Landgericht Mönchengladbach
15 July 2003 (high pressure filters), CISG-Online 813 (Pace) – Art. 4, para. 39; Art. 7, para. 55; Art. 62,
Landgericht München
27 February 2002 (globes), CISG-Online 654 (Pace) – Art. 35, para. 101, 118, 134; Art. 36, para. 18;
Art 38, para. 61
20 February 2002 (shoes), CISG-Online 712 (Pace) – Art. 39, para. 78; Art. 74, para. 17
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Table of Cases
6 April 2000 (furniture), CISG-Online 665 (Pace) – Art. 71, paras 20, 53; Art. 74, para. 74; Art. 75,
paras 33, 34
6 May 1997 (cars), CISG-Online 341 (Pace) – Art. 1, para. 53; Art. 4, para. 39,
29 May 1995 (computer hardware), CISG-Online 235 (Pace) Art. 1, para. 40; Art. 4, para. 24; Art. 6
para. 16
20 March 1995 (bacon), CISG-Online 164 (Pace) – Art. 4, para. 39; Art. 84, para. 8
8 February 1995 (software), CISG-Online 203 (Pace) – Art. 1, para. 40; Art. 3, paras 24, 25; Art. 14,
3 July 1989 (fashion textiles), CISG-Online 4 (Pace) – Art. 39, para. 34
Landgericht Neubrandenburg
3 August 2005 (pitted sour cherries), CISG-Online 1190 (Pace) – Art. 4, para. 24; Art. 7, para. 28;
Art. 14, paras 28, 29, 36, 38, 39, 40; Art. 55, para. 7; Art. 77, para. 31
Landgericht Nürnberg-Fürth
27 February 2003 (car accessories), CISG-Online 818 – Art. 57, para. 8
Landgericht Oldenburg
9 March 1996 (clothes), CISG-Online188 – Art. 49, para. 30
9 November 1994 (lorry platforms and belts), CISG-Online 114 (Pace) – Art. 39, para. 21; Art. 74,
para. 15
27 April 1994 (timber), CISG-Online 359 – Art. 31, para. 34
Landgericht Paderborn
25 June 1996 (granulated plastic – PVC), CISG-Online 262 (Pace) – Art. 35, paras 12, 24
Landgericht Potsdam
7 April 2009 (pharmaceutical machines, diagnostical tests), CISG-Online 1979 (Pace) – Art. 74,
para. 90
Landgericht Regensburg
24 September 1998 (cloth), CISG-Online 1307 (Pace) – Art. 3, para. 5; Art. 35, para. 104
Landgericht Saarbrücken
1 June 2004 (pallets), CISG-Online 1228 (Pace) – Art. 35, para. 25; Art. 38, para. 148; Art. 39, para. 71
2 July 2002 (tiles), CISG-Online 713 (Pace) – Art. 4, paras 35, 39; Art. 25, para. 37; Art. 39, para. 35;
Art. 74, para. 15
26 March 1996 (fixture for ice-cream parlor), CISG-Online 391 (Pace) – Art. 7, para. 28; Art. 38,
para. 143; Art. 39, paras 33, 34
23 March 1992 (doors), CISG-Online 60 (Pace) – Art. 38, paras 50, 65
Landgericht Stade
19 February 2015 (truck/vehicle), CISG-Online 2669 – Arts14–24 introductory remarks, para. 5;
Art. 14, para. 38
Landgericht Stendal
12 October 2000 (granite rock), CISG-Online 592 (Pace) – Art. 6, para. 8; Art. 50, para. 11; Art. 58,
para. 4; Art. 71, paras 40, 41, 43, 57; Art. 74, para. 38; Art. 78, para. 16
Landgericht Stuttgart
29 October 2009 (artificial lawn), CISG-Online 2017 (Pace) – Art. 4, para. 39; Art. 7, para. 55; Art. 50,
para. 36
15 October 2009 (printing machine), CISG-Online 2019 (Pace) – Art. 4, para. 24; Art. 8, para. 25;
Art. 39, paras 33, 43
4 June 2002 (porphyr stones), CISG-Online 909 (Pace) – Art. 35, paras 29, 30
13 August 1991 (textiles), CISG-Online 33 (Pace) – Art. 27, para. 26
31 August 1989 (shoes), CISG-Online 11 (Pace) – Art. 11, para. 17; Art. 38, paras 35, 42, 53, 65, 66;
Landgericht Trier
8 January 2004 (synthetic window parts), CISG-Online 910 (Pace) – Art. 4, paras 24, 32; Art. 14, paras
38, 40
12 October 1995 (wine), CISG-Online 160 (Pace) – Art. 35, para. 93; Art. 40, para. 10; Art. 74, para. 42
Landgericht Tübingen
18 June 2003 (computers and accessories), CISG-Online 784 (Pace) – Art. 35, para. 198; Art. 38,
Landgericht Zwickau
19 March 1999 (chemical products), CISG-Online 519 – Art. 1, para. 3; Art 14–24 introductory
remarks, para. 4; Art. 14, para. 2; Art. 77, para. 1; Art. 78, para. 10
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Table of Cases
Amtsgericht Alsfeld
12 May 1995 (flagstone tiles), CISG-Online 170 (Pace) – Art. 1, para. 45; Art. 4, para. 18; Art. 7,
Amtsgericht Augsburg
29 January 1996 (shoes), CISG-Online 172 (Pace) – Art. 4, para. 42; Art. 74, para. 87
Amtsgericht Berlin-Tiergarten
13 March 1997, CISG-Online 412 (Pace) – Art. 4, para. 42; Art. 74, paras 87, 90
Amtsgericht Charlottenburg
4 May 1994 (shoes), CISG-Online 386 (Pace) – Art. 80, para. 2
Amtsgericht Duisburg
13 April 2000 (pizza boxes), CISG-Online 659 (Pace) – Art. 1, para. 43; Art. 4, para. 39, 40; Art. 9,
paras 11, 33; Art. 36, para. 6; Art. 67, para. 8
Amtsgericht Frankfurt
31 January 1991, CISG-Online 34 (Pace) – Art. 9, para. 33; Art. 71, paras 38, 41, 45, 47
Amtsgericht Geldern
17 August 2011 (corn), CISG-Online 2302 – Art. 58, para. 31
Amtsgericht Kehl
6 October 1995 (knitwear), CISG-Online 162 (Pace) – Art. 11, para. 17; Art. 19, para. 15; Art. 24,
10 June 1995 – Art. 11, para. 17
Amtsgericht München
23 June 1995 (tetracycline), CISG-Online 368 (Pace) – Art. 48, para. 9; Art. 74, para. 43; Art. 77,
Amtsgericht Nordhorn
14 June 1994 (shoes), CISG-Online 259 – Art. 4, para. 25; Art. 14, paras 40, 42; Art. 50, para. 62
Amtsgericht Oldenburg in Holstein
24 April 1990 (fashion textiles), CISG-Online 20 (Pace) – Art. 49, para. 50; Art. 51, para. 39; Art. 78,
para. 12
Amtsgericht Riedlingen
21 October 1994 (ham), CISG-Online 358 (Pace) – Art. 38, paras 86, 89, 91
Amtsgericht Stendal
12 October 2000 (granite rock), CISG-Online 592 (Pace) – Art. 58, para. 4
Amtsgericht Viehtach
11 April 2002 (pallets), CISG-Online 755 – Art. 35, paras 29, 30, 32; Art. 74, para. 90; Art. 78, para. 16
Greece
Court of Appeals Athens
2006, 4861/2006 (automobile catalyst) (Pace) – Art. 4, para. 28; Art. 74, paras 2, 7, 63
Court of Appeals Lamia
2006 (sunflower seeds), (Pace) – Art. 75, para. 6; Art. 77, para. 13
Multi-Member Court of First Instance of Athens
1 January 2009 (bullet-proof vest), 4505/2009 CISG-Online 2228 (Pace) – Art. 1, paras 3, 42; Art. 4,
paras 10, 30, 39; Art. 6, para. 18; Art. 74, paras 11, 28, 33, 38
Single-Member Court of First Instance of Thessalonika
2008 (clothes), 43945/2007, (Pace) – Art. 7, para. 55
Hungary
Legfelsóbb Birósag
25 September 1992 (airplane engines), United Technologies International Inc. Pratt and Whitney
Commercial Engine Business vs. Magyar Légi Közlekedési Vállalat (Málev Hungarian Airlines),
CISG-Online 63 (Pace) – Art. 2, para. 38; Art. 14, para. 28; Art. 19, para. 13; Art. 55, paras 3, 8
Fovárosi Biróság Budapest
1 July 1997 (used timber machinery), CISG-Online 306 (Pace) – Art. 4, para. 21; Art. 54, para. 1
21 May 1996, CISG-Online 252 (Pace) – Art. 1, para. 49; Art. 7, para. 55; Art. 12, para. 10
24 March 1992, CISG-Online 61 (Pace) – Art. 9, para. 2; Art. 12, para. 10; Arts 14–24 introductory
remarks, para. 2; Art. 92, para. 5
19 March 1996 (instruments), CISG-Online 289 (Pace) – Art. 1, para. 33, Art. 4, para. 11
24 March 1992 – Art. 9, para. 2; Art. 12, para. 10; Art. 96, para. 6
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Israel
Supreme Court
17 March 2009 (tiles), Pamesa Ceramica v Yisrael Mendelson Ltd, CISG-Online 1980 (Pace) – Art. 4,
paras 5, 10; Art. 39; Art. 40
22 August 1993, Eximin v Textile and Footwear (Jeans boots), CISG-Online 1082 (Pace) – Art. 42,
paras 2, 39, 42, 43
Italy
Corte Suprema di Cassazione
19 June 2000 (sale and installation of plant for processing of metal), CISG-Online 1317 (Pace) – Art. 6,
para. 8
14 December 1999 (manufactured goods), CISG-Online 1314 (Pace) – Art. 1, para. 33
7 August 1998 (women’s stockings), CISG-Online 538 (Pace) – Art. 1, para. 47; Art. 9, para. 4; Art. 57,
para. 9
9 June 1995, Alfred Dunhill Ltd. V Tivoli Group S. r. l., CISG-Online 314 (Pace) – Art. 3, para. 11
Corte d’Appello di Milano
23 January 2001 – Art. 92, para. 5
1 December 1998 (printer device), CISG-Online 430 (Pace) – Art. 1, para. 47
20 March 1998 (knitwear), Italdecor s. a. s. v Yiu’s Industries (H. K.) Limited, CISG-Online 348 (Pace)
– Art. 1, para. 51; Art. 25, para. 34; Art. 49, para. 30
Tribunal di Bolzano
29 January 2009 (industrial machines), CISG-Online 2344 – Art. 74, para. 15
Tribunale di Busto Arsizio
13 December 2001 (machinery for recycling of plastic bags), CISG-Online 1323 (Pace) – Art. 7,
Tribunale Civile di Cuneo
31 January 1996 (sports clothes), CISG-Online 268 (Pace) – Art. 38, para. 89
Tribunale de Foggia
21 June 2013 (wine), Samuel Smith, The Old Brewery v. Vini San Barbato, snc, CISG-Online 2674
Tribunale di Forli
12 November 2012 (industrial equipment), CISG-Online 2594 (Pace) – Art. 33, para. 27
16 February 2009 (cisterns and related accessories), CISG-Online 1780 (Pace) – Art. 1, paras 25, 37;
11 December 2008 (shoes), CISG-Online 1729 (Pace; CLOUT 867) – Art. 1, para. 3; Art. 7, para. 42;
Art. 84, para. 12
Tribunale Civile di Monza
14 January 1993 (ferrochrome), CISG-Online 540 (Pace) – Art. 6, para. 18; Art. 79, para. 78
Tribunale di Padova
11 January 2005 (rabbits), CISG-Online 967 (Pace) – Art. 6, para. 27; Art. 7, para. 14
31 March 2004 (pizza boxes), Scatolificio La Perla S. n. c. di Aldrigo Stefano e Giuliano v Martin
Frischdienst GmbH, CISG-Online 823 (Pace) – Art. 16, para. 22; Art. 29, para. 9; Art. 78, paras 16, 23
25 February 2004 (agricultural products), CISG-Online 819 (Pace) – Art. 4, paras 18, 26, 30, 39, 46;
Art. 7, paras 12, 41, 55; Art. 16, para. 22; Art. 74, paras 2, 38; Art. 77, para. 1
Tribunale di Pavia
29 December 1999 (high fashion textiles), Tessile v Ixela, CISG-Online 678 – Art. 1, paras 3, 37; Art. 4,
para. 35; Art. 7, paras 18, 41, 42; Art. 74, paras 15, 70
Tribunale di Reggio Emilia
12 April 2011 (ceramic materials), CISG-Online 2229 (Pace) – Art. 39, para. 81
Tribunale di Rimini
26 November 2002 (porcelain tableware), CISG-Online 737 (Pace) – Art. 1, paras 25, 37, 42, 43; Art. 4,
para. 35; Art. 7, paras 18, 27, 41; Art. 16, para. 22; Art. 38, paras 94, 99, 140; Art. 39, paras 55, 60, 127;
Art. 74, paras 15, 38
Tribunale di Rovereto
21 November 2007 (mirrors), Takap B. V. v Europlay S. r. l., Case 914/06, CISG-Online 1590 (Pace) –
Art. 4, para. 24; Art. 8, paras 2, 10, 15, 25; Art. 77, para. 31
24 August 2006, CISG-Online 1374 – Art. 8, para. 25
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Tribunale di Vigevano
12 July 2000 (sheets of vulcanized rubber used in manufacture of shoe soles), Rheinland Versicherun-
gen v Atlarex, CISG-Online 493 (Pace) – Art. 1, paras 3, 38, 42, 45, 46, 47, 51; Art. 4, paras 18, 26, 30,
35, 39, 46; Art. 6, paras 9, 16; Art. 7, paras 18, 41; Art. 35, para. 182; Art. 38, paras 63, 148, 170; Art. 39,
para. 29; Art. 74, paras 15, 38; Art. 75, para. 6; Art. 76, para. 6; Art. 79, para. 99
Pretura circondariale di Parma/Fidenza
24 November 1989 (knapsacks, bags, wallets), CISG-Online 316 (Pace) – Art. 25, para. 49; Art. 49,
Mexico
First Civil Court of First Instance, Lerma de Villada
3 October 2006 (foil trading cards), CISG-Online 1357 (Pace) – Art. 39, para. 13
Juzgado Cuarto de lo Civil de Tijuana, Baja California
3 September 2010 (metals), (www.cisgspanish.com) – Art. 11, para. 17
Sixth Civil Court of First Instance, City of Tijuana, State of Baja California
14 July 2000 (wood), CISG-Online 571 (Pace) – Art. 1, para. 47; Art. 58, para. 37
Primer Tribunal Colegiado en Materia Civil del Primer Circuito
10 March 2005 (chemical product), CISG-Online 1004 (Pace) – Art. 8, para. 17; Art. 13, para. 6
Comisión para. la Protección del Comercio Exterior de México
29 April 1996 (canned fruit), Conservas la Costena v Lanis, CISG-Online 350 (Pace) – Art. 12, para. 9;
Art. 18, para. 8; Art. 31, para. 56; Art. 35, paras 34, 36, 137, 145; Art. 36, para. 9
Netherlands
Hoge Raad
4 February 2005 (panels for construction of green house), CISG-Online 1003 (Pace) – Art. 39, para. 51
28 January 2005 (tomato plants), B. V. B. A. Vergo Kwekerijen v Defendant, CISG-Online 1002 (Pace)
– Art. 4, para. 24; Art. 14, para. 38
7 November 1997 (vodka), CISG-Online 551 (Pace) – Art. 1, para. 51; Art. 12, para. 10; Art. 96, paras 6, 7
26 September 1997 (fabrics), CISG-Online 286 (Pace) – Art. 1, para. 47
Gerechtshof Amsterdam
16 July 1992 (shower cabinets), CISG-Online 48 (Pace) – Art. 1, para. 33; Art. 4, para. 11
5 January 1978 (gold and jewellery), [ULIS precedent] (Pace) – Art. 7, para. 26
Gerechtshof Arnhem-Leeuwarden
15 September 2015 (horse), CISG-Online 2628 – Art. 2, para. 9
18 July 2006 (potting soil), CISG-Online 1266 (Pace) – Art. 39, paras 63, 88, 124
27 April 1999 (movable room-units), G. Mainzer Raumzellen v Van Keulen Mobielbouw Nijverdal BV,
CISG-Online 741 (Pace) – Art. 1, para. 33; Art. 35, paras 91, 92, 93, 120, 126
9 February 1999 (painting), Kunsthaus Math. Lempertz v Wilhemina van der Geld, CISG-Online 1338
(Unilex) – Art. 36, para. 8; Art. 66, para. 37
17 June 1997 (gas compressors), CISG-Online 547 (Pace) – Art. 38, para. 29
5 June 1996 (vodka), CISG-Online 325 (Pace) – Art. 12, para. 10
21 May 1996 (knitwear), Maglificio Esse v Wehkamp, CISG-Online 1290 (Pace) – Art. 4, para. 35;
Art. 35, paras 49, 162; Art. 42, para. 54; Art. 74, para. 15
22 August 1995 (live lambs), Diepeveen-Dirkson v Nieuwenhoven Veehandel, CISG-Online 317 (Pace)
– Art. 4, para. 26; Art. 7, para. 55; Art. 74, para. 38; Art. 77, para. 23
Gerechtshof Den Haag (formerly Gerechtshof ‘s Gravenhage)
22 April 2014 (nuts, dried fruits and seeds), CISG-Online 2515 (Pace) – Art. 8, para. 17
23 April 2003 (wheat flour), Rynpoort Trading v Meneba Meel, CISG-Online 903 (Pace) – Art. 7,
Gerechtshof ‘s Hertogenbosch
29 September 2015 (conveyor belts), CISG-Online 2655 – Art. 14, para. 38
26 July 2011 (chicken), CISG-Online 2384 – Art. 30, para. 8
13 November 2007, Adex International Ltd v. First International Computer Europe B.V., (unpublished)
– Art. 6, para. 18
29 May 2007 (machine), CISG-Online 1550 (Pace) – Art. 8, para. 17; Art. 9, para. 7
2 January 2007, CISG-Online 1434 – Art. 53, para. 15
16 October 2002 (plants), CISG-Online 816 (Pace) – Art. 7, paras 43, 61; Art. 14, para. 38
15 December 1997 (furs), CISG-Online 552 (Pace) – Art. 38, para. 93
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2 October 1997 (leather goods), Van Dongen Waalwijk Leder v Conceria Adige, CISG-Online 550
24 April 1996 (yarn), CISG-Online 321 (Pace) – Art. 9, para. 7
26 February 1992 (shoes), CISG-Online 65 (Pace) – Art. 4, para. 46
Hof van Beroep Antwerpen
22 January 2007 (road sweeping vehicles), CISG-Online 1586 (Pace) – Art. 6, para. 24
Arrondissementsrechtbank Amsterdam
5 October 1994 (textiles), Tuzzi Trend Tex Fashion v Keijer-Somers, CISG-Online 446 (Pace) – Art. 1,
Arrondissementsrechtbank Den Haag (formerly Arrondissementsrechtbank s’Gravenhage)
2 July 1997 (cushions), CISG-Online 1331 (Pace) – Art. 1, para. 33
7 June 1995 (apple trees), CISG-Online 369 (Pace) – Art. 1, para. 52; Art. 6, para. 18
Arrondissementsrechtbank Arnhem
30 December 1993 (live lambs), CISG-Online 104 (Pace) – Art. 1, para. 37
25 February 1993 (clothes), P. R. Van den Heuvel v Santini Maglificio Sportivo de Santini, CISG-
Arrondissementsrechtbank Gelderland
30 July 2014 (truck), CISG-Online 2541 (Pace) – Art. 19, para. 10
17 July 1997 (painting), Kunsthaus Math. Lempertz v Wilhemina van der Geld, CISG-Online 548
(Pace) – Art. 36, para. 8; Art. 66, para. 37; Art. 69, para. 2
Arrondissementsrechtbank Limburg
16 April 2014 (glass), CISG-Online 2542 – Art. 16, para. 17
9 July 2008 (potatoes), CISG-Online 1748 (Pace) – Art. 79, para. 51
19 December 1991 (cheese), CISG-Online 29 (Pace) – Art. 38, paras 50, 91; Art. 40, para. 28
Arrondissementsrechtbank Middelburg
25 January 1995 (beef), CISG-Online 374 – Art. 4, para. 39
Arrondissementsrechtbank Midden-Nederland
20 January 2016 (meat), CISG-Online 2685 – Arts 14–24 introductory remarks, para. 5, Art. 14,
para. 39
18 July 2007 (gable plates), CISG-Online 1551 (Pace) – Art. 71, para. 38
Arrondissementsrechtbank Oost-Brabant
23 January 2013 (conveyor belts), CISG-Online 2393 (Pace) – Art. 18, para. 10
1 November 2012 (articulated loader), CISG-Online 2394 (Pace) – Art. 35, para. 96; Art. 38, paras 46,
68
6 May 1994 (yarn), CISG-Online 453 (Pace) – Art. 57, para. 9
2 October 1998 (powdered milk), CISG-Online 1309 (Pace) – Art. 79, para. 50
Arrondissementsrechtbank Overijssel
9 August 1995, Wolfgang Richter Montagebau GmbH v 1. V. o. f. Handelsonderneming Euro-Agra; 2.
Te Wierik; 3. Bosma, CISG-Online 365 (Pace) – Art. 78, para. 23
Arrondissementsrechtbank Roermond
6 May 1993 (electric kettles), Gruppo IMAR v Protech Horst, CISG-Online 454 (Pace) – Art. 4,
para. 39; Art. 74, paras 70, 71
Arrondissementsrechtbank Zeeland-West-Brabant
16 January 2009 (watermelon), CISG-Online 1769 (Pace) – Art. 38, para. 118; Art. 39, paras 29, 77,
124, 127
27 February 2008 (Pace) – Art. 9, para. 7
Arrondissementsrechtbank Zutphen
29 May 1997 (petunia cuttings), Aartsen v Suykens, CISG-Online 546 (Pace) – Art. 4, para. 25; Art. 9,
para. 29
Arrondissementsrechtbank Zwolle
5 March 1997 (fish), CISG-Online 545 (Pace) – Art. 7, para. 29; Art. 38, paras 25, 72, 91, 93
1 March 1995 (textiles), CISG-Online 372 (Unilex) – Art. 4, para. 35; Art. 42, para. 54; Art. 74, para. 15
Rechtbank Arnhem
17 January 2007, CISG-Online 1455/1476 (Pace) – Art. 11, paras 2, 12
1 March 2006 (steel products), CISG-Online 1475 (Pace) – Art. 74, para. 46
17 March 2004 (soil for plants), CISG-Online 946 (Pace) – Art. 11, para. 2
8 April 1999 (blades for windmill drives), CISG-Online 1339 – Art. 4, para. 46
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Rechtbank Breda
16 January 2009 (watermelons), CISG-Online 1789 (Pace) – Art. 74, para. 90
27 February 2008 (sulphuric acid), CISG-Online 2252 (Pace) – Art. 9, para. 7
Rechtbank Midden-Nederland
25 March 2015 (software programme), CISG-Online 2591 – Art. 4 para. 11; Art. 7, para. 12
Rechtbank Gelderland
6 November 2013 (hardware), CISG-Online 2590 – Art. 4, para. 24
Rechtbank Rotterdam
2 December 2015 (fruits and vegetables), CISG-Online 2683 – Arts 14–24 introductory remarks,
para. 5; Art. 14, paras 38, 39
1 October 2014 (chemicals), CISG-Online 2558 (Pace) – Art. 67, para. 34
2 June 2010 (adapters for water treatment plant), XL Insurance Company v. Italian Industrial Agency,
CISG-Online 2340 (Pace) – Art. 39, para. 119
23 December 2009 (armatures), CISG-Online 2071 – Art. 31, para. 65
25 February 2009 (fruits), Fresh-Life International B.V. v. Cobana Fruchtring GmbH & Co., KG, CISG-
online 1812 (Pace) – Art. 7, para. 28
5 November 2008 (crabs), CISG-Online 1817 – Art. 6, para. 18
15 October 2008 (fire resistant paint), CISG-Online 1899 (Pace) – Art. 74, para. 90; Art. 78, para. 20
1 November 2001, Nederlands Internationaal Privaatrecht, 2002, No. 114 – Art. 1, para. 25
12 July 2001 (lemons, mandarins, oranges), CISG-Online 968 (Pace) – Art. 12, paras 7, 10; Art. 18,
para. 10; Art. 79, para. 68; Art. 96, paras 5, 6
14 October 1999 (sheepskin), CISG-Online 1312 (Pace) – Art. 4, para. 24; Art. 23, para. 1
Rechtbank Utrecht
21 January 2009 (sesame seeds), CISG-Online 1814 (Pace) – Art. 4, para. 24
New Zealand
Supreme Court
Otago Station Estates Ltd v Parker [2005] 2 NZLR 734 (SCNZ) – Art. 54, para. 20
High Court of New Zealand
30 July 2010 (trucks), RJ & AM Smallmon v Transport Sales Limited and Grant Alan Miller, CISG-
Online 2113 (Pace) – Art. 7, paras 41, 48; Art. 35, paras 85, 89, 96, 125
Auckland High Court
31 March 2003, International Housewares Ltd. V SEB S. A., CISG-Online 833 (Pace) – Art. 35, para. 75
Court of Appeal New Zealand
22 July 2011 (trucks), RJ & AM Smallmon v. Transport Sales Limited and Grant Alan Miller, CISG-
Online 2215 (Pace) – Art. 7, paras 12, 19, 41; Art. 35, paras 26, 88, 96, 125; Art. 54, para. 6
3 October 2001 (shoes), Bobux Marketing Ltd. V. Raynor Marketing Ltd., CISG-Online 2451 (Pace) –
Art. 7, para. 42
2 July 1998 (commercial property lease), Tri-Star Customs and Forwarding Ltd. V. Denning, CISG-
Poland
Supreme Court
25 June 2015 (hyperbaric chamber), CISG-Online 2782 – Art. 4, para. 28
11 May 2007 (leather to manufacture shoes), CISG-Online 1790 (Pace) – Art. 7, paras 28, 53; Art. 80,
para. 3
27 January 2006 (metallurgical sand), CISG-Online 1399 (Pace) – Art. 75, para. 7
10 November 2005 (furniture), CISG-Online 2073 – Art. 4, para. 11
19 December 2003 (door components), “O. O.” AG in M. v Leszek W. & Zbigniew W., CISG-Online
1222 (Pace) – Art. 4, para. 46
Katowice Court of Appeals
22 January 2009 (aluminium profiles), CISG-Online 2787 – Art. 4, para. 39
Warsaw Court of Appeals
15 May 2015 (dietary products), CISG-Online 2783 – Art. 7, para. 55
20 November 2008 (truck), CISG-Online 2539 – Art. 7, para. 56
Poznan District Court
16 October 2015 (flowers), CISG-Online 2780 – Art. 4, para. 30
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Republic of Korea
High Court Seoul
23 July 2009 (duck feathers), CISG-Online 2507 (Pace) – Art. 4, para. 39
Central District Court Seoul
21 September 2012 (window shade), CISG-Online 2774 – Art. 4, para. 21
Serbia
High Commercial Court
Slovakia
Supreme Court
19 June 2008 (health care products), CISG-Online 1875 (Pace) – Art. 4, para. 30
30 April 2008 (health care products), CISG-Online 1873 (Pace) – Art. 4, para. 30; Art. 8, para. 23
3 April 2008 (raw materials for women’s coats), CISG-Online 1763 – Art. 31, para. 56
Regional Court Bratislava
11 October 2005 (fur), CISG-Online 1858 (Pace) – Art. 4, para. 30
Regional Court Kosice
22 May 2007 (plastic bottles), CISG-Online 1898 (Pace) – Art. 4, para. 46
Regional Court Zilina
18 June 2007 (baked and confectionary goods case) – CISG-Online 1951(Pace) – Art. 9, para. 10
District Court Nitra
29 May 2008, CISG-Online 1766 (Pace) – Art 53, para. 2
23 June 2006 (raw material for women’s coats), CISG-Online 1764 (Pace) – Art. 54, para. 1
District Court Trnava
17 September 2008 (chicken products), CISG-Online 1991 (Pace) – Art. 4, para. 46
Slovenia
Supreme Court
13 September 2011 (water and oil pumps), CISG-Online 2329 – Art. 26, para. 6
8 April 1998 (caprolactum), CISG-Online 1957 – Art. 4, para. 23
Higher Court Ljubljana
14 December 2005 (door and door jamb), CISG-Online 1959 – Art. 49, para. 23
Higher Court Maribor
21 October 2010 (printing machines), CISG-Online 2331 (Pace) – Art. 75, para. 15
Spain
Tribunal Supremo
9 July 2014 (red pepper powder), CISG-Online 2578 (Pace) – Art. 31, para. 4
1 July 2013 (cereals), CISG-Online 2495 (Pace) – Art. 9, para. 23
17 March 2011 (coffee), CISG-Online 2521 (Pace) – Art. 8, para. 32; Art. 57, para. 25
17 January 2008 (300 second-hand automobiles), CISG-Online 1640 (Pace) – Art. 8, para. 29; Art. 35,
paras 2, 56; Art. 39, paras 56, 65, 75; Art. 53, para. 2
21 December 2007 – Art. 9, para. 35
11 July 2007 – Art. 9, para. 35
16 May 2007 (water apparatus), CISG-Online 1638 (Pace) – Art. 7, para. 19
28 January 2000 (jute), Internationale Jute Maatschappij v Marı́n Palomares, CISG-Online 503 (Pace) –
Art. 1, para. 47; Art. 9, para. 10; Art. 77, paras 17, 19, 27
Audiencia Provincial de Alicante
16 November 2000 (shoes), CISG-Online 1318 (Pace) – Art. 6, paras 16, 17
Audiencia Provincial de Asturias
29 September 2010 (anchovies), CISG-Online 2313 (Pace) – Art. 9, para. 23; Art. 39, para. 77
Audiencia Provincial de Barcelona
24 March 2009 (cuttlefish), People Fisheries (Pvt) Ltd v Pescados Videla SA, CISG-Online 2042 (Pace)
– Art. 36, para. 24
28 April 2004 (metal covers for sewage drains), CISG-Online 931 (Pace) – Art. 8, para. 23
2 February 2004 (soy oil), CISG-Online 950 (Pace) – Art. 75, para. 7
27 November 2003 (ski equipment rental), CISG-Online 1102 (Pace) – Art. 55, para. 4
11 March 2002, CISG-Online 1325 (Pace) – Art. 86, para. 8
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20 June 1997 (dye for clothes), CISG-Online 338 (Pace) – Art. 4, para. 35; Art. 35, para. 169; Art. 74,
paras 15, 32
Audiencia Provincial de Cáceres
14 July 2010 (rolls of rubber), CISG-Online 2131 – Art. 8, para. 3
Audiencia Provincial de Cantabria
9 July 2013 (steel cable), CISG-Online 2487 (Pace) – Art. 53, para. 15; Art. 54, paras 1, 6; Art. 80,
para. 6
Audiencia Provincial de Cuenca
31 January 2005 (calves), CISG-Online 1241 (Pace) – Art. 78, para. 10
Audiencia Provincial de Girona
21 January 2016 (live molluscs/mussels), Alexandridis G. & CO. OESC v. Treatment Servimant, SL,
CISG-Online 2729 – Art. 7, paras 23, 58; Art. 74, para. 2
Audiencia Provincial de Granada
2 March 2000 (food), CISG-Online 756 (Pace) – Art. 35, paras 52, 88, 89
Audiencia Provincial de Madrid
17 February 2015 (garments), CISG-Online 2620 (Pace) – Art. 7, para. 61
18 October 2007 (textiles), CISG-Online 2082 (Pace) – Art. 7, para. 55
20 February 2007 (olive stones), CISG-Online 1637 (Pace) – Art. 8, para. 3
Audiencia Provincial de Murcia
25 May 2012 (red pepper powder), CISG-Online 2463 – Art. 25, para. 39; Art. 35, para. 98
Audiencia Provincial de Palencia
9 September 2014 (coffee), CISG-Online 2577 (Pace) – Art. 11, para. 2
Audiencia Provincial de las Palmas
16 February 2012 (margarine), CISG-Online 2516 (Pace) – Art. 39, para. 77
Audiencia Provincial de Navarra
30 July 2010 (billets – steel rods), CISG-Online 2315 (Pace) – Art. 39, para. 79
27 December 2007 (machine for repair of bricks), CISG-Online 1798 (Pace) – Art. 7, paras 27, 28;
22 September 2003 (motors for production of electricity), (Pace) – Art. 7, para. 28; Art. 11, para. 12
27 March 2000 (electrical goods), CISG-Online 575 (Pace) – Art. 1, para. 47
Audiencia Provincial de Pontevedra
6 October 2014 (frozen fish), CISG-Online 2576 – Art. 29, para. 8
19 December 2007 (frozen seafood), CISG-Online 1688 (Pace) – Art. 7, para. 19
8 February 2007 (machine) CISG-Online 1802 – Art. 36, para. 5
Audiencia Provincial de Valencia
13 March 2007 (coconut), CISG-Online 1719 (Pace) – Art. 4, para. 30; Art. 74, para. 15
31 March 2005 (oranges), Frischaff Produktions GmbH v Guillem Export S. L, CISG-Online 1369
(Pace) – Art. 26, para. 9; Art. 75, paras 6, 7
7 June 2003 (grape juice), CISG-Online 948 (Pace) – Art. 4, para. 35; Art. 7, paras 11, 13, 18, 35, 43;
Art. 74, para. 15
Audiencia Provinciale de Zaragoza
31 March 2009 (legs of pork), CISG-Online 2085 (Pace) – Art. 7, para. 28; Art. 9, para. 23
Juzgado de Primera Instancia No. 1 de Fuenlabrada
11 May 2012 (machine), Instalaciones y FabricacionesIndustriales, S.A. v. PM di Pizzolato Giorgio &
C., S.A.S., CISG-Online 2464 (Pace) – Art. 7, paras 18, 41; Art. 84, para. 12
Juzgado Primera Instancia e Instruccion No. 2, La Almunia de Dona Godina
28 November 2013 (cheese), SMR Automotive Systems Spain v. Bühler Motor GmbH, CISG-Online
2532 (Pace) – Art. 7, para. 18; Art. 8, para. 32; Art. 9, para. 23
Juzgado de Primera Instancia, No. 3 de Badalona
22 May 2006 (Bermuda shorts), CISG Online 1391 (Pace) – Art. 13, para. 6
Juzgado de Primera Instancia, No. 3 de Tudela
29 March 2005 (machine for rectification of bricks), Cerámica Tudelana, S. A. v Wassmer Gruppe
Spezial Machinen GmbH, CISG-Online 1016 (Pace) – Art. 35, para. 14; Art. 84, para. 12
Primer tribunal colegiado en materia civil del primer circuito
10 March 2005, CISG Spain Online – Art. 19, para. 10
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Switzerland
Bundesgericht
2 April 2015 (wire rod), CISG-Online 2592 – Art. 8, para. 17; Art. 34, paras 3, 10; Art. 35, para. 39;
Art. 39, paras 22, 34, 35, 43, 127; Art. 40, paras 12, 15; Art. 49, paras 13, 29; Art. 51, para. 45
23 September 2013 (steel coils), CISG-Online 2560 – Art. 8, para. 3; Art. 35, para. 39
23 April 2013 (watches), CISG-Online 2482 – Art. 8, para. 13
26 March 2013 (organic juices and organic oil), CISG-Online 2434 (Pace) – Art. 39, paras 109, 112, 116
16 July 2012 (spinning mill), CISG-Online 2371 (Pace) – Art. 35, paras 170, 171, 175, 182; Art. 50,
17 April 2012 (EAS tags), CISG-Online 2346 (Pace) – Art. 42, paras 9, 54
16 September 2010 (fuel oil), CISG-Online 2220 – Art. 76, para. 7
17 December 2009 (watches), CISG-Online 2022 (Pace) – Art. 4, para. 37; Art. 74, paras 18, 53; Art. 77,
paras 9, 13
26 June 2009 (anti grafitti protection coating), CISG-Online 1907 – Art. 8, para. 2
18 May 2009 (packaging machine), CISG-Online 1900 (Pace) – Art. 4, para. 30; Art. 39, para. 121;
Art. 49, paras 42, 72, 77
17 July 2007, CISG-Online 1515 (Pace) – Art. 71, paras 11, 16, 18, 25, 47
20 December 2006 (machines), CISG-Online 1426 (Pace) – Art. 4, para. 39; Art. 47, para. 21; Art. 49
12 June 2006 (triethylen tetramin), CISG-Online 1516 – Art. 79, para. 68
5 April 2005 (triethylen tetramin), CISG-Online 1012 – Art. 7, para. 26; Art. 11, para. 18; Art. 14, paras
24, 28; Art. 18, paras 10, 11; Art. 19, paras 9, 10; Art. 79, para. 92
7 July 2004 (cable drums), CISG-Online 848 (Pace) – Art. 4, paras 10, 35, 39; Art. 35, paras 19, 175,
180, 182; Art. 38, para. 5; Art. 50, para. 60; Art. 74, para. 15
13 January 2004 (menthol USP brand crystals), CISG-Online 838 (Pace) (Unilex) – Art. 35, paras 44,
110, 172, 174, 193
13 November 2003 (used laundry machine), CISG-Online 840 (Pace) – Art. 4, para. 35; Art. 7, para. 42;
Art. 9, para. 33; Art. 35, paras 170, 171; Art. 39, paras 19, 36, 38, 39, 43, 46, 81; Art. 46, para. 54;
28 May 2002 (lumber), CISG-Online 676 (Pace) – Art. 39, para. 36
22 December 2000 (used rotary printing textile machine), CISG-Online 628 (Pace) – Art. 4, para. 21;
Art. 35, paras 39, 57
11 December 2000 (fitted kitchen), CISG-Online 1319 – Art. 4, para. 21
17 October 2000 (locker system), Severin Wagner AG v Günter Lieber, CISG-Online 1053 (Pace) –
Art. 4, para. 46
15 September 2000 (Egyptian cotton), FCF S. A. v Adriafil Commerciale S. r. l., CISG-Online 770
(Pace) – Art. 4, para. 35; Art. 25, paras 12, 33; Art. 26, para. 7; Art. 74, para. 15
11 July 2000 (building materials), CISG-Online 627 (Pace) – Art. 1, para. 47; Art. 4, paras 31, 32;
Art. 11, para. 12
28 October 1998 (frozen meat), CISG-Online 413 (Pace) – Art. 1, para. 47; Art. 25, para. 37; Art. 49,
paras 37, 38; Art. 50, para. 64
3 April 1996 – Art. 25, para. 37
18 January 1996 (plant for purification of exhaust gases), CISG-Online 214 (Pace) – Art. 58, paras 16,
26
25 October 1983, BGE 109 II 319 (322) – Art. 41, para. 44
Appelationsgericht Basel-Stadt
26 September 2008 (packaging machine), CISG-Online 1732 – Art. 4, para. 39; Art. 8, para. 2; Art. 35,
paras 42, 50; Art. 49, para. 51
23 August 2003 (soyaprotein products), CISG-Online 943 (Pace) – Art. 35, paras 24, 39
Appellationsgericht Tessin
8 June 1999 (wine bottles), CISG-Online 497 (Pace) – Art. 39, para. 16
15 December 1998, CISG-Online 422 – Art. 4, para. 11
15 January 1998 (cocoa beans), CISG-Online 417 (Pace) – Art. 4, para. 36; Art. 35, paras 187, 198;
Art. 38, para. 143; Art. 84, para. 12
12 February 1996 (copy paper), CISG-Online 233 (Pace) – Art. 1, para. 45; Art. 4, para. 18
Cour de Justice de Genève
20 May 2011 (multifunctional facsimile and components), CISG-Online 2429 – Art. 8, para. 22
12 March 2010 (diamonds), CISG-Online 2426 – Art. 8, para. 4
12 May 2006 (office furniture), CISG-Online 1726 (Pace) – Art. 8, para. 8
15 November 2002 (window frames), CISG-Online 853 (Pace) – Art. 4, paras 31, 36, 37; Art. 11,
para. 16; Art. 50, paras 4, 29, 30, 34, 52; Art. 74, para. 18
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13 September 2002 (grain), CISG-Online 722 (Pace) – Art. 13, para. 2
10 October 1997 (acrylic cotton), CISG-Online 295 (Pace) – Art. 4, para. 30; Art. 39, para. 121
Kantonsgericht Appenzell Ausserhoden
9 March 2006 (fitness equipment), CISG-Online 1375 (Pace) – Art. 39, para. 79, 81, 127
10 March 2003, CISG-Online 852 (Pace) – Art. 71, paras 6, 22
Kantonsgericht Basel
5 October 1999 (garments), CISG-Online 492 (Pace) – Art. 9, para. 33
Kantonsgericht Freiburg
11 October 2004 (chemical product), CISG-Online 964 (Pace) – Art. 11, para. 21; Art. 14, para. 31;
23 January 1998 (commercial laundry machine), CISG-Online 423 (Pace) – Art. 4, para. 39; Art. 7,
paras 26, 55
Kantonsgericht Glarus
6 November 2008 (bags), CISG-Online 1996 (Pace) – Art. 35, para. 69, 97
Kantonsgericht Jura
Kantonsgericht Nidwalden
23 May 2005 (farm machines), CISG-Online 1086 (Pace) – Art. 4, paras 30, 35, 37; Art. 57, para. 5;
Art. 74, paras 15, 18
3 December 1997 (furniture), CISG-Online 331 (Pace) – Art. 6, para. 18; Art. 39, para. 34; Art. 78,
para. 23
Kantonsgericht Schaffhausen
27 January 2004 (model locomotives), CISG-Online 960 (Pace) – Art. 4, para. 30; Art. 35, para. 37;
Art. 38, paras 42, 59; Art. 39, paras 12, 53, 82; Art. 40, para. 13; Art. 81, para. 21; Art. 84, para. 12
20 October 2003 (aluminium foil film wrap), CISG-Online 957 (Pace) – Art. 4, para. 40
25 February 2002 (machines, devices & replacement parts), CISG-Online 723 (Pace) – Art. 58, para. 5;
Art. 78, para. 16
Kantonsgericht St. Gallen
15 June 2010 (StencilMaster 1621), CISG-Online 2159 (Pace) – Art. 8, para. 23
13 May 2008 (skid chains and adaptors), CISG-Online 1768 (Pace) – Art. 1, para. 42; Art. 4, para. 23
12 August 1997 (clothes), CISG-Online 330 (Pace) – Art. 31, para. 54
Kantonsgericht Tessin
29 October 2003 (modular wall partitions), CISG-Online 912 (Pace) – Art. 8, para. 23; Art. 79, para. 64
Kantonsgericht Waadt
28 January 2009 (fiberglass composite materials) (Pace) – Art. 9, para. 38; Art. 39, para. 38
11 April 2002 (clothing), CISG-Online 899 (Pace) – Art. 78, para. 25
26 May 2000, CISG-Online 1840 (Pace) – Art. 66, paras 24, 34
11 March 1996 (aluminium granules), CISG-Online 333 (Pace) – Art. 4, para. 39; Art. 74, para. 69;
Art. 78, para. 23
20 December 1994 (artificial stones), CISG-Online 302 (Pace) – Art. 58, para. 11
17 May 1994, CISG-Online 122 (Pace) – Art. 87, para. 10; Art. 88, para. 5
Kantonsgericht Wallis
28 January 2009 (fiberglass composite materials), CISG-Online 2025 (Pace) – Art. 4, para. 46; Art. 8,
27 April 2007 (oven), CISG-Online 1721 (Pace) – Art. 4, paras 17, 18, 35, 46; Art. 74, para. 15
23 May 2006 (suits), CISG-Online 1532 (Pace) – Art. 1, para. 43; Art. 4, para. 46; Art. 9, para. 10;
Art. 10, para. 15
19 September 2005 (fiberglass composite materials), (Pace) – Art. 4, paras 18, 35, 46; Art. 74, para. 15
27 May 2005 (welding devices), CISG-Online 1137 (Pace) – Art. 4, paras 18, 35, 46; Art. 7, para. 55;
Art. 74, para. 15
21 February 2005 (CNC-machine), CISG-Online 1193 (Pace) – Art. 4, paras 17, 31; Art. 25, paras 16,
19; Art. 35, para. 57; Art. 39; Art. 49, paras 77, 81
30 June 1998 (granite stones), CISG-Online 419 (Pace) – Art. 4, para. 46; Art. 54, para. 10
29 June 1998 (sports clothing), CISG-Online 420 (Pace) – Art. 35, paras 39, 155
28 October 1997 (second hand bulldozer), CISG-Online 328 (Pace) – Art. 35, paras 12, 155
11 March 1996 (clay) (Pace) – Art. 1, para. 25
29 June 1994 (furniture), CISG-Online 134 – Art. 6, para. 8
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Kantonsgericht Zug
5 March 2013 (marble slabs), CISG-Online 2471 – Art. 31, para. 16; Art. 32, para. 10; Art. 58, para. 21
14 December 2009 (spinning plant), CISG-Online 2026 (Pace) – Art. 3, para. 5; Art. 49, paras 52, 62, 63
27 November 2008 (packaging foils), CISG-Online 2024 (Pace) – Art. 78, para. 10
30 August 2007 (GMS modules), CISG-Online 1722 (Pace) – Art. 39, paras 31, 33, 37, 89, 127
2 December 2004 (dextrose), CISG-Online 1194 (Pace) – Art. 8, para. 31; Art. 14, paras 1, 14, 24, 28;
11 December 2003 (plastic granulate), CISG-Online 958 (Pace) – Art. 4, paras 31, 32
12 December 2002 (MTBE), CISG-Online 720 (Pace) – Art. 78, para. 16
21 October 1999 (PVC and other synthetic materials), CISG-Online 491 (Pace) – Art. 1, paras 25, 37;
Art. 76, paras 1, 7, 13; Art. 78, para. 10
25 February 1999 (building materials), CISG-Online 490 (Pace) – Art. 3, paras 15, 17
16 October 1997 (hygrometers), CISG-Online 335 (Pace) – Art. 53, para. 5
16 March 1995 (cobalt), CISG-Online 230 (Pace) – Art. 6, para. 18
Obergericht Aargau
3 March 2009 (prefabricated house), CISG-Online 2013 (Pace) – Art. 3, para. 5
Obergericht Bern
19 May 2008, CISG-Online 1738 (Pace) – Art. 6, para. 20
11 February 2004 (cables), CISG-Online 1191 (Pace) – Art. 4, para. 35; Art. 7, para. 13; Art. 9, para. 33;
Art. 11, para. 17; Art. 35, para. 175; Art. 38, paras 5, 39, 91; Art. 39, paras 28, 52, 56, 62; Art. 74,
para. 15
Obergericht Luzern
12 May 2003 (used textile cleaning machine), CISG-Online 846 – Art. 35, para. 175
8 January 1997 (blood infusion devices), CISG-Online 228 (Pace) – Art. 1, paras 33, 34; Art. 3, para. 17;
Art. 4, para. 11; Art. 35, para. 103; Art. 38, paras 27, 34, 35, 50, 126, 132; Art. 39, para. 81
Obergericht Thurgau
12 December 2006 (building materials), CISG-Online 1566 – Art. 8, paras 2, 23
19 December 1995 (cloth), CISG-Online 496 (Pace) – Art. 1, para. 45; Art. 4, paras 18, 39, 46
Obergericht Zug
8 November 2011 (spinning mill), CISG-Online 2425 – Art. 8, para. 2; Art. 35, paras 171, 182, 198
19 December 2006 (stove), CISG-Online 1427 (Pace) – Art. 38, paras 82, 110; Art. 39, para. 37, 127;
Art. 44
Obergericht Zürich
6 February 2009 (graffiti protection coating), CISG-Online 2000 (Pace) – Art. 11, para. 16; Art. 31,
para. 16
Bezirksgericht Arbon
9 December 1994 (cloth), CISG-Online 376 (Pace) – Art. 4, para. 46; Art. 78, para. 23
Bezirksgericht Laufen
7 May 1993 (goods (presumably metal-works)), CISG-Online 136 (Pace) – Art. 3, para. 15
Bezirksgericht Locarno-Campagna
27 April 1992 (furniture), CISG-Online 68 (Pace) – Art. 7, para. 19; Art. 38, para. 93
Bezirksgericht Saane
20 February 1997 (spirits), CISG-Online 426 (Pace) – Art. 1, paras 26, 47; Art. 4, para. 36; Art. 9,
paras 33, 38; Art. 10, para. 19; Art. 64, para. 10; Art. 54, paras 1, 15; Art. 72, para. 11; Art. 74, para. 18;
Art. 81, para. 4; Art. 84, paras 2, 12
Bezirksgericht Sissach
5 November 1998 (summer clothes collection), CISG-Online 1466 (Pace) – Art. 9, paras 28, 29; Art. 29,
Bezirksgericht St. Gallen
3 July 1997 (fabrics), CISG-Online 336 (Pace) – Art. 8, para. 9; Art. 14, paras 1, 4; Art. 55, para. 1
Amtsgericht Luzern-Land
Amtsgericht Sursee
12 September 2008 (second hand tractor), CISG-Online 1728 (Pace) – Art. 1, para. 26
Amtsgericht Willisau
12 March 2004 (wood), CISG-Online 961 (Pace) – Art. 74, para. 26; Art. 80, paras 6, 12
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Zivilgericht Basel-Stadt
8 November 2006 (packaging machine), CISG-Online 1731 – Art. 8, para. 2
3 December 1997 (Bulgarian white urea), CISG-Online 346 (Pace, CLOUT 221) – Art. 9, paras 11, 30,
35; Art. 57, paras 11, 13
21 December 1992 (textiles), CISG-Online 55 (Pace) – Art. 1, para. 45; Art. 4, para. 7; Art. 9, para. 30;
Arts 14–24 introductory remarks, para. 4
Handelsgericht Aargau
21 June 2011 (cosmetic products), CISG-Online 2432 – Art. 58, para. 11
26 November 2008 (fruit and vegetables), CISG-Online 1739 (Pace) – Art. 4, paras 17, 46; Art. 8,
paras 2, 10, 31; Art. 75, para. 4
5 February 2008 (fruit and vegetables), CISG-Online 1740 – Art. 8, paras 10, 29
19 June 2007 (railway rails), CISG-Online 1741 (Pace) – Art. 53, para. 1
25 January 2005 (floor tiles), CISG-Online 1091 (Pace) – Art. 48, paras 38, 41; Art. 58, para. 11
5 November 2002 (inflatable triumphal arch), CISG-Online 715 (Pace) – Art. 35, paras 118, 122;
Art. 49, para. 20; Art. 58, paras 16, 26; Art. 78, para. 16
11 June 1999 (granular plastic), CISG-Online 494 (Pace) – Art. 4, para. 18
26 September 1997 (cutlery), CISG-Online 329 (Pace) – Art. 14, para. 36; Art. 49, para. 48; Art. 74,
para. 74; Art. 75, paras 4, 24
Handelsgericht Bern
22 December 2004 (watches), CISG-Online 1192 (Pace) – Art. 28, para. 2
17 January 2002 (grapefruit seed extract), CISG-Online 725 (Pace) – Art. 39, paras 71, 122
30 October 2001 (H-F-A (machine)), CISG-Online 956 (Pace) – Art. 39, para. 122
Handelsgericht St. Gallen
14 June 2012 (organic juices and organic oils), CISG-Online 2468 (Pace) – Art. 34, para. 11; Art. 35,
paras 26, 54, 129, 190; Art. 36, para. 9; Art. 39, paras 109, 112; Art. 58, paras 31, 33
11 February 2003 (audio CDs), CISG-Online 900 (Pace) – Art. 38, para. 90; Art. 59, para. 4; Art. 73,
para. 10
3 December 2002 (sizing machine), DT Ltd. v B. AG, CISG-Online 727 (Pace) – Art. 74, paras 16, 28,
30, 42, 70, 72; Art. 77, paras 15, 29, 34, 35 paras 23, 47; Art. 81, para. 10
5 December 1995, CISG-Online 245 (Pace) – Art. 11, para. 8; Art. 14, paras 2, 16, 18
24 August 1995 (cleaning products) CISG-Online 247 – Art. 4, para. 21
Handelsgericht Zürich
17 September 2014 (wire rod), CISG-Online 2656 – Art. 74, para. 2
3 April 2013 (steel coils), CISG-Online 2562 (Pace) – Art. 35, para. 39
18 June 2012 (antique statue), CISG-Online 2660 (Pace) – Art. 35, paras 180, 182
25 June 2010 (aerosol can manufacturing series), CISG-Online 2161 – Art. 8, para. 32
25 June 2007 (printed materials), CISG-Online 1564 – Art. 74, para. 15
22 December 2005 (retail fashion clothes), CISG-Online 1195 (Pace) – Art. 4, paras 35, 39; Art. 14,
17 February 2000 (software), CISG-Online 637 (Pace) – Art. 3, para. 25
8 April 1999 (driving engines for wind power plants), CISG-Online 489 (Pace) – Art. 3, para. 5
10 February 1999 (art books) CISG-Online 488 (Pace) – Art. 3, para. 5; Art. 4, para. 35; Art. 6, para. 22;
Art. 50, paras 11, 23, 27, 36, 62; Art. 74, paras 9, 11, 15, 76, 83; Art. 79, para. 63
30 November 1998 (lambskin coats), CISG-Online 415 (Pace) – Art. 1, paras 3, 26; Art. 4, paras 18, 35,
46; Art. 8, paras 24, 28; Art. 35, paras 15, 29, 33, 59, 175; Art. 38, paras 50, 77, 102, 132, 146; Art. 39,
paras 34, 36, 53, 79, 109, 111, 113, 114; Art. 40, para. 28; Art. 44, paras 5, 6; Art. 54, para. 1; Art. 73,
paras 5, 12; Art. 74, para. 15
5 February 1997 (sunflower oil), CISG-Online 327 (Pace) – Art. 6, para. 18; Art. 73, para. 19; Art. 74,
paras 15, 32, 70, 72; Art. 78, para. 10; Art. 84, paras 11, 12
10 July 1996 (plastic chips), CISG-Online 227 – Art. 19, para. 17; Art. 78, paras 12, 13
26 April 1995 (saltwater isolation tank), CISG-Online 248 (Pace) – Art. 3, paras 15, 17; Art. 4, paras 32,
35; Art. 5, paras 15, 16, 19; Art. 11, para. 12; Art. 74, paras 15, 32, 67; Art. 79, para. 2
9 September 1993 (furniture), CISG-Online 79 (Pace) – Art. 3, para. 5; Art. 4, para. 35; Art. 74,
St. Gallen Gerichtskommission Oberrheintal
30 June 1995 (sliding doors), CISG-Online 425 (Pace) – Art. 58, paras 4, 5
Tribunale d’appello Ticino
20 April 2016 (cans of a bottling machine), CISG-Online 2759 – Art. 4, para. 28
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United Kingdom
English Court of Appeal
18 December 2006 (sale of shares in a Lloyd’s broker), The Square Mile Partnership Ltd. v. Fitzmaurice
McCall Ltd., CISG-Online 1425 (Pace) – Introduction, para. 35
17 February 2006 (supply of labor personnel and cleaning equipment), ProForce Recruit Ltd v. Rugby
Group Ltd, 2006 EWCA Civ 69, CISG-Online 1424 (Pace) – Introduction, para. 35
High Court of Justice
1 May 2012 (borence, polymer), Kingspan Environmental Ltd et al v Bore-alis A/S et al, CISG-Online
2391 (Pace) – Art. 1, para. 54; Art. 35, paras 40, 101, 108, 118, 194; Art. 39, paras 28, 33, 35, 37, 38, 39;
Art. 40, paras 3, 11, 12, 23
Court of Exchequer
Hadley v Baxendale (1854) 9 Exch 341 – Art. 74, paras 27, 31
United States of America
Supreme Court
25 March 2008, Hall Street Associates, LLC v Mattel, Inc. – Art. 28, para. 26
Michigan Supreme Court
19 December 1974, Shiffer v Board of Education of Gibraltar School District, 393 Mich 190) – Art. 77,
para. 2
Superior Court of Massachusetts
28 February 2005 (smoke detection units), Vision Systems, Inc. v EMC Corporation, CISG-Online
1005 (Pace) – Art. 1, para. 44; Art. 10, paras 11, 20, 35
Court of Appeals, 2nd Circuit
6 December 1995 (compressors for air conditioners), Delchi Carrier S. p. A. v Rotorex Corp., CISG-
Online 140 (Pace) – Art. 7, para. 19; Art. 25, para. 38; Art. 49, paras 14, 35, 39; Art. 74, paras 2, 27, 40,
43, 45; Art. 75, paras 14, 24, 35
Court of Appeals, 3rd Circuit
16 April 2010, Forestal Guarani S. A., v Daros International, Inc. (Pace) – Art. 12, para. 10
19 July 2007 (naphtha), Valero Marketing Supply Co vs. Greeni Oy, CISG-Online 1510 – Art. 29,
20 June 2003, Standard Bent Glass Corp. v Glassrobots Oy – Art. 92, para. 6
Court of Appeals, 4th Circuit
21 June 2002 (drapery fabric), Schmitz-Werke GmbH & Co v Rockland Industries, Inc., CISG-Online
625 (Pace) – Art. 4, para. 35; Art. 7, para. 19; Art. 35, para. 194; Art. 74, para. 15
11 June 2003 (gasoline), B P Petroleum International Ltd. v Empresa Estatal Petroleos de Ecuador,
CISG-Online 730 (Pace) – Art. 6, paras 16, 18
15 June 1993, Beijing Metals & Minerals v American Business Center, Inc, 993 F.2 d 1178, CISG-
21 January 2016 frozen potatoes), VLM Food Trading International, Inc. v. Illinois Trading Co., et al –
Art. 19, para. 15
23 May 2005 (pork ribs), Chicago Prime Packers Inc. v Northam Food Trading Co., 320 F. Supp. 2 d
702, 715 (N. D. Ill. 2004), affirmed, 408 F.3 d 894, CISG-Online 1026 (Pace) – Art. 4, para. 35; Art. 7,
para. 19; Art. 35, paras 174, 198; Art. 66, para. 23; Art. 74, para. 15; Art. 78, para. 21
19 November 2002 (cookie tins), Zapata Hermanos v Hearthside Baking, CISG-Online 684 (Pace) –
14 February 2011 (inulin), Dingxi Longhai Dairy, Ltd. V. Becwood Technology Group L.L.C., CISG-
online 2256 (Pace) – Art. 7, para. 19
8 November 2007, Barbara Berry, S. A. de C. V. v Ken M. Spooner Farms, Inc., CISG-Online 1835
(Pace) – Art. 4, para. 16; Art. 29, para. 7
5 May 2003 (wine corks), Chateau des Charmes Wines Ltd. v. Sabaté USA, Sabaté S. A., CISG-Online
767 (Pace) – Art. 4, para. 33; Art. 8, para. 32; Art. 9, para. 30; Art. 11, para. 13; Art. 23, para. 1; Art. 29,
para. 7
12 April 1995 (cedar shakes (wood)), GPL Treatment Ltd. V Louisiana-Pacific Group, CISG-Online
147 (Pace) – Art. 6, para. 20
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Table of Cases
12 September 2006 (tantalum carbide), Treibacher Industrie, A. G. v Allegheny Technologies, Inc.,
CISG-Online 1278 (Pace) – Art. 8, para. 23; Art. 9, paras 4, 23; Art. 77, paras 13, 16, 32, 35
29 June 1998 (ceramic tiles), MCC-Marbel Ceramic Center Inc. v Ceramica Nuova D’Agostino S. p. A.,
144 F.3 d 1384, CISG-Online 342 (Pace) – Art. 1, para. 47; Art. 7, para. 41; Art. 8, paras 8, 9, 26;
Art. 35, paras 39, 155
District Court for the Northern District of Alabama
27 April 2005 (hard metal powders), Treibacher Industrie, A. G. v TDY Industries, Inc., CISG-Online
District Court for the Eastern District of Arkansas
19 August 2010 (refrigerator motors), Electrocraft Arkansas, Inc. v Super Electric Motors, Ltd and
Raymond O’Gara, Individually and as Partner and Agent of Super Electric Motors, Ltd, CISG-Online
2149 (Pace) – Art. 93, para. 3
23 December 2009 (refrigerator motors), Electrocraft Arkansas, Inc. v Electric Motors, Ltd et al. CISG-
Online 2045 (Pace) – Art. 4, paras 10, 23; Art. 35, paras 200, 205
25 June 2009 (floating paddle-wheel aerators), Granjas Aquanova S.A. de C.V. v House Manufacturing
Co. Inc., CISG-Online 1527 – Art. 74, para. 94
District Court for the Northern District of California
2 November 2005 (corks for bottles of wine), McDowell Valley Vineyards, Inc. v Sabaté USA Inc. et al.,
27 July 2001 (electronic components/computer chips), Asante Technologies, Inc. v PMCSierra, Inc.,
CISG-Online 616 – Art. 1, para. 45; Art. 4, para. 9; Art. 7, para. 39; Art. 10, paras 22, 33
30 January 2001 (computer parts), Supermicro Computer, Inc. v. Digitechnic, S.A., et al., CISG-Online
612 (Pace) – Art. 8, para. 8
District Court for the Eastern District of California
21 January 2010 (centrifuge), Golden Valley Grape Juice and Wine, LLC v Centrisys Corporation et al.,
CISG-Online 2089 (Pace) – Art. 4, paras 24, 32
District Court of Colorado
28 July 2015 (wastewater evaporation technology), Orica Australia Pty Ltd v. Aston Evaporative
Services, LLC, CISG-Online 2661 (Pace) – Art. 19, para. 9
6 July 2010 (coal mining equipment), Alpha Prime Development Corporation v. Holland Loader
Company, CISG-Online 2111 (Pace) – Art. 8, para. 17
District Court of Delaware
9 May 2008 (soy lecithin), Solae, LLC v Hershey Canada, Inc., CISG-Online 1769 (Pace) – Art. 11,
para. 13
District Court for the Southern District of Florida
19 May 2008 (polyester dyed fabric), Zhejiang Shaoxing Yongli Printing and Dyeing Co., Ltd v
Microflock Textile Group Corporation, CISG-Online 1771 (Pace) – Art. 4, para. 19; Art. 12, paras 6, 7
22 November 2002, Impuls I. D International, S. L., Impuls I. D. Systems Inc., and PSIAR S. A. v Psion
Teklogix Inc. – Art. 95, para. 3
District Court for the Northern Division of Georgia
17 December 2009 (printer cartridges), CISG-Online 2044 (Pace) – Art. 93, para. 3
District Court for the Northern District of Illinois
3 September 2008 (refrigerators and freezers), CNA Int’l Inc. v. Guangdong Kelon Electronical
Holdings et al., CISG-Online 2043 (Pace) – Art. 7, para. 1; Art. 93, para. 3
6 July 2004 (used railroad rails), Raw Materials Inc. v Manfred Forberich GmbH & Co., KG, CISG-
Online 925 (Pace) – Art. 7, para. 19; Art. 79, para. 20; Art. 79, paras 46, 50
21 May 2004 (pork ribs), Chicago Prime Packers, Inc. v Northam Food Trading Co., CISG-Online 851
(Pace) – Art. 7, para. 42; Art. 38, paras 23, 146; Art. 74, para. 2; Art. 78, para. 23
6 October 2003 (beer), CISG-Online 1225 (Pace) – Art. 4, para. 11
29 January 2003 (fluidized bed furnace), Ajax Tool Works, Inc. v Can-Eng Manufacturing Ltd, CISG-
28 March 2002 (steel plate), Usinor Industeel v Leeco Steel Products, CISG-Online 696/1326 (Pace) –
Art. 4, paras 9, 28; Art. 7, para. 42; Art. 81, para. 16
28 August 2001 (cookie tins), Zapata Hermanos Sucesores v Hearthside Baking Co. Inc., CISG-Online
599 (Pace) – Art. 78, para. 24
7 December 1999 (steel bars), Magellan International v Salzgitter Handel, CISG-Online 439 (Pace) –
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27/28 October 1998 (aircraft parts), Mitchell Aircraft Spares, Inc. v. European Aircraft Service AB,
CISG-Online 444 (Pace) – Art. 1, para. 47; Art. 7, para. 41; Art. 8, para, 29; Arts 14–24 introductory
remarks, para. 2; Art. 92, para. 6
District Court of Kansas
28 September 2007 (headwear), Guang Dong Light Headgear Factory Co., Ltd., v. ACI International,
Inc., CISG-Online 1602 – Art. 8, para. 17
District Court for the Eastern District of Kentucky
22 February 2010 (caviar), Princesse D’Isenbourg et CIE Ltd. v Kinder Caviar, Inc., CISG-Online 2185
– Art. 95, para. 3
18 March 2008 (concrete light poles), Sky Cast, Inc v Global Direct Distribution, LLC, CISG-Online
1652 (Pace) – Art. 4, para. 10
District Court for the Eastern District of Louisiana
17 May 1999 (medical equipment), Medical Marketing v Internazionale Medico Scientifica, CISG-
Online 387 (Pace)) – Art. 1, para. 47; Art. 7, paras 19, 41
District Court for the District of Maryland
18 July 2011 (metalsort machine), CISG-Online 2222 (Pace) – Art. 4, para. 46; Art. 74, para. 38
8 February 2011 (Cable assemblies and related components), CISG-Online 2177 – Art. 8, paras 3, 25
District Court for the Eastern District of Michigan
28 September 2007 (sport bar assembly system), CISG-Online 1601 (Pace) – Art. 4, para. 46; Art. 6,
para. 18
District Court for the Western District of Michigan
17 December 2001 (thermoforming line equipment for manufacture of plastic gardening pots together
with the technology), Shuttle Packaging Systems L. L. C. v Tsonakis, CISG-Online 773 (Pace) – Art. 4,
para. 20; Art. 8, para 17; Art. 11, para. 11; Art. 38, paras 92, 96; Art. 39, para. 91; Art. 72, para. 9
District Court of Minnesota
1 July 2008 (organic kosher Inulin), CISG-Online 1774 – Art. 4, para. 23
9 March 1999 (billboards, remote controls), KSTP-FM v Specialized Communications, CISG-Online
471 (Pace) – Art. 4, para. 9
District Court for the Eastern District of Missouri
10 January 2011 (chunk polysilicon and ingot), Semi-Materials Co., Ltd. v. MEMC Electronic
Materials, Inc., CISG-Online 2168 and 2169 (Pace) – Art. 4, para. 23; Art. 76, para. 7
District Court of New Jersey
19 March 2012 (photograph printing and processing machine), CISG-Online 2357 (Pace) – Art. 4,
para. 9
7 October 2008 (wooden finger-joints), Forestal Guarani, S. A. v Daros International, Inc., CISG-
Online 1779 (Pace) – Art. 4, para. 19; Art. 7, para. 39; Art. 12, paras 6, 7
4 April 2006 (naphtha), Valero Marketing and Supply Co vs. Greeni Oy and Greeni Trading Oy, CISG-
Online 1216 – Art. 25, paras 31, 47; Art. 49, paras 28, 31
15 June 2005, Valero Marketing v Greeni Oy (merits) – Art. 92, para. 6
District Court for the Northern District of New York
7 September 1994 (compressors for air conditioners), Delchi Carrier, SpA v Rotorex Corp., CISG-
District Court for the Southern District of New York
23 March 2015 (sports apparel), Korea Trade Insurance v. Oved Apparel Corporation, CISG-Online
2608 (Pace) – Art. 7, para. 41
28 September 2011 (liquid phenol), Cedar Petrochemicals, Inc v Dongbu Hannong Chemical Co, Ltd,
CISG-Online 2338 (Pace) – Art. 9, para. 38; Art. 36, para. 5
18 January 2011 (toluene), Hanwha Corporation v. Cedar Petrochemicals, Inc., CISG-Online 2178 –
Art. 8, paras 8, 29
30 March 2010 (frozen tilapia filets), Guangxi Nanning Baiyang Food Co. Ltd. v Long River Interna-
tional, Inc., CISG-Online 2091 (Pace) – Art. 4, para. 46
29 May 2009 (women’s clothes), Doolim Corp v R Doll, LLC, CISG-Online 1892 (Pace) – Art. 6,
para. 18; Art. 71, paras 11, 20
20 August 2008 (acrylic yarn), Hilaturas Miel, S. L. v Republic of Iraq, CISG-Online 1777 (Pace) –
Art. 7, para. 19; Art. 54, para. 4; Art. 79, paras 57, 58
16 April 2008 (frozen chicken parts), CISG-Online 1653 (Pace) – Art. 79, para. 58
19 July 2007 (liquid phenol), Cedar Petrochemicals, Inc. v Dongbu Hannong Chemical Co., Ltd., CISG-
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23 August 2006 (packaging system), TeeVee Tunes, Inc. et al v Gerhard Schubert GmbH, CISG-Online
1272 (Pace) – Art. 4, para. 23; Art. 8, paras 3, 8, 29; Art. 11, paras 16, 23; Art. 29, para. 18; Art. 74,
para. 27
1 Jun 2006 (beverages), Multi-Juice, S.A., Snapple Hellas, S.A., and New Age Beverages Hellas v.
Snapple Beverage Corp., and Mistic Brands, Inc., CISG-Online 1229 (Pace) – Art. 4, para. 11
10 May 2002 (chemicals), Geneva Pharmaceuticals Tech. Corp. v Barr Labs. Inc., CISG-Online 653
(Pace) – Art. 4, paras 10, 13, 20; Art. 7, para. 39; Art. 9, para. 24; Art. 11, para. 16; Art. 14, para. 1;
26 March 2002, St. Paul Guardian Insurance Co., et al. v Neuromed Medical System & Support, et al,
8 August 2000, Fercus v Mario Palazzo et al., CISG-Online 588 (Pace) – Art. 11, para. 1
6 April 1998 (shoes), Calzaturificio Claudia v Olivieri Footwear, CISG-Online 440 (Pace) – Art. 1,
para. 47; Art. 7, para. 19; Art. 8, paras 13, 25, 26; Art. 9, para. 11; Art. 11, para. 16; Art. 19, para. 11
23 July 1997 (fashion accessories), Helen Kaminski Pty., Ltd v Marketing Australian Products d/b/a
Fiona Waterstreet Hats, Inc., CISG-Online 297 (Pace) – Art. 1, para. 33; Art. 61, para. 8
14 April 1992 (footware/boots), Filanto v Chilewich, CISG-Online 45 (Pace) – Art. 4, para. 33; Art. 9,
22 May 1990, Interag Company Ltd. v Stafford Phase Corporation, CISG-Online 18 (Pace) – Art. 7,
para. 19
District Court for the Eastern District of New York
19 March 2005, Genpharm Inc. v Pliva-Lachema A. S, CISG-Online 1006 (Pace) – Art. 7, para. 19
District Court of Ohio
10 October 2006 (used paper winder), Miami Valley Paper, LLC v Lebbing Engineering & Consulting
GmbH, CISG-Online 1362 (Pace)/26 March 2009, CISG-Online 1880 (Pace) – Art 4., para. 23; Art. 35,
para. 202
District Court for the Western District of Pennsylvania
10 September 2013 (copper mold plates), Roser Technologies, Inc. v. Carl Schreiber GmbH d/b/a Csn
Metals, CISG-Online 2490 (Pace) – Art. 8, para. 17; Art. 14, para. 39; Art. 19, para. 1; Art. 71, para. 11
25 July 2008 (locomotives), Norfolk Southern Railway Company v Power Source Supply, Inc., CISG-
Online 1776 (Pace) – Art. 4, para. 46; Art. 35, paras 165, 190; Art. 74, para. 38
District Court for the Middle District of Pennsylvania
13 July 2013 (cosmetic products), It’s Intoxicating, Inc. v. Maritim Hotelgesellschaft mbH and Daniela
Zimmer, CISG-Online 2492 (Pace) – Art. 18, para. 10
6 January 2006 (software), American Mint LLC et al. v GOSoftware, Inc., CISG-Online 1175 (Pace) –
16 August 2005 (software), American Mint LLC v GOSoftware, Inc., CISG-Online 1104 (Pace) – Art 4,
District Court for the Eastern District of Pennsylvania
19 January 2016 (furniture), Fujian Zhangzhou Foreign Trade Co, Ltd. and Haining Wansheng Sofa
Co., Ltd. v World Imports, Ltd., CISG-Online 2732 – Art. 9, para. 38
29 January 2010 (styrene), ECEM European Chemical Marketing B.V. v. The Purolite Company, CISG-
Online 2090 (Pace) – Art. 1, para. 42; Art. 8, para. 29; Art. 74, para. 18
29 March 2004 (gas meters and related piping), Amco Ukrservice et al. v American Meter Company,
29 August 2000 (wine), CISG-Online 675 (Pace) – Art. 1, para. 33; Art. 4, para. 10, 11
District Court for the Eastern Division of Tennessee
20 October 2010 (gemstones), America’s Collectible Network, Inc., d/b/a Jewelry Television, and BBJ
Bangkok, Ltd. v Timlly (HK), Timlly BBK Co., Ltd., Sunil Ratwani, and Sanjay Punjabi, CISG-Online
2484 (Pace) – Art. 93, para. 3
District Court for the Southern District of Texas, Houston Division
7 February 2006 (explosive boosters), CISG-Online 1177 (Pace) – Art. 9, para. 38; Art. 67, paras 26, 37
District Court for the Western District of Washington
17 July 2006, Prime Start Ltd. v Maher Forest Products Ltd. – Art. 95, para. 3
13 April 2006 (raspberry roots), Barbara Berry, S. A. de C. V. v Ken M. Spooner Farms, Inc., CISG-
Online 1354 – Art. 4, para. 13; Art. 9, para. 29; Art. 18, para. 8
District Court for the Western District of Wisconsin
7 July 2007 (polycarbonate sheets), CISG-Online 1962 (Pace) – Art. 4, para. 32
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Bankruptcy Court for the Middle District of Georgia
25 July 2002 (airplane and airplane engines), First National Bank of South Georgia vs. Ayers, CISG-
Bankruptcy Court for the Northern District of Ohio
10 April 2001 (pig iron from Russia), Victoria Alloys, Inc. v Fortis Bank SA/NV, CISG-Online 589
Bankruptcy Court for the District of Oregon
29 March 2004 (Christmas trees), In re Siskiyou Evergreen, Inc., CISG-Online 1174 (Pace) – Art. 35,
paras 43, 45; Art 39, paras 9, 28, 42
Federal Court of International Trade
24 October 1989, Orbisphere Corp. v United States, CISG-Online 7 (Pace) – Art. 6, para. 16
Federal District Court Arizona
16 December 2014 (skincare products), Adonia Holding GmbH v. Adonia Organics LLC, (Pace) –
Art. 1, para. 33
Arbitral Awards
Arbitration Court attached to the Bulgarian Chamber of Commerce and Industry
30 November 1998 (production of automobiles), CISG-Online 1832 (Pace) – Art. 55, para. 4
12 February 1998 (steel ropes), CISG-Online 436 (Pace) – Art. 1, para. 47; Art. 78, para. 17; Art. 79,
paras 72, 82
24 April 1996 (coal), CISG-Online 435 (Pace) – Art. 1, para. 44; Art. 7, para. 55; Art. 79, paras 49, 50
Arbitration Court attached to the Hungarian Chamber of Commerce and Industry
25 May 1999 (sour cherries), CISG-Online 438 (Pace) – Art. 1, para. 47; Art. 73, para. 23
10 December 1996 (caviar), CISG-Online 774 (Pace) – Art. 66, paras 33, 34; Art. 79, paras 42, 73, 87
5 December 1995 (containers), CISG-Online 163 (Pace) – Art. 3, para. 7; Art. 39, paras 70, 92; Art. 50,
para. 26; Art. 71, paras 20, 30; Art. 73, para. 19; Art. 78, para. 23
17 November 1995 (mushrooms), CISG-Online 250 (Pace) – Art. 6, para. 18; Art. 7, para. 28; Art. 54,
20 December 1993 (shares of a limited liability company), CISG-Online 94 (Pace) – Art. 1, para. 38
CIETAC
18 April 2008 (PTA powder), CISG-Online 2057 (Pace) – Art. 4, para. 28
9 January 2008 (metallic silicon), CISG-Online 2056 (Pace) – Art. 11, para. 17
1 October 2007 (CD-R and DVD-R production line systems), CISG/2007/03, CISG-Online 1931 (Pace)
– Art. 76, para. 4; Art. 87, para. 14
20 September 2006 (welding machine), CISG-Online 1473 – Art. 4, para. 26; Art. 74, para. 38
3 August 2006 (water pump), CISG-Online 1919 (Pace) – Art. 74, paras 29, 33, 46
21 May 2006 (diesel generator), CISG-Online 1454 (Pace) – Art. 1, para. 20
9 November 2005 (DVD machines), CISG-Online 1444 – Art. 4, para. 26; Art. 74, para. 38
21 October 2005 (sheet metal producing system), CISG-Online 1472 (Pace) – Art. 4, para. 23
15 September 2005 (wool), CISG/2005/15, CISG-Online 1714 (Pace) – Art. 78, para. 10
2 September 2005 (freezing units), CISG/2005/17, CISG-Online 1712 (Pace) – Art. 78, para. 25
18 August 2005, (Automatic production line) CISG-Online 1710 (Pace) – Art. 53, para. 1
April 2005 (caprolactam), CISG/2005/22, CISG-Online 1912 (Pace) – Art. 4, para. 18
7 April 2005 (U.S. gin motes), CISG/2005/01, CISG-Online 1453, (Pace) – Art. 73, para. 33
12 March 2004 (fireworks), CISG-Online 1599 – Art. 4, para. 18
3 December 2003 (false hair), CISG-Online 1469 (Pace) – Art. 4, para. 19
17 September 2003 (cotton), CISG/2003/14, CISG-Online 1558 (Pace) – Art. 79, para. 50
27 December 2002 (medicine manufacturing equipment), CISG/2002/29, CISG-Online 2205 (Pace) –
Art. 71, paras 8, 11, 29
13 September 2002 (velvet clothes), CISG-Online 1537 – Art. 80, para. 5
10 June 2002 (rapeseed dregs/a rice agricultural product), CISG/2002/02, CISG-Online 1528 (Pace) –
Art. 78, para. 24
7 March 2002 (lube oil), CISG-Online 974 – Art. 4, para. 18
22 March 2001 (mung beans), CISG-Online 1442 (Pace) – Art. 60, para. 6
February 2001 (equipment, material and services) (Pace) – Art. 54, para. 1
6 December 2000 (pharmaceutical products), CISG/2000/13, CISG-Online 1449 (Pace) – Art. 78,
para. 20
27 April 2000 (wool), CISG/2000/05 (Pace) – Art. 75, paras 6, 12
11 February 2000 (silicon metal), CISG-Online 1529 (Pace) – Art. 4, para. 42; Art. 74, para. 87; Art. 75,
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1 February 2000 (silicon and manganese alloy), CISG/2000/01 (Pace) – Art. 74, para. 47; Art. 76,
para. 9
1 January 2000 (souvenir coins), CISG/2000/17, CISG-Online 1614 (Pace) – Art. 4, para. 46; Art. 74,
para. 38
31 December 1999 (hot rolled steel sheets in coil), CISG/1999/32, CISG-Online 1805 (Pace) – Art. 78,
para. 10
4 June 1999 (industrial raw material), CISG/1999/28, CISG-Online 1806 – Art. 49, para. 46
1 June 1999 (peanut kernel), CISG/1999/03, CISG-Online 1671 (Pace) – Art. 77, para. 14
31 May 1999 (indium ingot), CISG-Online 1254 (Pace) – Art. 4, para. 23
21 May 1999 (Pace) – Art. 9, para. 4
12 May 1999 (excavators), CISG/1999/26, CISG-Online 1659 (Pace) – Art. 9, para. 4
8 April 1999 (raw wool), CISG-Online 1114 (Pace) – Art. 74, para. 2
7 April 1999 (PVC suspension resin), CISG/1999/20, CISG-Online 1244 (Pace) – Art. 66, paras 31, 37;
Art. 67, para. 35
5 April 1999 (air conditioner equipment), CISG/1999/19, CISG-Online 1253 (Pace) – Art. 73, para. 32
30 March 1999 (flanges), CISG-Online 1170 (Pace) – Art. 40, para. 27
12 February 1999 (nickel plating machine production line equipment case), CISG-Online 1113 (Pace) –
8 August 1998 (diaper machine), CISG/1996/36 (Pace) – Art. 71, para. 13
24 March 1998 (hempseed), CISG/1998/03, CISG-Online 930 (Pace) – Art. 6, para. 23
19 December 1997 (steel), CISG/1997/36, CISG-Online 1418 (Pace) – Art. 4, para. 30; Art. 72, para. 29
16 December 1997 (hot-dipped galvanized steel coils), CISG/1997/35, CISG-Online 1662 (Pace) –
Art. 72, para. 9
15 December 1997 (hot-rolled coils), CISG-Online 1204 (Pace) – Art. 12, para. 7
30 November 1997 (canned oranges), CISG/1997/33, CISG-Online 1412 (Pace) – Art. 75, para. 18;
Art. 79, paras 50, 68
8 September 1997, CISG/1997/27, CISG-Online 1074 (Pace) – Art. 88, para. 28
18 August 1997 (Vitamin C), CISG/1997/26, CISG-Online 1073 (Pace) – Art. 77, para. 13
31 July 1997, CISG/1997/24, CISG-Online 1072 (Pace) – Art. 9, paras 14, 23
26 June 1997 (monohydrate zinc sulphate), CISG/1997/17 (Pace) – Art. 73, paras 10, 20
25 June 1997 (art paper), CISG/1997/16, CISG-Online 1896 (Pace) – Art. 9, paras 36, 38
22 May 1997 (soybean oil), CISG-Online 1164 (Pace) – Art. 4, para. 17
7 May 1997 (sanguinarine), CISG/1997/11, CISG-Online 1152 (Pace) – Art. 79, paras 72, 73
23 April 1997, CISG 1997/08, CISG-Online 1151 (Pace) – Art. 84, para. 2
1 April 1997 (Pace) – Art. 68, para. 4
31 December 1996 (high carbon tool steel), CISG/1996/58, CISG-Online 1524 (Pace) – Art. 72,
18 December 1996 (lentils), CISG/1996/56, CISG-Online 2281 (Pace) – Art. 54, para. 1; Art. 71,
para. 20
15 November 1996 (oxtetrecycline), CISG/1996/52, CISG-Online 1148 (Pace) – Art. 77, para. 13
17 October 1996 (Pace) – Art. 9, para. 3
18 September 1996 (metal (lanthanide compound)), CISG/1996/01 (Pace) – Art. 73, para. 21
6 September 1996 (engines), CISG-Online 1146 (Pace) – Art. 12, para. 6
30 July 1996 (ferro-molybdenum alloy), CISG/1996/33, CISG-Online 1280 (Pace) – Art. 79, para. 69
22 May 1996 (broadcasting equipment) (Pace) – Art. 35, para. 39
14 May 1996 (down coat), CISG-Online 1125 (Pace) – Art. 4, para. 42; Art. 74, para. 87
29 March 1996 (natural rubber), CISG/1996/16, CISG-Online 2280 (Pace) – Art. 1, para. 22; Art. 71,
14 March 1996 (sweet dried potatoes), CISG/1996/14, CISG-Online 1523 (Pace) – Art. 79, para. 68
8 March 1996, CISG/1996/12, CISG-Online 1034 (Pace) – Art. 88, para. 20
8 March 1996 (horsebeans), CISG-Online 1245 (Pace) – Art. 60, para. 6
27 February 1996 (wool), CISG/1996/11, CISG-Online 1033 (Pace) – Art. 71, paras 7, 20, 47
5 February 1996 (antimony ingots), CISG/1996/07, CISG-Online 1122 (Pace) – Art. 72, para. 11
30 January 1996 (compound fertilizer), CISG/1996/05, CISG-Online 1120 (Pace) – Art. 72, para. 28
23 April 1995 (Australian raw wool), CISG/1995/07, CISG-Online 1031 (Pace) – Art. 9, paras 22, 24
22 March 1995 (down jacket and winter coat), CISG-Online 1118 (Pace) – Art. 35, paras 44, 71
10 March 1995 (wool), CISG 1995/04, CISG-Online 1065 (Pace) – Art. 79, para. 60; Art. 81, para. 19;
Art. 84, para. 14; Art. 88, para. 37
23 February 1995 (jasmine aldehyde), CISG/1995/01, CISG-Online 568 (and also 971) (Pace) – Art. 35,
17 June 1994 (warm rolled steel plates), CISG/1994/08, CISG-Online 1063 (Pace) – Art. 79, para. 69
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30 March 1994 (cow’s liver fungus), CISG/1994/04, CISG-Online 1030 (Pace) – Art. 71, para. 24
20 February 1994 (cysteine), CISG/1994/03 (Pace) – Art. 9, para. 23
20 January 1994 (hydraulic press) (Pace) – Art. 35, para. 161
1 January 1992 (white cardboard scrap paper), CISG 1993/14, CISG-Online 1231 (Pace) – Art. 82,
paras 11, 22
7 August 1993 (semi-automatic weapons), CISG/1993/11, CISG-Online 1060 (Pace) – Art. 79, para. 73
6 June 1991, CISG/1991/03, CISG-Online 845 (Pace) – Art. 85, para. 26; Art. 88, paras 26, 28
18 April 1991 (silicate-iron), CISG/1991/01 (Pace) – Art. 76, para. 10
1990 (cloth wind coats), CISG/1990/01 (Pace) – Art. 74, para. 17
1 January 1989 (Thai-made emulsion), CISG/1989/02, CISG-Online 1230 (Pace) – Art. 71, paras 20, 37
Corte Cubana de Arbitraje Comercial Internacional
23 December 2013, CISG-Online 2572 – Art. 58, para. 13
30 September 2013 (lifting platform), CISG-Online 2579 (Pace) – Art. 7, para. 61
Foreign Trade Court attached to the Serbian Chamber of Commerce
27 July 2011 (copper wire rod), CISG-Online 2276 – Art. 4, para. 26; Art. 74, para. 38
9 July 2010 (non-alcoholic beverages and fruit nectar), CISG-Online 2260 (Pace) – Art. 74, para. 2
15 June 2010 (Euro diesel), CISG-Online 2261 (Pace) – Art. 74, paras 28, 47
31 May 2010 (mobile shear baler), CISG-Online 2262 (Pace) – Art. 4, para. 26; Art. 74, para. 38
6 May 2010 (agricultural products and grains), CISG-Online 2358 (Pace) – Art. 7, para. 58
10 November 2009 (DVD editions), CISG-Online 2354 – Art. 74, para. 2
19 October 2009 (mineral water), CISG-Online 2265 (Pace) – Art. 7, para. 58; Art. 74, para. 2, 42;
Art. 78, paras 10, 25
17 August 2009 (vegetable fats), CISG-Online 2039 (Pace) – Art. 6, paras 10, 22
4 June 2009 (mineral water), CISG-Online 2266 (Pace) – Art. 78, para. 19
28 January 2009 (medicaments), CISG-Online 1856 (Pace) – Art. 4, paras 11, 45; Art. 74, para. 2;
Art. 78, para. 19
15 September 2008 (Feta cheese and other cheese products), CISG-Online 2269 (Pace) – Art. 4,
para. 46
19 August 2008 (peaches and nectarines), CISG-Online 2271 (Pace) – Art. 74, para. 2
15 July 2008 (milk packaging equipment), CISG-Online 1795 (Pace) – Art. 1, para. 25; Art. 4, paras 11,
26, 28; Art. 74, paras 15, 38
23 May 2008 (seamless steel pipes), CISG-Online 2272 (Pace) – Art. 74, para. 11
23 January 2008 (white crystal sugar), CISG-Online 1946 (Pace) – Art. 34, para. 10; Art. 78, para. 25
13 November 2007 (mineral water and wooden pallets), CISG-Online 1794 – Art. 4, para. 11
1 October 2007 (timber), CISG-Online 1793 (Pace) – Art. 76, para. 4
24 January 2006 (Australian wool), CISG-Online 2274 – Art. 4, para. 30
21 February 2005 (young chickens), CISG-Online 2038 (Pace) – Art. 4, para. 36
27 May 2004 (hydro-isolation material), CISG-Online 2079 (Pace) – Art. 78, para. 16
23 February 2004 (gray cast iron), no. T-09/01, CISG-Online 2078 – Art. 35, paras 161, 199
9 December 2002 (aluminium), CISG-Online 2123 (Pace) – Art. 7, paras 27, 58; Art. 74, para. 38;
Art. 77, para. 31
ICC
1 January 2011, ICC 13184/2011, CISG-Online 2724 – Art. 4, para. 21
Case No. 16369 (2011), Yearbook Commercial Arbitration XXXIX (2014), 169 – Art. 33 – para. 27
1 January 2007 (chemical compound), ICC 9926, CISG-Online 1850 (Pace) – Art. 4, para. 36
2004, ICC 12460/2004 (Pace, Unilex) – Art. 7, para. 61
1 January 2003 (fashion products), ICC 11849/2003, CISG-Online 1421 (Pace) – Art. 4, para. 11; Art. 7,
paras 28, 58; Art. 8, para. 29; Art. 26, para. 6; Art. 27, para. 26; Art. 54, para. 1; Art. 62, para. 7; Art. 63,
paras 4, 7; Art. 73, para. 21; Art. 78, paras 20, 25; Art. 80, para. 20
2003, ICC 12097/2003 (Pace, Unilex) – Art. 7, para. 61
1 January 2002 (machine for production of household textile product), ICC 10377/2002, CISG-Online
1419 (Pace) – Art. 82, para. 22
1 January 2002 (machine), ICC 11333 CISG-Online 1420 (Pace) – Art. 4, para. 30; Art. 6, paras 16, 18
1 January 2000 (industrial product), ICC 10329, CISG-Online 1173 (Pace) – Art. 4, para. 18; Art. 23,
para. 1
1 January 2000 (processed food), ICC 8790/2000, CISG-Online 1172 – Art. 79, para. 56
2000 (waste recycling plant), ICC 9781 of 2000 (Pace) – Art. 1, para. 43
1 August 1999 (books), ICC 9083/1999, CISG-Online 706 (Pace) – Art. 3, para. 5; Art. 35, para. 17;
Art. 40; Art. 44
August 1999 (chemicals), ICC 9887/1999 (Pace, Unilex) – Art. 73, para. 20; Art. 81, para. 8
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1 July 1999 (roller bearings), ICC 9448/1999, CISG-Online 707 (Pace) – Art. 1, para. 33; Art. 3, para. 5;
1 June 1999 (coke/koks), ICC 9187, CISG-Online 705 – Art. 6, para. 18; Art. 8, paras 3, 4, 10; Art. 38,
paras 20, 27; Art. 40, paras 13, 21; Art. 44, para. 9; Art. 74, paras 30, 32; Art. 77, para. 35; Art. 78,
1 March 1999, ICC 9978/1999, CISG-Online 708 (Pace) – Art. 4, para. 26; Art. 26, para. 4; Art. 74,
para. 38; Art. 79, para. 69; Art. 81, paras 8, 11; Art. 84, para. 12
1 January 1999 (poultry feed), ICC 10274/1999, CISG-Online 1159 (Pace) – Art. 25, paras 30, 41;
Art. 73, para. 10
1 December 1998 (pipes), ICC 8908/1998, CISG-Online 1337 (Pace) – Art. 1, para. 33; Art. 78, para. 29
1 October 1998 (services), ICC 9333/1998, CISG-Online 1308 (Pace) – Art. 1, para. 22; Art. 9, para. 36;
Art. 78, para. 20
1 March 1998, ICC 9117, CISG-Online 777 – Art. 29, para. 22
1 December 1997 (food products), ICC 8817/1997, CISG-Online 750 and 776 (Pace) – Art. 7, para. 61;
1 September 1997 (glass commodities), ICC 8962/1997, CISG-Online 1300 (Pace) – Art. 78, para. 11
23 January 1997 (industrial equipment), ICC 8611/HV/JK, CISG-Online 236 – Art. 1, para. 33; Art. 19,
1 January 1997 (clothing), ICC 8786/1997, CISG-Online 749 (Pace) – Art. 16, para. 22; Art. 25,
para. 34; Art. 71, paras 13, 22; Art. 72, paras 11, 35; Art. 77, paras 15, 20, 36; Art. 78, para. 10
1 December 1996 (electrical appliances plus tooling), ICC 8769/1996, CISG-Online 775 (Pace) – Art. 7,
1 November 1996 (rice), ICC 8502/1996, CISG-Online 1295 (Pace) – Art. 9, para. 36; Art. 78, para. 29
1 October 1996 (Russian coal), ICC 8740/1996, CISG-Online 1294 (Pace) – Art. 73, para. 10; Art. 76,
para. 12
1 September 1996 (metal concentrate), ICC 8574, CISG-Online 1293 (Pace) – Art. 71, paras 26, 37;
June 1996 (chemical compound), ICC 8247, (Pace) – Art. 38, para. 77
1 January 1996, ICC 8769, CISG-Online 1276 – Art. 11, paras 16, 23
1 October 1995 (machine for medical use), ICC 8453/1995, CISG-Online 1275 (Pace) – Art. 6, para. 20;
Art. 9, para. 36
1 March 1995 (crude metal), ICC 7645/1995, CISG-Online 844 (Pace) – Art. 4, para. 26; Art. 25,
1 January 1995 (chemical fertilizer), ICC 8128/1995, CISG-Online 526 (Pace) – Art. 7, para. 61; Art. 26,
para. 4; Art. 49, paras 28, 30, 31; Art. 73, para. 13; Art. 75, paras 15, 16, 18, 24; Art. 79, paras 64, 73
1 January 1995 (mineral of manganese), ICC 8324/1995, CISG-Online 569 (Pace) – Art. 1, para. 52;
23 August 1994 (battery machinery), ICC 7660/1994, CISG-Online 129 (Pace) – Art. 1, para. 51; Art. 4,
1 January 1994 (cowhides), ICC 7331/1994, CISG-Online 106 (Pace) – Art. 1, para. 26; Art. 4, para. 46;
1 January 1994 (scaffold fittings), ICC 7531/1994, CISG-Online 565 – Art. 9, para. 36; Art. 25, paras 45,
47, 49; Art. 49, para. 18; Art. 51, para. 10; Art. 85, para. 29
1 January 1994 (coke), ICC 7565/1994, CISG-Online 566 (Pace) – Art. 6, para. 18; Art. 78, para. 20
1 January 1994 (radio-communication equipment), ICC 7844/1994, CISG-Online 567 (Pace) – Art. 6,
1 January 1993 (steel bars), ICC 6653/1993, CISG-Online 71 (Pace, Unilex) – Art. 6, para. 18; Art. 35,
1 January 1993 (shoes), ICC 7399, CISG-Online 748 (Pace) – Art. 4, para. 36
1 January 1992, ICC 7153/1992, CISG-Online 35 (Pace) – Art. 3, para. 15; Art. 78, para. 24
1 January 1992 (failure to open letter of credit and penalty clause), ICC 7197/1992, CISG-Online 36
(Pace) – Art. 4, para. 26; Art. 7, para. 55; Art. 25, para. 44; Art. 54, para. 15; Art. 62, para. 5; Art. 74,
1 January 1992 (production line for foamed boards), ICC 7585/1992, CISG-Online 105 (Pace) – Art. 1,
para. 49; Art. 4, para. 42; Arts 14–24 introductory remarks, para. 2; Art 25, para. 44; Art. 54, paras 1,
15; Art. 74, paras 45, 87; Art. 77, paras 21, 29; Art. 78, para. 11; Art. 84, para. 12
1990 (clothing), ICC 6149 (Pace) – Art. 9, para. 36
26 August 1989 (steel bars), ICC 6281/1989, CISG-Online 8 (Pace) – Art. 9, para. 36; Art. 79, para. 82
1 January 1989, ICC 5713/1989, CISG-Online 3 – Art. 9, para. 36; Art. 38, para. 17
ICC 11638/2002 – Art. 7, para. 61
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Internationales Schiedsgericht der Bundeskammer der gewerblichen Wirtschaft in Österreich
15 June 1994 (rolled metal sheets), Vienna Arbitral Tribunal, SCH 4318/4366, CISG-Online 120/121/
691 (Pace) – Art. 1, para. 51; Art. 4, para. 46; Art. 6, para. 18; Art. 7, paras 27, 58; Art. 16, para. 22;
Art. 38, paras 72, 144; Art. 39, paras 102, 113, 116; Art. 74, paras 2, 45, 63; Art. 78, paras 24, 25
Netherlands Arbitration Institute
10 February 2005, CISG-Online 1621 (Pace) – Art. 8, para. 31; Art. 9, paras 7, 10, 12
15 October 2002 (condensate crude oil mix), NAI No. 2319, CISG-Online 740 (Pace) – Art. 1, para. 53;
Art. 7, para. 9; Art. 35, paras 68, 74, 77, 79, 82, 113, 199; Art. 39, para. 93
15 October 2002, Case 2319 (Pace) – Art. 71, paras 6, 23, 24, 25, 42; Art. 73, paras 3, 5, 7, 19, 23, 33
SCC
5 June 1998 (rail press), Beijing Light Automobile Co. Ltd. v Connell Limited Partnership, CISG-
Online 379 (Pace) – Art. 1, para. 47; Art. 7, para. 27; Art. 35, paras 39, 65, 101, 102, 168; Art. 36,
para. 13; Art. 40, paras 1, 2, 3, 5, 12, 26, 27; Art. 84, para. 15
Schiedsgericht der Handelskammer Hamburg
21 June 1996 (Chinese goods), CISG-Online 465 (Pace) – Art. 1, paras 26, 51; Art. 4, para. 42; Art. 6,
para. 18, 21
21 March 1996 (Chinese goods), CISG-Online 187 (Pace) – Art. 4, para. 42; Art. 73, paras 3, 5; Art. 74,
para. 87; Art. 79, paras 23, 64
Supreme Arbitration Court of the Russian Federation (Moscow)
26 February 2009 (wheat), CISG-Online 2523 (Pace) – Art. 12, para. 6
Tribunal of International Commercial Arbitration at the Russian Federation Chamber of Commerce and
Industry
13 May 2008, CISG-Online 2103 (Pace) – Art. 79, para. 42
8 February 2008 (natural gas), CISG-Online 2102 (Pace) – Art. 7, para. 25
13 April 2006, CISG-Online 1944 – Art. 4, para. 26; Art. 8, para. 23; Art. 9, para. 38; Art. 74, para. 38;
Art. 77, para. 12
7 April 2006 (equipment), CISG-Online 1943 (Pace) – Art. 78, para. 19
1 March 2006, CISG-Online 1941 (Pace) – Art. 4, para. 26; Art. 7, para. 55; Art. 49, para. 52; Art. 74,
para. 38
13 February 2006 (equipment), CISG-Online 1623 (Pace) – Art. 1, para. 21; Art. 4, para. 26; Art. 9,
para. 38
13 January 2006, CISG-Online 1622 (Pace) – Art. 4, para. 26; Art. 74, para. 38
21 November 2005 (equipment), CISG-Online 1520 – Art. 79, para, 58
27 October 2005, 132/2004, CISG-Online 1503 (Pace) – Art. 35, para. 19
18 October 2005 (varnish and paint machine), 21/2005, CISG-Online 1457 (Pace) – Art. 25, para. 6;
Art. 82, para. 20
27 May 2005, 95/2004, CISG-Online 1456 – Art. 7, para. 28; Art. 81, para. 8
16 March 2005, CISG-Online 1480 (Pace) – Art. 6, para. 18
29 December 2004 (equipment), CISG-Online 1212 (Pace) – Art. 80, para. 5
23 December 2004, CISG-Online 1188 (Pace) – Art. 36, para. 13; Art. 74, para. 28; Art. 77, paras 12, 14
12 November 2004, CISG-Online 2406 – Art. 71, paras 35, 37
9 June 2004, CISG-Online 1239 (Pace) – Art. 4, paras 17, 26; Art. 12, para. 2; Art. 74, para. 38; Art. 75,
para. 6
28 May 2004, 175/2003, CISG-Online 1513 (Pace) – Art. 84, para. 12
19 May 2004, 100/2002, CISG-Online 1358 (Pace) – Art. 84, paras 12, 13
16 February 2004, 107/2002, CISG-Online 1181 (Pace) – Art. 1, para. 30; Art. 29, para. 18; Art. 77,
para. 15
17 September 2003, CISG-Online 979 (Pace) – Art. 6, para. 18
25 June 2003 (equipment), CISG-Online 978 (Pace) – Art. 6, para. 18
16 June 2003, 135/2002, CISG-Online 977 (Pace) – Art. 84, para. 10
16 April 2003, 99/2002, CISG-Online 1683 (Pace) – Art. 84, para. 12
10 December 2002, 211/2001, CISG-Online 942 (Pace) – Art. 88, para. 38
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24 January 2002 (case iron products), CISG-Online 88 (Pace) – Art. 60, para. 5
13 June 2000, CISG-Online 1083 (Pace), 280/1999 – Art. 81, paras 7, 8
6 June 2000, CISG-Online 1249 (Pace) – Art. 4, para. 30; Art. 74, paras 33, 46; Art. 75, para. 4; Art. 78,
para. 23
29 February 2000, in: Rozenberg (ed.), Praktika Mezhdunarodnogo Kommercheskogo Arbitrazhnogo
Suda pri TPP RF za 1999–2000gg. (2002), p. 233 seq. – Art. 71, paras 3, 18, 40, 41
10 February 2000, No. 340/1999, CISG-Online 1084 (Pace) – Art. 88, para. 26
24 January 2000, 54/1999, CISG-Online 1042 (Pace) – Art. 6, para. 16; Art. 38, para. 116; Art. 44,
17 January 2000 (Pace) – Art. 9, para. 10
27 July 1999, CISG-Online 779 (Pace) – Art. 7, para. 27; Art. 71, paras 20, 38; Art. 77, paras 9, 22
7 June 1999 (Pace), 238/1998 – Art. 72, paras 11, 19
24 November 1998 (equipment), CISG-Online 1525 (Pace) – Art. 7, para. 28
25 May 1998 (Pace) – Art. 71, paras 20, 35
5 March 1998, 160/1997, (Pace) – Art. 81, para. 8
16 February 1998, CISG-Online 1303 (Pace) – Art. 12, para. 7; Art. 55, para. 5; Art. 96, para. 5
22 January 1998, 102/1997 (Pace) – Art. 71, para. 55
21 January 1998, 99/1997, CISG-Online 1246 (Pace) – Art. 41, para. 27
10 January 1998, CISG-Online 2122 (Pace) – Art. 4, para. 26; Art. 74, para. 38
25 December 1997 (Pace), 53/1997 – Art. 84, para. 12
5 June 1997, CISG-Online 1247 (Pace) – Art. 4, para. 26; Art. 9, paras 25, 36; Art. 74, para. 49
29 May 1997 (Pace), 439/1995 – Art. 84, para. 12
11 May 1997, 2/1995, CISG-Online 1514 (Pace) – Art. 79, para. 82; Art. 81, para. 19
3 March 1997, 82/1996, CISG-Online 1298 (Pace) – Art. 81, para. 14
25 December 1996 (Pace) – Art. 9, para. 38
25 April 1996 (Pace), 72/1995 – Art. 84, para. 12
10 February 1996 (Pace) – Art. 85, para. 19
22 November 1995 (Pace) – Art. 55, para. 5
17 October 1995 (automatic diffractameter), CISG-Online 207 (Pace) – Art. 54, paras 3, 6; Art. 79,
para. 23
28 April 1995, (Pace) – Art. 13, para. 11
25 April 1995, 161/1994 (Pace) – Art. 72, paras 11, 17; Art. 81, para. 7
25 April 1995, 142/1995, CISG-Online 367 (Pace) – Art. 88, paras 20, 37
16 March 1995 (chemical products), CISG-Online 205 (Pace) – Art. 75, para. 14; Art. 79, paras 64, 99
3 March 1995, CISG-Online 204 (Pace) – Art. 14, para. 36; Art. 55, paras 3, 4
1 January 1995 (chemical fertilizer), ICC 8128/1995, CISG-Online 526 (Pace) – Art. 79, para. 66
21 April 1994, (Pace) – Art. 74, para. 70
15 April 1994, 1/1993, CISG-Online 449 (Unilex) – Art. 84, paras 12, 13
9 June 2004, CISG-Online 1239 (Pace) – Art. 4, para. 17, 26, 30
142/1994, CISG-Online 367 (Pace) – Art. 88, para. 14
Tribunal of International Commercial Arbitration at the Ukraine Chamber of Commerce and Trade
23 January 2012 (corn), CISG-Online 2556 – Art. 31, para. 52; Art. 79, para. 90
1 January 2005, 48/2005, CISG-Online 1372 (Pace) – Art. 71, paras 38, 40; Art. 77, para. 15
15 April 2004, CISG-Online 1103 (Pace) – Art. 4, paras 11, 30
10 October 2003 (barter transactions), CISG-Online 923/1268 (Pace) – Art. 1, para. 30
21 June 2002 (equipment), CISG-Online 922/1387 (Pace) – Art. 80, para. 11
18 November 2004 (manufactured articles), CISG-Online 1371 – Art. 49, para. 31
Others
12 December 2007 (frozen chicken parts), AAA 50181T 0 036406, Macromex Srl. v Globex Interna-
tional Inc., CISG-Online 1647 (Pace) – Art. 26, para. 7; Art. 29, para. 8
23 October 2007 (frozen chicken parts), interim arbitral award, American Arbitration Association,
Macromex Srl. v Globex International Inc., CISG-Online 1645 (Pace) – Art. 7, paras 19, 35, 43; Art. 25,
para. 34; Art. 9, para. 10; Art. 74, para. 29; Art 79, para. 57
19 January 2007, PSEG Global Inc. and Konya Ilgin Elektrik Üretim ve Ticaret Limited Sirketi v
Republic of Turkey (ICSID Case No. ARB/02/5) – Art. 78, para. 29
17 January 2007, Siemens A. G. v Argentine Republic (ICSID Case No. ARB/02/8) – Art. 78, para. 29
30 November 2006 (Unilex), Centro de Arbitraje de México – Art. 79, para. 51
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2 October 2006, ADC Affiliate Limited and ADC & ADMC Management Limited v Republic of
Hungary (ICSID Case No. ARB/03/16) – Art. 78, para. 29
14 July 2006, Azurix Corp. v Argentine Republic (ICSID Case No. ARB/01/12) – Art. 78, para. 29
26 May 2003 (coal), Federal Arbitration Court for the Moscow Region (Russia), CISG-Online 836
(Pace) – Art. 1, para. 30; Art. 4, para. 11
6 August 2002, Arbitration Court [Appellate Court] for the Western Siberia Circuit (Russia),
O. I. L. Otto International Leasing AG v Zernopererabatyvayuschy kombinat Barnaulskaya melnitsa
(Pace) – Art 71, paras 13, 26; reversed later by High Arbitration Court for Presidium of Supreme
Arbitration Court (Russia) 28 January 2003, CISG-Online 835 – Art. 41, para. 34
28 September 2001 (steel wire, nails and wire rod), Chamber of National and International Arbitration
of Milan (Italy), CISG-Online 1582 (Unilex) (Pace) – Art. 4, para. 39; Art. 10, para. 37; Art. 71,
25 May 2001, Foreign Trade Arbitration Court attached to the Yugoslav Chamber of Commerce in
Belgrade, Serbia T-15/01 (Pace) – Art. 88, para. 15
8 December 2000, Wena Hotels Limited v Arab Republic of Egypt (ICSID Case No. ARB/98/4) –
Art. 78, paras 11, 29
13 November 2000, Agustı́n Maffezini v Kingdom of Spain (ICSID Case No. ARB/97/7) – Art. 78,
para. 29
17 February 2000, Santa Elena S. A. v Republic of Costa Rica (ICSID Case No. ARB/96/1) – Art. 78,
para. 29
29 December 1998 (cheese), Schiedsgericht der Hamburger freundlichen Arbitrage, CISG-Online 638
(Pace) – Art. 1, para. 26; Art. 6, para. 21; Art. 49, para. 32; Art. 57, para. 8; Art. 73, paras 10, 12, 19;
Art. 84, para. 12
18 December 1998, Russian Maritime Commission Arbitral Tribunal (military submarine), CISG-
30 November 1998 (sweets), Comisión para. la Protección del Comercio Exterior de México, Dulces
Luisi v Seoul International, CISG-Online 504 (Pace) – Art. 7, paras 3, 26, 28; Art. 11, para. 8; Art. 54,
para. 1
1 January 1998 (steel bars), 107/1997, Arbitration Institute of the Stockholm Chamber of Commerce,
CISG-Online 1301 (Pace) – Art. 74, para. 45
10 December 1997 (barley), Schiedsgericht der Börse für landwirtschaftliche Produkte Wien (Austria),
CISG-Online 351 (Pace) – Art. 9, para. 4; Art. 35, para. 197; Art. 38, para. 32; Art. 39, para. 102;
Art. 72, paras 9, 15, 27; Art. 73, paras 7, 18, 19, 29, 36
25 March 1997 (onions), Presidium of the Supreme Arbitration Court of the Russian Federation, 4670/
96, CISG-Online 1224 (Pace) – Art. 12, para. 7
31 May 1996 (aluminium), Handelskammer Zürich, Soinco v NKAP, CISG-Online 1291 (Pace), ZHK
273/95 – Art. 4, paras 23, 37; Art. 28, para. 2; Art. 72, para. 28; Art. 73, paras 5, 6, 7, 19, 23, 29; Art. 80,
para. 3
21 March 1996, Schiedsgericht der Handelskammer Hamburg, CISG-Online 187 (Pace) – Art. 79,
para. 69
5 October 1995 (refrigerators and deep-freezers), Belarusian Chamber of Commerce and Industry
International Court of Arbitration (Belarus), ATT v Armco, CISG-Online 861 (Pace) – Art. 71, paras 3,
20, 37, 41, 55; Art. 80, para. 3
19 April 1994, ad hoc Florence (leather/textile wear), CISG-Online 124 (Pace) – Art. 1, para. 51; Art. 6,
para. 18
4 May 1993 (garlic), Comisión para. la Protección del Comercio México, CISG-Online 75 (Pace) –
22 April 1986, McCollough & Co., Inc. v Ministry of Post, Tel. & Tel., 11 Iran-U. S. Cl. Trib. Rep. 3
(1986) – Art. 78, para. 11
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Abbreviations
AAA ....................................... American Arbitration Association

ABA ....................................... American Bar Association
AC .......................................... Law Reports, House of Lords (Appeal Cases)
AIA ........................................ Italian Arbitration Association
ALI ......................................... American Law Institute
All ER .................................... All England Law Reports
ALR ........................................ Australian Law Reports
Art(s) ..................................... Article(s)
ASA ........................................ Swiss Arbitration Association
ATF ........................................ Arrêts du Tribunal Fédéral Suisse
BCSC ..................................... British Columbia Supreme Court
BGB ....................................... Bürgerliches Gesetzbuch (German Civil Code)
BGE ....................................... Entscheidungen des schweizerischen Bundesgerichts
BGHZ .................................... Sammlung der Entscheidungen des Bundesgerichtshofs in Zivil-sachen
Brussels Convention .......... Convention of 27 September 1968 on Jurisdiction and the Enforcement of
Judgments in Civil and Commercial Matters
Brussels Regulation ............ Council Regulation (EC) No 44/2001 of 22 December 2000 on jurisdiction
and the recognition and enforcement of judgments in civil and commercial
matters
C&F ....................................... Cost and Freight
CA .......................................... Court of Appeal of England and Wales
CAMCA ................................ Commercial Arbitration and Mediation Centre for the Americas
Cc ........................................... Code civil, Codice civile, Civil code, Código civil
CCI ........................................ Chamber of Commerce and Industry of the Russian Federation
CCP ....................................... Code of Civil Procedure
CEPANI ................................ Belgian Centre for Arbitration and Mediation
Cf ............................................ confer
CFR ........................................ Cost and Freight
Ch D ...................................... Chancery Division
CIETAC ................................ China International Economic and Trade Arbitration Commission
CIF ......................................... Cost, Insurance, Freight
CIP ......................................... Carriage and Insurance Paid
Cir .......................................... Circuit
CISG ...................................... UN Convention on Contracts for the International Sale Goods of 11 April
1980
CISG-AC .............................. Advisory Council of the CISG
CISG-Online ........................ CISG Database based at the University of Basel www.cisg-online.ch
Civ .......................................... Cour de Cassation, Chambre civile
CLOUT ................................. Case Law on UNCITRAL Texts
CLR ........................................ Commonwealth Law Reports
Clunet .................................... Journal de droit international
CMEA ................................... Council of Mutual Economic Assistance
CMI ....................................... Comité Maritime International
CMR ...................................... UN Convention on the Contract for the International Carriage of Goods
by Road of 19 May 1956
COD ...................................... Cash On Delivery
COM ...................................... EC document intended for communication to the public
Compromex ......................... Mexican Commission for the Protection of Foreign Trade
Corp ....................................... Corporation
CPC ....................................... Codice di Procedura Civile, Code de Procedure Civile
CPR ........................................ Civil Procedure Rules (England)
CPT ........................................ Carriage Paid To
CRCICA ............................... Cairo Regional Centre For International Commercial Arbitration
Ct ............................................ Court
Ct App .................................. Court of Appeals
CTO ....................................... Combined Transport Operator
DAF ....................................... Delivered At Frontier
DAP ....................................... Delivered At Place
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Abbreviations
DAT ....................................... Delivered At Terminal
DCFR .................................... Draft Common Frame of Reference
DDP ....................................... Delivered Duty Paid
DDU ...................................... Delivered Duty Unpaid
DEQ ....................................... Delivered Ex Quay
DES ........................................ Delivered Ex Ship
DIS ......................................... Deutsche Institution für Schiedsgerichtsbarkeit
Dist ........................................ District
EC .......................................... European Community
ECB ........................................ European Central Bank
ECE ........................................ Economic Commission for Europe
ECHR .................................... European Convention on Human Rights
ECJ ......................................... Court of Justice of the European Communities
ECOSOC .............................. United Nations Economic and Social Council
ED .......................................... Eastern District
ed(s) ....................................... editor(s), edition
EDI ......................................... Electronic Data Interchange
EDF ........................................ European Development Fund
EEC ........................................ European Economic Community
Eg ........................................... for example
EGBGB .................................. Einführungsgesetz zum BGB
ER ........................................... English Reports
et al ........................................ and others
et seq ..................................... and following
etc ........................................... etcetera
EU .......................................... European Union
eUCP ..................................... Supplement to the Uniform Customs and Practice for Documentary
Credits for Electronic Presentation
EWCA Civ ........................... Neutral citation for England and Wales Court of Appeal civil division
decisions
EWiR ..................................... Entscheidungen zum Wirtschaftsrecht
Ex ........................................... Court of Exchequer
EXW ...................................... Ex Works
F .............................................. Federal Reporter
F 2d ........................................ The Federal Reporter Second Series
F 3d ........................................ The Federal Reporter Third Series
FAA ....................................... United States Federal Arbitration Act
FAS ........................................ Free Alongside Ship
FCA ....................................... Free Carrier
FIDIC .................................... Fédération Internationale des Ingénieurs-Conseils
FOB ........................................ Free on board
FS ........................................... Festschrift
F Supp ................................... Federal Supplement
GAFTA ................................. Grain and Feed Trade Association
GDR ....................................... German Democratic Republic
HGB ....................................... Handelsgesetzbuch
HKHC ................................... Hong Kong High Court
HKIAC .................................. Hong Kong International Arbitration Centre
HL .......................................... House of Lords
IACAC .................................. Inter-American Commercial Arbitration Commission
IBA ......................................... International Bar Association
IBA Rules ............................. IBA Rules on the taking of Evidence in International Commercial Arbitra-
tion
Ibid ......................................... ibidem
ICAC ..................................... Moscow International Commercial Arbitration Court
ICC ........................................ International Chamber of Commerce
ICC Bulletin ......................... International Chamber of Commerce International Court of Arbitration
Bulletin
ICCA ..................................... International Council for Commercial Arbitration
ICDR ..................................... American Arbitration Association International Center for Dispute
Resolution
ICSID .................................... International Centre for the Settlement of Investment Disputes
Idem ...................................... the same person
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Abbreviations
Ie ............................................. id est
IHR ........................................ Internationales Handelesrecht (law journal)
ILR ......................................... International Law Reports
Incoterms ............................. ICC International Commercial Terms revised in 2010
IPR ......................................... Internationales Privatrecht
IPRax ..................................... Praxis des internationalen Privat- und Verfahrensrechts
JCAA ..................................... Japan Commercial Arbitration Association
JDI .......................................... Journal du Droit International (Clunet)
KB .......................................... King’s Bench Division
LCIA ...................................... London Court of International Arbitration
LG .......................................... Landgericht
LJ ............................................ Lord Justice
LMAA ................................... London Maritime Arbitration Association
LT ........................................... Law Times Reports
Ltd .......................................... Limited
MERCOSUR ........................ Common Market of the Southern Cone pursuant to the Treaty of Asun-
ción of 26 March 1991
Model Law ........................... UNCITRAL Model Law on International Commercial Arbitration adopted
21 June 1985
MR ......................................... Master of the Rolls
MünchKomm ...................... Münchener Kommentar zum Bürgerlichen Gesetzbuch
MünchKommHGB ............. Münchener Kommentar zum Handelsgesetzbuch
NAI ........................................ Netherlands Arbitration Institute
NCPC .................................... French Code of Civil Procedure (Nouveau Code de Procedure Civile)
ND ......................................... Northern District
New York Convention ...... UN Convention on the Recognition and Enforcement of Foreign Arbitral
Awards of 10 June 1958
NJW ....................................... Neue Juristische Wochenschrift
No(s) ..................................... number(s)
NSWLR ................................. New South Wales Law Reports
NZLJ ...................................... New Zealand Law Journal
OECD .................................... Organisation for Economic Co-operation and Development
OGH ...................................... Oberster Gerichtshof (Austrian Supreme Court)
OHADA ............................... Organization for the Harmonization of Business Law in Africa
OJ ........................................... Official Journal of the European Communities
OLG ....................................... Oberlandesgericht (Court of Appeal)
OR .......................................... Official Records
p, pp ...................................... page, pages
Pace ........................................ Albert H Kritzer CISG Database based at Pace University: www.cisg.law.-
pace.edu
PC .......................................... Privy Council
PCA ....................................... Permanent Court of Arbitration (The Hague)
PECL ..................................... Principles of European Contract Law
PICC ...................................... UNIDROIT Principles of International Commercial Contracts
PIL ......................................... (Swiss) Private International Law
PIL Sales Convention ........ Convention on the Law Applicable to Contracts for the International Sale
of Goods of 22 December 1986
QBD ....................................... Queen’s Bench Division
RabelsZ ................................. Rabels Zeitschrift für ausländisches und internationales Privatrecht
Reg ......................................... Regulation
Rev Arb ................................. Revue de l’arbitrage
Rev crit dip .......................... Revue critique de droit international privé
RIW ....................................... Recht der Internationalen Wirtschaft
Rome Convention .............. EC (Rome) Convention on the Law Applicable to Contractual Obligations
1980
RPS ........................................ Recht und Praxis der Schiedsgerichtsbarkeit
RSC ........................................ Rules of Supreme Court
S Ct ........................................ Supreme Court of the United States
s(s) ......................................... section(s)
SCC ........................................ Stockholm Chamber of Commerce Arbitration Institute
SchiedsVZ ............................ Zeitschrift für Schiedsverfahren
SchwZIER ............................. Schweizeriche Zeitschrift für internationals und europäisches Recht
sec .......................................... Section
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Abbreviations
SGA ....................................... Sale of Goods Act
SIAC ...................................... Singapore International Arbitration Centre
TRIPS .................................... Agreement on Trade Related Aspects of Intellectual Property Rights
UCC ....................................... Uniform Commercial Code
UCP ....................................... Uniform Customs and Practices relating to Documentary Credits
UKPC .................................... Neutral citation for decisions of the Privy Council
ULF ........................................ Uniform Law on the Formation of Contracts for the International Sale of
Goods of 1 July 1964
ULIS ....................................... Uniform Law on the International Sale of Goods of 1 July 1964
UN ......................................... United Nations
UNCITRAL .......................... United Nations Commission for International Trade Law
UNIDROIT .......................... International Institute for the Unification of Private Law
UNILEX ................................ International Case Law and Bibliography on the CISG and the UNIDROIT
Principles: http://www.unilex.info/
US, USA ............................... United States of America
USSR ...................................... Union of Soviet Socialist Republics
v .............................................. Versus
vol .......................................... Volume
WG ........................................ Working Group
WIPO .................................... World Intellectual Property Organisation
WLR ...................................... The Weekly Law Reports
WM ....................................... Wertpapier-Mitteilungen
WR ......................................... Weekly Reporter
WTO ..................................... World Trade Organization
WuB ...................................... Entscheidungssammlung zum Wirtschafts- und Bankrecht
YB .......................................... UNCITRAL Yearbook
YBCA .................................... Yearbook of Commercial Arbitration
ZBB ........................................ Zeitschrift für Bankrecht und Bankwirtschaft
ZfRV ...................................... Zeitschrift für Rechtsvergleichung
ZIP ......................................... Zeitschrift für Wirtschaftsrecht und Insolvenzpraxis
ZPO ....................................... German Code of Civil Procedure (ZPO)
ZVglRwiss ............................ Zeitschrift für vergleichende Rechstwissenschaften
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Abbreviated bibliography
Audit, Vente Internationale

(1990) ................................................... Audit, Bernard, La vente internationale de marchandises, Conven-
tion des Nations Unies du 11 avril 1980 (LGDJ: Paris, 1990)
Author, in: Bamberger/Roth (eds),
Kommentar zum Bürgerlichen Ge-
setzbuch (2012) .................................. Bamberger, Heinz Georg, Roth, Herbert (eds.), BGB, Kommentar,
3rd edition (C.H. Beck: München 2012)
Author, in: BeckOK BGB Kom-
mentar (2015) ..................................... Beck’scher Online-Kommentar, BGB, Bamberger, Heinz Georg,
Roth, Herbert (eds.) 36th edition (C.H. Beck: München 2015)
Benjamin’s Sale of Goods (2006) ... Benjamin’s Sale of Goods, 7th edition (Sweet & Maxwell: London,
2006, A. Guest et al, eds)
Benjamin’s Sale of Goods (2010) ... Benjamin’s Sale of Goods, 8th edition (Sweet & Maxwell: London,
2010, M. Bridge, ed.)
Bernstein/Lookofsky, Understand-
ing the CISG (2003) .......................... Bernstein, Herbert/Lookofsky, Joseph, Understanding the CISG in
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Bernstein/Lookofsky, Understand-
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Secretariat Commentary on 1978
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Commentary (2008) ......................... Vogenauer, Stefan/Kleinheisterkamp, Jan, Commentary on the
UNIDROIT Principles of International Commercial Contracts
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LXXX
o:/Beck/978-3-406-71455-9/3d/A7 - Status of CISG.3d from 21.02.2018 11:11:36
3B2 9.1.580; Page size: 160.00mm 240.00mm
Status of the CISG1
State Signature Ratification, Acces- Entry into force

sion, Approval, Ac-
ceptance or Succession
Albania 13 May 2009 (b) 1 June 2010
Argentina (a) 19 July 1983 (b) 1 January 1988
Armenia (a) 2 December 2008 (b) 1 January 2010
Australia 17 March 1988 (b) 1 April 1989
Austria 11 April 1980 29 December 1987 1 January 1989
Azerbaijan 3 May 2016 (b) 1 June 2017
Bahrain 25 September 2013 (b) 1 October 2014
Belarus (a) 9 October 1989 (b) 1 November 1990
Belgium 31 October 1996 (b) 1 November 1997
Benin 29 July 2011 (b) 1 August 2012
Bosnia and Herzegovina 12 January 1994 (c) 6 March 1992
Brazil 4 March 2013 (b) 1 April 2014
Bulgaria 9 July 1990 (b) 1 August 1991
Burundi 4 September 1998 (b) 1 October 1999
Cameroon 11 October 2017 (b) 1 November 2018
Canada (d) 23 April 1991 (b) 1 May 1992
Chile (a) 11 April 1980 7 February 1990 1 March 1991
China (e) 30 September 1981 11 December 1986 (f) 1 January 1988
Colombia 10 July 2001 (b) 1 August 2002
Congo 11 June 2014 (b) 1 July 2015
Costa Rica 12 July 2017 (b) 1 August 2018
Croatia (g) 8 June 1998 (c) 8 October 1991
Cuba 2 November 1994 (b) 1 December 1995
Cyprus 7 March 2005 (b) 1 April 2006
Czech Republic (h), (i) 30 September 1993 (c) 1 January 1993
Denmark (j) 26 May 1981 14 February 1989 1 March 1990
Dominican Republic 7 June 2010 (b) 1 July 2011
1 As stated on the UNCITRAL website (http://www.uncitral.org/uncitral/en/uncitral_texts/sale_goods/
1980CISG_status.html) on 15 February 2018.
LXXXI
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Status of the CISG

sion, Approval, Ac-
Ecuador 27 January 1992 (b) 1 February 1993
Egypt 6 December 1982 (b) 1 January 1988
El Salvador 27 November 2006 (b) 1 December 2007
Estonia (k) 20 September 1993 (b) 1 October 1994
Fiji 26 May 1981 7 June 2017 1 July 2018
Finland (j) 15 December 1987 1 January 1989
France 27 August 1981 6 August 1982 (f) 1 January 1988
Gabon 15 December 2004 (b) 1 January 2006
Georgia 16 August 1994 (b) 1 September 1995
Germany (l), (m) 26 May 1981 21 December 1989 1 January 1991
Ghana 11 April 1980
Greece 12 January 1998 (b) 1 February 1999
Guinea 23 January 1991 (b) 1 February 1992
Guyana 25 September 2014 (b) 1 October 2015
Honduras 10 October 2002 (b) 1 November 2003
Hungary (a), (n) 11 April 1980 16 June 1983 1 January 1988
Iceland (j) 10 May 2001 (b) 1 June 2002
Iraq 5 March 1990 (b) 1 April 1991
Israel 22 January 2002 (b) 1 February 2003
Italy 30 September 1981 11 December 1986 1 January 1988
Japan 1 July 2008 (b) 1 August 2009
Kyrgyzstan 11 May 1999 (b) 1 June 2000
Latvia (a) 31 July 1997 (b) 1 August 1998
Lebanon 21 November 2008 (b) 1 December 2009
Lesotho 18 June 1981 18 June 1981 1 January 1988
Liberia 16 September 2005 (b) 1 October 2006
Lithuania (a) 18 January 1995 (b) 1 February 1996
Luxembourg 30 January 1997 (b) 1 February 1998
Madagascar 24 September 2014 (b) 1 October 2015
Mauritania 20 August 1999 (b) 1 September 2000
Mexico 29 December 1987 (b) 1 January 1989
LXXXII
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Status of the CISG

sion, Approval, Ac-
Mongolia 31 December 1997 (b) 1 January 1999
Montenegro 23 October 2006 (c) 3 June 2006
Netherlands 29 May 1981 13 December 1990 (o) 1 January 1992
New Zealand 22 September 1994 (b) 1 October 1995
Norway (j) 26 May 1981 20 July 1988 1 August 1989
Paraguay (a) 13 January 2006 (b) 1 February 2007
Peru 25 March 1999 (b) 1 April 2000
Poland 28 September 1981 19 May 1995 1 June 1996
Republic of Korea 17 February 2004 (b) 1 March 2005
Republic of Moldova 13 October 1994 (b) 1 November 1995
Romania 22 May 1991 (b) 1 June 1992
Russian Federation (a), 16 August 1990 (b) 1 September 1991

(p)
Saint Vincent and the 12 September 2000 (b) 1 October 2001

Grenadines (i)
San Marino 22 February 2012 (b) 1 March 2013
Serbia (q) 12 March 2001 (c) 27 April 1992
Singapore (i) 11 April 1980 16 February 1995 1 March 1996
Slovakia (h), (i) 28 May 1993 (c) 1 January 1993
Slovenia 7 January 1994 (c) 25 June 1991
Spain 24 July 1990 (b) 1 August 1991
State of Palestine 29 December 2017 (*) 1 January 2019
Sweden (j) 26 May 1981 15 December 1987 1 January 1989
Switzerland 21 February 1990 (b) 1 March 1991
Syrian Arab Republic 19 October 1982 (b) 1 January 1988
The former Yugoslav Re- 22 November 2006 (c) 17 November 1991

public of Macedonia
Turkey 7 July 2010 (b) 1 August 2011
Uganda 12 February 1992 (b) 1 March 1993
Ukraine (a) 3 January 1990 (b) 1 February 1991
United States of America 31 August 1981 11 December 1986 1 January 1988

(i)
Uruguay 25 January 1999 (b) 1 February 2000
LXXXIII
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Status of the CISG

sion, Approval, Ac-
Uzbekistan 27 November 1996 (b) 1 December 1997
Venezuela (Bolivarian 28 September 1981

Republic of)
Viet Nam (a) 18 December 2015 (b) 1 January 2017

Zambia 6 June 1986 (b) 1 January 1988
Parties: 89
(a) Declarations and reservations. This State declared, in accordance with articles 12 and 96 of the
Convention, that any provision of article 11, article 29 or Part II of the Convention that allowed a
contract of sale or its modification or termination by agreement or any offer, acceptance or other
indication of intention to be made in any form other than in writing, would not apply where any party
had his place of business in its territory.
(b) Accession.
(c) Succession.
(d) Declarations and reservations. Upon accession, Canada declared that, in accordance with article 93
of the Convention, the Convention would extend to Alberta, British Columbia, Manitoba, New Bruns-
wick, Newfoundland and Labrador, Nova Scotia, Ontario, Prince Edward Island and the Northwest
Territories. (Upon accession, Canada declared that, in accordance with article 95 of the Convention, with
respect to British Columbia, it will not be bound by article 1, paragraph (b), of the Convention. In a
notification received on 31 July 1992, Canada withdrew that declaration.) In a declaration received on
9 April 1992, Canada extended the application of the Convention to Quebec and Saskatchewan. In a
notification received on 29 June 1992, Canada extended the application of the Convention to the Yukon
Territory. In a notification received on 18 June 2003, Canada extended the application of the Convention
to the Territory of Nunavut.
(e) Declarations and reservations. Upon approving the Convention, the People’s Republic of China
declared that it did not consider itself bound by sub-paragraph (b) of paragraph (1) of article 1 and article
11, nor the provisions in the Convention relating to the content of article 11.
(f) Approval.
(g) Upon succeeding to the Convention, Croatia has decided, on the basis of the Constitutional
Decision on Sovereignty and Independence of the Republic of Croatia of 25 June 1991 and the Decision
of the Croatian Parliament of 8 October 1991, and by virtue of succession of the Socialist Federal
Republic of Yugoslavia in respect of the territory of Croatia, to be considered a party to the Convention
with effect from 8 October 1991, the date on which Croatia severed all constitutional and legal
connections with the Socialist Federal Republic of Yugoslavia and took over its international obligations.
(h) The former Czechoslovakia signed the Convention on 1 September 1981 and deposited an
instrument of ratification on 5 March 1990, with the Convention entering into force for the former
Czechoslovakia on 1 April 1991. On 28 May and 30 September 1993, respectively, Slovakia and the Czech
Republic, deposited instruments of succession, with effect from 1 January 1993, the date of succession of
both States.
(i) Declarations and reservations. This State declared that it would not be bound by paragraph 1 (b) of
article 1.
(j) Declarations and reservations. Upon ratifying the Convention, Denmark, Finland, Norway and
Sweden declared, in accordance with article 92, paragraph 1, that they would not be bound by Part II of
the Convention (“Formation of the Contract”). These declarations have since been withdrawn: in
Denmark with the effect from 1 February 2013; in Finland with the effect from 1 June 2012; in Norway
with the effect from 1 November 2014; and in Sweden with the effect from 1 December 2012.
Upon ratifying the Convention, Denmark, Finland, Norway and Sweden declared, pursuant to article
94, paragraph 1 and 94, paragraph 2, that the Convention would not apply to contracts of sale where the
parties have their places of business in Denmark, Finland, Iceland, Norway or Sweden. In a notification
effected on 12 March 2003, Iceland declared, pursuant to article 94, paragraph 1, that the Convention
would not apply to contracts of sale or to their formation where the parties had their places of business in
Denmark, Finland, Iceland, Norway or Sweden.
(k) Declarations and reservations. On 9 March 2004, Estonia withdrew the reservation made upon
ratification mentioned in footnote (a).
LXXXIV
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Status of the CISG

(l) The Convention was signed by the former German Democratic Republic on 13 August 1981 and
ratified on 23 February 1989 and entered into force on 1 March 1990.
(m) Declarations and reservations. Upon ratifying the Convention, Germany declared that it would not
apply article 1, paragraph 1 (b) in respect of any State that had made a declaration that that State would
not apply article 1, paragraph 1 (b).
(n) Declarations and reservations. Upon ratifying the Convention, Hungary declared that it considered
the General Conditions of Delivery of Goods between Organizations of the Member Countries of the
Council for Mutual Economic Assistance to be subject to the provisions of article 90 of the Convention.
(o) Acceptance.
(p) The Russian Federation continues, as from 24 December 1991, the membership of the former
Union of Soviet Socialist Republics (USSR) in the United Nations and maintains, as from that date, full
responsibility for all the rights and obligations of the USSR under the Charter of the United Nations and
multilateral treaties deposited with the Secretary-General.
(q) The former Yugoslavia signed and ratified the Convention on 11 April 1980 and 27 March 1985,
respectively. On 12 March 2001, the former Federal Republic of Yugoslavia declared the following:
“The Government of the Federal Republic of Yugoslavia, having considered [the Convention], succeeds
to the same and undertakes faithfully to perform and carry out the stipulations therein contained as from
April 27, 1992, the date upon which the Federal Republic of Yugoslavia assumed responsibility for its
international relations.”
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Introduction to the CISG

Outline
I. General Remarks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
II. Legislative History . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
1. The search for an international sales law: driving forces and objectives . . 3
2. From the UNIDROIT Initiative to the Hague Uniform Laws . . . . . . . . . . . . . 5
3. The drafting process and the adoption of the CISG . . . . . . . . . . . . . . . . . . . . . . . . 8
III. Content and Legal Nature. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
1. Legal nature of the CISG . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
2. Structure and content at a glance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
3. Main Principles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
IV. The CISG’s Global Reach and Grounds for Success . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
V. Impact on International and Regional Harmonization and National
Modernization. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
VI. Application in Practice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
1. The original scepticism . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
2. Increasing role in practice. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
3. Commodity Trade . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
VII. Advantages of the CISG . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
VIII. Working with the CISG . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
IX. Contract Drafting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
X. Electronic Commerce. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
I. General Remarks
The CISG, i. e. the United Nations Convention on Contracts for the International Sale of 1
Goods,1 – often also referred to as the Vienna Convention or the UN Sales Convention – is
rightly praised as “the most significant piece of substantive contract legislation in effect at
the international level”.2 More than thirty five years after its adoption at the diplomatic
conference in Vienna in 1980 and about thirty years after its entry into force on 1 January
1988, the CISG has become the primary law for international sales contract. Its more than
90 Contracting States3 comprise countries from all regions of the world with different
economic and political regimes and include representatives of all major legal systems.
These States, include most major industrial nations (e. g. Brazil, China, France, Germany,
Japan, and the U.S.), and amount to more than two thirds of the world’s population and
include nine of the ten leading industrial nations. As a consequence, the CISG is
potentially applicable for over 80 % of the world’s trade in goods. Still, there are important
countries that have not yet ratified the CISG, such as the UK and India.4
One of the reasons for the clear success of the CISG is that it enshrines a modern 2
understanding of the principal legal institutions of the contract of sale while achieving a
uniform regime that provides a common understanding to buyers and sellers around
the world. Traders from the United States to China, from Norway to Australia speak the
1
UN Document A/CONF.97/18 Annex 1.
2
Lookofsky, The 1980 United Nations Convention on Contracts for the International Sale of Goods, in:
Blanpain (ed.), International Encyclopaedia of Law (1993), p. 18.
3 As of 19 February 2018 the CISG had been ratified by 89 countries; an up-to-date list of the
Contracting States can be found on the website of UNCITRAL at. http://www.uncitral.org/uncitral/en/

uncitral_texts/sale_goods/1980CISG_status.html and also at http://www.cisg.law.pace.edu/cisg/countries/
cntries.html.
4 For an analysis of the position of the UK see Baasch Andersen, Of Cats and Cream – The UK and the
CISG, in: Schwenzer/Spagnolo, Growing the CISG (2016), p. 1 et seq.
Kröll/Mistelis/Perales Viscasillas 1
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Introduction CISG 3–5

same sales law language, use the same concepts and solve their conflicts according to the
same principles.5 This convergence and harmonisation inevitably help to reduce
transaction costs.6 At the same time the substantive provisions of the CISG are –
despite some opposing views and criticism7 – overall neutral between the sellers and
buyers and at least economically as efficient as the comparable national sales laws.8
II. Legislative History

1. The search for an international sales law: driving forces and
objectives
3 The CISG is the product of a long quest for the enhancement of cross-border
business and promotion of international trade; it is well understood that this can be
achieved by establishing a secure, fair and culturally-neutral international regime for
sales contracts. The increasing importance of international trade at the beginning of the
19th century, a direct consequence of industrialisation and the improvements and
celerity of means of transport as well as developments in communications, was the
driving force which finally led to the international movement towards the unification of
the substantive rules applicable to international trade. While commercial law was largely
harmonised until the end of the 18th century, the 19th century witnessed the “nationa-
lisation” or domestication of civil and commercial law, introducing a high level of
disunification of law. Commercial and trade realities brought the quest for harmonisa-
tion of law back on the agenda.
4 The existing conflict of laws approach was considered to be risky, uncertain and
insufficient to deal with the complex issues raised in international sale of goods
contracts. Indeed, apart from the deficiencies of this approach, most legal systems at
that time were obsolete, incomplete, fragmented and inadequate to govern international
transactions. The focus of these systems was on a pre-industrial economy, and adopted
a purely local perspective to trade. A new legal regime was urgently needed: a regime apt
to new emerging economic and commercial traffic based on the sale of complex
manufactured industrial goods that needed to be transported to distant places, that
resort also to satellite (ancillary) transactions, such as financing payment arrangements,
insurance, transport contracts and guarantees.
2. From the UNIDROIT Initiative to the Hague Uniform Laws

5 The movement towards the unification of the rules of law for international sale of
goods contracts began in 19309 when UNIDROIT undertook the initiative to unify the
5 Schlechtriem, 25 Years of the CISG: An International lingua franca for Drafting Uniform Laws, Legal
Principles, Domestic Legislation and Transnational Contracts, in: Flechtner/Brand/Walter, Drafting

Contracts (2007), p. 167 (168).
6 See Spagnolo, CISG Exclusion and Legal Efficiency (2014), pp. 29 et seq., providing a detailed account
of the original economic objectives of the drafters; critical Cuniberti, Is the CISG Benefiting Anybody? 39
Vanderbilt Journal of Transnational Law, 2006, 1511, 1519 et seq.; Gillette/Scott, The Political Economy of
International Sales, 25 International Revue Law & Economics, 2005, 446 et seq.
7 Gillette/Walt, Sales Law (2016), pp. 5 et seq.
8 Spagnolo, CISG Exclusion and Legal Efficiency (2014), pp. 47 et seq.
9 Before that date several regional unification efforts were made: The 1905 Uniform Laws on the
International Sale of Goods for the Nordic countries and the Projet de Code des Obligations et des
Contrats drafted by a group of French and Italian lawyers under the chairmanship of Prof. Vittorio
Sciajola and with the idea of creating a new European ius commune. This was, however, rejected by the
French and Italian governments. See Bonell, The Unidroit Initiative for the Progressive Codification of
International Trade Law, 27 International and Comparative Law Quarterly (1978) 413 (413 et seq.).
2 Kröll/Mistelis/Perales Viscasillas
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6–7 Introduction CISG

substantive rules for the contract of sale. Although initially the Committee entrusted
with this task dealt with all the aspects of the contract of sale, in 1934 it was decided to
separate the rules on formation from the rules on performance of contract.10 In 1964,
after several drafting projects11 and several years of interruption due to World War II,
representatives of 28 States met at The Hague during three intensive working weeks
with the task of approving two Conventions. On 1 July 1964 two texts were approved:
The Convention relating to a Uniform Law on the International Sale of Goods with an
Annex: The Uniform Law on the International Sale of Goods (ULIS), and the Conven-
tion relating to a Uniform Law on the Formation of Contracts for the International Sale
of Goods, also with an Annex: The Uniform Law on the Formation of Contracts for the
International Sale of Goods (ULF)12 (collectively referred to as “Uniform Laws”).
The ULIS entered into force on 18 August 1972, while the ULF came into force five days 6
later. However, they did not succeed universally for several reasons. First, only a small
number of States were represented at the diplomatic conference: 22 out of the 28 States
represented were Western European and highly developed countries; only three developing
countries and three countries from Eastern Europe attended. Second, as a consequence of
the low participation, the rules adopted were more closely related to trade among countries
with similar attitudes towards international commerce; a situation that raised much
criticism against the Uniform Laws13. Third, only a very small number of States ratified
both Conventions: nine in total14. Fourth, there was much criticism in the “hectic” way in
which the Conventions and the Uniform Laws were adopted, not only in terms of speed15,
but also because of pressure asserted by the representatives of the continental (civil) legal
systems, who represented the majority in the Drafting Committee16. As a result, much of
the criticism derived from the unclear and abstract drafting of the rules.
It is therefore no surprise that developing countries rejected the texts of the Uniform 7
Laws since they were adopted without their participation (most developing countries
10 The Committee explained the separation due to the importance of the rules on performance of the
contract. However, the true reason was that the Committee was incapable of reaching a consensus on the
precise moment of the conclusion of the contract to which the Draft Project referred to in several
occasions. See A/CN.9/128, Annex II, UNCITRAL YB VIII (1977), pp. 103–104.
11 In 1936 a draft was published on the formation of contract (Loi uniforme sur la formation des
contrats internationaux par correspondance) and there was also a project on the performance of contract
drafted on the basis of the work done by the German jurist Ernst Rabel (Rabel, Das Recht des
Warenkaufs, Vol. I (1936) and Vol. II (1958)). The so-called Rabel’s Draft was distributed among the
members of the League of Nations and after observations were made, a Draft was prepared in 1939. After
World War II, the work was resumed and these projects were replaced by a 1957 Draft Uniform Law on
the International Sale of Goods, and 1959 Draft Uniform Law on Formation, followed by a 1963 Project.
12 Available at http://www.unidroit.org/english/conventions/c-main.htm. There are several important
publications on The Hague Conventions and Uniform Laws. See: Kahn, La Convention de La Haye du 1er
juillet 1964 portant loi uniforme sur la vente internationale des objets mobiliers corporels, 17 Revue
Trimestrielle du Droit Commercial (1964) 689 (689 et seq.); Dölle (ed.), Kommentar zum Einheitlichen
Kaufrecht (1976); and Mertens/Rehbinder, Internationales Kaufrecht (1975).
13 Ndulo, The Vienna Sales Convention 1980 and the Hague Uniform Laws on International Sale of
Goods 1964: a comparative analysis, 38 International and Comparative Law Quarterly (1989) 1 (4 et seq.).
See A/CN.9/17, International Sale of Goods. The Hague Conventions of 1964. Analysis of the replies and
studies received from Governments: report of the Secretary-General, where several criticisms were made
by several States.
14 Belgium, Gambia, Germany, Israel, Italy, Luxembourg, Netherlands, San Marino and the United
Kingdom. The status is available at http://www.unidroit.org/english/implement/i-main.htm.

15 Honnold, The Uniform Law for the International Sale of Goods: the Hague Convention of 1964, 30
Law and Contemporary Problems 326 (326 et seq.).

16 The controversy between Prof. Nadelmann and Prof. Tunc is very illustrative. See: Nadelmann, The
Uniform Law on the International Sale of Goods: A Conflict of Laws Imbroglio, 74 Yale Law Journal
1964–65) 446 (446 et seq.); and Tunc, The Uniform Law on the International Sale of Goods: A reply to
Professor Nadelmann, 74 Yale Law Journal 1409 (1409 et seq.).
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Introduction CISG 8
were emerging at the same time as the result of a slow decolonisation process) and did
not reflect their interests in international trade. Moreover, one has to reflect on the
refusal to ratify by the common law countries, which were based on different grounds:
i. e. U.S. did not participate in the drafting and negotiation process, and, at the end of
the Conference, Great Britain succeeded in introducing a reservation to the Uniform
Law – the so-called British Reservation (Art. V) – by which the field of application was
severely restricted by virtue of an express opting in requirement17. Despite these
criticisms, the Uniform Laws ought to be considered important steps towards the
unification of the law relating to the international sale of goods. Although the attempts
were clearly insufficient, they were the first stone on which the CISG was based and as
such the CISG has successfully replaced the Uniform Laws (Art. 99(3) CISG)18.
3. The drafting process and the adoption of the CISG

8 In light of the limited “success” of the 1964 Hague Conventions, the Hungarian
representative before the United Nations asked the United Nations for the adoption of
the necessary measures to promote the harmonization and unification of international
trade law. A research document prepared by Prof. Schmitthoff between 1964 and 1966
was the basis for the Report of the Secretary General19 and the subsequent establishment
of the United Nations Commission on International Trade Law (UNCITRAL) on
17 December 1966 by Resolution 2205 (XXI) of the General Assembly. UNCITRAL
began its work in January 196820. During its first period of sessions, UNCITRAL
decided to focus its work on the study of three subjects: the international sale of goods,
payments and arbitration. Consequently, UNCITRAL had to decide whether to “adopt”
the 1964 Uniform Laws or to formulate a new text that would gain the necessary
international consensus. Due to the technical difficulties in approaching this task,
UNCITRAL began its work on the limitation period in the international sale of goods
and finally approved a Convention in 1974 that was later amended to encompass the
1980 Vienna Convention. At the same time, UNCITRAL sent the 1964 Uniform Laws
coupled with comments made by Prof. Tunc21 to the Member States and UN observers
to receive their comments. During UNCITRAL’s second session, the responses were
analysed and a conclusion to reject the Uniform Laws was reached22. A Working Group
was formed under the chairmanship of Prof. Barrera Graf of Mexico and composed of
members from 15 countries with the task of effecting the necessary amendments to the
17 Article V of The 1964 Convention on the International Sale of Goods: “Any State may, at the time of
the deposit of its instrument of ratification of or accession to the present Convention declare, by a
notification addressed to the Government of the Netherlands, that it will apply the Uniform Law only to
contracts in which the parties thereto have, by virtue of Article 4 of the Uniform Law, chosen that Law as
the law of the contract”. Belgium, Gambia and UK made an Art. V reservation.
18 The Hague Conventions are still in force in Gambia, Israel, San Marino and UK. Note that UK and
Gambia made an Art. V reservation.

19 A/6396 – Report to the Secretary General (“The Schmitthoff Study”) (available at: http://www.unci-
tral.org).
20 Presently sixty member States have been elected by the General Assembly. Membership is structured
so as to be representative of the world’s various geographic regions and its principal economic and legal
systems. Members of the Commission are elected for terms of six years, the terms of half the members
expiring every three years. For the text of Resolution 2205 (XXI) and more information about
UNCITRAL see http://www.uncitral.org.
21 Tunc, Commentary of the Hague Conventions of 1 July 1964 on the International Sale of Goods and
on the Formation of Contracts of Sale, Ministerie Van Justitie, Den Haag-Nederland, available at the Pace
database at http://www.cisg.law.pace.edu/cisg/biblio/tunc.html.
22 A/CN.9/31 – Analysis of replies and comments by governments on the Hague Conventions of 1964
1st session, 5–16 January 1970, New York.
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Uniform Laws, taking into account the interests of countries with different legal, social
and economic systems23. Initially UNCITRAL decided to work separately on the issues
of formation of contract and the rights and obligations of the parties. In January 1976
the work done on the ULIS was finalized, adopting the form of a Draft Convention that
was adopted in the 10th UNCITRAL session24. Similarly, in 1977, the work on the ULF
was also discussed and approved in the form of a Draft Convention on Formation in
197825. It was then unanimously decided by the Commission to combine the two Drafts
in a single Draft Convention and to circulate it among the Member States and
observers.
The General Assembly of the UN called a Diplomatic Conference to work on the 9
1978 Draft Convention26 that was held between 10 March and 11 April 1980 in Vienna
with the participation of 62 States, plus one State observer and eight international
organizations. Prof. Gyula Eörsi (Hungary) was elected President and at that time Prof.
Willem C. Vis was the Secretary of UNCITRAL. The Convention was adopted by the
Conference on 10 April by 42 votes in favour and 9 abstentions, and opened for its
accession on 11 April 1980. The Convention entered into force on 1 January 198827.
III. Content and Legal Nature

1. Legal nature of the CISG
The Vienna Convention contains substantive rules on two of the most important 10
questions in international sales transactions. Part II regulates the formation of the
contract of sale by matching acceptance and performance. Part III contains rules on the
rights and obligations of sellers and buyers arising from the international sale of goods
contract, as well as the remedies that parties to a contract of sale have in response to the
breach of its counterparty (Part III). Furthermore, Part I of the CISG is devoted to the
field of application as well as to the general provisions applicable to the Vienna text,
while Part IV is devoted to the final provisions mainly related with possible reservations
to the Convention.
The CISG is a substantive law treaty and as such it is not a conflict of laws 11
instrument.28 Beyond defining its own scope and sphere of application, the Convention
does not deal with conflict of laws,29 i. e. rules that decide the applicable law when there
are several converging in a transaction. The Vienna Convention is a uniform law
23 See: A/7618 – Report of the United Nations Commission on International Trade Law on the work of
its second session. The member States of the Working Group were: Brazil, France, Ghana, Hungary,
India, Iran, Japan, Kenya, Mexico, Norway, UK, Tunisia, former USSR and USA.
24 A/32/17 – Report of the United Nations Commission on International Trade Law on the work of its
tenth session, 10th Session, 23 May – 17 June 1977, Vienna at 13 et seq. See also: A/CN.9/128/Annex I –
Draft convention on the formation of contracts for the international sale of goods as approved or deferred
for further consideration by the Working Group on the International Sale of Goods at its eighth session,
10th Session, 23 May – 17 June 1977, Vienna.
25 A/CN.9/143 – Draft Convention on the formation of contracts for the international sale of goods;
and A/CN.9/144 – Commentary on the draft convention on the formation of contracts for the
international sale of goods, 11th Session, 30 May – 16 June 1978, New York.
26 Resolution 33/93, in A/CONF.97/1, at A/CONF.97/19, p. XV. The Conference was held in Vienna at
the Kongresszentrum Hofburg.

27 Art. 99 CISG. On 11 December 1986, China, Italy and USA ratified the Convention so the number of
Member States of the CISG increased to 11, and as such the number of countries needed for entry into
force was satisfied.
28 For the relevance of choice of laws questions within the CISG, see Bridge, Choice of Law and the
CISG: Opting In and Opting Out, in: Flechtner/Brand/Walter, Drafting Contracts (2007), pp. 65–100.
29 But see Art. 10 which is conflict of laws provision. Art. 1 is a unilateral conflict of laws provision.
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instrument that supersedes the choice of law analysis.30 The importance of the Conven-
tion is seen in the simple fact that it provides to operators (parties, lawyers, judges and
arbitrators) from Mexico, Germany, US, Japan, etc., the same substantive regime to be
applied to the contract of sale: the same uniform language,31 methodology and a
common understanding to the basic issues of the international sale of goods contract.
12 Despite the international origin and features of the Convention, once it is ratified by a
State32, it is fully incorporated within the national legal system displacing the domestic
regime otherwise applicable, whether this would be a single regime or a double regime
depending upon the civil or commercial character of the transaction. The CISG does
not contribute to the battle between codes – typical of legal regimes with a double
regulation for a contract of sale – reflecting the neutral choice of the drafters (Art. 1(3)).
As such, the national distinction between civil and commercial transactions is of no
importance to the CISG when deciding its scope of application. Only in instances where
the domestic law needs to be considered, i. e., when there is a matter excluded from the
CISG or a gap that cannot be filled within the system of the Convention (Art. 7(2)),
does the distinction matter. Having said this, it has to be recognized that, in light of
Art. 2(a), most international sale of goods contracts governed by the CISG are con-
sidered to be commercial contracts within the dualistic legal domestic systems. Thus,
the CISG is in line with the trend observed in other uniform international commercial
instruments that exclude from their scope of application consumer transactions.
2. Structure and content at a glance
13 The CISG is composed of 101 articles, divided up into four Parts. Its substantive
provisions are primarily contained in Part II (Formation of the Contract) and Part III
(Sale of Goods).
14 Part I (Articles 1–13) deals with General Rules of the Convention. In particular, Arts
1–5 concern the scope of application of the CISG, they explain the definition of sales
and the exclusion of certain sales. Arts 6 and 9 explain the hierarchy of sources, i. e.
contract, customary rules and the rules of the Convention. Art. 7 provides a guide to the
interpretation of the CISG as well as a method for filling gaps in the CISG, while Art. 8
provides standards for the interpretation of the contract and conduct of the parties.
Art. 11 deals with form requirements introducing a low threshold.
15 Part II (Articles 14–24) addresses Formation of Contract and has specific provisions
relating to offer, revocation, acceptance and withdrawal as well as to the time when an
offer, acceptance of other indication of intent reaches its addressee.
16 Part III (Articles 25–88) is the longest part of the CISG and covers the performance
of a contract for the sale of goods and focuses on the obligations of the buyer and the
seller for proper fulfilment of the contract and the remedies in case of breach. It is
organised in five chapters: Chapter I covers general provisions and most importantly
fundamental breach (Art. 25), notices and communications (Arts 26–27), specific
performance (Art. 28) and contract modification (Art. 29). Chapter II addresses the
obligations of the seller (delivery of goods, handling of documents, conformity of goods
and third party claims) and remedies for breach of contract by the seller. Chapter III
30 For the prevalence of the CISG, see Tribunale di Vigevano (Italy) 12 July 2000 (sheets of vulcanized
rubber used in manufacture of shoe soles), CISG-Online 493 (Pace).

31 In the words of John Honnold: “Words are mushy, ambiguous things,” but they are all we lawyers
have to work with. Expecting them to function equally on a global scale is utopian. Honnold, The 1980
Sales Convention – Can Uniform Words Give Us Uniform Results?, 2 Juridisk Tidsskrift (1990–91) 3–14.
32 From a public international law perspective, the means for a State to effect the application of the
CISG are ratification, accession, approval, acceptance or succession. The method most commonly used
for the CISG is ratification.
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focuses on obligations of the buyer (payment of price, taking delivery) and remedies for
breach of contract by the buyer. Chapter IV covers passing of risk and Chapter V
contains provisions common to the obligations of the seller and the buyer (instalment
contracts, anticipatory breach, damages, interest, exemption from paying damages,
effects of avoidance of contract and preservation of the goods).
Finally, Part IV (Articles 89–101) covers the Final Provisions concerning rules of 17
ratification and entry into force, and the reservations.
3. Main Principles
The CISG contains a number of fundamental principles,33 mostly enshrined in Part 18
I. The main principle of the Convention is party autonomy and freedom of contract, as
manifested in Art. 6 and Art. 9. The Convention also has an “internal mechanism” for
its interpretation (Art. 7): it requires that when issues of interpretation of its provisions
arise, “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.” In
the event of gap-filling, and where matters are not expressly covered by the CISG, one
should settle such matters primarily “in conformity with the general principles on
which [the CISG] is based”; if such principles cannot be found then one will have to
resort the “law applicable by virtue of the rules of private international law.”
Furthermore, the CISG clearly expresses the need to respect customs and practices 19
established between the parties or established in a particular industry or region (Art. 9).
The Convention has also a mechanism for the interpretation of statements made by the
parties or the conduct of the parties (Art. 8). A subjective interpretation (for which the
subjective intent of the party in question is primarily relevant) is to be followed, unless
such intent is not known (Art. 8(1)). In that case the objective meaning of the declaration
or conduct will be relevant, i.e. how a reasonable party in the position of the other party
would have understood it. In either case, consideration should also be given to the
circumstances of the case, the negotiations and any practices established between the
parties as well as usages and their subsequent conduct (Art. 8(3)).
The Convention relies significantly on the principle of sanctity of contracts: parties 20
should not try to terminate or avoid the contract but every effort should be made to save
the contract and perform it as far as possible. Avoidance is an exceptional and drastic
remedy and only to be used in rare and exceptional circumstances. In this respect, the
CISG expects that the contracting parties continue to communicate, avoid surprises and
to the extent possible provide adequate notice of actions they intend to take. The
importance of “notice” in particular can be demonstrated by its 25 references in the
Convention (e. g., Arts 19, 20, 21, 26, 32, 39, 40, 43, 44, 46, 47, 48, 49, 67, 71, 72, 79, 88).
There are also no less than 47 references of the word “reasonable”34 in the CISG 21
(reasonable time, reasonable person and/or reasonable notice).35 It seems that the term
reasonableness in the CISG the same function as it has in common law jurisdictions, i. e.
a standard of assessment akin to the civil law equivalent of good faith.
33Kritzer refers to general principles in http://www.cisg.law.pace.edu/cisg/text/principles7.html.

34For a critique on the excessive reliance on the word “reasonable”, possibly an expression of compromise
in cases of cultural clashes see Schlechtriem, From the Hague to Vienna: Progress in Unification of the Law of
International Sales Contracts?, in: Horn/Schmitthoff (eds), The Transnational Law of International Com-
mercial Transactions: Studies in Transnational Economic Law, vol. 2 (1982), pp. 125–135; Gillette/Scott, The
Political Economy of International Sales, 25 International Revue Law & Economics, 2005, 446, 473 et seq.
35 See Weiszberg, Le “Raisonnable” en Droit du Commerce International, French thesis of 2003. See also
DiMatteo, The Counterpoise of Contract: The Reasonable Person Standard and the Subjectivity of Judgment,
48 South Carolina Law Review (1997) 293–355.
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IV. The CISG’s Global Reach and Grounds for Success

22 At the legislative/state level the CISG has undoubtedly been a success story beyond
imagination. The most obvious proof of its wide-spread use and global acceptance is the
number of its Contracting States, coming from all legal families, including the world’s
biggest trading nations as well as developing countries (see supra section I). Addition-
ally, the CISG has strongly influenced other legislative initiatives at the international,
regional and national level. Beyond doubt, the CISG has gained far more international
consensus than its predecessors, i. e. the ULIS and ULF. Over twice as many
states participated in the CISG’s drafting process than in the 1964 Conventions,36 and
it has been translated into the local language of a wide range of Contracting States. In
other words, the Vienna Convention has succeeded where the Hague Uniform Laws
failed; namely, it moved away from Euro-centrism, lack of participation of developed
countries and the low number of ratifying States.
23 There are several reasons for this considerable success. The Vienna Convention has
found a common ground for the different interests of the various players involved and
achieved the difficult task of appealing to, through a uniform law, countries with strong
and at first sight irreconcilable political, economic, social and legal structures. The most
important barrier to the unification of trade law was the legal-technical differences
among countries, particularly in those instances in which the conflict between common
law and civil law was impossible to overcome due to different traditions, diversity of
methodology and legal thinking. The solution was by no means found by legal
imperialism or legal transplant, but rather by a patient and systematic dialogue, the
spirit of compromise, the focus on transactions and the fine balance, achieved between
seller’s and buyer’s respective rights and obligations37. Due to the long period of
gestation and the experiences with the Uniform Laws, the drafters of the CISG had
sufficient time to fine tune the Convention’s provisions, taking into account not only
the extensive comparative analysis of domestic sales laws, but also the critical comments
of academics and practitioners.38
24 The Convention achieves in most of its solutions a good equilibrium among several
principles that inspire the legal systems around the world. By no means is the CISG a
patchwork of different legal systems adopting rules that are more convenient, a
common solution adopted by the legal systems, or a solution adopted by the majority.
On the contrary, the CISG is built on the basis of facilitating international trade, under
the influence of commercial practice, its own interpretative rules and principles, and an
36 Out of the total number of 62 States, 22 were developed countries, 11 socialist, 11 South American, 7
from Africa, and 11 from Asia: Eörsi, A Propos the Vienna Convention on Contracts for the International
Sale of Goods, 27 American Journal of Comparative Law (1983) 335 (note 5). Statistics show that during the
Hague Conference the distribution of participating countries was: developed (78.6 %), third world (10.7 %),
while during the Diplomatic Conference in 1980 participation was: developed (35.5 %) and third world
(46.8 %). See Brussel, The 1980 United Nations Convention on Contracts for the International Sale of
Goods: a legislative study of the North-South debates, 6 New York International Law Review (1993) 53 (61).
37 Olivencia, La Convención de las Naciones Unidas sobre los contratos de compraventa internacional
de mercaderı́as: Antecedentes históricos y estado actual, 201 Revista de Derecho Mercantil 377 (394). For
more information on the legal compromises, see Garro, Reconciliation of Legal Traditions in the UN
Convention on Contracts for the International Sale of Goods, 23 International Lawyer (1989) 443–483
(Pace).
38 Schlechtriem, in: Flechtner/Brand/Walter, Drafting Contracts (2007), p. 167 (169); insofar the
criticism by Gillette/Roberts, The Political Economy of International Sales Law, Working Paper No. 05-
02 New York University Law and Economics Research Paper Series (April 2005) (Pace) that commercial
interests were not sufficiently taken account of does not appear justified.
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authentic spirit of compromise. The reason for the success of the Convention is that it
was able to produce acceptable results for all legal systems and interests confronted.
In the view of most legislators these benefits outweigh the necessary downsides of 25
such an approach. In order to reach this common ground, it is sometimes unavoidable
to compromise in relation to the simplicity and clarity of the rules.39
Beyond the mere number of Contracting States the importance and the success of the 26
CISG can also be measured by several other factors. First, it has successfully achieved the
unification of the legal regime of the contract which is the centrepiece of international trade
as well as the most important contract in domestic legal systems. Second, it has overcome the
psychological barriers of lawyers and traders to adapt their way of reasoning and commercial
behaviour to a new international text. Third, the supremacy of the legal approach and
methodology adopted by the CISG has also lead to a new approach of the law rotating
around uniformity, internationality and globalization of international trade law. Judicial and
arbitral application of the Convention are also worth considering since a global application is
a growing tendency. This can be attributed to the awareness of the need for a uniform and
international application of the CISG and the widespread use of the electronic resources on
the CISG40. At the same time, abundant and increasingly global legal literature on the CISG
contributes to the uniform understanding of CISG notions, concepts and principles.
In this regard, the Convention is considered an international lingua franca41 to the 27
point that the Convention extends its influence well beyond the international sale of
goods contract.
V. Impact on International and Regional Harmonization and

National Modernization42
There is a large international consensus about the value of the Vienna Convention 28
rules and principles.43 The CISG is one of the preferred instruments used in the
modernization of contract law, whether domestic, regional or international. This
evidences the general character of the rules of the Convention – general rules of the
law of contract, and even to the law of obligations – apt to be applied to any kind of
39 That has, however, led to considerable criticism from authors adopting a primarily economical
approach to the default rules contained in the CISG, which in their view are inferior to rules in the
domestic sales; see Gillette/Scott, The Political Economy of International Sales Law, 25 International
Review of Law and Economics (2005) 446 (448 et seq.) (Pace).
40 CLOUT and Digest (www.uncitral.org), UNILEX (www.unilex.info), Pace Database (www.cisg-
law.pace.edu), and CISG-Online (cisg-online.ch), as well as other regional or national databases are
excellent sources to the CISG and related instruments.
41 See Schlechtriem, in: Flechtner/Brand/Walter, Drafting Contracts (2007), pp. 167 et seq. In case law
see: Arbitral Award (CIETAC) 11 February 2000 (Silicon Metal) CISG-Online 1529 (Pace), considering
the CISG as a “set of uniform rules which takes different legal systems into account; hence, it is more
understandable for merchants from different jurisdictions in international trade. Moreover, compared
with the national laws of some States, CISG equally reflects the interests of seller and buyer”; and
Audiencia Provincial of Barcelona (Spain) 3 July 2007 (Parts and machinery) CISG-Online 1767 (Pace):
“CISG’s principles correspond to the sense of justice universally accepted”.
42 For a more detailed discussion see the various contributions in Ferrari (ed.), The CISG and its
Impact on National Legal Systems (2008) with country reports from 23 countries and two general reports;
Lookofsky/Andersen (eds), The CISG Convention and Domestic Contract Law – Harmony, Cross-
Inspiration or Discord? (2014).
43 For a critical assessment see Bailey, Facing the Truth: Seeing the Convention on Contracts for the
International Sale of Goods as an Obstacle to a Uniform Law of International Sales, Cornell International
Law Journal (1999) 273–317 (Pace); see also below for the criticism concerning the suitability of the CISG
for commodity trade.
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contracts, including consumer contracts44. The close relationship between the CISG and
regional and international instruments justifies the inclusion of a section in this
commentary dealing with a comparison of the CISG and those instruments as well as
domestic legal regimes when pertinent.
29 At the national level, the CISG was a clear model in the Reform of the Law of
Obligations in Germany, and in the modernization of other domestic legal systems,
such as the Dutch Civil Code (1992), Russian Civil Code (1994), Chinese Civil Code
(2002) and the Estonian Law of Obligations (2002).
30 Regionally, it is possible to refer to the Uniform Laws in the framework of OHADA45,
and the Principles of European Contract Law (PECL)46. PECL was drafted as the
foundation stone towards the building of a European Civil Code on the Law of
Contracts and Obligations47. Since 1997, the Study Group of a European Civil Code,
has been drafting the different chapters that presumably would be integrated under this
prospective “Civil Code”. In 2003, the European Commission published a so-called
“Action Plan”48 that consists of several measures within the Common Frame of
Reference, the CFR. In order to prepare this CFR, a Joint Network on European Private
Law was set up in 2005 including several institutions and research groups, and primarily
the Study Group. A Draft Common Frame of Reference (DCFR) was published in
January 200949. This predominately academic DCFR was intended to serve as a model
to prepare the CFR50. Also, the draft regulation for an optional Common European
Sales Law,51 which was in the end not pursued, drew heavily on the CISG in the areas
where they overlapped.52
44 See, EC Directive 1999/44, 25 May 1999 on certain aspects of the sale of consumer goods and
associated guarantees. O. J. 1999 L 171/12. Also the influence of CISG is seen in EC Directive 2000/35 on
Late Payment. Perales Viscasillas, Late Payment Directive 2000/35 and the CISG, FS Farnsworth (2007),
Pace International Law Review (2007) 125 (128 et seq.). The same influence is seen in EC Directive 2011/
7, 16 February 2011 which replaces EC Directive 2000/3 on Late Payment.
45 OHADA, the French acronym for “Organisation pour l’Harmonisation du Droit des Affaires en
Afrique” translated in English as the “Organization for the Harmonisation of Business Law in Africa” is
an organisation created on 17 October 1993 in Port Louis (Mauritius). The OHADA Treaty is made up
today of 16 African states. See: http://www.ohada.com. See Book V (Commercial Sale) of The Uniform
Act relating to General Commercial Law (1998).
46 Drafted by the Commission on European Contract Law (or the “Lando Commission” after his
president Prof. Ole Lando) and published by Ole Lando and Hugh Beale (eds), Principles of European
Contract Law, Parts I and II (2000). Part I and Part II were published in 1999 and deal with formation of
contract, validity, performance, non-performance and remedies. Part III, published in 2002, deals with
assignment, assumption of debts, set off, prescriptions and conditions. The European Principles are
similar to the Restatements and have closely followed both the CISG and the UNIDROIT Principles on
International Commercial Contracts. It covers civil and commercial contracts within the EU. See: http://
frontpage.cbs.dk/law/commission_on_european_contract_law/index.html.
47 The establishment of the Commission on Contract Law entrusted to the drafting of the Principles is
due to several resolutions of the European Parliament. See: O. J. 1989 C 158/400 (Resolution A2–157/89);
O. J. 1994 C 205/518 (Resolution A3–0329/94); and COM (2001) 398, Resolution of the European
Parliament on the approximation of Civil Law and Commercial Law of the Member States. See also:
Communication on Contract Law (2001/C 255/01), O. J. 13. 9. 2001, at 1.
48 Action Plan on a more coherent European Contract Law (2003/C 63/01), O. J. 2003 C 63/1
(hereinafter Action Plan); Further, European Contract Law and the Revision of the Acquis: The Way
Forward (COM (2004) 651 Final) of 11 October 2004 (hereinafter ‘The Way Forward’).
49 Principles, definitions and Model Rules of European Private Law. Draft Common Frame of
Reference (DCFR). Prepared by the Study Group on a European Civil Code and the Research Group on
EC Private Law (Acquis Group). Edited by Christian von Bar, Eric Clive and Hans Schulte-Nölke, Sellier
(2009), available also at http://www.law-net.eu.
50 Introduction DCFR (January 2009).
51 See the draft Regulation of 11.10.2011, COM(2011) 635.
52 Lando, CESL or CISG? Should the proposed EU Regulation on a Common European Sales Law
(CESL) replace the United Nations Convention on International Sales (CISG)?, in: Remien/Herler/
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Finally, internationally the CISG has been the inspiration to other UNCITRAL53 and 31
UNIDROIT instruments, particularly influencing one of the most important soft law
instruments in the area of international commercial contracts: The UNIDROIT Princi-
ples of International Commercial Contracts (PICC)54.
Undoubtedly both the PICC and PECL were drafted with the CISG in mind and 32
there is a close resemblance among them.55 Particularly, the PICC goes further than the
CISG as it is more detailed and tries to develop several CISG provisions as well as to fill
its gaps. The role that the PICC and PECL might develop in relation with the
Convention depends on the circumstances of each particular transaction and the body
entrusted with the judgement of the case. The PICC, contrary to the PECL, states
expressly in its Preamble that it “may be used to interpret or supplement international
uniform law instruments”, which undoubtedly includes the CISG. The Comments
justify this position on the basis of the principles of internationality and uniformity in
the interpretation and application of uniform law56; principles that are rooted in the
CISG (Art. 7(1)). The PECL is less explicit in this regard although it is foreseen that it
will play a role as a gap-filler for the applicable law.
As most of these regional projects or modernizations at the national level are not 33
limited to sales contracts, the CISG has a considerable harmonizing effect going far
beyond its actual scope of application.57
The value of the substantive rules of the Convention has also increasingly been 34
recognized by courts and arbitral tribunals around the world. Some of them have taken
advantage of the CISG’s fundamental rules and principles as an aid to confirm general
principles of a national domestic system, to confirm a trend in domestic judicial
interpretation, or, more importantly, as a tool of interpretation and supplementation
of the various kinds of domestic contracts, not limited to commercial contracts58 and
not limited to courts in Contracting States.59 In this respect, the CISG has served as an
important instrument for the development of national legal systems.
The Vienna Convention has also served to develop certain domestic institutions 35
under the umbrella of the CISG. For example, the influence of the good faith principle
in the CISG is evident in the developments of case law in certain common law
Limmer (eds), Gemeinsames Europäisches Kaufrecht für die EU (2012), p. 15. See also Magnus, CISG and
CESL (September 1, 2012). Liber Amicorum Ole Lando, pp. 225–255, Bonell, Holle and Nielsen, eds.,
Djøf Forlag, 2012; Max Planck Private Law Research Paper No. 12/27. Available at SSRN: https://
ssrn.com/abstract=2165758.
53 See for example Art. 11 of the 2005 UN Convention on the use of Electronic Communications in
International Contracts, which is a “translation” of Art. 14 CISG to encompass electronic means.

54 First edition (1994), second edition (2004), third edition (2010), fourth edition on long-term
contracts (2016). For more information, see http://wwww.unidroit.org.

55 For list of the provisions of the CISG influencing PICC and PECL, see: Flechtner, The CISG’s impact
on international unification efforts: The UNIDROIT Principles of International Commercial Contracts

and the Principles of European Contract Law. The 1980 Uniform Sales Law. Old Issues Revisited in the
Light of Recent Experiences. Verona Conference (2003) 176 (176 et seq.).
56 See Comment 5 to the Preamble.
57 Further: Perales Viscasillas, The Role of the UNIDROIT Principles and the PECL in the interpreta-
tion and Gap-Filling of CISG, in: Janssen/Meyer (eds), CISG Methodology (2009), pp. 287–317. In case
law, recently filling-gaps (hardship) within the CISG: Court of Cassation (Belgium) 19 June 2009 (Steel
tubes) CISG-Online 1963 (Pace).
58 For example, Tribunal Supremo (Spain) 20 July 2006, CISG-Online 1801 (Pace), in a domestic
contract considering that Art. 25 CISG fills the gap of Art. 1124 Spanish Civil Code. Doctrine followed by
many appellate courts, among the latest: Audiencia Provincial de Madrid (Spain) 8 April 2008, CISG-
Online 2083 (Aranzadi/Westlaw No. 189 148).
59 See the two decisions by the English Court of Appeal, using the CISG as a yardstick for good
commercial contract law interpretation, in ProForce Recruit Ltd v. Rugby Group Ltd, 17 February 2006
(Pace) and in The Square Mile Partnership Ltd. v. Fitzmaurice McCall Ltd., 18 December 2006 (Pace).
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jurisdictions, such as Australia and New Zealand. There, courts have used that principle
as an important tool in relation to domestic contracts.60
36 Finally, international model contract clauses offered by different international orga-
nizations have received a source of inspiration from the CISG, for example by stipulat-
ing the CISG as the governing law of the contract.61
37 The increasingly global importance of the Convention and thus sensibility of the
Contracting States towards its international and uniform character are also demon-
strated by the process of erosion of the non-unified provisions within the CISG, mainly
the reservation provisions (Arts 92, 95, 96). Norway, Finland, Denmark and Sweden
withdrew from their Art. 92 reservation which was included in the Convention due to
pressure asserted by these countries as they were not satisfied with some aspects of Part
II (Formation of the Contract).62 Arts 95 and 96 reservations have been withdrawn by
some States63 and others are exploring the possibility of withdrawing in the future.
VI. Application in Practice

38 As early as 1992 the New Zealand Law Commission wrote in its report preparing the
ratification of the CISG by New Zealand that the CISG, is “not a case of uniformity for
the sake of uniformity. Rather, the world trading community has made the practical
decision that this uniform law will facilitate international trade”.64 Irrespective of this
correct perception and decision, for a considerable time the CISG only played a limited
role in practice in most jurisdictions, as the available empirical as well as anecdotal data
shows.65
1. The original scepticism

39 At the beginning, the CISG was met with considerable scepticism by the parties in
international trade. It contained new and often unfamiliar rules which had not been
tested in practice.66 Unlike many national sales laws, the CISG lacked a centuries’
(rather than century’s) old body of case law and legal thinking available to provide
60 Court of Appeal New South Wales (Australia) 12 March 1992, CISG-Online 44 (Pace); Federal Court
of Australia (Australia) 3 November 2000, CISG-Online 586 (Pace). Also in New Zealand: Court of
Appeal of Wellington (New Zealand) 3 October 2001 (Pace). Of course in civil law systems as well: see
Audiencia Provincial de Navarra (Spain) 22 September 2003 (Pace).
61 E. g., the ICC Model for International Sale Contracts (Manufactured Goods intended for resale
receives inspiration from both CISG and PICC). See ICC Publication, no 556 (1998). The model contract
declares the transaction subject to the CISG, see Art. 1.2(A) of Part B. The International Trade Center
UNCTAD/WTO offers the Model Contract and User’s Guide for International Commercial Sale of
Perishable Goods of 1999. Number 14 of the Model Contract provides the applicable rules of law by
applying, first the CISG, second the PICC, and third the possibility of determining a domestic law, or in
its absence, the seller’s place of business.
62 For further background discussion on this see Lookofsky, Alive and Well in Scandinavia: CISG Part
II, 18 Journal of Law and Commerce (Spring 1999) 289; Baasch-Andersen, Recent Removals of
Reservations under the International Sales Law – Winds of Change heralding a Greater Unity under the
CISG?, [2012] Journal of Business Law, 698 et seq.
63 See infra comments to Arts 12 and 96.
64 New Zealand Law Commission, The United Nations Conventions on Contracts for the International
Sale of Goods: New Zealand’s Proposed Acceptance Report No. 23 of the Law Commission (Wellington,
New Zealand, June 1992), p. 10 (Pace).
65 For an analysis of the available empirical data see Schroeter, Empirical Evidence of Courts’ and
Counsels’ Approach to the CISG (with some Remarks on Professional Liability) in: DiMatteo, Interna-
tional Sales Law: A Global Challenge (2014), pp. 649 et seq.
66 The lack of familiarity of both counsel and the parties played a very prominent role as a ground for
exclusion in the enquiry under German lawyers; see Meyer, UN-Kaufrecht in der deutschen Anwalts-
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guidance for the application of it in practice.67 Moreover, applying the CISG meant not
only that the parties and their lawyers had to familiarize themselves with the new rules,
but also that contract practices and existing model contracts had to be adapted to the
new rules. As a consequence, parties, often following the advice of their lawyers and
national business organizations, regularly tried to opt out of the CISG and exclude its
application.68 There was a tendency to prefer “the devil you know” to the devil you do
not know.69 At the same time judges and arbitrators also lacked the necessary knowl-
edge and experience with the CISG and were thus more than willing to interpret the
parties’ declarations and behaviour as an exclusion of the CISG.70
In addition, parties had concerns about the quality of the provisions of the CISG. It 40
was presumed that due to the need to reach compromises, the CISG often only adopted
second best solutions. Moreover, the use by the CISG drafters of vague concepts such as
“fundamental breach” or “reasonable time” was considered to constitute a considerable
threat to predictability of results, even more so as no coherent body of case law
existed.71 Last but not least, parties were concerned about the CISG’s lack of complete-
ness which required the application of national laws for all issues not governed by the
CISG. There was the fear that this could result in frictions which could be avoided if the
complete transaction was governed by a single but complete national law.
2. Increasing role in practice

Over the years the tide has slowly been turning. In numerous countries lectures about 41
the CISG are now part of the standard curriculum of law schools and every year far
more than 2,000 students participate in the Willem C. Vis Moot, which deals with the
CISG, either in Vienna or Hong Kong. Consequently, more and more students and
practitioners are now familiar with the rules of the CISG and appreciate its potential
benefits. Libraries can be filled with legal writings about the CISG and a considerable
body of case law has developed, accessible to a considerable extent for free via the
Internet.72 Courts in numerous countries are now very reluctant to interpret all but the
most explicit statements by the parties as an agreement to exclude the CISG. In
particular, subsequent behaviour of the parties, such as pleading their case on the basis
of national law, is only considered to constitute a choice of law in favour of the national
law pleaded if the parties were aware of them opting out of the CISG.73
praxis, 69 RabelsZ (2005) 457 (474 et seq.); for a comprehensive analysis of the problem see Spagnolo,
CISG Exclusion and Legal Efficiency (2014), pp. 149 et seq.
67 Smits, Problems of Uniform Sales Law – why the CISG may not promote international trade, in:
DiMatteo, International Sales Law: A Global Challenge (2014), p. 605, 610; electronic copy available at:
http://ssrn.com/abstract=2197468 on a contrary view: See: Berman, The inevitable legal pluralism within
universal harmonization regimes: the case of the CISG, ULF, 2016, vol. 21, pp. 23–40, p. 32.
68 Koehler, Survey regarding the relevance of the United Nations Convention for the International Sale
of Goods (CISG) in legal practice and the exclusion of its application (Pace).
69 For a critical assessment of the older German practice see Koch, Wider den formularmäßigen
Ausschluss des UN-Kaufrechts, NJW (2000) 910.

70 It appears that this homeward trend is well embedded in certain legal systems where jura novit curia
exists and it will take some time before it is reduced or eliminated. See some rather positive examples in
Oregon Court of Appeals (U.S.) 12 April 1995 (Cedar shakes (wood)), GPL Treatment Ltd. v. Louisiana-
Pacific Group, CISG-Online 147 (Pace); Cour de cassation (France) 26 June 2001 (Auto parts), CISG-
Online 600 (Pace); Arbitral Award, ICC 8453/1995 (Medical machine), CISG-Online 1275 (Pace).
71 See Meyer, UN-Kaufrecht in der deutschen Anwaltspraxis, 69 RabelsZ (2005) 457 (474 seq.)
reporting that in his enquiry of German lawyers, the presumed lacked of certainty accounted for more
than 40 % of the exclusion of the CISG.
72 See supra at VIII. Working with the CISG in practice.
73 See Oberlandesgericht Oldenburg (Germany) 20 December 2007 (Industrial tools) CISG-Online 1644;
Arbitral Award (CIETAC) 24 March 1998 (Hempseed) CISG-Online 930. Further: CISG-AC Opinion
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42 As a consequence, users have slowly changed their attitude towards the CISG. A good
example is provided by the developments in Germany. For a long time, as a matter of
course, parties excluded the application of the CISG in the standard terms, often on the
basis of recommendation by their business associations.74 In 2002 the Deutsche
Industrie und Handelskammertag (DIHK), the leading business association, reversed
its previous position and recommended its members to submit all their international
contracts to the CISG.75
43 It was furthermore realized that most of the perceived downsides of the CISG could
easily be remedied by appropriate contractual drafting. Provisions in the contract
stipulating when the seller has to be informed about the non-conformity of the goods
under Art. 39 or what constitutes a fundamental breach remove most uncertainties
inherent in broad notions such as reasonable time.76 In addition, the otherwise applic-
able non-harmonized national sales laws often used equally vague concepts77 and
consequently had to be supplemented to provide for the necessary legal certainty and
predictability. The only difference was insofar that they were part of a system with a
highest court empowered to give binding interpretations of the concepts used.
44 With the increasing body of case law providing guidance as to the application of such
broad principles also this disadvantage is gradually diminishing. Consequently, there are
predictions that in the future the CISG legislative success will be mirrored by its success
in practice.78 An advice to exclude the CISG which is not based on a proper evaluation
of its advantages and disadvantages constitutes a case of malpractice.79
3. Commodity Trade
45 One important area of cross border sales where the CISG, until today, only plays a
very limited role, if any, is the trade in commodities such as metals, raw materials, grain
or other foodstuff. The model contracts, forms and rules recommended by the relevant
institutions or used by the parties normally explicitly exclude an application of the CISG
as a matter of course. The reasons given, in particular by English authors, are that the
CISG is not suitable for the particularities of commodity trade.80 The main focus of the
criticism is regularly the limited right of both parties to avoid the contract for its breach
by the other side, in particular the requirement of a fundamental breach. According to
the critics, the particularities of the trade in commodities, i. e. the highly fluctuating
prices and the often documentary element of the transactions, require that any breach
No. 16, Exclusion of the CISG under Article 6, Rapporteur: Doctor Lisa Spagnolo, Monash University,
Australia. Adopted by the CISG Advisory Council following its 19th meeting, in Pretoria, South Africa on
30 May 2014.
74 For such recommendation, see Meyer, UN-Kaufrecht in der deutschen Anwaltspraxis, 69 RabelsZ
(2005) 457 (464).

75 Herber, Editorial, IHR (2002) 1.
76 Behr, Dealing with Non-Conformity – A Transaction Test Analysis of CISG Regulations on
Examination and Notice under Articles 38 through 44, in: Flechtner/Brand/Walter, Drafting Contracts
(2007), p. 429 (435).
(2007), p. 429 (437).
78 Spagnolo, Green Eggs and Ham: The CISG, Path Dependence, and the Behavioural Economics of
Lawyers’ Choices of Law in International Sales Contracts; 6 Journal of Private International Law (2010)
pp. 417 et seq.
79 Schroeter, Empirical Evidence of Courts’ and Counsels’ Approach to the CISG (with some Remarks
on Professional Liability) in: DiMatteo, International Sales Law: A Global Challenge (2014), pp. 649, 665
et seq.
80 See Bridge, The Bifocal World of International Sales: Vienna and Non-Vienna, in: Cranston (ed.)
Making Commercial Law (1997), pp. 277 et seq.
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should entitle a party to terminate a contract and not only “fundamental” breaches and
any right to cure should be excluded. A further reason given for the non-suitability of
the CISG, is that it does not provide for the required certainty, as, unlike English law, it
lacks sufficiently detailed rules on passing of risk and property and a developed body of
case law.81
Such criticism, however, has not remained uncontested. There is a strong current in 46
the CISG-literature which doubts the veracity of the above reasoning and considers the
CISG perfectly suitable to govern the trade in commodities.82 The fact remains that the
CISG is a permissive legal text giving way to the application of customary rules or
practises established between the contracting parties or in a particular region or
industry. A proper application of Art. 9 allows to take account of the needs of the
commodities trade.
VII. Advantages of the CISG

The major advantage of the CISG is that it provides for international transactions a 47
uniform set of substantive rules specifically drafted for such transactions taking into
account their particularities. Thus it avoids the need to undergo the difficulties of the
otherwise necessary conflict of laws approach in determining the applicable law and that
at least one party must submit to a law with which it is not familiar. Consequently, at
least in the long run, after the adaptation of the models used, the CISG helps to reduce
transaction costs. The same type of contract can be used in transactions with parties
from different jurisdictions. An agreement on such a CISG-contract is to a lesser extent
dependent on the respective bargaining power, as would be a contract based on a
particular national law. Moreover, as an international convention, the CISG is in
principle not open to subsequent changes requiring an adaptation of the contract.
In court proceedings in one of its no less than 89 Contracting States, the CISG avoids 48
the necessity to ask for costly and time consuming expert reports as to the applicable
law. As the CISG constitutes part of the national law, the judges should in principle be
aware of its content.83
In addition, there are also some intrinsic advantages of the CISG. Unlike some 49
national contract laws which either favour buyers or sellers, the CISG tries to balance
the rights and obligations of both equally.84 In light of Art. 6, the parties may, however,
always change the allocation of risks embodied in the CISG if they want to favour either
the seller or the buyer.
Making Commercial Law (1997), p. 277; Mullis, Termination for Breach of Contract in C. I. F. Contracts
Under the Vienna Convention and English Law: Is there a substantial Difference, in Lomnicka/Morse
(ed.), FS-Guest (1997) pp. 137 et seq., emphasizing the lack of a developed case law.
82 Winsor, The Applicability of the CISG to Govern Sales of Commodity Type Goods, 14 Vindobona
Journal of International Commercial Law and Arbitration (2010) 83 et seq.; Zeller, Commodities Sale and
CISG, in: Andersen/Schroeter (eds), Sharing International Commercial Law across National Boundaries,
FS Kritzer (2008), pp. 627–639; id, Commodity Sales – Can they be governed by the CISG?, in:
Schwenzer/Spagnolo, Growing the CISG (2016), pp. 91 et seq.; Schwenzer/Hachem, The CISG – Successes
and Pitfalls, 57 American Journal of Comparative Law (2009) 457 (478).
83 This was mentioned as one of the advantages of the CISG in the enquiry of German lawyers: See
Meyer, UN-Kaufrecht in der deutschen Anwaltspraxis, 69 RabelsZ (2005) 457 (479 seq.). A similar
comment is made in, Schlechtriem, Requirements of Application and Sphere of Applicability of the CISG,
36 Victoria University of Wellington Law Review (2005) 781 (793–794) where he illustrates the point
using two practical examples.
84 Eiselen, in: Kritzer/Vanto/Vanto/Eiselen, International Contract Manual, Vol. 4 § 81:5; Honnold,
Uniform Law (1999), p. 69.
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VIII. Working with the CISG

50 Parties and counsel faced in practice with CISG related legal questions can now draw
from a vast number of sources to gain the necessary information. In English, the lingua
franca of international commerce, there are now several article-by-article commentaries
available which provide direct guidance on a particular question.85
51 In addition, a considerable amount of information is also available for free on the
Internet on the various CISG related websites.86 UNCITRAL provides with its CLOUT-
database English language abstracts of the most important decision on the CISG.87 They
are prepared by the various national correspondents appointed by the respective govern-
ments and made available to UNCITRAL jointly with the full text in the original language
which can also be requested from UNCITRAL. Moreover, there is a regularly updated
Digest available on the UNCITRAL website, summarizing the various decisions rendered.88
52 Case law in the original language as well as other useful materials can also be found at
the CISG-Online website maintained by Prof. Schwenzer at the University of Basel.
Spanish and Latin American cases can be found at the University Carlos III database.89
53 The most comprehensive collection of CISG related cases and materials is provided
by the Pace University website founded by Albert Kritzer.90 It contains more than 3,000
cases with 10,000 annotations and 10,300 bibliographical citations as well as the full text
of 1,700 scholarly writings. Most decisions are translated full text into English by the
Queen Mary Translation Program: as of June 2017 more than 1,885 cases were
translated into English or their translation has been assigned.
54 Finally, one should refer to the CISG Advisory Council (CISG-AC), a private
initiative which aims at promoting a uniform interpretation of the CISG. It is a private
initiative in the sense that its members do not represent countries or legal cultures, but
rather are scholars who look beyond the cooking pot for ideas and for a more profound
understanding of the issues relating to CISG. As at November 2017 the CISG-AC has
produced 17 Opinions and two Declarations (translated in the official languages of the
United Nations and German, Japanese and Portuguese); although four or five more
opinions are expected in the near future.91
IX. Contract Drafting

55 In the early days, one of the major obstacles to the application of the CISG was the
need to adapt existing contract forms and standard terms and conditions which have
been developed over decades for application under national law. In the meantime,
numerous Model Contracts have been developed on the basis of the CISG. The most
prominent example is probably the ICC Model International Sales Contract for
manufactured goods intended for resale.92
85 Bernstein/Lookofsky, Understanding the CISG (2012); Bianca/Bonell, Commentary (1987); Schlecht-
riem/Butler, CISG (2009); Schlechtriem/Schwenzer, Commentary (2016).

86 For an overview see Newman, CISG Sources and Researching the CISG, in: DiMatteo, International
Sales Law: A Global Challenge (2014), pp. 37, 43 et seq.

87 http://www.uncitral.org/uncitral/en/case_law.html
88 For the 2016 version of the digest see http://www.uncitral.org/pdf/english/clout/CISG_Digest_2016.pdf.
89 For a list of CISG related websites see Annex supra chapter “How to use this Commentary?”.
90 http://www.cisg.law.pace.edu.
91 http://www.cisg-ac.org.
92 ICC Publication No 738, (2013), replacing the 1997 version published in ICC Publications No 556,
(1997), The ICC Model International Sales Contract – Manufactured goods intended for resale.
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Additionally, a fair number of manuals for drafting international contracts take 56
account of the CISG and suggest clauses to deal with issues that require contractual
stipulation.93 Inter alia the leading CISG website of Pace University provides a freely
accessible and article-by-article guide for drafting contracts under the CISG, primarily
against the common law background.94 At the same time the website contains a
regularly updated Guide for Managers and Counsel on applying the CISG.
In this respect UNCITRAL’s Draft Digest on the CISG, prepared and updated by 57
leading scholars, may play a valuable role. By organizing the existing jurisprudence on
the CISG, it can provide examples of what problems may have to be addressed in
contract drafting.95
In addition, as a consequence of the harmonizing effects of the CISG, parties may use 58
it as a guideline for drafting their contracts. References to concepts and terminology
developed in national laws – in addition to the fact that they are often drafted for
domestic sales transactions – always entail the danger that they are misunderstood by
the other party.96 By contrast, references to the harmonized CISG terminology and
concepts reduce such dangers. The parties are, however, well advised to define a number
of the broad concepts, such as “fundamental breach” or “reasonable time”.
Moreover, appropriate contract drafting can avoid most of the perceived disadvan- 59
tages of the CISG, and in particular the criticized lack of certainty. The lack of
predictability due to reliance on vague concepts such as “reasonable time” and “funda-
mental breach”, of which a trial lawyer may rightly complain, may be prevented by the
transaction lawyer through appropriate contract drafting, i. e. by defining those concepts
for the particular contract.
X. Electronic Commerce
The globalization of market economies due to technological developments is one of 60
the most distinguished features today in international trade. The CISG was drafted
before the emergence of e-commerce and as such only refers to telegraph and fax as a
means of communication (Art. 13). For the same reason, the Vienna Convention did
not foresee transactions made entirely by electronic means: contract conclusion, delivery
of the goods and their payment.
The CISG, however, is able to cope with electronic transactions by a simple adapta- 61
tion of its provisions to electronic means97. First, an extended interpretation of writing
within the CISG is possible so as to cover electronic means of communications98.
Second, contract conclusion by electronic means is not perceived as a problem by
scholars and case law as it is consistent with the principle of freedom of form (Art. 11).
93 Gelzer, in: Münch/Böhringer/Lehne/Probst (eds), Schweizer Vertragshandbuch: Musterverträge für
die Praxis (2010), pp. 273–299; Gildeggen/Willburger, Internationale Handelsgeschäfte, 4th ed. (2012)
pp. 142–149; Piltz, Sale agreement pursuant to the United Nations Convention on Contracts for the
International Sale of Goods, in: Schütze/Weipert/Rieder, Münchener Vertragshandbuch, Band 4
(Wirtschaftsrecht III), 7th ed. (2012); Flechtner/Brand/Walter (eds), Drafting Contracts (2007); McMahon,
Guide for Managers and Counsel: Drafting CISG Contracts and Documents and Compliance Tips for
Traders (2004) (Pace); Ostendorf, International Sales Terms (2010).
94 See McMahon, Drafting CISG Contracts and Documents and Compliance Tips for Traders (2004),
available at http://www.cisg.law.pace.edu/cisg/contracts.html.
95 See Lookofsky, Tooling up for Warranties with the CISG Case Digest, in: Flechtner/Brand/Walter,
Drafting Contracts (2007), p. 343 (344 seq.) pointing also to the limits of that approach.
96 Schlechtriem, in: Flechtner/Brand/Walter, Drafting Contracts (2007), p. 167.
97 CISG-AC Opinion no 1, Electronic Communications under CISG, 15 August 2003. Rapporteur:
Professor Christina Ramberg, Gothenburg, Sweden (at http://www.cisg-ac.org).

98 Infra comments to Art. 13.
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Introduction CISG 62
The use of electronic means is admitted within the CISG not only during the formation
of the contract but also during its performance. A more difficult question to consider is,
however, whether some kinds of “goods” such as software, which might be transmitted
electronically, are to be considered within the CISG’s scope of application.
62 The CISG further is now considered suitable for a broader range of contracts
involving digital goods subject, of course to several conditions, given that the CISG
was developed primarily for tangible goods and traditional payments. The expansion of
the CISG to cover digital goods and digital trade as well the use of digital currencies
would exponentially expand the scope of application. There seems to be good reasons to
argue that the CISG is in principle compatible with all demands of modern digital
trade.99
99 Eggen, Digitale Inhalte unter dem CISG Eine Rundschau über Herausforderungen und mögliche
Lösungen, Internationales Handelsrecht, 17(6), 229–237.
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Preamble
THE STATES PARTIES TO THIS CONVENTION,
BEARING IN MIND the broad objectives in the resolutions adopted by the sixth
special session of the General Assembly of the United Nations on the establishment of
a New International Economic Order,
CONSIDERING that the development of international trade on the basis of
equality and mutual benefit is an important element in promoting friendly relations
among States,
BEING OF THE OPINION that the adoption of uniform rules which govern
contracts for the international sale of goods and take into account the different social,
economic and legal systems would contribute to the removal of legal barriers in
international trade and promote the development of international trade,
HAVE DECREED as follows:
The Preamble introduces the 101 articles of the Convention on Contracts for the
International Sale of Goods (CISG) and provides the broad justification for the drafting
of the Convention as well as the motivation of the signatory parties. The Convention is
organized in four Parts: Part I is focused on the Sphere of Application and General
Provisions (Articles 1–13); Part II deals with Formation of Contract (Articles 14–24);
Part III is by far the longest and provides the main body of provisions for the Sale of
Goods (Articles 25–88); finally Part IV is dedicated to the Final Provisions (Articles 89–
101).
The Preamble sets three main broader aspects in which the Convention operates: the
New International Economic Order, the development of trade on the basis of equality
and promotion of friendly relations amongst States and the adoption of uniform rules
for contracts for the international sale of goods which can in turn further international
trade by lifting barriers.
The Convention fits well with the main objectives of UNCITRAL:1 i. e. the facilitation
and development of international trade and the promotion of friendly relations among
States on the basis of equality and harmonization of law. In this regard, harmonization
of law2 is also the convergence of legal systems: one should consider different social,
economic and legal backgrounds. It is for this reason that Conventions, such as the
CISG, aim at lifting barriers imposed by different legal systems and creating a level
playing field amongst nations and their traders. The Preamble of the CISG clearly spells
out the said objectives.
It is notable that the Preamble sets out the economic/ideological context in which the
CISG operates, the “New International Economic Order” but also the promotion and
development of international trade. As such these objectives and context are rather
1 The United Nations Commission on International Trade Law (UNCITRAL) was established by the
General Assembly of the United Nations in 1966 (Resolution 2205 (XXII) of 17 December 1966). The
General Assembly recognized that disparities in national laws governing international trade created
obstacles to the flow of trade, and it regarded the Commission as the vehicle by which the United Nations
could play a more active role in reducing or removing these obstacles. See http://www.uncitral.org/
uncitral/en/commission/sessions/pre.html and Herrmann, The Role of UNCITRAL, in: Fletcher/Mistelis/
Cremona (eds), Foundations and Perspectives of International Trade Law (2001), pp. 28–36.
2 See, e. g., Mistelis, Is Harmonisation a Necessary Evil? Use and Abuse of Comparative Law and the
Future of Harmonisation, in: Fletcher/Mistelis/Cremona (eds), Foundations and Perspectives of Interna-

tional Trade Law (2001), pp. 1–27.
Mistelis 19
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Preamble
political and not legal.3 While the economic context refers to the period of the drafting
and adoption of the CISG,4 the broader objectives are enduring and arguably renewed.
Indeed, with the launch of the UN Global Compact since 2000 the United Nations
promote sustainable development and protection of human rights through ten princi-
ples which have been developed in 2000 and 2004.5 The UN Global Compact is not a
regulatory instrument and merely highlights the new UN “ideology” in respect of trade
and business. Legal and economic objectives are now combined with ethical values.6
The most important issue in relation to the Preamble is whether it has any role in the
interpretation of the Convention it introduces. Different views have been expressed.
Leading commentators have correctly indicated that the Preamble has as its main
objective to manifest the “goals of the signatory states” and hence is of no use for the
interpretation of normative substantive provisions.7 Moreover, the CISG ultimately has
a “technical” character and specific rules of interpretation, such as those found in
Article 7,8 so that “the scope for interpretation in the light of the Preamble may not be
very wide”.9
However, the contrary view that the Preamble “informs many other provisions” of
the Convention10 also exists in the literature. In this vein, “the spirit of the Preamble
should also be taken account of when agreed texts of sales contracts are to be
interpreted.”11
There are references to the Preamble in the case law. In a 2002 case from the United
States,12 the court states that “[t]he intent of the contracting parties to the CISG can be
discerned from the introductory text.”13 The issue in question was to decide what law
governed the sales contract: state law or the CISG. The court found that the Conven-
tion’s “expressly stated goal of developing uniform international contract law to
promote international trade indicates the intent of the parties to the treaty to have the
treaty pre-empt state law causes of action.”14
Despite the character of the Preamble as an expression of political declaration of the
Contracting States which may well contrast with the technical/normative nature of the
substantive provisions of the Convention, it may be used for the compliance of possible
interpretations with the spirit of the Convention, especially in legal cultures where the
Preamble is looked at customarily.
3Schwenzer/Hachem in Schwenzer (ed), Schlechtriem & Schwenzer, pp 15–16.
4The General Assembly of the United Nations adopted resolutions on the Establishment of a New
International Economic Order in 1974 (Resolution 3201 of 1 May 1974 and Resolution 3281 of
12 December 1974) and 1975 (Resolution 3362 of 16 December 1975).
5 https://www.unglobalcompact.org/.
6 Schwenzer/Leisinger, Ethical Values and International Sales Contracts, in: Leisinger/Probst (eds),
Human Security and Business, Zurich 2007, 124–149, 139–141.

7 Schlechtriem, Uniform Sales Law – The UN Convention on Contracts for the International Sale of
Goods (1986), p. 38 para. 111.

8 See comments to Art. 7 infra 1.3.3.
9 Evans, in: Bianca/Bonell, Commentary (1987), p. 25.
10 Kastely, Rhetorical Analysis of the Convention, 8 Northwestern Journal of International Law and
Business (1988) 594. See also Grigera Naón, The UN Convention on Contracts for the International Sale
of Goods, in: Horn/Schmitthoff (eds) Transnational Law of International Commercial Transactions –
Studies in Transnational Law Vol. 2 (1982), p. 92.
11 Enderlein/Maskow, International Sales Law (1992), p. 20. See also comments to Art. 7 infra 1.3.3.
12 District Court, SD of New York (U.S.) 10 May 2002 (chemicals), Geneva Pharmaceuticals Tech. Corp.
v. Barr Labs. Inc., CISG-Online 653 (Pace). See also further cases in comments to Art. 7 infra 1.3.3.
13 Id., at 285. References were also made to the statement made during the introduction of the CISG as
legislation to be adopted in the U.S. Senate.

14 Id., at 285–286. See also District Court, ND of California (U.S.) 27 July 2001 (electronic components),
Asante Technologies, Inc. v. PMC-Sierra, Inc., CISG-Online 616 (Pace).
20 Mistelis
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PART I
Sphere of Application and General Provisions
Chapter I
Sphere of Application
Article 1
(1) This Convention applies to contracts of sale of goods between parties whose
places of business are in different States:
(a) when the States are Contracting States; or
(b) when the rules of private international law lead to the application of the law
of a Contracting State.
(2) The fact that the parties have their places of business in different States is to be
disregarded whenever this fact does not appear either from the contract or from any
dealings between, or from information disclosed by, the parties at any time before or
at the conclusion of the contract.
(3) Neither the nationality of the parties nor the civil or commercial character of
the parties or of the contract is to be taken into consideration in determining the
application of this Convention.
Bibliography: Bernasconi, The Personal and Territorial Scope of the Vienna Convention on Contracts for
the International Sale of Goods (Article 1), 46 Netherlands International Law Review (1999) 137; Bridge,
Uniform and Harmonized Sales Law: Choice of Law Issues, in: Fawcett/Harris/Bridge, International Sale
of Goods in the Conflict of Laws (2005) 908; Butler, Article 1 CISG – The Gateway to the CISG, in
Schwenzer/Pereira/Tripodi (eds.), CISG and Latin America: Regional and Global Perspectives (2016) pp
379–396; Ferrari, The Sphere of Application of the 1980 Vienna Sales Convention (1995); Ferrari, What
Sources of Law for Contracts for the International Sale of Goods? Why One Has to Look Beyond the
CISG, 25 International Review of Law and Economics (September 2005) 314; Ferrari, Contracts for the
International Sale of Goods: Applicability and Application of the 1980 United Nations Sales Convention
(2012); Gilette/Walt, The UN Convention on Contracts for the International Sale of Goods – Theory and
Practice, 2nd edition (2016); Jansen and Spilker, The Application of the CISG in the World of Interna-
tional Commercial Arbitration, 77 RabelsZ (2013) 131; Petrochilos, Arbitration Conflict of Laws Rules
and the 1980 International Sales Convention, 52 Revue Hellenique de Droit International (1999) 191;
Schlechtriem, Requirements of Application and Sphere of Applicability of the CISG, Victoria University
Wellington Law Review (2005/4) 781; Spagnolo, CISG Exclusion and Legal Efficiency (2014); Ziegel, The
Scope of the Convention: Reaching Out to Article One and Beyond, 25 Journal of Law and Commerce
(2005–2006) 59; CISG-AC Opinion no 4, Contracts for the Sale of Goods to be Manufactured or
Produced and Mixed Contracts (Article 3 CISG), 24 October 2004. Rapporteur: Pilar Perales Viscasillas,
Universidad Carlos III de Madrid (at http://www.cisg-ac.org).
Outline
I. Importance and Role of the Provision . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1. General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
a) Territorial scope . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
b) Subject matter – substantive scope. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
c) Arbitration as a special case . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
2. Drafting history . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
3. Importance of provision. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Mistelis 21
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Article 1 1–3 Part I. Sphere of Application and General Provisions

II. Detailed Commentary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
1. Sales contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
a) Contract of sale . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
b) Related contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
2. Goods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
3. Internationality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
a) Introductory remarks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
b) Place of business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
c) Agency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
4. Automatic application if international sales contract . . . . . . . . . . . . . . . . . . . . . . 47
5. Territorial application – Contracting States. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
6. Application by operation of conflict of laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
III. Comparable Rules . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
I. Importance and Role of the Provision

1 Art. 1 is a significant provision and can be characterised as a unilateral conflict of laws
rule: it determines the sphere of application (applicability) of the Convention and at the
same time prevails over recourse to conflict of laws to the greatest extent possible. As a
unilateral conflict of laws rules, Art. 1 does not provide for an applicable law when the
Convention does not apply. In fact, this article provides only some of the rules for
determining whether the Convention applies. It should be read in conjunction with Arts.
2 and 3 which respectively narrow and extend the CISG’s substantive sphere of applica-
tion. Moreover, Art. 100 defines the temporal sphere of application of the Convention.
1. General
2 Art. 1 introduces a number of criteria. First, the CISG requires the underlying transaction
to be a contract of sale, but stops short of providing an express definition of such contract –
this definition may be deduced from Arts. 30 and 53. Second, it applies to the international
sale of goods: the internationality is established on the basis that the contracting parties
have their place of business in different States (Art. 1(1)). This is a relative internationality
and has to be assessed at the time of conclusion of contract. Third, the CISG requires that
the parties of the sales contract relate to more than one Contracting State (Art. 1(1)(a));
such internationality may well be established by operation of private international law
which may refer the matter to the law of a Contracting State (Art. 1(1)(b)).
3 Art. 1 is to be read in conjunction with Arts 2–5. From a combined reading of Art. 1 with
Arts. 2 and 3 it is concluded that not all sales contracts will be covered by the CISG. As will
be discussed in detail below as well as in the corresponding articles, certain restrictions exist
in respect of certain goods and certain kinds of contracts of sale. Finally we should not
overlook the fact that the CISG has a defined scope of application and only regulates certain
aspects of sales contract (i. e. performance and formation) and that certain matters are
not covered (Arts. 4 and 5). It is expected that the CISG will eliminate the scope of
forum shopping1 and reduce the need to recourse to rules of private international law.2 In
countries where the CISG is applicable, if the substantive rules of the Convention apply,
1 See Ferrari, Forum Shopping et Droit Materiel Uniforme, Journal du Droit International 383 (2002);
Ferrari, ‘Forum Shopping’ despite international uniform Contract law Conventions, 51 International and
Comparative Law Quarterly (2002) 689–707.
2 Tribunale di Vigevano (Italy) 12 July 2000 (Vulcanized rubber), CISG-Online 493 (Pace); Tribunale di
Pavia (Italy) 29 December 1999 (High fashion textiles), CISG-Online 678; Landgericht Zwickau (Ger-
many) 19 March 1999 (Chemical products), CISG-Online 519; Handelsgericht des Kantons Zürich
(Switzerland) 30 November 1998 (Lambskin coat), CISG-Online 415; Landgericht Heilbronn (Germany)
15 September 1997 (Film coating machine), CISG-Online 562; Oberlandesgericht Frankfurt am Main
(Germany) 20 April 1994 (New Zealand mussels), CISG-Online 125.
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Chapter I. Sphere of Application 4–7 Article 1

there is in principle no need to refer to private international law.3 Ultimately the CISG
provides a modern (uniform) law of sales appropriate for transactions of an international
character and technically the Convention prevails over the recourse to the otherwise
applicable conflict of laws rules.4
It is important also to consider the interrelation of sub-paragraphs (a) and (b) of 4
Art. 1(1).5 It appears that the two entry points for the CISG under Art. 1(1)(a) and
1(1)(b) are alternatives with primacy given to sub-paragraph (a). This proposition is not
necessarily consistent with the practice of national courts and arbitration tribunals
which tend to consider the two sub-paragraphs as complementary ones, so that the
Convention would apply through sub-paragraph (b) even though the case at hand is
prima facie one that would fall under sub-paragraph (a).6
In any event it is also clear that the two sub-paragraphs serve different purposes. Sub- 5
paragraph (a), on the one hand, introduces an autonomous and unilateral system for
the application of the CISG and renders the application of conflict of laws rules
obsolete.7 Sub-paragraph (b), on the other hand, acknowledges the application of
conflict of laws rules and also makes explicit that the Convention will be part of
national domestic law in all Contracting States. In the latter case, if only one party, or
indeed if neither party, has its place of business in a Contracting State, the CISG may
well be applicable if private international law makes the law of a Contracting State (e. g.,
France) the applicable law. Schlechtriem aptly comments and advises that:
“Although it was thought by those drafting and promulgating a uniform sales law that it 6
would make conflict of laws rules obsolete, this is not the case. Even if the CISG is applicable on
account of article 1(1)(a) – which in itself could be regarded as a one-sided conflict rule there
are many questions not covered by the Convention which have to be solved under domestic law
determined by conflict rules of the forum. And in the case of an article 1(1)(b) situation, conflict
rules are indispensable, since they are a prerequisite to the application of the Convention.
Therefore, even in the case of a sale clearly governed by the Convention, it is advisable to have a
choice of law clause.”8 [footnote omitted]
In short the CISG will apply by effect of party autonomy, direct choice of rules of 7
the Convention by the contracting parties or when there is a sale of goods and the
seller and buyer have their places of business in different Contracting States9 or when
3 Polimeles Protodikio Athinon (Greece), case no 4505/2009, available at http://cisgw3.law.pace.edu/
cases/094505gr.html (Material for bullet-proof vest); Tribunale di Forli (Italy) 11 December 2008, (shoes)
CLOUT Case no 867 (Pace). See, however, Gilette/Walt, at p. 25, who correctly point out that the “CISG
only partly avoids the uncertainty in applicable law created by conflicts rules”.
4 This view is widely held in PR China. See, for example, High People’s Court of Zhejiang Province,
People’s Republic of China, 26 August 2011, (Daewoo GSI (Korea) Co. Ltd v. Zhejiang Wuyi Tea Co. Ltd)
(2011) Zhe Shang Wai Zhong Zi No. 16 Civil Judgment, available on the Internet at www.court.gov.cn; and
further references in CISG Digest 2016, page 7, note 2. This view is also held in other jurisdictions, e.g.,
CLOUT case No. 867, Tribunale di Forli|‘, Italy, 11 December 2008, (shoes), English translation available on
the Internet at www.cisg.law.pace.edu; Oberlandesgericht Schleswig, Germany, 24 October 2008, (shop
furnishings), English translation available on the Internet at www.cisg.law.pace.edu; Oberster Gerichtshof,
Austria, 18 December 2002, English translation available on the Internet at www.cisg.law.pace.edu. For
further refererences see UNCITRAL CISG Digest, Article 1, note 2.
5 Petrochilos, Arbitration Conflict of Laws Rules and the 1980 International Sales Convention, 52 Revue
Hellenique de Droit International (1999) 191–218.

6 Petrochilos, Arbitration Conflict of Laws Rules and the 1980 International Sales Convention, 52 Revue
Hellenique de Droit International (1999) 191–218, 192-4 with further references.

7 See to the same effect Gillete/Walt, p. 25.
8 Schlechtriem, Requirements of Application and Sphere of Applicability of the CISG, Victoria
University Wellington Law Review (2005/4) 781 (784).

9 For an up-to-date list see www.uncitral.org.
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the applicable private international law points to the application of the law of a
Contracting State.
8 a) Territorial scope. Art. 1(1) provides that the basic criterion for the application of
the CISG to a contract for the sale of goods as well as to its formation is that the parties’
places of business are in different States. This Convention is not concerned with the law
governing contracts of sale or their formation where the parties of whatever nationality
have their places of business within one and the same State. These matters will normally
be governed by the domestic law of that State, unless the State has a single law for both
international and domestic sales.
9 Even though the parties have their places of business in different States, the CISG
applies only if the States in which the parties have their places of business are
Contracting States; or the rules of private international law lead to the application of
the law of a Contracting State. An example for the former is where the Seller is a
company with his place of business in Australia and the Buyer a company with his place
of business in France: here the CISG clearly applies. An example for the latter is where
the Seller is a company with his place of business in China and the Buyer is a company
with his place of business in England10 (a non-Contracting State) and the parties have
agreed to the jurisdiction of the English courts. English courts in accordance with EC
Regulation 593/2008 and/or the Contracts (Applicable Law) Act will apply the law of
the place of business of the seller (China) as it is deemed to provide the characteristic
performance to this contract of sale. As a result, the CISG will apply.
10 If the two States in which the parties have their places of business are Contracting
States the CISG applies even if the rules of private international law of the forum would
normally designate the law of a third country, such as the law of the State in which the
contract was concluded. This result could be defeated only if the litigation took place in
a third non-Contracting State, and the rules of private international law of that State
would apply the law of the forum, i. e., its own law, or the law of a fourth non-
Contracting State to the contract. Such cases will be far and few between.
11 Even if one or both of the parties to the contract have their places of business in a
State which is a non-Contracting State, the CISG is applicable if the rules of private
international law of the forum lead to the application of the law of a Contracting State.
In such a situation, the question is then which law of sales of that State shall apply. If
the parties to the contract are from different States, the appropriate law of sales is the
CISG.
12 A further application of this principle is that if two parties from different States have
designated the law of a Contracting State as the law of the contract, the CISG is
applicable even though the parties have not specifically mentioned it. The example
would be where the Seller has his place of business in Ireland and the Buyer has his
place of business in the UK; the parties agreed to the application of Swiss or French law
as a neutral law to govern the contract of sale. In such a case the CISG would apply.
13 Pursuant to Art. 1(2), the CISG does not apply if “the fact that the parties have their
places of business in different States … does not appear either from the contract or
from any dealings between, or from information disclosed by, the parties at any time
before or at the conclusion of the contract”. One example of such a situation is where
the parties appear to have their places of business in the same State but one of the
parties was acting as the agent for an undisclosed foreign principal. In such a situation,
10 The United Kingdom is not a Contracting State but arguably because of constitutional reforms in the
UK and devolution of certain powers to Scotland, Wales and Northern Ireland, each of the constituent
parts of the UK could ratify the CISG independently from the others.
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Art. 1(2) provides that the sale, which appears to be between parties whose places of
business are in the same State, is not governed by this Convention.
However, the question whether the CISG is applicable to a contract of sale of goods is 14
determined primarily by whether the relevant “places of business” of the parties are in
different Contracting States. The relevant “place of business” of a party is determined by
application of Art. 10(a)11 without reference to nationality, place of incorporation, or
place of head office. Art. 1(3) reinforces that rule by making it clear that the nationality
of the parties is not to be taken into consideration.
b) Subject matter – substantive scope. The scope of application of the Convention is 15
also determined by looking at the subject matter of the sales contract. Indeed, in some
legal systems the law relating to sale of goods contracts is different depending on
whether the parties or the contract are characterized as civil or commercial. In other
legal systems this distinction is not known. In order to ensure that the CISG’s scope
provisions are not interpreted to apply only to contracts of sale characterized as
“commercial” or between parties characterized as “commercial” under the law of a
Contracting State, Art. 1(3) provides that the civil or commercial character of the parties
or of the contract is not to be taken into consideration.
It should be noted, however, that Art. 2 excludes from the substantive sphere of 16
application certain contracts for the sale of goods which are likely to be characterized as
“civil” contracts by legal systems that recognize the distinction between civil and
commercial contracts. In particular, Art. 2(a) excludes the sale “of goods bought for
personal, family or household use.” In other words consumer sales contracts fall outside
the sphere of application of the CISG.
c) Arbitration as a special case. It appears that disputes relating to international sales 17
contracts are more often than not referred to international arbitration tribunals for
resolution. Arbitration is a very fertile ground for the resolution of international sale
disputes, however it is impossible to expect that Art. 1 will be treated in the same way in
arbitration as it would by national courts. The reason for this is that in arbitration there
are specific conflict of laws rules, typically found in arbitration rules12 and in arbitration
laws13 so that a different method for the determination of applicable law is employed.14
Arbitral tribunals apply a specific law or rules of law either by operation of conflict of
laws (indirect reference or voie indirecte) or directly without having to resort to a private
international law system (direct reference or voie directe). This is arguably a three-step
method:15 (1) First one must ask whether there is a choice of law by the parties. If this
can be answered in the affirmative, next one looks to whether it covers the entire
dispute before the tribunal; whether there is any contradiction with mandatory rules or
public policy; and, in any event, whether it is possible to solve the dispute by relying
exclusively on the contract. (2) In the absence of choice of law by the parties, one then
asks whether it is possible to determine the applicable law or non-legal standard without
reference to conflict of laws, and whether this is an appropriate law or non-legal
standard for this particular dispute. (3) Finally one asks whether it is necessary to
employ conflict of laws rules, and which conflict of laws rules should be applied. This
will involve assessing whether there is a conflict of laws system most closely connected
11
See further Art. 10 infra.
12
See, e. g., Art. 21 ICC Rules of Arbitration, Art. 35 UNCITRAL Arbitration Rules.
13 See, e. g., Art. 28 UNCITRAL Model Law, Section 46 English Arbitration Act.
14 See, e. g., Lew/Mistelis/Kröll, Comparative International Commercial Arbitration (2003), Chapter 17;
Born, International Commercial Arbitration, volume 2, 2nd edition (2014), 2620 et seq.
15 Ibid., paras 17–78.
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with the dispute, whether it is possible to apply cumulatively all relevant conflict of laws
systems, and whether it is possible to apply generally accepted conflict of laws rules.
18 A review of the published awards reveals a fascinating picture about how the CISG
has been applied by arbitral tribunals.16 This survey was completed in July 2008 and
looked at all published awards in the major collections, i. e. the Pace database, Unilex
and ICC collections of abstracted awards,17 as well as CLOUT. The most comprehensive
database on the CISG, the Pace CISG Database, features in July 2017 3152 court
decisions and arbitral awards on the CISG. Out of the 3152 decisions, more than 1600
are arbitral awards. Although arbitral awards account for 50 % of the published
decisions, the real number of awards on the CISG must be significantly higher. It is a
well known fact that very few awards get published: arguably, significantly less than 5 %
of arbitral awards get published. On that basis one can assume that there are well more
than 10,000 awards on the CISG. For example, this author is aware of at least ten
unpublished awards on the CISG in the LCIA.18 This makes arbitration the main forum
for the resolution of disputes arising out of international sales contracts under the CISG.
Arguably, more than 70 % of cases relating to the CISG will have been (or actually are)
rendered in arbitration.
19 The endorsement of the CISG by arbitral tribunals is not only encouraging, but is also
essential for the widespread use and well being of the Convention. It also follows that
arbitral tribunals do not apply Art. 1 in a strict and/or consistent fashion; some
tribunals apply the CISG as the choice of parties, others by operation of conflict of
laws, very often as a choice of the tribunal or even as a general principle of law.19
20 However, the path to the CISG is not always without problems. For example, in a
CIETAC award the tribunal, instead of referring to CISG Article 1(1)(a), applied the
CISG by operation of Article 142 of the Civil Code of the PRC.20
21 A Moscow tribunal was far more precise in its award as to applicable law. The
contract concluded by the parties did not contain provisions on the applicable law.
Since Russia and Germany are Contracting States, the tribunal held that the CISG
was applicable to the relations of the parties by virtue of Art. 1(1)(a) CISG. As to the
16 Mistelis, CISG and Arbitration, in: Janssen/Meyer (eds), CISG Methodology (2009), pp. 375 et seq.
See also Butler, CISG and International Arbitration – A Fruitful Marriage? (2014). XVII International
Trade and Business Law 322, Special Volume for Professor Zeller’s 70th Birthday, 322–357 (2014); Janssen
& Spilker, The CISG and International Arbitration, in DiMatteo (Ed.), International Sales Law: A Global
Challenge. (2014), also at 77 RabelsZ (2013) 131-157; Kröll, Arbitration and the CISG, in Schwenzer/
Atamer/Butler, Current Issues in CISG and Arbitration (2014); Perales Viscasillas and Ramos Munoz,
CISG & Arbitration, 10 Spanish Arbitration Review 63–84 (2011).
17 Most notably the ICC International Court of Arbitration Bulletin, Volume 11(2) 2000.
18 LCIA stands for London Court of International Arbitration. LCIA has a strong confidentiality policy
and awards are never published.

19 Interestingly enough, out of the 512 published awards between 1988 and 2007, in 57 awards or 11 %
of the cases, the CISG is choice of parties; in 115 awards or 22 % of the cases, the CISG applied by effect
of conflict of laws; in 289 awards or 57 % of the cases, the CISG applied as the choice of the tribunal; in 12
awards or 2 % of the cases, the CISG applied as general principles of law; and in 39 awards or 8 % of the
cases there is no discussion why the CISG is applied. There has been a significant increase of published
arbitral awards applying the CISG in the last decade.
20 Arbitral Award, CIETAC, 21 May 2006 (Diesel generator), CISG-Online 1454 (Pace). The tribunal
held:
The Contract has no stipulation on the applicable law. The [Buyer]’s place of business is in China and the
Respondents’ are in Singapore, and both China and Singapore are Contracting States of the United
Nations Convention on Contracts for the International Sales of Goods (hereafter referred to as, the
“CISG”). Therefore, based on Article 142 of the Civil Code of the PRC, the CISG shall apply and has
priority. As to the issues beyond the scope of the CISG, the Arbitration Tribunal deems that China has
the closest relationship with the dispute in this case. Therefore, based on Article 145 of the Civil Code of
the PRC, the proximate connection principle, Chinese law shall be applied to those issues.
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subsidiary law applicable to the issues directly not regulated by the Convention, the
tribunal referred to Art. 28(1) of the Law of the Russian Federation “On International
Commercial Arbitration.”21
It is also worth noting a couple of arbitral awards that apply the CISG as general 22
principles of law. The first is an ICC award which pointed out that an exclusion of the
right to the payment of interest for delayed payment would have been difficult to
reconcile with the usages of international trade which are echoed by, among others, the
CISG and also the PICC.22 Also interesting is a CIETAC award in a dispute between a
Thai seller and a UK buyer (neither Thailand nor UK are Contracting States), in which
the tribunal found that although the parties’ places of business were located in non-
Contracting States, they made reference to the CISG in their statement of claim and
statement of defence. Considering this as well as the fact that Chinese law was applied
to the instant case, the tribunal held that the relevant provisions of the CISG should be
referred to.23
2. Drafting history
Art. 1 ULF and Arts 1, 2 and 7 ULIS contain similar provisions to Art. 1 CISG albeit 23
with different scope. It was widely felt that the sphere of application of the Hague Sales
Laws was a source of confusion with various subjective and objective tests as well as a
number of reservations declared by most Contracting States.24 As a result, the Working
Group on the drafting of this Convention25 took careful steps to elaborate rules relating
to the sphere of application which were simpler and to the extent possible clearer. The
consequence of these efforts is that there is no longer a principle of absolute univers-
ality,26 since the place of business of the parties is an undisputed criterion for the
application of the Convention pursuant to Art. 1(1)(a); there is, however, a qualified
universality by virtue of Art. 1(1)(b) which is also balanced out by the reservation in
Art. 95.27
3. Importance of provision
The importance of Art. 1 can be ascertained by the fact that Art. 1 is to-date 24
mentioned in roughly one in three known CISG cases, whether court decisions or
arbitral awards. Art. 1 sets out the CISG’s own (autonomous) rules of application and
also limit the scope of the Convention. It is correctly pointed out that the importance
lies in the fact that “the unification of sales law is only a partial one: the CISG only
purports to regulate a section of the law.”28 Inevitably, domestic law retains its relevance
and hence it is essential to delimit the sphere and scope of application of the CISG as
precisely and uniformly as possible.
21 Arbitral Award, Tribunal of International Commercial Arbitration at the Russian Federation
Chamber of Commerce and Industry, 13 February 2006, (Equipment), CISG-Online 1623 (Pace). The
Tribunal held that for matters not governed by the CISG German law was applicable.
22 Arbitral Award, ICC 9333/1998 (Services), CISG-Online 1308 (Pace).
23 Arbitral Award, CIETAC, 29 March 1996 (Natural rubber), (Pace).
24 Schwenzer/Hachem, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 1 para. 1.
25 Honnold, Documentary History (1989), pp. 16–18, 29–39, 44–63, 96, 100–101, 197–198, 213–218,
241–243, 275–277, 300–302, 318–323, 358–361, 392, 394.

26 Schwenzer/Hachem, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 1 para. 2 with further
references.
27 See also Art. 95 infra; pursuant to Art. 95 reservations the CISG cannot apply through Art. 1(1)(b),
only through 1(1)(a).

28 Schlechtriem/Butler, CISG (2016), para. 8.
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II. Detailed Commentary

1. Sales contracts
25 The CISG will only apply to contracts for the sale of goods and certain mixed
contracts29 with a preponderant sales contract element. While there is no express
definition of sales contract in the Convention30 one can devise one autnonomous31
definition by looking at Arts 30 and 53.32 A contract for the sale of goods is a contract
where goods are exchanged for money33 and a formal “labelling” of the contract by the
contracting parties as a contract or sale would not normally be required.34 It would be
more precise though to consider as a sales contract covered by the CISG, a contract
pursuant to which the seller is bound to deliver the goods and transfer the property in
the goods sold and the buyer is obligated to pay the price and accept the goods.35 Not all
contracts with characteristics of a sales contract will fall under the ambit of the CISG:
sometimes what is relevant is the nature of the contract, and in other cases the nature of
the goods sold. A particular modern legal challenge relates to the use of the CISG in
digital contracts and contracts for the sale of digital goods.36
26 a) Contract of sale. The CISG covers the basic contract for the sale of tangible goods
(goods delivered against payment) but also other contracts of sale. For example, it follows
from Art. 73 that the CISG applies to contracts for the delivery of goods by instalments,37
and contracts providing for the delivery of the goods sold directly from the supplier to the
seller’s customer, i. e. the buyer.38 Contracts for the delivery of instalments are quite
common in business practice and so are contracts where the seller effectively acts as an
intermediary between the supplier and the buyer – in fact the seller purchases goods from
the supplier and sells them on to the buyer.39 They possess all characteristics of sales
contracts and should be treated as such. Moreover, and pursuant to Art. 29, contracts
modifying or even avoiding the original sales contract also fall within the sphere of
29See Art. 3 infra.

30See Oberster Gerichtshof (Austria) 10 November 1994 (Chinchilla furs), CISG-Online 117 (Pace).
31 See Tribunale di Forli (Italy), 16 February 2009 (cisterns), CISG-Online 1780 (Pace).
32 See Rechtbank Rotterdam (Netherlands) 1 November 2001, Nederlands Internationaal Privaatrecht,
2002, No. 114; Kantonsgericht Wallis (Switzerland) 11 March 1996 (Clay); Tribunale di Rimini (Italy)
26 November 2002 (Porcelain tableware), CISG-Online 737 (Pace).
33 Schlechtriem/Butler, CISG (2009), para. 24. See also Kantonsgericht des Kantons Zug (Switzerland)
21 October 1999 (PVC and other synthetic materials), CISG-Online 491 (Pace); Tribunale di Forli (Italy),
16 February 2009 (cisterns), CISG-Online 1780 (Pace).
34 Foreign Trade Court of Arbitration attached to the Serbian Chamber of Commerce, Serbia, Arbitral
Award of 15 July 2008 (milk packaging equipment), CLOUT no 1021 (Pace).

35 See Oberster Gerichtshof (Austria) 10 November 1994 (Chinchilla furs), CISG-Online 117 (Pace) (see
full text of the decision); for a reference to the buyer’s obligation mentioned in the definition cited in the text,
see Rechtbank Koophandel Hasselt (Belgium) 2 May 1995 (Frozen raspberries), CISG-Online 371 (Pace).
36 Eggen, (2017). Digitale Inhalte unter dem CISG Eine Rundschau über Herausforderungen und
mögliche Lösungen, 17(6) Internationales Handelsrecht 229.

37 See Arbitral Award, Schiedsgericht der Hamburger freundlichen Arbitrage, 29 December 1998
(Cheese), CISG-Online 638 (Pace); Handelsgericht des Kantons Zürich (Switzerland) 30 November 1998
(Lambskin coat), CISG-Online 415; Oberster Gerichtshof (Austria) 12 February 1998 (Umbrella), CISG-
Online 349 (Pace); Arbitral Award, Schiedsgericht der Handelskammer Hamburg, 21 June 1996 (Chinese
goods), CISG-Online 465 (Pace); Landgericht Ellwangen (Germany) 21 August 1995 (Paprika), CISG-
Online 279 (Pace); Cour d’appel Grenoble (France) 22 February 1995 (Jeans), CISG-Online 151 (Pace).
38 Bundesgerichtshof (Germany) 12 February 1998 (Air cleaning installation), CISG-Online 343 (Pace);
Bezirksgericht der Sanne (Switzerland) 20 February 1997 (Spirits), CISG-Online 426 (Pace).
39 Schlechtriem/Butler, CISG (2009), para. 24 a.
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application of the CISG.40 In this context, even a repurchase obligation would be governed
by the Convention if it is associated with a sales contract.41
Contracts modifying a prior contract may assume other characteristics than the original 27
contract, but also normally carry on with the features of the original contract. One may
consider two different scenarios: in the first, the contract originally fell under the CISG at
the time of contract drafting, but at the time of modification this became no longer so; e. g.
where one party no longer has its place of business in a Contracting State. In such a case,
the CISG continues to apply if it were applicable at the time of contract conclusion. In the
second scenario the original contract was governed by national law, but at the time of the
contract modification the CISG could become applicable if a new contract had been
concluded. Arguably the CISG could apply also in this second factual scenario.
It is rightly suggested that the CISG should also apply to framework contracts which 28
obligate the contracting parties to agree a sales contract, provided the framework
contains the main rights and duties without having to refer to them in the main
contract: in other words one should equate contacts of sale with contracts for sale.42
Specific examples of framework contracts where the CISG may apply include distribu-
tion and franchising agreements, discussed below.
Art. 3 specifically deals with contracts of a mixed nature and contains a special rule 29
which extends, within certain limits, the CISG’s sphere of application to contracts for
the sale of goods to be manufactured or produced as well as to contracts pursuant to
which the seller is also bound to deliver additional services, such as labour.43
It is widely accepted that barter (countertrade – goods delivered in exchange for other 30
goods) does not fall under the substantive sphere of application of the CISG. Although
the CISG could possibly apply,44 it is clear that barter falls outside the definition of
contract of sale suggested above. If one were to read the definition broadly (goods
delivered against a value rather than price) the barter could be accommodated under the
CISG.45 Barter contracts have become a less regular occurrence in many parts of the
world, but do survive in certain parts of central Asia and Africa.
Certain contracts of sale are excluded from the substantive sphere of application of 31
the CISG, pursuant to Art. 2.46 This may be justified the basis of the nature (or more
accurately the objective) of the sales contract (in particular, pursuant to Art. 2(a), sale of
40 See Oberlandesgericht München (Germany) 21 January 1998 (Insulating materials), CISG-Online 536
(Pace); Oberlandesgericht München (Germany) 8 February 1995 (Automobiles), CISG-Online 143 (Pace);
Arbitral Award, ICC 7331/1994 (Cowhides), CISG-Online 106 (Pace); Landgericht Hamburg (Germany)
26 September 1990 (Textiles), CISG-Online 21 (Pace); Amtsgericht Sursee (Switzerland) 12 September
2008 (Second hand tractor), CISG-Online 1728 (Pace).
41 Bundesgerichthof (Germany), 28 May 2014 (sale of bowling alleys with repurchase obligation in sales
contract), CISG-Online 2513, Contrast Oberlandesgericht Köln (Germany), 21 November 2012 (repurch-
ase obligation contained in court settlement in a CISG case), CISG-Online 2401.
42 Schlechtriem/Butler, CISG (201609), para. 24 b. See also Bridge, International Sale of Goods (2007),
para. 2.18; Cour de cassation (France) 30 June 2004, CISG-Online 870 (Pace); Cour de cassation (France)
20 February 2007 (Perfume), CISG-Online 1492 (Pace). See also related contracts below at paras 32 et seq.
43 See further Art. 3 infra. See also CISG-AC Opinion no 4.
44 Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 1 para. 18; Tribuna Of Interna-
tional Commercial Arbitration at the Ukrainian Chamber of Commerce and Trade (Ukraine), 10 October
2003 (Pace).
45 Bridge, International Sale of Goods (2007), para. 11.19; Schwenzer/Hachem, in: Schlechtriem/
Schwenzer, Commentary (2010), Art. 1 para. 11; it is noteworthy that the authors state that in barter
contract most likely both parties can be treated as sellers. As a matter of fact, both parties can be treated
as sellers and buyers. See also Arbitral Award, International Court of Arbitration at the Russian Chamber
of Commerce and Industry, 9 March 2004, CISG-Online 1181; Federal Arbitration Court of the Moscow
Region (Russian Federation), 26 May 2003 (Pace).
46 See Art. 2 infra.
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goods bought for personal, family or household use) or the non-contractual basis of the
sales transaction, in particular sale by auction (Art. 2(b)) or sale on execution or by
authority of law (Art. 2(c)). The former is justified as the law wishes to protect weaker
parties, the latter exists because the contract is neither negotiated nor clearly expresses
the intent of the parties and most terms are implied by statute.
32 b) Related contracts. A number of contracts with a sales element may also be
considered as falling within the substantive sphere of the CISG. There is case law (and
clarity) in respect of certain types of contracts while there is debate and no practice in
relation to other contracts.
33 Most courts (but not all courts)47 have held that the CISG does not apply to
distribution agreements;48 the reasoning has been that distribution agreements have as
their focus the organization of distribution of goods (mostly as a service) rather than the
passing of property and delivery of goods.49 It follows that all sales contracts concluded
in performance and implementation of the distribution agreement could and should be
governed by the CISG.50 A good example is provided in case law51 where a possible
combination of the framework agreement (in this particular case, distribution), which is
subject to domestic law, and the sales contracts made in the performance of this
agreement, which are subject to the Convention.52
34 It is also accepted in case law that franchising agreements also fall outside the
substantive sphere of application of the CISG:53 franchising agreements contain many
additional features, such as a license to use a trademark, know-how of the organization
and running of business, all of which are significant and distinct from rights and duties
under a sales contract. However, if under a franchise contract there are several contracts
47 One court has applied the CISG to a distributorship agreement. See Corte di Cassazione (Italy)
14 December 1999 (Manufactured goods), CISG-Online 1314 (Pace). For a case in which the issue was
raised but not resolved, see Federal District Court, SD of New York (U.S.) 23 July 1997 (Fashion
accessories), CISG-Online 297 (Pace).
48 See Cour d’appel de Reims (France), 30 Apirl 2013; Oberlandesgericht München (Germany) 21 Jan-
uary 1998 (Insulating materials), CISG-Online 536 (Pace); Oberlandesgericht Hamm (Germany) 5 No-
vember 1997 (Inline skates), CISG-Online 381 (Pace); Oberlandesgericht München (Germany) 9 July 1997
(Leather goods), CISG-Online 282 (Pace); Oberlandesgericht Düsseldorf (Germany) 11 July 1996 (Lawn
mower engines), CISG-Online 201 (Pace); Fovárosi Biróság (Hungary) 19 May 1996 (Instruments),
(Pace); Oberlandesgericht Koblenz (Germany) 17 September 1993 (Computer chip), CISG-Online 91
(Pace); Hof Amsterdam (Netherlands) 16 July 1992 (Shower cabinets), CISG-Online 48 (Pace); U.S.
District Court, District of Arizona (U.S.), 16 December 2014, Adonia Holding GmbH v. Adonia Organics
LLC (Pace); Federal District Court, ED of Pennsylvania (USA) 29 August 2000 (Wine), CISG-Online 675
(Pace); Hof Arnhem (Netherlands) 27 April 1999 (Movable room units), CISG-Online 741 (Pace);
Rechtsbank ‘s-Gravenhage (Netherlands) 2 July 1997 (Cushions), CISG-Online 1331 (Pace).
49 Obergericht des Kantons Luzern (Switzerland) 8 January 1997 (Blood infusion devices), CISG-Online
228 (Pace); Cour de cassation (France) 20 February 2007 (perfume), CISG-Online 1492 (Pace). The
contrary view was held in Arbitral Award, ICC 9448/1999 (Roller bearings), CISG-Online 707 (Pace)
where the tribunal held that a framework agreement was governed by the CISG because it ultimately
provided for future sales.
50 See Oberlandesgericht Hamm (Germany) 5 November 1997 (Inline skates), CISG-Online 381 (Pace);
Oberlandesgericht München (Germany) 9 July 1997 (Leather goods), CISG-Online 282 (Pace); Oberlan-
desgericht Düsseldorf (Germany) 11 July 1996 (Lawn mower engines), CISG-Online 201 (Pace); Cour
d’appel Grenoble (France) 15 May 1996, Thermo King v Cigna Insurance, CISG-Online 219 (Pace);
Oberlandesgericht Koblenz (Germany) 17 September 1993 (Computer chip), CISG-Online 91 (Pace);
Arbitral Award, ICC 8908/1998 (Pipes), CISG-Online 1337 (Pace); Arbitral Award, ICC 8611/1997
(Industrial equipment), CISG-Online 236 (Pace).
51 Bundesgerichtshof (Germany) 23 July 1997 (Benetton II), CISG-Online 276 (Pace).
52 See also discussion by Schlechtriem, Uniform Sales Law in the Decisions of the Bundesgerichtshof,
http://www.cisg.law.pace.edu/cisg/biblio/schlechtriem3.html.
53 See Obergericht des Kantons Luzern (Switzerland) 8 January 1997 (Blood infusion devices), CISG-
Online 228 (Pace).
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for the international sale of goods between the parties of the franchise contract, these
sales contracts should be governed by the CISG.
It is also widely accepted that a contract for the sale of goods with a special finance 35
agreement would typically be excluded from the substantive sphere of application of the
CISG. Examples of such contracts with a finance facility would include hire purchase
(leasing) agreements and sale-and-lease back contracts. The justification is that the
finance facility in such agreements is more important than the sales element itself,
although the circumstances of each agreement may modify the degree of importance.54
2. Goods
The Convention contains no definition of “goods”. Despite this fact, the term 36
“goods”, as it is a Convention term, has to be interpreted in accordance with Art. 7(1):
“goods is to be interpreted autonomously, having regard to the “international char-
acter” of the CISG and the “need to promote uniformity in its application”.55 In other
words any definition of “goods” will be made without any reference to the same term in
domestic laws. Similarly, the CISG does not introduce distinctions between tangible and
intangible goods, movable and immovable goods, and the like.
According to case law, CISG “goods” typically are items that are, at the moment of 37
delivery,56 “moveable and tangible”,57 regardless of whether they are solid,58 used or
new,59 inanimate or alive.60 It is correctly suggested that human organs, artificial limbs,
cultural and art objects, pharmaceuticals and similar goods would qualify as CISG
goods,61 with the caveat that domestic law may impose restrictons as to the sale of said
goods or the validity of such contracts.62
At the same time, intangibles, such as intellectual property, an interest in a limited 38
liability company,63 or an assigned debt64 have been considered not to fall within the
54 See Schwenzer/Hachem, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 1 paras 12–13; See a dif-
ferent view in Ferrari, in: Schlechtriem/Schwenzer, Kommentar (6th German ed. 2013), Art. 1 paras 27 and 30.
55 See Art. 7.
56 See Cour d’appel Grenoble (France) 26 April 1995, Marques Roque v Manin Reviere (Second hand
portable warehouse shed), CISG-Online 154 (Pace); Tribunale di Rimini (Italy) 26 November 2002
(Porcelain tableware), CISG-Online 737 (Pace); Tribunale di Forli (Italy), 16 February 2009 (cisterns),
CISG-Online 1780 (Pace).
57 See Kantonsgericht des Kantons Zug (Switzerland) 21 October 1999 (PVC and other synthetic
materials), CISG-Online 491 (Pace); Tribunale di Pavia (Italy) 29 December 1999 (High fashion textiles),
CISG-Online 678; Oberlandesgericht Köln (Germany) 26 August 1994 (Market study), CISG-Online 132
(Pace); Oberster Gerichtshof (Austria) 10 November 1994 (Chinchilla furs), CISG-Online 117 (Pace);
Tribunale di Rimini (Italy) 26 November 2002 (Porcelain tableware), CISG-Online 737 (Pace); Tribunale
di Forli (Italy), 16 February 2009 (cisterns), CISG-Online 1780 (Pace).
58 See Oberster Gerichtshof (Austria) 6 February 1996 (Propane), CISG-Online 224 (Pace), applying the
CISG to the sale of propane gas.

59 See Oberlandesgericht Köln (Germany) 21 May 1996 (Used car), CISG-Online 254 (Pace) and the
prior instance: Landgericht Köln (Germany) 16 November 1995 (Used car), CISG-Online 265; Tribunale
di Forli (Italy), 16 February 2009 (cisterns), CISG-Online 1780 (Pace).
60 See Rechtbank Arnhem (Netherlands) 30 December 1993 (live lambs), CISG-Online 104 (Pace); Ober-
landesgericht Jena (Germany) 26 May 1998 (live fish), CISG-Online 513 (Pace); Cour d’appel Paris (France)
14 January 1998 (circus elephants), CISG-Online 347 (Pace). Cf. Oberster Gerichtshof (Austria) 10 November
1994 (Chinchilla furs), CISG-Online 117 (Pace); Oberlandesgericht Hamm (Germany) 22 September 1992
(bacon), CISG-Online 57 (Pace). For a decision that deems animals to be “goods” in the sense of the
Convention, see Landgericht Flensburg (Germany) 19 January 2001 (Live sheep), CISG-Online 619 (Pace).
61 See Schwenzer/Hachem, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 1 para. 16.
62 See Bridge, International Sale of Goods, no 157.
63 See Arbitral Award, Arbitration Court attached to the Hungarian Chamber of Commerce and
Industry, 20 December 1993 (Shares of stock), CISG-Online 94 (Pace).

64 See Tribunale di Vigevano (Italy) 12 July 2000 (Vulcanized rubber), CISG-Online 493 (Pace).
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CISG’s concept of “goods”, to a large extent because there can be no element of physical
delivery in accordance with the provisions of the Convention65. The same is true for a
market research study66 or similar intellectual products that would hardly qualify as
goods. In fact, one can argue that market research or an expert report is a contract of
different quality, namely the provision of a service or a contract for the performance of
a work. There is, however, significant scholarly opinion suggesting that sale of digital
goods may also qualify as a contract for the sale of goods under the CISG.67
39 It is also clear that the sale of a business would not qualify as a CISG sale, nor would a
sale of rights. According to one court, however, the concept of “goods” is to be interpreted
broadly,68 with the arguable conclusion that the CISG may apply also to intangible goods.
It is generally accepted that the CISG will not apply to immovable property or property
which is at law treated as immovable, i. e. registered property such as ships and aircrafts.
(Art. 2(e)). Certain other restrictions in relation to “goods” are introduced in Art. 269
where sale of electricity (Art. 2(f)) – but not necessarily of all forms of energy resources70
– and sale of stocks, shares, investment securities, negotiable instruments or money
(Art. 2(d))71 are excluded from the substantive sphere of the Convention.
40 Another contentious area is that of the sale of software and whether software qualifies
as “goods” under the CISG. While the sale of computer hardware clearly falls within the
sphere of application of the CISG,72 the application of the Convention is disputed when
it comes to software. Some courts consider only standard software to be “goods” under
the Convention;73 another court concluded that any kind of software, including tailor-
made software, should be considered “goods”.74 Software is not always delivered in a
tangible form: it may well happen that the “buyer” of software merely acquires an access
key, a license to use the software. Most certainly, the acquisition of software is also
associated with the acquisition of intellectual property for which a separate license is
given. The CISG may be applicable to the sale of software, but it would be inevitable
that some of its provisions may have to be adapted as software transactions also involve
65See Gilette/Walt, at p. 44.

66See Oberlandesgericht Köln (Germany) 26 August 1994 (Market study), CISG-Online 132 (Pace).
67 See the comprehensive discussion in Eggen, Digitale Inhalte unter dem CISG Eine Rundschau über
Herausforderungen und mögliche Lösungen. 17(6) Internationales Handelsrecht, 231 et seq.

68 See Oberlandesgericht (Germany) 17 September 1993 (Computer chip), CISG-Online 91 (Pace).
70 A different view may be taken in relation to liquidated natural gas or propane gas. See Oberster
Gerichtshof (Austria) 6 February 1996 (Propane), CISG-Online 224 (Pace), applying the CISG to the sale
of propane gas.
71 See also the discussion in FMLC, Implementation of the Vienna Sales Convention – Issue 130:
Legal assessment of various financial markets aspects of the question whether the UK should implement
the Vienna Sales Convention – July 2008, available at http://www.fmlc.org/papers/Issue130reportJu-
ly08.pdf.
72 See Landgericht München (Germany) 29 May 1995 (Computer hardware), CISG-Online 235 (Pace);
Landgericht Heidelberg (Germany) 3 July 1992 (Computer components), CISG-Online 38 (Pace). See also,
for a comprehensive discussion, Gilette/Walt, at pp. 49–55; and Sono. The Applicability and Non-
Applicability of the CISG in Software Transactions, in Andersen & Schroeter (eds.), Sharing International
Commercial Law across National Boundaries: Festschrift for Albert H. Kritzer on the Occasion of his
Eightieth Birthday (2008) 512–526.
73 See Oberlandesgericht Köln (Germany) 26 August 1994 (Market study), CISG-Online 132 (Pace);
Landgericht München (Germany) 8 February 1995 (Standard software), CISG-Online 203 (Pace). See also
Ferrari, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2013), Art. 1 para. 38; Diedrich, Maintain-
ing Uniformity in International Uniform Law Via Autonomous Interpretation: Software Contracts and
the CISG, 8 Pace International Law Review (1996) 303 (325–332).
74 See Oberlandesgericht Koblenz (Germany) 17 September 1993 (Computer chip), CISG-Online 91
(Pace); Oberster Gerichtshof (Austria) 21 June 2005, CISG Online 1043.
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intellectual property transactions and may also otherwise qualify as mixed contracts
(tailor-made software is also discussed under Art. 3).75
Documentary sales will not introduce any problem to the application of the CISG.76 41
Documentary sales are normal sales for which goods will have to be delivered; simply
because of the distance between the parties and a number of ancillary obligations, such
as shipment and insurance, documents are also produced which are delivered in
addition to the delivery of goods. The most important documents in this respect are
documents of title, such as a bill of lading.77
3. Internationality
a) Introductory remarks. The CISG applies to contracts for the international sale of 42
goods. Pursuant to Art. 1(1), a contract for the sale of goods is international when the
parties have, at the moment of the conclusion of the contract,78 their relevant place of
business in different States.79 “Place of business” is hence essential in the determination
of internationality. The CISG, however, does not define it; it merely addresses the issue
of which of a party’s multiple places of business is to be taken into account in
determining internationality.80
b) Place of business. In absence a definition of “place of business” in the CISG, the 43
matter has been addressed on a number of occasions by case law. According to one
court, “place of business” may be defined as “the place from which a business activity is
de facto carried out […]; this requires a certain duration and stability as well as a
certain amount of autonomy.”81 Another court has concluded that a liaison office
cannot be considered a “place of business” under the Convention.82 In other words, the
case law clearly suggests that under the CISG “place of business” require a genuine and
effective link of the business with a place with at least regular business activity. It is
irrelevant as such whether the seller or buyer is incorporated in the “place of business”.
As a result, the place of contracting does not necessarily constitue a place of business;83
the same applies in relation to the place of storage of goods.84
75See Art. 3 infra.

76Schlechtriem, Requirements of Application and Sphere of Applicability of the CISG, Victoria
University Wellington Law Review (2005/4) 781 (784).
77 Bridge, International Sale of Goods, para 10.20.
78 See Oberlandesgericht Dresden (Germany) 27 December 1999 (Chemical products), CISG-Online 511
(Pace); Tribunale di Forli (Italy), 11 December 2008 (shoes), CISG-Online 1768 (Pace).
79 See Tribunale di Vigevano (Italy) 12 July 2000 (Vulcanized rubber), CISG-Online 493 (Pace);
Oberlandesgericht Köln (Germany) 21 May 1996 (Used car), CISG-Online 254 (Pace); Oberster Gericht-
shof (Austria) 10 November 1994 (Chinchilla furs), CISG-Online 117 (Pace); Tribunale di Rimini (Italy)
26 November 2002 (Porcelain tableware), CISG-Online 737 (Pace); Polimeles Protodikion Athinon
(Greece), 4505/2009 (Materials forbull-proof vests) CISG-Online 2228 (Pace).
80 See Art. 10 infra. See also U.S. District Court, Eastern District of Pennsylvania (U.S.). 29 January 2010
(Styrene), CISG-Online 2090.

81 Oberlandesgericht Hamm (Germany) 2 April 2009 (cars), CISG-Online 1978; Oberlandesgericht
Stuttgart (Germany) 28 February 2000 (Floor tiles), CISG-Online 583 (Pace); Tribunale di Rimini (Italy)
26 November 2002 (Porcelain tableware), CISG-Online 737 (Pace); for a similar definition see Oberster
Gerichtshof (Austria) 10 November 1994 (Chinchilla furs), CISG-Online 117 (Pace); for a court decision
stating that the phrase “place of business” requires the parties to “really” do business out of that place, see
Amtsgericht Duisburg (Germany) 13 April 2000 (Pizza cartons), CISG-Online 659 (Pace).
82 See Cour d’appel Paris (France) 22 April 1992 (Electronic components), CISG-Online 222 (Pace).
83 Arbitral Award, ICC Court of Arbitration, in case no 9781 of 2000 (waste recycling plant) at para. 33.
(Pace).
84 Tribunal cantonal du Valais (Switzerland), 23 May 2006 (clothing, suits), CISG-Online 1532 (Pace).
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44 The internationality requirement is not met where the parties have their relevant
place of business in the same country;85 diversity of place of business is an absolute
condition for Art. 1(1) to operate. This is true even if the seller and the buyer have
different nationalities, as Art. 1(3) states that the nationality of the parties is not relevant
when determining the application of the CISG.86 It is diversity of place of business not
diversity of citizenship that is relevant to establish internationality. Equally, the fact that
the place of the conclusion of the contract is located in a different State from the State in
which the performance takes place does not render the contract “international”.87 It
is also irrelevant whether the goods will cross borders or not. For example, a seller of
beer with a place of business in Germany who agrees with a hotel chain with place
of business in Switzerland for beer to be transferred from the warehouse of a beer
producer in Moscow to the hotels of the chain operating in Russia qualifies as interna-
tional sale under the CISG.
45 c) Agency. An intriguing point of Art. 1 relates to the use of intermediaries or agents
in “international” sales contracts. Where the contract for the sale of goods is concluded
through an intermediary or an agent,88 it is essential to establish who the parties to the
sales contract are in order to determine whether the contract is international.89 The
CISG, however, does not deal with the question of who is party to a contract of sale, in
particular, in cases where the identity of the parties is not directly clear from the
contract formation (e. g. when both parties use agents for the contract negotiation and
conclusion)90 Consequently, the question must be answered by reference to the law
applicable by operation of the private international law91 of the deciding court or the
private international law applicable to an arbitral tribunal. Once the places of business
of the parties have been determined, the court or tribunal can decide whether the
contract is international.92
85 See Superior Court of Massachussetts (U.S.), 28 February 2005 (smoke detection units), CISG-Online
1005 (Pace).
86 For references to the irrelevance of the nationality of parties, see Bundesgerichtshof (Germany)
31 October 2001 (Machinery), CISG-Online 617 (Pace); Rechtbank Koophandel Veurne (Belgium)
25 April 2001 (Diesel tram), CISG-Online 765 (Pace); Arbitral Award, Court of Arbitration of the
Bulgarian Chamber of Commerce and Industry 56/1995, 24 April 1996 (Coal), CISG-Online 435 (Pace).
87 See Oberlandesgericht Köln (Germany) 27 November 1991 (Ticket for soccer world championship),
88 See also Schwenzer/Hachem, in: Schlechtrriem/Schwenzer, Commentary (2016), Art. 1 paras 26–27;
Ferrari, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2013), Art. 1 paras 41–42, 51; Honnold/
Flechtner, Uniform Law (2009), Art. 1 para. 41.
89 U.S. District Court, ND of California (U.S.) 27 July 2001, Asante Technologies, Inc. v PMC-Sierra,
Inc. (Computer chips), CISG-Online 616. See also the discussion in Honnold/Flechtner, Uniform Law
(2009), Art. 1 para. 42.
90 For court decisions stating that issues of agency and similar matters are outside the sphere of
application of the CISG, see Tribunale di Vigevano (Italy) 12 July 2000 (Vulcanized rubber), CISG-Online
493 (Pace); Oberster Gerichtshof (Austria) 20 March 1997 (Mono ammonium phosphate), CISG-Online
269 (Pace); Appellationsgericht Tessin (Switzerland) 12 February 1996 (Copy paper), CISG-Online 233
(Pace); Obergericht des Kantons Thurgau (Switzerland) 19 December 1995 (Cloth), CISG-Online 496
(Pace); Landgericht Kassel (Germany) 22 June 1995 (Clothes), CISG-Online 370 (Pace); see Amtsgericht
Alsfeld (Germany) 12 May 1995 (Flagstone tiles), CISG-Online 170 (Pace); Kammergericht Berlin
(Germany) 24 January 1994 (Wine), CISG-Online 130 (Pace); Zivilgericht Basel-Stadt (Switzerland)
21 December 1992 (Textiles), CISG-Online 55 (Pace); Landgericht Hamburg (Germany) 26 September
1990 (Textiles), CISG-Online 21 (Pace).
91 Ferrari in Schlechtriem/Schwenzer (German ed., 2013), Art. 1, para 41. Saenger in Ferrari et al,
Internationales Vertragsrecht, Article 1, para. 12.

92 See Oberlandesgericht Köln (Germany) 13 November 2000 (Plug-couplings), CISG-Online 657
(Pace).
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Pursuant to Art. 1(2), whether the internationality requirement is met or not, it is 46
irrelevant where the places of business in different States do not follow either from the
contract or from any dealings between, or from information disclosed by, the parties at
any time before or at the conclusion of the contract.93 In other words, the CISG protects
the parties’ reliance upon what appears to be a domestic setting for a transaction. In
such a case, the burden of proof rests with the party asserting that the CISG is not
applicable because the internationality of the contract was not apparent.94
4. Automatic application if international sales contract

According to Art. 1(1) there are in total three criteria essential for the application of 47
the CISG. The first two have to be met in any event: first it must be a “contract for the
sale of goods”, second it has to be an “international contract”. The third criterion is
one of two alternative criteria which has to be made in addition95 to the first two
(establishing internationality and subject matter) to make the Convention applicable.
One alternative criterion can be found in Art. 1(1)(a) and makes the application of
the Convention “automatic” or “autonomous”96 or “direct”,97 without any need for
recourse to private international law rules.98 The second alternative is discussed under
section 6 below. The application of the CISG is autonomous or direct when the States
in which the parties have their relevant places of business are Contracting States. With
the increase of the number of Contracting States,99 this criterion has as a consequence
that the application of the Convention will be automatic in an ever-increasing number
of cases.100
93 For a reference to this provision, see Oberster Gerichtshof (Austria) 21 March 2000 (Wood), CISG-
Online 641 (Pace); Tribunale di Vigevano (Italy) 12 July 2000 (Vulcanized rubber), CISG-Online 493
(Pace).
96 See Tribunale di Vigevano (Italy) 12 July 2000 (Vulcanized rubber), CISG-Online 493 (Pace);
Oberster Gerichtshof (Austria) 20 March 1997 (Mono ammonium phosphate), CISG-Online 269 (Pace).
97 See Bundesgericht (Switzerland) 11 July 2000 (Building materials), CISG-Online 627 (Pace); Berzirks-
gericht der Sanne (Switzerland) 20 February 1997 (Spirits), CISG-Online 426 (Pace).
98 See Bundesgerichtshof (Germany) 11 December 1996 (Marzipan), CISG-Online 225 (Pace).
99 See http://www.uncitral.org/uncitral/en/uncitral_texts/sale_goods/1980CISG_status.html for an up-
to-date status of the Convention. There are 89 Contracting States as of February 2018.
100 For a selection of court decisions applying the Convention by virtue of Art. 1(1)(a), see, e. g., Hof
Beroep Gent (Belgium) 31 January 2002 (Candy), CISG-Online 1349 (Pace); Cour d’appel Orléans
(France) 29 March 2001 (High tension neon transformers), CISG-Online 611 (Pace); Oberster Gerichtshof
(Austria) 7 September 2000 (Tombstones), CISG-Online 642 (Pace); Oberlandesgericht Frankfurt am
Main (Germany) 30 August 2000 (Yarn), CISG-Online 594 (Pace); Sixth Civil Court of First Instance, City
of Tijuana, State of Baja California (Mexico) 14 July 2000 (Wood), CISG-Online 571 (Pace); Tribunale di
Vigevano (Italy) 12 July 2000 (Vulcanized rubber), CISG-Online 493 (Pace); Oberster Gerichtshof
(Austria) 28 April 2000 (Jewellery), CISG-Online 581 (Pace); Oberster Gerichtshof (Austria) 13 April
2000 (Machines), CISG-Online 576 (Pace); Audiencia Provincial de Navarra (Spain) 27 March 2000
(Electrical goods), CISG-Online 575 (Pace); Tribunal Supremo (Spain) 28 January 2000 (Jute), CISG-
Online 503 (Pace); Bundesgerichtshof (Germany) 3 November 1999 (Machine for producing hygenic
tissues), CISG-Online 475 (Pace); Cour d’appel Grenoble (France) 21 October 1999 (Footwear), CISG-
Online 574 (Pace); Ontario Superior Court of Justice (Canada) 31 August 1999 (Picture frame mouldings),
CISG-Online 433 (Pace); Cour de cassation (France) 26 May 1999 (Laminated sheet metal), CISG-Online
487 (Pace); Arbitral Award, Arbitration Court attached to the Hungarian Chamber of Commerce and
Industry, 25 May 1999 (Sour cherries), CISG-Online 500 (Pace); Cour d’appel Paris (France) 21 May 1999
(Electronic equipment), CISG-Online 498 (Pace); Federal District Court, ED of Louisiana (U.S.) 17 May
1999 (Medical equipment), CISG-Online 387 (Pace); Bundesgerichtshof (Germany) 24 March 1999 (Vine
wax), CISG-Online 396 (Pace); Corte di Appello, Milano (Italy) 11 December 1998 (Printer device), CISG-
Online 430 (Pace); Bundesgericht (Switzerland) 28 October 1998 (Meat), CISG-Online 413 (Pace); Federal
District Court, ND of Illinois (U.S.) 28 October 1998 (Aircraft parts), CISG-Online 444 (Pace); Corte di
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48 As it was unambiguously stated during the 1980 Diplomatic Conference, “if the two
States in which the parties have their places of business are Contracting States, the
Convention applies even if the rules of private international law of the forum would
normally designate the law of a third country.”101 This statement will have to be
qualified though; the CISG will not be automatically applied if a third country’s law
would apply because of a choice of law agreement by which the parties to the sales
contract express their intention to exclude the CISG, a right the parties have pursuant
Art. 6 of the Convention.102
49 It is also important to establish when a State becomes a Contracting State. This is to
be determined by Art. 99;103 inter-temporal rules about the application of the CISG
pursuant to Art. 1(1)(a) are contained in Art. 100.104 In addition, one should also
ascertain whether the States in which the parties have their relevant places of business
have made either an Art. 92105 or an Art. 93106 reservation.107
5. Territorial application – Contracting States

50 Generally, a Contracting State is any State which has implemented the Convention by
ratification or accession pursuant to Art. 91(2) and Art. 91(3)108 and by its entry into
force in accordance with Art. 99(2)109 and Art. 91(4)110.
Cassazione (Italy) 7 August 1998 (Women’s stockings), CISG-Online 538 (Pace); Cour de cassation
(France) 16 July 1998 (Aluminium hydrate), CISG-Online 344 (Pace); US Court of Appeals, 11th Circuit
(U.S.) 29 June 1998 (Ceramic tiles), CISG-Online 342 (Pace); Arbitral Award, Arbitration Institute of the
Stockholm Chamber of Commerce, 5 June 1998 (4,000 ton rail press), CISG-Online 379 (Pace); Federal
District Court, SD of New York (U.S.) 6 April 1998 (Shoes), CISG-Online 440 (Pace); Arbitral Award,
Arbitration Court attached to the Bulgarian Chamber of Commerce and Industry 11/1996, 12 February
1998 (Steel ropes), CISG-Online 436 (Pace); Hoge Raad (Netherlands) 26 September 1997 (Fabrics),
101 United Nations Conference on Contracts for the International Sale of Goods, Vienna, 10 March-
11 April 1980, Official Records, Documents of the Conference and Summary Records of the Plenary
Meetings and of the Meetings of the Main Committee, 1981, 15.
105 See Art. 92 infra. See also Østre Landsret (Denmark) 23 April 1998 (Women’s clothing), CISG-
Online 486 (Pace); Fovárosi Biróság (Hungary) 21 May 1996, CISG-Online 252 (Pace); Oberlandesgericht
Rostock (Germany) 27 July 1995 (Plants), CISG-Online 209 (Pace); Arbitral Award, ICC 7585/1992
(Foamed board machinery), CISG-Online 105 (Pace). If one State has made an Art. 92 reservation
declaring that it is not bound by a specified part of the CISG, the Convention as a whole cannot be
applicable by virtue of Art. 1(1)(a). Rather, one must determine on the basis of Art. 1(1)(b) whether the
part of the Convention to which the reservation relates applies to the transaction.
106 See Art. 93 infra. Upon accession to the Convention, Canada declared, pursuant to Art. 93, that the
Convention would be applicable in some but not all of its territorial units. Since accession, Canada has
extended the application of the Convention to specific territorial units not covered by its original
accession.
107 See also CISG-AC Declaration No 2: Use of Reservations under the CISG. Rapporteur: Professor Dr.
Ulrich G. Schroeter, University of Mannheim, Germany. Adopted by the CISG-AC following its 18th
meeting, in Beijing, China, on 21 October 2013.
108 See Art. 91 infra. “(2) This Convention is subject to ratification, acceptance or approval by the
signatory States. (3) This Convention is open for accession by all States which are not signatory States as
from the date it is open for signature.”
109 See Art. 99 infra. According to (2) “When a State ratifies, accepts, approves or accedes to this
Convention after the deposit of the tenth instrument of ratification, acceptance, approval or accession,
this Convention, with the exception of the Part excluded, enters into force in respect of that State, …, on
the first day of the month following the expiration of twelve months after the date of the deposit of its
instrument of ratification, acceptance, approval or accession.”
110 See Art. 91 infra. According to (4) “Instruments of ratification, acceptance, approval and accession
are to be deposited with the Secretary-General of the United Nations.”
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6. Application by operation of conflict of laws

The CISG can also apply by operation of Art. 1(1)(b) where only one (or neither) 51
party has its relevant place of business in Contracting States,111 if the rules of private
international law lead to the law of a Contracting State.112 It is not always clear which
rules of private international law would be relevant, but it is reasonable to assume that
they will be those of the forum,113 at least in the context of litigation. Consequently, it
will very much depend on the domestic rules of private international law whether the
parties are allowed to choose the applicable law, whether renvoi is allowed (i. e. one has
to look into the rules of private international law designated by the rules of private
international law of the forum), and the like.
Under most private international law rules systems (such as the one based on 52
EC Regulation 593/2008 on the Law Applicable on Contractual Obligations114 or its
predecessor, the 1980 Rome Convention on the Law Applicable to Contractual
Obligations115), the parties’ choice of the law of a Contracting State can lead to the
applicability of the Convention by virtue of Art. 1(1)(b):116 both the Rome Convention
and the Regulation recognize the primacy of party autonomy. This is also true where
the rules of private international law of the forum are those laid down in the 1955
Hague Convention on the Law Applicable to International Sales.117
111 United Nations Conference on Contracts for the International Sale of Goods, Vienna, 10 March-
11 April 1980, Official Records, Documents of the Conference and Summary Records of the Plenary
Meetings and of the Meetings of the Main Committee, 1981, 15.
112 There are many cases referring to Art. 1(1)(b); see, e. g., Supreme Court of Queensland (Australia)
17 November 2000 (Scrap steel), CISG-Online 587 (Pace) (Malaysian and Australian parties chose
law applying in Brisbane); Cámara Nacional de Apelaciones en lo Comercial (Argentina) 24 April
2000 (Charcoal), CISG-Online 699 (Pace); Oberlandesgericht Hamburg (Germany) 26 November 1999
(Jeans), CISG-Online 515 (Pace); Østre Landsret (Denmark) 23 April 1998 (Women’s clothing), CISG-
Online 486 (Pace); Corte d’Appello Milano (Italy) 20 March 1998 (Knitwear), CISG-Online 348
(Pace); Oberster Gerichtshof (Austria) 12 February 1998 (Umbrella), CISG-Online 349 (Pace); Cour
de cassation (France) 27 January 1998 (Hooks, sockets/cartridges for fitting to electrical connectors),
CISG-Online 309 (Pace); Hoge Raad (Netherlands) 7 November 1997 (Vodka), CISG-Online 551
(Pace); Rechtbank Koophandel Kortrijk (Belgium) 6 October 1997 (Crude yarn), CISG-Online 532
(Pace); Arbitral Award, Schiedsgericht der Handelskammer Hamburg, 21 June 1996 (Chinese goods),
CISG-Online 465 (Pace); Cour de cassation (France) 4 January 1995 (Electronic components), CISG-
Online 138 (Pace); Arbitral Award, ICC 7660/1994 (Battery machinery), CISG-Online 129 (Pace);
Arbitral Award, Schiedsgericht der Bundeskammer der gewerblichen Wirtschaft (SCH 4366), 15 June
1994 (Rolled metal sheets), CISG-Online 121 (Pace); Arbitral Award, Schiedsgericht der Bundeskam-
mer der gewerblichen Wirtschaft (SCH-4318), 15 June 1994 (Rolled metal sheets), CISG-Online 120
(Pace); Arbitral Award, Ad hoc Florence, 19 April 1994 (Leather/textile wear), CISG-Online 124
(Pace).
114 http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2008:177:0006:0016:EN:PDF.
115 http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=CELEX:41998A0126(02):EN:NOT.
116 See Hof Beroep Gent (Belgium) 15 May 2002 (Design of radio phone), CISG-Online 746 (Pace);
Landgericht Kassel (Germany) 15 February 1996 (Marble slab), CISG-Online 191 (Pace); Arbitral Award,
ICC 8324/1995 (Magnesium), CISG-Online 569 (Pace); Rechtbank s’Gravenhage (Netherlands) 7 June
1995 (Apple trees), CISG-Online 369 (Pace); Oberlandesgericht Düsseldorf (Germany) 8 January 1993
(Tinned cucumbers), CISG-Online 76 (Pace); Oberlandesgericht Koblenz (Germany) 17 September 1993
(Computer chip), CISG-Online 91 (Pace).
117 For the relation of CISG to these and other similar Conventions see Bridge, International Sale of
Goods (2007), paras 11.14–11.15. See also Fawcett/Harris/Bridge, International Sale of Goods in the
Conflict of Laws (2005), pp. 843 et seq., 905 et seq.
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53 The Convention may be selected directly by the parties as the law applicable to the
contract.118 In the absence of a choice of law by the parties, one has to consider the
criteria set forth by the rules of private international law applicable to the case to
determine whether the CISG is applicable by virtue of Art. 1(1)(b). For example, in the
European Union the Uniform Law on Law Applicable to Contractual Obligations (EC
Regulation 593/2008 on the Law Applicable on Contractual Obligations)119 stipulates
that one has to apply the law “most closely connected” to the contract. It is presumed
that the contract is most closely connected with the country where the party who is to
effect the performance which is characteristic of the contract has its habitual residence
at the time of conclusion of the contract. Under the regulation, the party providing the
characteristic performance120 is the seller. For this reason, the CISG has often been
applied by courts in Contracting States to the Rome Convention when the seller, had his
place of business in a Contracting State to the CISG.121
54 Although the CISG does not bind non-Contracting States, it has been applied in
courts of non-Contracting States where the forum’s rules of private international law led
to the law of a Contracting State or where a national law is applicable and that law
incorporates the CISG by way of ratification.122 While the CISG is an international
convention when signed ratified or acceded to by State, it becomes part of the law of
that State. Depending on national law (typically Constitutional law), in some states123 a
ratified international convention may well rank immediately after the Constitution and
above any other domestic law, in other states it ranks equal to other domestic law.
Arguably, in either system the Convention becomes part and parcel of domestic law and
as such should be considered by the courts.124
III. Comparable Rules

55 Comparable provisions about the sphere of application of the texts in question can be
found in the PICC, PECL and DCFR. In the Preamble of the PICC there is expression of
the situations when the PICC may be applied as an international commercial contracts
body of rules of law. In Art. 1:101 PECL the sphere of application of the PECL as a
European Union contract law is referred to. In the first provisions of the DCFR there is
discussion of its sphere and scope. The CISG as an international convention has a more
clearly defined and limited sphere of application.
118 See, for example, Bundesgerichtshof (Germany), 11 May 2010 (aluminium rings) CISG-Online 2125;
Arbitral Award, Netherlands Arbitration Institute, 15 October 2002 (Condensate crude oil mix), CISG-
Online 740 (Pace).
119 http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2008:177:0006:0016:EN:PDF.
120 For cases expressly pointing out that the seller is the party that has to effect the characteristic
performance, see Landgericht Berlin (Germany) 24 March 1998 (Knitwear), CISG-Online 742 (Pace);
Landgericht München (Germany) 6 May 1997 (Cars), CISG-Online 341 (Pace); Rechtbank Amsterdam
(Netherlands) 5 October 1994 (Textiles), CISG-Online 446 (Pace); Oberlandesgericht Düsseldorf (Ger-
many) 10 February 1994 (Shirts), CISG-Online 116 (Pace); Oberlandesgericht Düsseldorf (Germany)
12 March 1993 (Textiles), CISG-Online 82 (Pace).
121 One should also consider in this regard Art. 95 of the Convention.
122 High Court of England and Wales (UK), Kingspan Environmental et al v Boralis A/S and another,
1 May 2012 (borence, polymer) CISG-Online 2391.

123 E.g. amongst others, Germany and Greece.
124 For the role of various reservations see Ferrari, What Sources of Law for Contracts for the
International Sale of Goods? Why One Has to Look Beyond the CISG, 25 International Review of Law
and Economics (September 2005) 314–341, 318–321; Walt, The CISG’s Expansion Bias: A Comment on
Franco Ferrari, 25 International Review of Law and Economics (September 2005) 342–349; Ziegel, The
Scope of the Convention: Reaching Out to Article One and Beyond, 25 Journal of Law and Commerce
(2005-06) 59–73, 63–67.
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Article 2
This Convention does not apply to sales:
(a) of goods bought for personal, family or household use, unless the seller, at
any time before or at the conclusion of the contract, neither knew nor ought
to have known that the goods were bought for any such use;
(b) by auction;
(c) on execution or otherwise by authority of law;
(d) of stocks, shares, investment securities, negotiable instruments or money;
(e) of ships, vessels, hovercraft or aircraft;
(f) of electricity.
Bibliography: Achilles, Kommentar zum UN-Kaufrechtsübereinkommen (CISG) (2000); Czerwenka, Re-

chtsanwendungsprobleme im internationalen Kaufrecht – Das Kollisionsrecht bei grenzüberschreitenden
Kaufverträgen und der Anwendungsbereich internationaler Kaufrechtsübereinkommen (1988); Daun,
Grundzüge des UN-Kaufrechts, JuS (1997) 811; Financial Markets Law Committee, Issue 130 – Implemen-
tation of the Vienna Sales Convention. Legal assessment of various financial markets aspects of the question
whether the UK should implement the Vienna Sales Convention, available at: http://www.fmlc.org/papers/
Issue130reportJuly08.pdf; Herber, Mangelfolgeschäden nach dem CISG und nationales Deliktsrecht, IHR
(2001) 187; U. Huber, Der UNCITRAL-Entwurf eines Übereinkommens über Internationale Warenkauf-
verträge, 43 RabelsZ (1979) 413; Janssen, Kollision des einheitlichen UN–Kaufrechts mit Verbrau-
cherschutzrecht am Beispiel der Richtlinie über den Verbrauchsgüterkauf und–garantien, VuR (1999) 324;
Karollus, UN-Kaufrecht – Eine systematische Darstellung für Studium und Praxis (1991); Magnus, UN-
Kaufrecht und Verbraucher, Liber amicorum Kurt Siehr (2010), 405; Micklitz, Die Verbrauchsgüter-
Richtlinie, EuZW (1999) 485; Pereira, Application of the CISG to International Government Procurement
of Goods, 35 Years CISG and Beyond (2016), 205; Piltz, Gestaltung von Exportverträgen nach der
Schuldrechtsreform, IHR (2002) 2; Schroeter, UN–Kaufrecht und Europäisches Gemeinschaftsrecht. Ver-
hältnis und Wechselwirkungen (2006); Schroeter, Die Anwendbarkeit des UN–Kaufrechts auf grenzübers-
chreitende Versteigerungen und Internetauktionen, ZEuP (2004) 20.
Outline
II. Detailed Commentary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
1. Consumer sales. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
a) Goods bought for personal use . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
aa) General remarks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
bb) Mixed-use of goods. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
b) Discernability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
c) Special issues in regard to EU Consumer Law . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
2. Sales by auction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
a) Definition of auction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
b) No exclusion of Internet auctions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
3. Sales on execution or otherwise by authority of law . . . . . . . . . . . . . . . . . . . . . . . . 33
4. Sales of stocks, shares, investment securities, negotiable instruments or
money. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
5. Sales of ships, vessels, hovercraft or aircraft . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
a) General Remarks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
b) Ships and vessels. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
c) Aircrafts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
6. Sales of electricity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
7. Burden of proof . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
III. Comparable Rules. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
Spohnheimer 39
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1 In general, a sale of goods is covered by the CISG if the requirements of Art. 1 are
met and the parties did not exclude the application of the CISG by an agreement
pursuant to Art. 6. Since Art. 1 only refers to an objective understanding of an
‘international sales’ transaction, the Convention’s sphere of application is more
expansive than that of its predecessor, Art. 1 ULIS. As a result, there are cases in
which the application of the CISG would be unreasonable, despite being applicable
pursuant to Art. 1.
2 The general underlying rationale of Art. 2 is to limit the Convention’s sphere of
application, and to remove those transactions that would otherwise – but unreasonably
– be governed by the CISG.1 Art. 2, therefore, provides for several exceptions which
should not be covered by the CISG, even if these transactions meet the requirements for
the CISG to be applicable according to Art. 1. These exceptions can be classified in three
main groups which were discussed during the drafting of the CISG: first, exceptions
based on the purpose of the transactions for which the goods are sold (Art. 2(a));
second, exceptions based on specific types of transactions (Art. 2(b) and (c)); and third,
exceptions based on the kinds of goods sold (Art. 2(d)–(f)).2
3 Although the rationales underlying these exceptions are different in detail, there are
two general themes that can be identified. Firstly, the Convention should not be applied
to legal relationships that are covered by national provisions that are generally so diverse
that harmonisation would be very difficult.3 Secondly, the Convention should not apply to
sales transactions that are insignificant in both value and impact and that have generally
no international aspect4, e. g. when a tourist buys something during a holiday abroad.
4 The exceptions enumerated in Art. 2 were – in part – already made by Art. 5(1)
ULIS.5 They are exhaustive and generally not to be applied to other, even similar cases,
by way of analogy.6
5 Even if the Convention is not applicable pursuant to Art. 2, this does not mean that
the parties cannot contractually agree that the contract concluded should be covered by
the CISG. Rather, the parties are free to ‘opt in’ to the Convention in regard to those
sales transactions excluded by Art. 27 provided that the otherwise applicable national
law allows for such a choice of law.8
1Lüderitz/Fenge, in: Soergel, Bürgerliches Gesetzbuch (2000), Art. 2 para. 1.

2See UNCITRAL, Digest of Case Law on the CISG, Art. 2 para. 1. See also Czerwenka, Rechtsanwen-
dungsprobleme im internationalen Kaufrecht (1988) p. 148; Saenger, in: Ferrari et al., Internationales
Vertragsrecht (2012), Art. 2 CISG para. 1; Enderlein/Maskow, International Sales Law (1992), p. 32.
Slightly different Honnold/Flechtner, Uniform Law (2009), Art. 2 para. 50, according to whom the
exceptions are based on the nature of the transaction (Art. 2(a)–(c)) and the nature of the goods
(Art. 2(d)–(f)).
3 Magnus, in: Staudinger Kommentar (2013), Art. 2 para. 1; Benicke, in: MünchKommHGB (2013),
Art. 2 CISG para. 1.

4 Magnus, in: Staudinger Kommentar (2013), Art. 2 para. 2.
5 Khoo, in: Bianca/Bonell, Commentary (1987), Art. 2 para. 1.1.
6 Ferrari, in: Schlechtriem/Schwenzer Kommentar (2013), Art. 2 para. 5; Huber, in: MünchKommBGB
(2016), Art. 2 CISG para. 2; Saenger, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 2 CISG
para. 1.
7 Lookofsky, Understanding the CISG (2012), p. 17.
8 In the case of Art. 2(a) such a choice of law would e. g. be forbidden by the national provisions
enacting Art. 7 of the EC Directive 99/44/EC of the European Parliament and of the Council of 25 May
1999 on certain aspects of the sale of consumer goods and associated guarantees, when already made at
the time of conclusion of the contract.
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1. Consumer sales
Art. 2(a) is the result of a compromise.9 Attempts to establish an exception for all 6
sales contracts that are covered by mandatory national provisions have not been
accepted by the conference.10 Rather, the Norwegian proposal to focus on the use the
goods are bought for has been adopted and no stipulation has been provided for
limiting these exclusions to ones that are covered by mandatory provisions of national
law.11 As a consequence of this exception being so broad, the Convention is not
applicable to all consumer sales – de lege lata, at least when the seller could have been
aware of the nature of the contract12.
Although the nature of the sales contract is not of relevance for the application of the 7
CISG according to Art. 1, the exclusion of consumer sales in Art. 2(a) limits the
Convention’s sphere of application de facto to commercial sales contracts.13
Art. 2(a) applies if the goods are sold to a consumer but it does not apply in either case if 8
the goods are sold by a consumer, so that the Convention may be applicable although a
consumer is involved in the contract.14 It applies if goods are sold for a professional purpose
(consumer-trader transaction). But it can also apply in a consumer-consumer transaction: If
the buyer is a consumer but the seller could not have known it, the sales contract is covered
by the CISG although no commercial party is involved in the transaction.15
a) Goods bought for personal use
aa) General remarks. The CISG is not applicable, according to Art. 2(a), if the goods 9
are bought for personal use including consumption16. This includes both family and
household use. The exception is only based on the intended purpose the goods are
bought for and applies irrespective of whether the buyer is a businessman or not.17 In
other words, it is not the buyer’s status that is of relevance (e. g. whether he is a
merchant);18 rather, the decisive factor is the intended use at the time of the conclusion
of the contract.19 Therefore, the Convention will apply to all sales that are intended for
non-personal use – e. g. both industrial and professional20 – if the transaction does not
fall under another exception as provided for in Art. 2(b)–(e) and the parties have not
contractually excluded the CISG’s application as provided for in Art. 6.
9Czerwenka, Rechtsanwendungsprobleme im internationalen Kaufrecht (1988), p. 149.

10See Khoo, in: Bianca/Bonell, Commentary (1987), Art. 2 paras 1.3 et seq.
11 See Ferrari, in Schlechtriem/Schwenzer, Kommentar (2013), Art. 2 para. 3.
12 But see also infra paras 22 et seq.
13 Huber, in: Huber/Mullis, The CISG (2007), p. 49; Schwenzer/Hachem, in: Schlechtriem/Schwenzer,
Commentary (2016), Art. 2 para. 4. For the remaining cases, in which the seller could not know that the
goods are bought for a consumer’s personal use, cf. infra paras 24 et seq.
14 Lorenz, in: Witz/Salger/Lorenz, Kommentar (2016), Art. 2 para. 2; Magnus, Liber amicorum Kurt
Siehr (2010), p. 405 (415).

15 Magnus, Liber amicorum Kurt Siehr (2010), p. 405 (415).
16 Huber, in: MünchKommBGB (2016), Art. 2 para. 6; Saenger, in: Ferrari et al., Internationales
Vertragsrecht (2012), Art. 2 CISG para. 3; Piltz, Internationales Kaufrecht (2008), paras 2–60; Lüderitz/
Fenge, in: Soergel, Bürgerliches Gesetzbuch (2000), Art. 2 CISG para. 2.
18 Bundesgerichtshof (Germany) 31 January 2001 (machinery), CISG-Online 617 (Pace); Benicke, in:
MünchKommHGB (2013), Art. 2 para. 3.

19 Schroeter, UN-Kaufrecht und Europäisches Gemeinschaftsrecht, § 6 para. 87; Schwenzer/Hachem, in:
Schlechtriem/Schwenzer, Commentary (2016) Art. 2 para. 4.

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10 A personal use is given if a retired civil servant buys a horse for leisure purposes21 or
if a kitchen was bought for private use22. A business and not a personal use of the goods
is given if office equipment is bought by a lawyer.23 If an enterprise buys a car to make it
available to its employee for private use, the sales contract has nevertheless a profes-
sional purpose; so in this case the application of the CISG is not excluded by Art. 2(a).24
A Dutch Court held in favour of a professional purpose of a sales agreement on a horse
because the buyer invested in a horse stable and paid no VAT on the purchase price.25
Nevertheless, whether the payment of the VAT is an indication in the one or the other
direction, depends on the applicable tax law.
11 The relevant point in time is the conclusion of the contract; the (later) actual use of
the goods is not of relevance for the question whether the Convention’s application is
excluded.26 If the buyer intended to use the goods for personal needs, the CISG is not
applicable even if the buyer later uses the goods for professional purposes. Conversely, if
the buyer originally intended to use the goods for professional purposes, the CISG
remains applicable regardless of an actual personal use. The underlying rationale of this
principle is to create legal certainty at the time of the conclusion of the contract. The
seller should not be burdened with a later (non-) applicability of the Convention.
12 It can be rather difficult to determine whether the goods are bought for professional or
personal use. If the buyer is a legal entity, there can be no consumer sales transaction.27
Less problematic are cases where goods that are usually bought for professional use are
bought for that purpose. However, goods that are normally bought for personal use can
also have a professional use (e. g. clothes) and goods that are normally intended to be used
professionally might exceptionally be used personally (e. g. when an amateur cameraman
buys professional camera equipment as part of his hobby). In the end, however, these
considerations are only relevant in determining whether the seller could have been aware
of the buyer’s intended personal use in regard to the ‘counter-exception’ concerning the
non-discernable intention of a personal use of the goods.28
13 Furthermore, the decisive intention is the intention of the buyer of the CISG contract,
not the use the goods are generally intended for. For example, parlour games are
typically intended for a personal use by the end-consumer. Nevertheless, a contract
between a distributor and a merchant who sells the goods to an end-consumer has a
commercial purpose and is covered by the CISG if the other requirements are met.
14 The Convention places personal use and family or household use on equal footing.29
The notions ‘family’ and ‘household’ are to be interpreted broadly30 and are not related
to any legal relationship based on family law31.
21
LG Münster (Germany) 11 September 2013 (horse), CISG-Online 2554 (Pace).
22
Bundesgerichtshof (Germany) 7 March 2013 (fitted kitchen) NJW 2013, 1431.
23 Landgericht Bamberg (Germany) 13 Aril 2005 (furnishings) CISG-Online 1402 (Pace); Schwenzer/
Hachem, in: Schlechtriem/Schwenzer Commentary (2016), Art. 2 para. 4.

24 Magnus, Liber amicorum Kurt Siehr (2010), p. 405 (414).
25 Gerechtshof Arnhem-Leeuwarden (Netherlands) 15 September 2015 (horse), CISG-Online 2628.
26 UNCITRAL, Digest of Case Law on the CISG, Art. 2 para. 2; Lorenz, in: Witz/Salger/Lorenz
Kommentar (2016), Art. 2 para. 3; Ferrari, in: Schlechtriem/Schwenzer Kommentar (2013), Art. 2
para. 8; Siehr, in: Honsell, Kommentar (2010), Art. 2 para. 13; Saenger, in: Ferrari et al., Internationales
Vertragsrecht (2012), Art. 2 CISG para. 3.
27 Benicke, in: MünchKommHGB (2013), Art. 2 para. 3.
28 For a more detailed discussion concerning the discernability cf. infra paras 16 et seq.; for a discussion
on who bares the burden of proof cf. infra para. 49.

30 Piltz, Internationales Kaufrecht (2008), paras 2–60; Lorenz, in: Witz/Salger/Lorenz Kommentar
(2016), Art. 2 para. 4.

31 Similar Schwenzer/Hachem, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 2 para. 6.
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bb) Mixed-use of goods. Not undisputed but also not explicitly answered by the 15
Convention’s wording is the question whether the CISG is applicable in cases, in which
the goods’ use is not solely personal; in other words, in cases, in which the goods are
bought for a personal and also for a professional use. Some scholars32 and courts33 are of
the opinion that the exception of Art. 2(1) only applies if the goods are intended to be
used exclusively for personal purposes. In a case34 where a log house has ben bought
primarily for private living but also to run office premises, it was held that the contract
was governed by the CISG. Others are of the opinion that the exception applies if the
goods are also (but not only) bought for an intended personal purpose.35 The decision is
highly important since it results in further questions of differentiations between the CISG
and national consumer sales provisions partially enacting supranational directives.36 In
the interest of legal certainty, the sphere of application of the CISG and the sphere of
application of other non-national provisions or national provisions enacting non-national
directives which regulate international sales should be distinguished in a way that avoids
overlaps. As a result, in deciding whether the application of the CISG should be excluded
or not, it is this author’s submission that the sphere of application of these other
provisions should be taken into account. This is not contrary to the principles laid down
in Art. 7(1) since it takes into account provisions regulating international sales transac-
tions and promoting uniformity in its application, rather than national law. It is
furthermore in accord with the underlying rationales of Arts 90 and 94 that allow non-
national provisions regulating international sales contracts to prevail. If non-national
provisions or national provisions enacting international law, such as an EU directive, are
applicable to sales contracts if the goods are also, but not exclusively, bought for personal
use, the exception of Art. 2(a) should apply.37 This takes into account the fact that a body
of law relating to an international sales transaction exists so there is no need for the CISG
to be applicable since there is already a harmonised body of law. In cases where the
Convention interferes with national provisions that do not have an international base, the
rule and the exception have to be taken into account: the CISG applies as long as the
goods are not solely bought for personal use.
b) Discernability. The last part of Art. 2(a) creates an exception from the exception38. 16
Where the seller neither knew nor ought to have known that the goods were bought for
any such use, the exclusion of the Convention’s general applicability does not apply, so
the contract that fulfils all other requirements of the Convention’s application is
governed by the CISG.
Consequently, according to its wording, the CISG applies if two requirements are 17
met: firstly, the seller does not know the intended personal use of the goods, and
secondly, the seller should not ought to have known that the goods were bought for any
32 Siehr, in: Honsell, Kommentar (2010), Art. 2 para. 13; Schwenzer/Hachem, in: Schlechtriem/
Schwenzer, Commentary (2016), Art. 2 para. 7; Lorenz, in: Witz/Salger/Lorenz Kommentar (2016),
Art. 2 para. 4 (arguing in fn. 12 that the wording of the provision is clear and does not allow any other
interpretation – however the wording of Art. 2 lit. a is not that clear, it does not speak of only a private
use); Magnus, in: Staudinger Kommentar (2013), Art. 2 para. 17; Magnus, in: Liber amicorum Kurt
Siehr (2010), p. 405 (412); Piltz, Internationales Kaufrecht (2008), paras 2–61; Martiny, in: Münch-
KommBGB (2015), Anhang Art. 4 Rom I-VO para. 46; Benicke, in: MünchKommHGB (2013), Art. 2
CISG para. 4.
33 Korkein Orkeus (Finland) 14 October 2005 (log house), CISG-Online 1882 (Pace).
34 Korkein Orkeus (Finland) 14 October 2005 (log house), CISG-Online 1882 (Pace).
35 See Lüderitz/Fenge, in: Soergel, Bürgerliches Gesetzbuch (2000), Art. 2 CISG para. 3.
36 For further details, cf. infra paras 24 et seq.
37 Cf. infra para. 24.
38 Schwenzer/Hachem, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 2 para. 8, name it a
‘counter-exception’.
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such use. As it is clear from the wording of the provision, the relevant point in time is
the conclusion of the contract. Subsequent awareness of the personal use is not of
relevance.39 If the seller is aware of an intended personal use of the goods, the CISG
does not apply regardless of whether he ought not have known this intent. This is in line
with the underlying principle of the exception that only the seller’s justified reliance in
the Convention’s application should be protected.
18 If the seller could not have been unaware – meaning that he could have been aware – of
the intended personal, family or household use, he cannot rely on his unawareness.
Therefore, the relevant but at the same time most difficult question to answer is whether
the seller could have been aware of the intended use of the goods for personal purposes.
As there is no general duty on the seller to inquire about the purpose of the goods,40 the
decisive factor in determining whether the seller ought to have known about this purpose
is whether a reasonable third person in the shoes of the seller would have understood the
indications in the case in dispute as giving evidence that the goods bought are intended
for personal use.41 In this case, the seller cannot rely on his unawareness of the intended
personal use.42
19 There are various indications to make the intention to use the goods personally
apparent.43 Such indications can be inter alia the nature of the goods, the person of the
buyer – especially the legal form he is acting in44, or the quantity of the goods bought.45
Other indications can follow from the circumstances of the conclusion of the contract,
e. g. the use of professional stationery, the delivery to a business address, or other
statements made by the buyer during the negotiations.46 Also the mere fact, that sales
transactions for private purposes between two countries over long distances in regard to
specific goods are quite unusual can be an indication for a business transcation.47
20 If there is an indication that the goods are generally used for personal purposes, in
absence of any other indication, it is submitted that the seller cannot rely on the idea
that the goods are bought for professional use. In this situation, a reasonable person in
the shoes of the seller would not rely on a professional use. On the contrary, if there is
an indication that the goods are intended to be used professionally, it is submitted that
the seller – in absence of any other indication – should not be deemed to ought to have
known the intention of a personal use.
21 However, the decision can only be made on a case to case basis taking all available
cirumstances into consideration. Each indication for a personal use in itself might lead
to the conclusion that the seller could not have been unaware of the intended personal
use of the goods. However, this indication might nevertheless be rebutted by a contra-
39 Magnus, in: Staudinger Kommentar (2013), Art. 2 para. 26; Schwenzer/Hachem, in: Schlechtriem/
Schwenzer, Commentary (2016), Art. 2 para. 12.

40 Ferrari, in: Schlechtriem/Schwenzer, Kommentar (2013), Art. 2 para. 20; Schwenzer/Hachem, in:
Schlechtriem/Schwenzer, Commentary (2016), Art. 2 para. 11; Piltz, Internationales Kaufrecht (2008),
paras 2–64; Meier/Stacher, in: Brunner Kommentar (2014) Art. 2 para. 10.
41 In a similar way Magnus, in: Staudinger Kommentar (2013), Art. 2 para. 22.
42 This approach avoids to decide whether the seller was grossly negligent or not (criteria argued by
Schwenzer/Hachem, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 2 para. 11) and provides more
legal certainty.
43 For numerous examples see Magnus, in: Staudinger Kommentar (2013), Art. 2 paras 22 et seq.;
Benicke, in: MünchKommHGB (2013), Art. 2 CISG para. 7.

44 See Oberlandesgericht Stuttgart (Germany) 31 March 2008 (automobile), CISG-Online 1658 (Pace).
45 See Magnus, in: Staudinger Kommentar (2013), Art. 2 para. 23; Ferrari, in: Schlechtriem/Schwenzer
Kommentar (2013), Art. 2 para. 17.

46 Schwenzer/Hachem, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 2 para. 10; Magnus, Liber
amicorum Kurt Siehr (2010), p. 405 (413).

47 Magnus, Liber amicorum Kurt Siehr (2010), p. 405 (414) (for a sale of a car).
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indication that leads to the conclusion that the goods are bought for professional use. If
several (weak) indications that might lead to the conclusion that the goods are bought
for a personal use are given each of these indications might strengthen the other in-
dications, so several (weak) indications can work hand in hand. The more indications
lead to the conclusion that the buyer bought the goods for personal use, the less the
seller can rely on its unawareness of this intended use.
Likewise, in cases where the seller thought the goods were bought for an intended 22
personal use, but the intended use is indeed a professional one, the Convention does
apply.48 This is in line with the Convention’s underlying principles. Art. 1 has a broad
sphere of application to ensure that international sales transactions are generally
covered by the CISG. Art. 2 creates exceptions for cases when the Convention’s
application would be unreasonable, whereas the ‘counter-exception’ in Art. 2(a) protects
the seller’s reliance in the Convention’s applicability. However, the CISG does not
protect the reliance in the inapplicability of its provisions. If the seller wants to ensure
the transaction is not covered by the CISG it is in his own sphere of responsibility to
exclude the Convention’s application pursuant to Art. 6. The general unawareness of
the Convention’s existence is not protected.
It is only the seller who can invoke that he neither know nor ought to have known 23
that the goods were bought for a personal use. This is because Art. 2(a) requires the
private purpose of the transaction to be discernible to protect the seller’s expectation
that the international sales transactions will be covered by the CISG.
c) Special issues in regard to EU Consumer Law. Problems concerning Art. 2(a) 24
arise in regard to EU Consumer Law, i. e. the EU’s Directive on certain aspects of the
sale of consumer goods and associated guarantees49. Although the CISG was the
Directive’s antitype,50 there are different legal consequences in regard to several
aspects. It is the purpose of Art. 2(a) to avoid conflicts and interferences between the
Convention’s sphere of application and consumer protection law.51 Nevertheless, there
remain two areas where interferences could not be completely avoided. Firstly,
Art. 2(a) limits the exclusion of the CISG to cases where the seller was aware or could
not have been unaware of the intended personal use. The Directive has no such
limitation.52 Consequently, in cases where the seller ought not to have known that the
goods were bought for an intended personal use, the Convention’s applicability is not
excluded, but the provisions of the Directive are also applicable. Secondly, it is argued
that the Convention’s application is only excluded in cases where the goods are only
bought for a personal use.53 If a professional use is also intended, this transaction is
covered by the CISG. On the other hand, national provisions enacting the Directive are
applicable if there is also a personal use.54 Consequently, in the case of a mixed-use of
the goods, two bodies of law with provisions containing different legal consequences
would be applicable.
48
Magnus, in: Lieber amicorum Kurt Siehr (2010), p. 405 (410).
49
EC Directive 99/44/EC of the European Parliament and of the Council of 25 May 1999 on certain
aspects of the sale of consumer goods and associated guarantees.
50 Piltz, Internationales Kaufrecht (2008), paras 2–69; Micklitz, Die Verbrauchsgüter-Richtlinie, EuZW
(1999) 485 et seq.; Financial Markets Law Committee, Legal assessment of various financial markets
aspects, Issue 130, para. 3.3.
51 Schlechtriem/Butler, CISG (2009), para. 29 b; Schwenzer/Hachem, in: Schlechtriem/Schwenzer, Com-
mentary (2016), Art. 2 para. 1.

52 Schroeter, UN–Kaufrecht und Europäisches Gemeinschaftsrecht (2005), § 6 para. 110.
53 Cf. supra para. 15.
54 According to Schroeter, UN–Kaufrecht und Europäisches Gemeinschaftsrecht (2005), § 6 para. 106,
the EU Directive is not applicable in cases of a mixed use of the goods.
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25 With these points in mind, the question whether the CISG or the national provision
enacting the Directive prevails comes into play. It has been argued that the CISG
prevails over national consumer protections laws.55 It is argued in the literature that this
is also true with respect to domestic consumer legislation based on EU directives.56 The
reasons given are only different in the details. It is usually argued that the CISG contains
special provisions for international sales and demands its application in so far as there is
no exception.
26 It is this author’s opinion that the national provisions enacting the EU Directive must
prevail for several reasons. Firstly, it is not only the CISG’s but also the EU Directive’s
goal to create special provisions concerning international sales transactions.57 As it is the
Directive’s goal to create a special body of laws concerning international consumer sales
contracts, the Directive’s provisions are lex specialis in relation to those of the CISG
which do not even intend to cover consumer contracts. Secondly, although it is argued in
the literature that a state that signs the Convention and implements it by ratification has
public international law obligations which would be violated if it enacted laws conflicting
with provisions of the Convention,58 it is submitted that non-compliance with a directive
that the Member States of the European Union are bound to according to Art. 288 TFEU
would also be a violation of an obligation set out by public international law.59 It is true
that the Convention itself does not stipulate that the national provisions enacting EU
directives prevail over the CISG. Furthermore, Art. 90 is said not to apply since a
directive is not an international agreement that contains provisions that regulate matters
governed by the Convention.60 Nevertheless, the Convention recognises in Art. 94 the
principle that the CISG should not apply if there are provisions that contain harmonised
principles in regard to cross-border sales transactions. The underlying principle is that
the Convention does not demand its application if there is no (further) need for the
application of harmonised legal rules. Since both provisions do not deal with the
relationship between the Convention and the national provisions enacting EU directives,
the solution does not follow from a direct application of the Convention. Rather, it is this
author’s submission that the legal basis for this result is an analogous application of both
Arts 90 and 94. The usual requirements for an analogy are met: there is an unintended
gap and the interests involved in the question at hand are identical to those underlying
Art. 90 and Art. 94. Since the rationales underlying both provisions do not apply to
situations different than an internationles sales contract between parties from different
Member States of the European Union, in cases where a party from a non-EU country is
involved, the Convention must prevail over the national provisions that most often
contain a more extensive regulation than is asked for by the directive and is not related
to inter-EU-sales transactions. As far as a declaration of the states is required under
55Cf. supra para. 24.

56Schwenzer/Hachem, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 2 para. 18; Magnus, in:
Staudinger Kommentar (2013), Art. 2 paras 30 et seq.; Benicke, in: MünchKommHGB (2013), Art. 2 CISG
para. 8; Saenger, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 2 CISG para. 7; Piltz,
Gestaltung von Exportverträgen nach der Schuldrechtsreform, IHR (2002) 2 (4); Huber, in: Huber/Mullis,
The CISG (2007), p. 49.
57 See inter alia recital 2 of the EC Directive EC/99/44.
58 Schwenzer/Hachem, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 2 para. 18 with foot-
note 73.
59 Vice versa the EU is not a party to the CISG and therefore not hindered to enact directives that
creates conflicts with the Convention.

60 Huber, in: MünchKommBGB (2016), Art. 90 para. 2; differently Herber, Mangelfolgeschäden nach
dem CISG und nationales Deliktsrecht, IHR (2001) 187 (191); Daun, Grundzüge des UN-Kaufrechts, JuS
(1997) 811 (813); Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 90 CISG para. 8;
Janssen, Kollision des UN-Kaufrechts mit dem Verbraucherschutzrecht, VuR (1999) 324 et seq.
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Art. 94(1), it is submitteld that the states’ obligation to enact EU Directives can be seen
as such a declaration.
2. Sales by auction
Sales by auctions have been undisputedly considered to be covered by special national 27
provisions and usages and should therefore be excluded from the Convention’s sphere
of application.61 Additionally, it was often argued that it would be uncertain whether it
is a national or an international sales transaction until the acceptance of the bid was
made.62 Since the seller should not be unexpectedly confronted with the application of
the CISG to a sales contract, it was seen to be more favourable to exclude auctions from
the Convention’s sphere of application.63 In addition, it was the general understanding
in the deliberations of the Convention that an auction is usually held in one place,
governed by the law and usages of that place and that the parties are normally not aware
of the fact that they have their places of business in different states.64
a) Definition of auction. Auctions in the sense of Art. 2(b) are either auctions by law 28
or private auctions.65 These are sales to the highest bidder and – as in most national
provisions – the sale at auction is completed when the auctioneer so announces in a
customary manner usually upon a formal acceptance of the bid66. An auction must be
publicly announced before it takes place.67 Auctions in enforcement proceedings are not
subject to this provision but rather to Art. 2(c).68 Consequently, Art. 2(b) only applies to
auctions of a private auctioneer.
Sales on commodity markets are not included in the exception and are therefore 29
covered by the CISG.69
The exception does not apply if the sales transaction was initiated by a competitive 30
(public) procurement process.70 This is because no party is unaware of the CISG’s
application. The economic operator taking part in the competitive procedure (being
usually the seller) is already aware of the party contracting with and therefore also
on the Convention’s application. If he could have been aware of the Convention’s
application and places an offer, he cannot rely on the Convention’s non-applica-
tion. The same is true if the Convention does not apply: He cannot rely on its
application. The party asking for offers in the competition can already exclude the
Convention’s application in the call for competition. If it failed to do so, it still has the
possibility to decide what offer to accept and can take into account the application of
the CISG as a ground to contract with a specific party or not to contract with it. This
is because not only costs have to be taken into account when deciding on the award of
the contract.71
61
Magnus, in: Staudinger Kommentar (2013), Art. 2 para. 32.
62
Khoo, in: Bianca/Bonell, Commentary (1987), Art. 2 para. 2.3; Benicke, in: MünchKommHGB
(2013), Art. 2 para. 9.
63 Ferrari, in: Schlechtriem/Schwenzer, Kommentar (2013), Art. 2 para. 30.
64 Ferarri, in: Schlechtriem/Schwenzer, Kommentar (2013), Art. 2 para. 30.
65 UNCITRAL, Digest of Case Law on the CISG, Art. 2 para. 5.
66 See Martiny, in: MünchKommBGB (2015), Anhang Art. 4 Rom I-VO para. 48.
68 Ferrari, in: Schlechtriem/Schwenzer Kommentar (2013), Art. 2 para. 29; Magnus, in: Staudinger
Kommentar (2013), Art. 2 para. 33. For a discussion of Art. 2(c) cf. infra paras 33 et seq.
69 Magnus, in: Staudinger Kommentar (2013), Art. 2 para. 35; Saenger, in: Ferrari et al., Internationales

70 Saenger, in: Ferrari et al., Internationals Vertragsrecht (2012), Art. 2 para. 8; Magnus, in: Staudinger,
Kommentar (2013), Art. 2 para. 34; Pereira, 35 years CISG and beyond (2016), p. 205 (207, 210 et seq.).
71 See eg Art. 67 Directive 2014/14/EU.
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31 b) No exclusion of Internet auctions. Keeping in mind the reasons why auctions should
not be covered by the CISG, i. e. that they normally are only of local relevance, it is
questionable whether Internet auctions should fall under Art. 2(b). The majority opinion in
the literature is that the exception of Art. 2(b) also includes Internet auctions.72 Following
this opinion, a sales contract concluded in an Internet auction is not covered by the CISG
even if the seller and the buyer are from different states and the CISG would be applicable
according to Art. 1. In this author’s view, Internet auctions should not fall within the
exception of Art. 2(b) for several reasons. Firstly, the general rule, established by Art. 1 is
that international sales contracts should (reasonably) be covered by the CISG. Therefore,
the exceptions made by Art. 2 must be interpreted narrowly and whenever there is no
reasonable ground for the exception, the Convention should be applied. Therefore, the
starting point in determining this question must be whether there are reasonable grounds to
exclude the application of the Convention from an international sales contract. When the
drafters provided for the Art. 2(b) exclusion, their focus was on situations where a buyer
from abroad came to a local auction – a situation no doubt unusual at the time. Nowadays,
it is more likely that a seller who sells goods using the Internet cannot reasonably be
unaware of the fact that the Internet is accessible from almost all over the world and his
goods can thus be bought from all over the world. It is therefore not unreasonable for the
seller to take into account that the highest bidder may come from a different country. In
addition, it should be remembered that this ‘burden’ is only one side of the coin. The other
side is that the use of an Internet auction gives the seller an additional benefit compared to
a traditional auction. Namely, if an article is offered worldwide, there is a greater pool of
potential buyers which may correlate to a higher sale price. If the seller uses the advantage
of an Internet auction – being that anybody in (nearly) the whole world can bid on an item
– he must also bear the disadvantage – being that the sales contract might potentially be
covered by the CISG. This is in line with another underlying principle pointed out in the
Convention: the CISG does not apply if the buyer is a consumer according to Art. 2(a), but
it does apply if the seller is a consumer73 and the buyer buys the goods for an intended pro-
fessional use. If the seller is not aware of the existence of the CISG, he may not have regard
to whether the buyer comes from his own country or from abroad. He is, however, in this
case bound to the provisions of the CISG regardless of his lack of awareness. Taking the
last-mentioned point into account, it does not overburden the seller in an Internet auction
that the Convention is applicable if a buyer is a merchant from another country. In the end,
it is up to the seller to protect himself from the application of the CISG if he does not want
to be bound to it. He can simply exclude the Convention’s application in the Internet
auction’s conditions. If a potential buyer bids on the item, in this case, he implicitly agrees
that the sales contract should not be covered by the CISG, resulting in an agreement to
exclude it according to Art. 6.
32 In recent times, (international) business to business sales using Ebay and the like have
increased. While it is suggested that the reasoning above also applies to Internet auction
portals such as Ebay, it is argued that, in any event, it is questionable whether a sale on
Ebay is an auction in the sense of Art. 2(b) at all. The German Bundesgerichtshof has
decided that this is not an auction in regard to § 312 d (4) (Nr. 5) of the German BGB in
its old version.74 This provision limited the applicability of the provisions enacting the EU
Distance Selling Directives75 in case of auctions. As already mentioned above, an auction
72 See Schroeter, Anwendbarkeit des UN-Kaufrechts auf grenzüberschreitende Auktionen, ZEuP (2004)
20 (30 et seq.) with a detailed discussion; Lorenz, in: Witz/Salger/Lorenz, Kommentar (2016), Art. 2 para. 7.
74 Bundesgerichtshof (Germany), 3 November 2004, VIII ZR 275/03.
75 EC Directive 97/7/EC.
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requires that the highest bid is formally accepted by the auctioneer.76 Such a formal
acceptance does not take place if goods are sold on Ebay even on the basis of the highest
bid. This result was already convincing for German law. This argument becomes even
stronger taking into account the wording of § 312g(2)(Nr. 10) – the new provision
enacting EU Directive 2011/83/EU. Although, the Convention should be interpreted
in its international context according to Art. 7(1), the reasoning given by the German
Bundesgerichtshof is also convincing for the question whether Art. 2(b) includes Internet
auctions and can therefore be used in order to decide that question. Therefore, in this
author’s view, an auction on Ebay is no auction in the sense of Art. 2(b) and these sales
are consequently covered by the CISG if the preconditions given by Art. 1 are met and the
transaction does not fall under another Art. 2 exception and the parties have not
contractually excluded the CISG’s application pursuant to Art. 6.
3. Sales on execution or otherwise by authority of law

These sales have been removed from the Convention’s sphere of application since the 33
parties are not able to negotiate the terms of the contract77. Additionally, in these
transactions, special attention must be given to public interest; this may not be
guaranteed under the CISG.78
Since the CISG’s underlying principle is that of party autonomy, its application would 34
be unreasonable. In addition, these sales are generally subject to special regulations
other than (usual) sales law provisions, independent of whether the sale is based on a
contract or a sovereign act79.
The national law of the state whose courts have initiated the sale of goods decides 35
what sales transactions are meant to fall under the exception.80 The decisive factor is
that the sale was initiated by an institution that has state powers comparable to judicial
powers,81 i. e. sales in enforcement proceedings by public authorities or in insolvency
proceedings82. Conversely, sales contracts that are concluded by the insolvency repre-
sentative in the normal course of business do not fall within this exception.83 This is
based on the fact, that the insolvency representative represents the debtor and can –
unlike state authorities that are bound by law – negotiate contractual obligations with
the buyer and therefore act like any other (private) seller. Therefore, Art. 2(c) does also
apply if a pledged item is not sold in an auction but rather by private agreement (e. g.
according to Sect. 817 a para. 3, 821, 825 of the German Code of Civil Procedure).84
4. Sales of stocks, shares, investment securities, negotiable instruments

or money
This provision is identical to its predecessor, Art. 5(1)(a) ULIS. The exception made 36
in Art. 2(d) is based on the idea that the CISG is not tailored to cover sales of stocks,
shares, investment securities, negotiable instruments or money, and that the CISG is
76
Cf. supra para. 28; Magnus, in: Staudinger Kommentar (2013), Art. 2 para. 33.
77
Honnold/Flechtner, Uniform Law (2009), Art. 2 para. 52.
78 Lüderitz/Fenge, in: Soergel, Bürgerliches Gesetzbuch (2000), Art. 2 para. 7.
79 Achilles, UN-Kaufrechtsübereinkommen (2000), Art. 2 para. 6.
80 Magnus, in: Staudinger Kommentar (2013), Art. 2 para. 36; Siehr, in: Honsell, Kommentar (2010),
Art. 2 para. 16.

81 Magnus, in: Staudinger Kommentar (2013), Art. 2 para. 36; Siehr, in: Honsell, Kommentar (2010),
Art. 2 para. 16.

82 Saenger in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 2 para. 9.
Vertragsrecht (2012), Art. 2 para. 8.

84 Saenger, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 2 para. 9.
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only applicable to the sale of goods, not the sale of rights.85 In this sense, the provision
is only of declaratory character.86 In addition, conflicts with – mostly mandatory –
national provisions should be avoided.87 Therefore, in general, financial instruments
should be removed from the Convention’s sphere of application.88
37 Consequently, Art. 2(d) removes sales transactions of collateralised securities from
the Convention’s sphere of application. ‘Documents of title to goods’ are not included
in this exclusion.89 This is convincing since these securities only ‘replace’ the goods that
are part of the sales transaction and that the provisions of the CISG are tailored to.
38 The exception of ‘negotiable instruments’ means bills of exchange, cheques, shares,
stocks, and ‘effets’ de commerce,90 and should be interpreted in a way that it includes all
financial markets instruments91.
39 Art. 2 makes no mention of derivatives. International sales contracts for derivatives
are nevertheless not governed by the Convention. Derivatives are of the same character
as options.92 In the end, a derivative is a right, not a good and consequently, sales of
derivatives are sales of rights, not sales of goods. Since the Convention’s sphere of
application is limited to sales of goods according to Art. 1 and does not cover sales of
rights93, these contracts do not fall within its sphere of application. This is also true for
the sale of over-the-counter (OTC)-derivatives, regardless of whether there is a provi-
sion for physical delivery or not.
40 Money means all lawful coins and paper money.94 The CISG is, however, applicable
to money that is not functional as currency any longer.95 In this case, the function of the
money is not to be a lawful currency, but to be a collectible in the foreground. It is
suggested that the Convention should be applied if currencies are dealt with that are
emitted by private entities (e. g. BITCOINS).96 However, it is questionable, whether
these transactions are even a sale of goods under Art. 1.
5. Sales of ships, vessels, hovercraft or aircraft

41 a) General Remarks. Art. 2(e) states an exception for sales transactions of ships,
vessels, hovercrafts and aircrafts. The underlying rationales are to avoid interferences
with national duties to register these goods and to clarify that these goods that are widely
85
Saenger, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 2 para. 10.
86
Magnus, in: Staudinger Kommentar (2013), Art. 2 para. 2; Saenger, in: Ferrari et al., Internationales
87 Enderlein/Maskow, International Sales Law (1992), p. 34; Schwenzer/Hachem, in: Schlechtriem/

88 Financial Markets Law Committee, Legal assessment of various financial markets aspects, Issue 130,
para. 6.9.

90 Enderlein/Maskow, International Sales Law (1992), p. 34; Saenger, in: Ferrari et al., Internationales
Vertragsrecht (2012), Art. 2 para. 10; Magnus, in: Staudinger Kommentar (2013), Art. 2 para. 39;
Martiny, in: MünchKommBGB (2015), Anhang Art. 4 Rom I-VO para. 51; Huber, in: MünchKommBGB
(2016), Art. 2 para. 18; Khoo, in: Bianca/Bonell, Commentary (1987), Art. 2 para. 2.5.
91 Financial Markets Law Committee, Legal assessment of various financial markets aspects, Issue 130,
para. 6.17.
92 Similar Lorenz, in: Witz/Salger/Lorenz, Kommentar (2016), Art. 2 para. 8.
93 Lorenz, in: Witz/Salger/Lorenz, Kommentar (2016), Art. 1 para. 5.
94 Saenger, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 2 para. 10; Lüderitz/Fenge, in:
Soergel, Bürgerliches Gesetzbuch (2000), Art. 2 para. 8.

Vertragsrecht (2012), Art. 2 para. 10; Siehr, in: Honsell, Kommentar (2010), Art. 2 para. 19; Lorenz, in:
Witz/Salger/Lorenz, Kommentar (2016), Art. 2 para. 8.
50 Spohnheimer
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considered to be immovable goods97 should not be within the Convention’s sphere of
application.98 Unlike under its predecessor (Art. 5(1)(b) ULIS), for the exception to apply
it is not necessary that the vehicle be registered, although the underlying rationale of this
exception is that the application of the CISG might come in conflict with national
provisions stating a duty to register.99 Consequently, Art. 2(e) applies regardless of
whether the vehicle actually has to be registered or not.
The exception set out by Art. 2(e) only applies for assembled goods; the sale of 42
components that have still to be assembled is covered by the Convention.100 This
argumentation is in line with the underlying rationale that interferences with national
obligations of registration should be avoided.101 On the other hand, the exception also
applies when the manufacturing process is still ongoing.102
b) Ships and vessels. Ships and vessels are not easy to distinguish.103 Since a 43
differentiation does not result in any legal consequence, it is submitted that no
distinction has to be made. The decisive factor is that they can be moved on or under
water104 regardless of the intended use105.
It is disputed whether the exception applies irrespective of the size of the ship. It has 44
been argued that vehicles must have a minimum size to classify as a ship in the sense of
Art. 2(e).106 Taking into account that one of the major purposes of the Convention is to
provide legal certainty and that the wording does neither foresee a minimum size nor a
duty to register, it is, in this author’s view, more favourable not to require a minimum
size for the exception to apply.107 The decisive factor is whether these vehicles, be it civil
or military vessels108, are intended for a continual movement.109 Therefore ‘vehicles’
that are intended for a local use at the same place (e. g. house boats, oil rigs and floating
97Honnold/Flechtner, Uniform Law (2009), Art. 2 para. 55.

98UNCITRAL, Digest of Case Law on the CISG, Art. 2 para. 9; Saenger, in: Ferrari et al., Internationales
99 Magnus, in: Staudinger Kommentar (2013), Art. 2 para. 44. For a more detailed discussion of the
drafting history see Schwenzer/Hachem, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 2 para. 27;
Khoo, in: Bianca/Bonell, Commentary (1987), Art. 2 para. 2.6.
100 Benicke, in: MünchKommHGB (2013), Art. 2 para. 21; Achilles, UN-Kaufrechtsübereinkommen
(2000), Art. 2 para. 9 (in regard to aircrafts); Saenger, in: Ferrari et al., Internationales Vertragsrecht
(2012), Art. 2 para. 11; Schwenzer/Hachem, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 2
para. 32; Lookofsky, Understanding the CISG (2012), p. 17 fn. 32; Legfelsóbb Birósag (Hungary) 25 Sep-
tember 1992 (airplane engines), United Technologies International Inc. Pratt and Whitney Commercial
Engine Business vs. Magyar Légi Közlekedési Vállalat (Málev Hungarian Airlines), CISG-Online 63
(Pace). It seems that this has been overseen in the decision US Bankruptcy Court for the Middle District
of Georgia (USA) 25 July 2002 (airplane and airplane engines), First National Bank of South Georgia vs.
Ayers, CISG-Online 1663 (Pace): In regard to the aircraft engines, the CISG was indeed applicable. The
decisive question was whether the parties had an intent that the sale of the engines and the sale of the
aircraft should be covered by the same law. In this case one could argue that the parties implicitly
excluded the Convention’s application according to Art. 6.
101 Piltz, Internationales Kaufrecht (2008), paras 2–51.
103 Enderlein/Maskow, International Sales Law (1992), p. 35.
106 Piltz, Internationales Kaufrecht (2008), paras 2–52; Meier/Stacher, in: Brunner Kommentar (2014),
Art. 2 Rn. 14; Magnus, in: Staudinger Kommentar (2013), Art. 2 para. 46.
107 See also Schwenzer/Hachem, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 2 para. 30;

108 Arbitral Award, Russian Maritime Commission Arbitral Tribunal, 18 December 1998 (military
submarine), CISG-Online 1588 (Pace).

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docks) are not included in the exception created by Art. 2(e).110 Taking into account the
underlying rationale of the provision, the exception does not apply to sailing boats and
other sporting equipment.111 This follows from the wording of the provision: these
goods cannot be classified as a ‘ship’ or ‘vessel’.
45 Taking these difficulties into account, parties should explicitly agree to the applicable
law in the contract.112
46 c) Aircrafts. The term aircraft includes civil and military aircrafts that are intended to
transport humans or goods and are intended for a continual movement113. Model
planes are not considered to be an aircraft in the sense of Art. 2(e).114 The same is true
for hang-gliders, satellites and skyrockets.115
6. Sales of electricity
47 The reason to exclude sales of electricity from the Convention’s sphere of application
is that there are tendencies arguing that electricity is not a ‘good’, which is of course a
prerequisite for the CISG to be applicable at all according to Art. 1.116 In addition,
contracts for the supply of electricity often contain special provisions for which the rules
established by the CISG are inappropriate.117
48 Taking this underlying principle into account, it is questionable whether the Con-
vention is applicable to sales contracts concerning other energy sources, such as oil, gas
and liquidated gas. These are to be considered goods in the sense of Art. 1, even if gas is
not tangible.118 In this author’s opinion the decisive factor should be that these energy
sources can be traded like every other good and can even be made movable. Conse-
quently, these contracts are governed by the Convention if no other exception applies.
Although providing for such an exception was discussed during the drafting of the
Convention119, the drafters rejected a broader exception during their deliberation.120
Furthermore, these goods cannot be removed from the CISG’s sphere of application
by analogy121 for two reasons. Firstly, as it has already been mentioned, Art. 2 contains
explicit exceptions which have to be interpreted narrowly and cannot be extended to
other goods. Secondly, an analogous interpretation cannot be made against the drafters’
110 Saenger, in: BeckOK BGB Kommentar (2017), Art. 2 para. 10; Lorenz, in: Witz/Salger/Lorenz,
Kommentar (2016), Art. 2 para. 9; Piltz, Internationales Kaufrecht (2008), paras 2–52.
111 Saenger, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 2 para. 11; Magnus, in: Staudin-
ger Kommentar (2013), Art. 2 para. 46; Benicke, in: MünchKommHGB (2013), Art. 2 CISG para. 19.
116 Khoo, in: Bianca/Bonell, Commentary (1987), Art. 2 para. 2.7.
117 Schwenzer/Hachem, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 2 para. 33; Saenger, in:
Ferrari et al., Internationales Vertragsrecht (2012), Art. 2 para. 12.

118 Magnus, in: Staudinger Kommentar (2013), Art. 1 para. 45; Honnold/Flechtner, Uniform Law
(2009), Art. 2 para. 56.1; Karollus, UN-Kaufrecht (1991), p. 22. The CISG has been applied to a sale of
propane gas by the Oberster Gerichtshof (Austria) 6 February 1996 (propane gas), CISG-Online 224
(Pace). See also UNCITRAL, Digest of Case Law on the CISG, Art. 2 para. 9.
119 See the criticism by U. Huber, UNCITRAL-Entwurf eines Übereinkommens über internationale
Warenkaufverträge, 43 RabelsZ (1979) 413 (419).

120 Official Records, Doc. A/CONF.97/19, p. 200 et seq.; Benicke, in: MünchKommHGB (2013), Art. 2
CISG para. 22; Honnold/Flechtner, Uniform Law (2009), Art. 2 para. 56; Schwenzer/Hachem, in: Schlech-
triem/Schwenzer, Commentary (2016), Art. 2 para. 33.
121 Achilles, UN-Kaufrechtsübereinkommen (2000), Art. 2 para. 10; Magnus, in: Staudinger Kommentar
(2013), Art. 2 para. 50; Schwenzer/Hachem, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 2
para. 33; Lookofsky, Understanding the CISG (2012), p. 20 footnote 49; Saenger, in: Ferrari et al.,
Internationales Vertragsrecht (2012), Art. 2 para. 12.
52 Spohnheimer
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expressed intent, which has to be respected. In addition, this result is in line with the
Convention’s aim to strengthen legal harmonisation and to avoid legal uncertainty in
international sales transactions. Taking this into account, the CISG should apply to
these contracts if no other body of law exists that excludes the Convention’s application
according to Arts 90 and 94.
7. Burden of proof
According to the general principle ‘ei incumbit’ that underlies the Convention, the 49
party who argues that the contract, which would otherwise be covered by the CISG
according to Art. 1, falls under one of the exceptions given by Art. 2, generally bears the
burden of proof.122 However this general rule is disputed especially in regards to
consumer sales contracts (Art. 2(a)). According to some authors it shall always be the
buyer who bears the burden of proof that the sales contract the parties entered into is a
consumer contract; and it should always be the seller who bears the burden of proof that
he was not aware of the specific purpose and could reasonably be unaware of it.123 The
majority opinion however applies the general principle. From a practical point of view,
there is no difference between both points of view, if it is – like usual – the buyer who
relies on the non-applicability of the CISG according to Art. 2 and if it is the seller who
relies on its applicability.124 The situation is, however, different if it is the claiming seller
who argues that the transaction is a consumer contract, because he does not want the
transaction governed by the CISG. Following the general principles, it would be up to the
buyer to argue and to prove that the private purpose of the contract was not discernable.
However, the decisive question is whether Art. 2(a) prevents the buyer from relying on
the counter-exception. No such restriction is mentioned in the wording of the provision.
Nevertheless, it is the Convention’s goal to protect a seller who could not be aware of a
private use of the goods by the Convention’s application and it is not the Convention’s
goal to protect reliance on its inapplicabiltiy125. Therefore, a buyer should not be allowed
to rely on the indiscernibility of the private purpose of the sales transaction. Conse-
quently, in cases where, the buyer argues that the transaction is a consumer contract
(Art. 2(a)), the burden of proof that this was not discernable, is always with the seller who
wants to rely on the exception from the exception.126 This follows from the wording of
Art. 2(a) whereupon the Convention does not apply “unless the seller neither knew nor
ought to have known” the intention of a personal use.

There is no similar provision in the PECL and the PICC since these principles are 50
intended to have a broader sphere of application and there is no need for such a
limitation. However, the DCFR contains exclusions similar to those of Art. 2, i. e. Art. I.
– 1:101(2)(d) excludes rights similar to these mentioned in Art. 2(d).
122 In a similar way Achilles, UN-Kaufrechtsübereinkommen (2000), Art. 2 para. 11; Saenger, in: Ferrari
et al., Internationales Vertragsrecht (2012), Art. 2 CISG para. 13.

123 Karollus, UN-Kaufrecht (1981) p. 22.
124 Saenger, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 2 para. 13; Ferrari, in: Schlech-
triem/Schwenzer Kommentar (2013), Art. 2 para. 22.

125 Schwenzer/Hachem, in: Schlechtriem/Schwenzer Commentary (2016), Art. 2 para. 8; cf. supra
para. 17.
126 See also Saenger, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 2 CISG para. 13; Siehr,
in: Honsell, Kommentar (2010), Art. 2 para. 14; H. P. Westermann, in: MünchKommBGB (2012), Art. 2
para. 6; Benicke, in: MünchKommHGB (2013), Art. 2 CISG paras 24 seq; Schlechtriem/Butler, CISG
(2009), para. 29 b.
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Article 3
(1) Contracts for the supply of goods to be manufactured or produced are to be
considered sales unless the party who orders the goods undertakes to supply a
substantial part of the materials necessary for such manufacture or production.
(2) This Convention does not apply to contracts in which the preponderant part of
the obligations of the party who furnishes the goods consists in the supply of labour
or other services.
Bibliography: Bevilacqua, L’artcile 3 de la Convention de Vienne et les contrats comlexes dans le domaine
de l’informatique; une lecture de la jurisprudence pertinente, 50 McGill Law Journal 553 (2005); CISG-AC
Opinion no 4, Contracts for the Sale of Goods to Be Manufactured or Produced and Mixed Contracts
(Article 3 CISG), 24 October 2004. Rapporteur: Professor Pilar Perales Viscasillas; Eggen, Digitale Inhalte
unter dem CISG Eine Rundschau über Herausforderungen und mögliche Lösungen, 17(6) Internationales
Handelsrecht, (2017), pp. 229–237; Gilette/Walt, The UN Convention on Contracts for the International
Sale of Goods – Theory and Practice, 2nd edition (2016); Green/Saidov, Software as Goods, Journal of
Business Law (March 2007) 161; Lookofsky, In Dubio Pro Conventione? Some Thoughts about Opt-outs,
Computer Programs and Preemption Under the 1980 Vienna Sales Convention (CISG), 13 Duke Journal of
Comparative and International Law (2003) 263; Perovic, Selected Critical Issues Regarding the Sphere of
Application of the CISG, 3 Annals of the Faculty of Law in Belgrade 181 (2011); Schroeter, Vienna Sales
Convention: Applicability to “Mixed Contracts” and Interaction with the 1968 Brussels Convention, 5
Vindobona Journal of International Commercial Law and Arbitration (2001) 74; Sono. The Applicability
and Non-Applicability of the CISG in Software Transactions, in Andersen & Schroeter (eds.), Sharing
International Commercial Law across National Boundaries: Festschrift for Albert H. Kritzer on the
Occasion of his Eightieth Birthday (2008) 512–526; CISG-AC Opinion no 4, Contracts for the Sale of
Goods to Be Manufactured or Produced and Mixed Contracts (Article 3 CISG), 24 October 2004.
Rapporteur: Professor Pilar Perales Viscasillas, Universidad Carlos III de Madrid.
Outline
I. Importance and Role of the Provision. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1. General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
2. Drafting history . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1. Contracts for the sale of goods to be manufactured or produced. . . . . . . . . 5
a) Substantial test . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
b) Substantial versus essential. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
c) Materials necessary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
2. Service Contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
a) Preponderant. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
b) The issue of severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
3. Software . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
4. Burden of proof . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26

1. General
1 Art. 3 extends the Convention’s sphere of application beyond the supply of goods
in two important ways: (1) contracts where the buyer provides a non-substantial
portion of the materials necessary, and (2) to contracts which include services as a
non-preponderant portion of the obligation provided by the party furnishing the
goods. This extension of the sphere of application is significant as the CISG can apply
54 Mistelis/Raymond
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not only to the sale of ready or manufactured goods but also in relation to goods
which are to be manufactured and certain mixed contracts where the sale is a
significant element.1
2. Drafting history
Art. 3(1) may be compared with ULIS Art. 6, according to which contracts in which 2
the party who orders the goods also supplies a substantial part of the materials are
excluded from the scope of the Convention.2 The criterion would be whether the
materials supplied are “substantial” or not. The party claiming that the ULIS does not
apply must prove that the ordering party supplied, or was supposed to supply, a
substantial amount of the materials. The same burden of proof would presumably apply
in the case of the CISG.3
Art. 3(2) excludes mixed contracts with a sales element which are predominately 3
contracts for the supply of labour or services. One of the issues to be addressed here is
the case of goods delivered which require an installation (e. g. complex machinery). This
issue was considered problematic under the ULIS and may well continue to be
problematic under the CISG. Generally, the language used, i. e. “preponderant part”,
should be understood in terms of relative value and would normally imply significantly
higher than 50 % of the price.4
It is worth mentioning that during the deliberations, the UK delegation proposed to 4
address in (and exclude from) Art. 3 transfer of technology and transfer of know-how.
It was generally felt that it was excessively difficult to characterize such contracts and
that they would normally be excluded from sales contracts in domestic laws.5
1. Contracts for the sale of goods to be manufactured or produced

Art. 3 makes clear that the Convention should apply to contracts for the sale of goods 5
to be manufactured and/or produced provided that the party ordering the goods has not
1 Court of Justice of European Union Case C-381/08, Car Trim GmbH v Key Safety Systems srl,
25 February 2010 (airbag systems) CISG-Online 2351, in the context of Art. 3 CISG looked as the criteria
of distinguishing between “sale of goods” and “provision of services” and noted that it is important that
the buyer has not supplied the materials and the seller/supplier is responsible for the quality of the goods
and their conformity oftp te contract. The Court of Justice of the European Union looks at the CISG as an
incidental matter in relation to EC Regulation 44/2001 and the question of jurisdiction in civil and
commercial matters.
2 Schlechtriem, Uniform Sales Law – The UN-Convention on Contracts for the International Sale of Goods
(1986) p. 31. See also Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), pp. 65–74.
3 Schlechtriem, Uniform Sales Law – The UN-Convention on Contracts for the International Sale of
Goods (1986) p. 31 with reference to Riese, 29 RabelsZ (1965) 18.

4 See, e. g., Honnold/Flecthner, Uniform Law (2009), Art. 3 para. 59; see also Kahn, La Convention de
Vienne du 11 avril 1980 sur les contrats de vente internationale de marchandises, Review internation-ale
de droit compare (1981) 955 (presumption that the CISG is applicable to contracts with a clearly
preponderant “service” component as well as to “turn-key” contracts); A/Conf. 97/C.1/L.26, Official
Records 84; Secretariat Commentary on 1978 Draft, Art. 3 (now Art. 3); contra Honnold/Flechtner,
Uniform Law (2009), Art. 3 para. 60 (arguing that the Convention should apply to the entire agreement).
See also Schlechtriem, Uniform Sales Law – The UN-Convention on Contracts for the International Sale
of Goods (1986) p. 32. It is generally clear that a mere quantitative assessment would be inadequate,
Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), pp. 67 et seq.
Goods (1986) p. 32.
Mistelis/Raymond 55
3B2 9.1.580; Page size: 160.00mm 240.00mm
supplied a substantial part of the necessary materials.6 It should not matter if the goods
being considered are thought of as specific, or customized goods7 – nor should it matter
if the seller enlists the assistance of a designer or purchases components from another
party.8 Another issue of contention is non-physical contributions, such as technical
knowledge or intellectual property; they are generally understood not to fall under the
scope of Art. 3(1).9
6 a) Substantial test. The Convention is silent on the definition of‘substantial part’;
however, one should note the different phrasing used in para. 2 of the article, that
of‘preponderant’. Based on the different phrasing used, one certainly must recognize the
lower standard that is present in the expression ‘substantial’ used within para. 1 of the
article.
7 Case law and commentators have shed some light on how the phrase substantial
should be interpreted. Some suggest the determination of substantial should be based on
a simple quantitative criterion. For example, a criterion based upon weight or volume of
the material provided in relation to the total weight or volume of material used.10
However, some commentators argue that the use of a quantitative measure is much
too simplistic and will lead to odd and often unanticipated results. Honnold, for
example, gives examples in which the primary criterion should be based in ‘value.’ It
follows that value would then be used to consider the value of the portion supplied as
measured against the value of the entire value of all material used.11
8 Clearly, one must admit that quantitative analysis is a reasonable initial considera-
tion; however, one can easily find examples of how the use of quantitative measures as
the sole criterion will fall wilfully short.12 Moreover, value as a primary criterion may
also lead to some unintended outcomes. Numerous examples exist in the area of
electronics in which a single component can greatly out-value the value of all other
6 Kantongericht Zug (Switzerland), 14 December 2009 (spinning company) CISG-Online 2026; Ober-
gericht Aargau (Switzerland), 3 March 2009 (Prefabricated house) CISG-Online 2013; Handelsgericht des
Kantons Zürich (Switzerland) 8 April 1999 (Windmill drives), CISG-Online 489 (Pace); Handelsgericht
des Kantons Zürich (Switzerland) 10 February 1999 (Art books) CISG-Online 488 (Pace); Oberlandesger-
icht Oldenburg (Germany), 20 December 2007 (Industrial tools) CISG-Online 1644 (Pace); Oberlandes-
gericht Innsbruck (Austria), 18 December 2007 (steel bars) CISG-Online 1735 (Pace); Oberlandesgericht
Linz (Austria) 24 September 2007 (lamninated glass) CISG-Online 1583 (Pace); Landgericht Regensburg
(Germany) 24 September 1998 (Cloth), CISG-Online 1307 (Pace); Oberlandesgericht München (Ger-
many) 8 February 1995 (Polypropylene plastic granulate), CISG-Online 142 (Pace); Oberlandesgericht
Köln (Germany) 26 August 1994 (Market study), CISG-Online 132 (Pace); Handelsgericht des Kantons
Zürich (Switzerland) 9 September 1993 (Furniture), CISG-Online 79 (Pace); Oberlandesgericht Frankfurt
am Main (Germany) 17 September 1991 (Shoes), CISG-Online 28 (Pace); Arbitral Award, ICC Court of
Arbitration, Award no 9083, CLOUT Case 1086, ICC Court of Arbitration, Award no 9448, July 1999,
CLOUT Case No 630.
7 For example, see the Swiss case of Handelsgericht des Kantons Zürich (Switzerland) 10 February 1999
(Art books) CISG-Online 488 (Pace); the German case of Oberlandesgericht Frankfurt am Main
(Germany) 17 September 1991 (Shoes), CISG-Online 28 (Pace). In contrast, see the French case of Cour
d’appel de Chambéry (France) 25 May 1993 (Adapters), CISG-Online 223 (Pace). For an examination of
the distinction in made to order goods and services, see, Ferrari, excerpt from Selected Topics of the CISG
in the Light of Judicial Application and Scholarly Writing, 15 Journal of Law and Commerce (1995) 1–
126 (Pace).
8 See Piltz, Internationales Kaufrecht, para 2–33; Enderlein/Maskow, International Sales Law (1992),
p. 38.
10 See, for example, the Hungarian case Arbitral Award, Arbitration Court attached to the Hungarian
Chamber of Commerce and Industry, 5 December 1995 (Waste container) CISG-Online 163 (Pace).
11 See Honnold/Flechtner, Uniform Law (2009), Art. 3 para. 59.
12 This argument was advanced in courts in the German case of Landgericht Mainz (Germany)
26 November 1998 (Cylinder), CISG-Online 563 (Pace).
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components. Should the sale of a computer be eliminated from the Convention merely
because the buyer orders a computer with specifications, but elects to source the
processor from another manufacturer?
Some commentators have attempted to place a more specific value or percentage to 9
quantify ‘substantial.’ Commentators have suggested rangers between 15 % to 50 %.13
However the vast majority support a threshold of ‘50 % and above’ to be appropriate.14
Despite attempts at fixing a rigid value-based percentage to exclude certain types of
contracts from the Convention, some commentators argue that the rigid standard
should be rejected,15 and some argue that each standard serves its purpose, but that no
single criterion should be used.16
Despite the lack of a precise definition, one must appreciate the importance of 10
allowing a level of flexibility in determining ‘substantial’ in light of the surrounding
circumstances. As the commentary clearly describes, Art. 3 is designed to eliminate
contracts for the supply of services or labour from the sales convention.17 As such,
Art. 3(1) should exclude contracts that are more “akin to contracts for the supply of
services or labour than to contracts for sale of goods.”18 This should be the effect of
Art. 3 and a level of flexibility to achieve this effect is not necessarily a bad thing.
b) Substantial versus essential. Arguments have been made that the determining 11
criteria would be better expressed with the use of the phrase ‘essential’ part of the
materials necessary for such manufacture or production.19 This discussion partly derives
from the French text of the Convention which refers to “essential”.20 The arguments for
the use of the term ‘essential’ are supported for several reasons. The use of essential as a
single determinative criterion, however, must ultimately be rejected.
As the French translation of the Convention in fact uses the term ‘essential’ in place 12
of the term ‘substantial’ which is used in the English version,21 some French, German
and Swiss commentators argue that this should be the criterion.22 Clearly, ‘essential’ will
then be the language considered by the courts in these instances as this is in fact the
language within the Convention. However, the use of the term essential should not be
over interpreted to the effect that a court or tribunal considers ‘essential’ to be a better
measure. Moreover, the use of the term essential does not eliminate the grey areas
created by the use of such a term – it merely shifts the debate slightly. Essential,
although possibly a term with a clear definition on its face (perhaps shifting the focus
on a qualtitative rather than quantitative criterion), does not eliminate the unintended
outcomes within this occasionally grey area of law. If the seller was to provide the
13 See Honnold/Flechtner, Uniform Law (2009), Art. 3 para. 59 stating “a tribunal might well conclude
that 15 % is ‘substantial’ but the evaluation of such questions of degree is difficult to predict”. Enderlein/
Maskow/Strohbach, Internationales Kaufrecht (1991), Art. 3 para. 3 (less than 50 %).
14 See the pertinent discussion in Schwenzer/Hachem, in: Schlechtriem/Schwenzer, Commentary
(2016), Art. 3 para. 5.

15 See Magnus, in: Staudinger Kommentar, Art. 3, para. 18.
17 See Secretariat Commentary on 1978 Draft, Art. 3 (now Art. 3) para. 5.
18 Secretariat Commentary on 1978 Draft, Art. 3 (now Art. 3) para. 5.
19 For example, the Italian case of Corte Suprema di Cassazione (Italy) 9 June 1995, Alfred Dunhill Ltd.
v Tivoli Group S. r. l., CISG-Online 314 (Pace).

21 See Schroeter, Vienna Sales Convention: Applicability to “Mixed Contracts” and Interaction with the
1968 Brussels Convention, 5 Vindobona Journal of International Commercial Law and Arbitration (2001)
74–86.
22 See Schroeter, Vienna Sales Convention: Applicability to “Mixed Contracts” and Interaction with the
1968 Brussels Convention, 5 Vindobona Journal of International Commercial Law and Arbitration (2001)
74–86.
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processor for the computers, should the court determine the processor more essential to
the overall computer than the hard drive? This single example highlights the fact that
the changing of the terminology does not eliminate the same grey area created with the
use of the term substantial.
13 The legislative history suggests that the drafters considered and rejected the use of the
term ‘essential’ within Art. 3,23 and as such, it is suggested that the use of the term
should be rejected as the single interpretive measure. Moreover, the use of the term also
does not promote the international character of the Convention, but instead places yet
another obstacle in interpretation.
14 c) Materials necessary. Controversy also sometimes surrounds the use of the phrase
‘materials necessary’ for the manufacture or production because this arguably could
include design specifications, etc.24 Of course, design specifications and similar instruc-
tions or plans used by the seller to produce specific and/or tailor made goods for the
buyer should not preclude the application of the Convention to the goods25 as these
should be considered ‘immaterial’ contributions. As such, these ‘immaterial’ contribu-
tions should not be misunderstood to be included in the expression ‘materials’
necessary for manufacture or production.
2. Service Contracts
15 Art. 3(2) sets forth that the Convention does not apply to service contracts in which
the ‘preponderant part’ of the contractual obligations are labour or other services.26 Of
course, the Convention will apply to mixed contracts only in the situation where a
single contract exists,27 and merely providing traditional ancillary packaging/delivery
obligations should not be considered services or labour.28
16 In this sense, some commentators argue that ‘turnkey contracts’ will most likely by
excluded from the Convention as “the sale of goods element is rarely at the forefront”.29
While it is true that most turnkey contracts will be drafted in such detail as to practically
leave no room for the CISG,30 it is suggested that courts should not be too quick to exclude
them from the scope of the Convention. As a national court’s definition of a turnkey
contract will often vary jurisdiction to jurisdiction, a case-by-case analysis as to whether
the requirements for the exclusion is satisfied is recommended.31
23See CISG-AC Opinion no 4, para. 2.5.

24Some courts disagree on the issue of whether design specifications provided by the buyer constitutes
‘materials necessary’ for the production of the goods under Art. 3(1). See e. g., Cour d’appel de Chambéry
(France) 25 May 1993 (Adapters), CISG-Online 223 (Pace).
25 See Oberlandesgericht Frankfurt am Main (Germany) 17 September 1991 (Shoes), CISG-Online 28
(Pace).
26 See Arbitral Award, ICC 7153/1992, 1 January 1992, CISG-Online 35 (Pace); Kantonsgericht Zug
(Switzerland) 25 February 1999 (Building materials), CISG-Online 490 (Pace); Bundesgerichtshof (Ger-
many) 12 February 1998 (Air cleaning installation), CISG-Online 343 (Pace); Handelsgericht des Kantons
Zürich (Switzerland) 26 April 1995 (Saltwater isolation tank), CISG-Online 248 (Pace); Bezirksgericht
Laufen (Switzerland) 7 May 1993, CISG-Online 136 (Pace).
27 See Secretariat Commentary on 1978 Draft, Art. 3 (now Art. 3) para. 3; Schwenzer/Hachem, in:
Schlechtriem/Schwenzer, Commentary (2010), Art. 3 para. 17.

28 Such as packaging, dispatching the goods, concluding contracts with carriers and other traditional
basic obligations in relation to protecting the goods or arranging transport. See CISG-AC Opinion no 4,
para. 3.1. See, for example: Cour d’appel de Colmar (France) 26 February 2008 (Printed products), CISG-
Online 1657 (Pace) (the work necessary for the production and the packaging of the goods cannot be
considered a service in the sense of Art. 3(2)).
30 Ibid.
31 CISG-AC Opinion no 4, para. 3.5.
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a) Preponderant. The Convention clearly stipulates that contracts that include an 17
obligation to provide services alongside the delivery of goods are excluded from the
Convention if the service obligations are a preponderant part of the obligations.32
However, the Convention is silent as to the definition of ‘preponderant’. As mentioned
above, one should note the different phrasing used in para. 1 and para. 2 of this article.
Based on the different phrasing used, one certainly must recognize the higher standard
that is present in the expression ‘preponderant’, used within para. 2.
But the question remains, if substantial is arguably at least 50 % of the value,33 how 18
much is a preponderant part of the obligations and what should be the determinative
factor. The prevailing view is that the test should be one of an economic value34 based
on a comparison of the parties’ obligations in light of the entire agreement.35 Most
commentators agree that overly prescriptive percentages designed to determine the
application of the Convention are too dogmatic. However, when a percentage is used,
most agree that the percentage must certainly ‘exceed 50 %’,36 although some argue the
percentage must ‘significantly exceed 50 %’. This high of a standard is not widely
followed.
Regardless of the use of percentages, most commentators and courts support the view 19
that the economic value factor should be supplemented by consideration of the parties’
intentions as expressed in the contract and surrounding circumstances.37 In fact, several
courts have considered the weight the parties themselves have placed upon the various
obligations as one of the primary determinative factors.
The Belgian case of S. r. l. Orintix v NV Fabelta Ninove (2004)38 is enlightening on 20
this issue. In this case, the court determined that “the circumstance that the price of the
delivered hardware was higher than the price of the software is not determinative in the
case at hand.”39 This is true because the “will of the parties was that [Seller] would
create a system for [Buyer] and make it operational.”40 To accomplish this, the Seller
needed to repeatedly adjust the software – either at the place of the buyer or elsewhere
so that the said goals would be reached. In this case, the court enumerated “the services
32 See, for example, Kantonsgericht Zug (Switzerland) 25 February 1999 (Building materials), CISG-
Online 490 (Pace); Oberlandesgericht München (Germany) 9 July 1997 (Fitness equipment), CISG-Online
281 (Pace); Obergericht des Kantons Luzern (Switzerland) 8 January 1997 (Blood infusion devices), CISG-
Online 228 (Pace); Handelsgericht des Kantons Zürich (Switzerland) 26 April 1995 (Saltwater isolation
tank), CISG-Online 248 (Pace); Cour d’appel de Grenoble (France) 26 April 1995 (Second hand metallic
hangar), CISG-Online 154 (Pace); Oberster Gerichtshof (Austria) 27 October 1994 (Brushes and brooms),
33 As arguably established above as the minimum percentage to qualify as ‘substantial’ under Art. 3 (1).
34 See Schwenzer/Hachem, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 3 para. 18; Enderlein/
Maskow/Strohbach, Internationales Kaufrecht (1991), Art. 3 para. 7; Honnold/Flechtner, Uniform Law

(2009), Art. para. 60.1; Magnus, in: Staudinger Kommentar, Art. 3 para. 22.
35 See CISG-AC Opinion no 4, para. 3.4.
36 See Schwenzer/Hachem, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 3 para. 20. See also,
for example, Tribunale di Forli (Italy) 16 February 2009 (Cisterns and accessories) CISG-Online 1780
(Pace) stating that the Convention shall not apply if the value of the goods to be delivered is lower than
that of the labour (and/or services), that is to say, when the value of manpower or other services amounts
to more than 50 % of the value of the goods.
37 As expected under Art. 6. See CISG-AC Opinion no 4, para. 3.4. See also, Landgericht Mainz
(Germany) 26 November 1998 (Cylinder), CISG-Online 563 (Pace).

38 See Hof van Beroep Gent (Belgium) 24 November 2004 (Computer hardware and software), CISG-
Online 966 (Pace) [translation used for commentary]. See also in this respect, Oberlandesgericht Dresden
(Germany) 11 June 2007 (Airbag parts), CISG-Online 1720; Landgericht Mainz (Germany) 26 November
1998 (Cylinder for production of tissue paper), CISG-Online 563.
39 Hof van Beroep Gent (Belgium) 24 November 2004 (Computer hardware and software), CISG-
Online 966 (Pace).

40 Ibid.
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are determinative in the task of [Seller], so that the CISG cannot be applied.”41 Overall,
the approach taken by the court is one to appreciate as both efficient and practical.
21 b) The issue of severability. Certainly, one can – and should – consider the option of
severing the services part of the contract and having this portion of the contract covered
by the application of applicable domestic law. Some commentators go so far as to
import the domestic definition of services into the international contract for the sale of
goods and thereby use this definition to determine the portion to be severed.42
22 This of course, would be a reasonable approach if the vast majority of domestic
systems afforded great weight to the promotion of giving full effect to the rules
governing international sales. However, this approach is far from universal and, as
such, one must appreciate that States that are parties to the Convention have agreed
via Art. 7 to give regard to its international character and the need to promote
uniformity. Importing domestic law definitions would fail to honour this obligation.
3. Software
23 Despite a bit of confusion over sales of software in general, the Convention should
not be interpreted to be overly hostile toward the sale of software43 – even software to be
produced. As discussed above, even a contract for the supply of goods “to be
manufactured or produced” is a CISG sale under Art. 3(1). This general statement is
arguably true even in situations where the value of the labour and services involved in
the production exceeds the value of the raw materials needed to manufacture the goods
concerned. Consequently, software should not be excluded merely because it is the
product of intellectual efforts, the value of which exceeds the value of the medium in
which the software is embodied. Software should be considered, in many ways, in the
same manner as any other sale of intangible property. Although intellectual property
rights flow from such an endeavour, this is no different than many other goods that
have intellectual property rights associated with the good.44
24 Clearly a distinction can be drawn between contracts involving standard software,45
contracts for software specifically developed for the needs of a particular customer46
41 Hof van Beroep Gent (Belgium) 24 November 2004 (Computer hardware and software), CISG-Online
966 (Pace). See also, the Austrian court determination: “Mixed-type contracts are not governed by the
United Nations Convention on Contracts for the International Sale of Goods, if the part which does not
relate to the sale is crucially predominant. The individual circumstances of the relation between the part
which relates to the sale and the part which does not relate to the sale are decisive (citing 4Ob 179/05 k).
The quantitative balance does not constitute the sole requirement in respect to the question whether the
supply of services is predominant. In addition, further components have to be taken into account in each
case such as in particular the interest of the parties as regards the remaining performances.” Oberlandesger-
icht Innsbruck (Austria) 18 December 2007 (Steel bars), CISG-Online 1735 (Pace).
42 See Secretariat Commentary on 1978 Draft, Art. 3 (now Art. 3) para. 3. Unsurprisingly this approach
has been criticised, see Enderlein/Maskow/Strohbach, Internationales Kaufrecht (1991), Art. 3, note 7.
Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 3 para. 5, suggests the distinction is
“unlikely to have any practical consequence”. This comment is not made in the 2010 edition.
43 See Fawcett/Harris/Bridge, International Sale of Goods in the Conflict of Laws (2005), pp. 516–517;
Bevilacqua, L’artcile 3 de la Convention de Vienne et les contrats comlexes dans le domaine de

l’informatique; une lecture de la jurisprudence pertinente, 50 McGill Law Journal 553 (2005); Gilette/
Walt, 49–55.
44 Eggen, Digitale Inhalte unter dem CISG Eine Rundschau über Herausforderungen und mögliche
Lösungen, 17(6) Internationales Handelsrecht, (2017) 231 et seq.

45 See Landgericht München (Germany) 8 February 1995 (Software), CISG-Online 203 (Pace).
46 For cases considering that standard software is governed by the CISG, but not custom-made
software, see: Oberlandesgericht Köln (Germany) 16 October 1992 (Computers), CISG-Online 50 (Pace);
Oberlandesgericht Köln (Germany) 26 August 1994 (Market study), CISG-Online 132 (Pace); and Land-
gericht München (Germany) 8 February 1995 (Software), CISG-Online 203 (Pace).
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and contracts for software that includes various support services, such as installation
support, system support, program support services and/or training.47 Although soft-
ware in many instances is substantially different from the traditional sales of tangible
goods, for the purposes of the application of the Convention this distinction should
be minimized, although some authors point out that the online sale of software
merely can be seen as a license to use a software and not a transfer of a tangible
asset.48 Moreover, as discussed within considerations of what constitutes a ‘good’
under the Convention, the value of creativity, amount of workhours needed and/or
technology necessary to produce is irrelevant when considering whether or not the
item should be considered a ‘good’. In fact, most goods have within their price matrix
considerations given to such elements and this salient fact should not shift the
definition of a ‘good.’
Even software that is delivered by an installation specialist should not fall afoul of 25
the Convention,49 unless the installation is of such great measure as to become the
‘predominant’ standard. An example of this are situations where the parties contract
for the sale of software that must be installed by an installation specialist, who then
remains on site to provide training for end users. Situations such as this would clearly
cause issue as the predominant threshold will most likely have been met.50 Conse-
quently, in cases where the service element predominates the total value of the
transaction, Art. 3(2) should serve to ensure that the entire transaction is removed
from the application of the Convention.51
4. Burden of proof
The party who argues that a contract falls outside the scope of the CISG pursuant to 26
Art. 3 bears the burden of proof. Namely, the party asserting the exception (buyer or
seller) must prove either that the party who ordered the goods undertook to supply a
substantial part of the material necessary for the production/manufacture in the case of
Art. 3(1) or that the preponderant part of contract consisted of the supply of labour or
other services in the case of Art. 3(2). This is based on the general principle of ei
incumbit probatio qui dicit, non qui negat, which is the basis for the allocation of the
burden of proof under the CISG.52
47 For a full discussion, see Green/Saidov, Software as Goods, Journal of Business Law (March 2007)
161 (170–173) (Pace) and Gilette/Walt, 49–55; Bevilacqua, L’artcile 3 de la Convention de Vienne et les
contrats comlexes dans le domaine de l’informatique; une lecture de la jurisprudence pertinente, 50
McGill Law Journal 553 (2005).
48 See Sono. The Applicability and Non-Applicability of the CISG in Software Transactions, in
Andersen & Schroeter (eds.), Sharing International Commercial Law across National Boundaries:
Festschrift for Albert H. Kritzer on the Occasion of his Eightieth Birthday (2008) 512–526. Gilette/Walt,
p. 52, argue that since “goods” is undefined may well also include intangible assets.
49 See Landgericht München (Germany) 8 February 1995 (Software), CISG-Online 203 (Pace).
50 See Handelsgericht des Kantons Zürich (Switzerland) 17 February 2000 (Software), CISG-Online 637
(Pace).
51 Art 3. For a further discussion, see Lookofsky, In Dubio Pro Conventione? Some Thoughts about
Opt-outs, Computer Programs and Preemption Under the 1980 Vienna Sales Convention (CISG), 13
Duke Journal of Comparative and International Law (2003) 263 (274–279).
52 See, for example, Ferrari, Burden of Proof under the CISG, Pace Review of the Convention on
Contracts for the International Sale of Goods (CISG) (2000–2001) 1 (1–8) (Pace). Although the issue of
burden of proof is an internal gap of the Convention, reference to wording such as that in Art. 3 itself
(i. e. ‘unless’ in Art. 3(1)), suggests that the general principal of ei incumbit probatio qui dicit is
determinative. See also, Schwenzer/Hachem, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 3
para. 23.
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27 Comparable provisions cannot be found in the PICC or the PECL. The PICC neither
define a sales contract nor distinguish between sales contracts and other types of
contracts. Similarly, the PECL are intended to be applied as general rules of contract
law in the European Union and, hence, make no distinction between sales and service
contracts.
28 The DCFR is similar to the CISG in that it applies to contracts under which one party
undertakes to manufacture or produce goods (Art. IV. A. – 1:102). It does not, however,
make the same distinction as the CISG with respect to contracts under which the
ordering party supplies a substantial part of the goods necessary (Art. 3(1) CISG). This
point is irrelevant to the application of the DCFR.
29 Furthermore, the DCFR provides for pure service contracts (see, for example, Book
IV Part C),53 unlike Art. 3(2) CISG, which only applies to contracts in which the
preponderant part does not comprise of labour or other services. Service contracts
under the DCFR are regulated with a separate set of rules than those governing the sale
of goods, which, at first blush, seems to bring about problems similar to those faced by
the CISG. Namely, difficult questions may arise in determining which set of rules (Sales
under Part A or Services under Part C) applies in the case of ‘mixed contracts’ and how
and where the line should be drawn in making this determination. However, unlike the
CISG, in a “quest for comprehensiveness”54 the DCFR has provided a formula for
dealing with ‘mixed contracts’ (Art. II. – 1:107) by allowing the rules “applicable to each
relevant category [to] apply … to the corresponding part of the contract and the rights
and obligations arising from it”, except where “one part of a mixed contract is in fact
so predominant that it would be unreasonable not to regard the contract as falling
primarily within one category.”
53 Along with the “general rules” provided in Book IV Part C Chapter 2, the DCFR has “special rules”
governing contracts concerning construction, processing, storage, design, information or advice, and
treatment, which will be give priority over the general rules (Art. IV. C. – 1:103(b)).
54 Eidenmüller/Faust/Grigoleit/Jansen/Wagner/Zimmermann, The Common Frame of Reference for
European Private Law-Policy Choices and Codification Problems, 28(4) Oxford Journal of Legal Studies
(2008) 659 (667).
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Article 4
This Convention governs only the formation of the contract of sale and the rights
and obligations of the seller and the buyer arising from such a contract. In particular,
except as otherwise expressly provided in this Convention, it is not concerned with:
(a) the validity of the contract or of any of its provisions or of any usage;
(b) the effect which the contract may have on the property in the goods sold.
Bibliography: Ferrari, Scope of application: Articles 4–5, in: Ferrari/Flechtner/Brand, Draft Digest
and Beyond (2004), p. 96; Flechtner, Selected Issues Relating to the CISG’s Scope of Application, 13
Vindobona Journal of International Commercial Law and Arbitration (1/2009) 91, (Pace) Huber, Some
introductory remarks on the CISG, 6 Internationales Handelsrecht (2006) 228 (Pace); Huber, Standard
Terms under the CISG, 13 Vindobona Journal of International Commercial Law and Arbitration (2009)
123 (Pace), Kröll, Selected Problems Concerning the CISG’s Scope of Application, 25 Journal of Law and
Commerce (2005–2006) 39 (Pace); Lookofsky, Loose Ends and Contorts in International Sales: Problems
in the Harmonization of Private Law Rules, 39 American Journal of Comparative Law (1991) 403 (Pace);
Magnus, Incorporation of Standard Contract Terms under the CISG, FS Kritzer (2008), p. 303 (Pace);
CISG-AC Opinion no 6, Calculation of Damages under CISG Article 74. Rapporteur: Professor John Y.
Gotanda, Villanova University School of Law, Villanova, Pennsylvania, USA (at http://www.cisg-ac.org);
CISG-AC Opinion no 8, Calculation of Damages under CISG Articles 75 and 76. Rapporteur: Professor
John Y. Gotanda, Villanova University School of Law, Villanova, Pennsylvania, USA (at http://www.cisg-
ac.org); CISG-AC Opinion no 9, Consequences of Avoidance of the Contract, 15 November 2008.
Rapporter: Professor Michael Bridge, Tokyo, Japan (at http://cisg-ac.org); CISG-AC Opinion no 10,
Agreed Sums Payable upon Breach of an Obligation in CISG Contracts, 3 August 2012, Rapporteur: Dr.
Pascal Hachem, Bär & Karrer AG, Zurich, Switzerland (at http://www.cisg-ac.org); CISG-AC Opinion no
12, Liability of the Seller for Damages Arising Out of Personal Injuries and Property Damage Caused by
Goods and Services under the CISG. Rapporteur: Professor Hiroo Sono, School of Law, Hokkaido
University, Sapporo, Japan (at http://www.cisg-ac.org); CISG-AC Opinion no 13 Inclusion of Standard
Terms under the CISG, Rapporteur: Professor Sieg Eiselen, College of Law, University of South Africa,
Pretoria, South Africa (at http://www.cisg-ac.org); CISG-AC Opinion no 14, Interest under Article 78
CISG, 21 and 22 October 2013. Rapporteur: Professor Doctor Yes˛im M. Atamer, Istanbul Bilgi University,
Turkey (at http://www.cisg-ac.org); CISG-AC Opinion no 17, Limitation and Exclusion Clauses in CISG
Contracts, 16 October 2015. Rapporteur: Prof. Lauro Gama Jr., Pontifical Catholic University of Rio de
Janeiro, Brazil (at http://www.cisg-ac.org).
Outline
1. General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1. Matters explicitly governed by the Convention . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
a) Formation of sales contract . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
b) Rights and obligations of the seller and the buyer. . . . . . . . . . . . . . . . . . . . . . . 8
c) Other contracts excluded . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
2. Matters explicitly excluded from the Convention . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
a) The validity of the contract or of any of its provisions or of any usage 13
aa) Capacity and authority . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
bb) Formal validity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
cc) Consideration and causa . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
dd) Mistake, fraud and concurrent remedies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
ee) Incorporation and validity of standard terms . . . . . . . . . . . . . . . . . . . . . . . 24
ff) Validity of penalty clauses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
gg) Validity of usages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
b) The effects on the property of the goods sold. . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
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3. Other (non)contentious matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
a) Limitation of actions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
b) Procedural issues. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
c) Issues of jurisdiction and dispute resolution clauses . . . . . . . . . . . . . . . . . . . . 32
d) Burden of proof and standard of proof . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
e) Set-off . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
f) Recovery of attorneys’ fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
g) Interest rate on sums in arrears . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
h) Other issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
1. General
1 The CISG is not a comprehensive code regulating all matters that fall within its
sphere of application.1 On the contrary, when applied in practice it “resembles an island
of international rules surrounded by an ocean of still-applicable national law […]. This
means that courts will often face difficult boundary questions as to exactly where the
sovereignty of the CISG ends and domestic law takes over.”2 Art. 4 is a provision that
aims to help judges and arbitrators in answering these questions.
2 Whilst Arts 1–3 and Art. 6 define the sphere of application, i. e. determine whether the
CISG applies at all to the contract concluded between the parties (whether its application
is excluded, whether the internationality requirement is complied with, whether the
‘goods’ or the modality of transaction involved are of the type covered by the CISG,
whether the sales elements of the contract prevail over other elements, and whether the
nexus requirement between the law of the parties’ ‘state of origin’ and the Convention is
met),3 Arts 4 and 5 perform a different function – they set “the legal scope” of the CISG’s
application, i. e. they define the issues to which the CISG applies.4
3 While Art. 5 excludes the applicability of the CISG in regard to the seller’s liability
for death or personal injury caused by the goods to any person5, Art. 4 sets further
limits to “the substantive ambit”6 of the CISG both positively and negatively. The
former is articulated in its explicit declaration of applicability only to the formation of
the contract of sale and to the rights and obligations of the seller and the buyer arising
from such a contract. The latter excludes from its scope of application, unless otherwise
expressly provided in the Convention, issues of validity of the contract or of any of its
provisions or of any usage and to the effect which the contract may have on the
property in the goods sold. Consequently, the proper application of the CISG to any
contentious issue amongst the parties to the sales contract first requires answering the
question whether such an issue is governed by the CISG or whether it lies outside its
1 Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2004), p. 96; Kröll, Selected Problems
Concerning the CISG’s Scope of Application, 25 Journal of Law and Commerce (2005–2006) 39 (Pace);
Lookofsky, Loose Ends and Contorts in International Sales: Problems in the Harmonization of Private
Law Rules, 39 American Journal of Comparative Law (1991) 403 (404) (Pace); Zeller, CISG and the
Unification of International Trade Law (2007), p. 64.
2 Flechtner, The U. N. Sales Convention (CISG) and MCC-Marble Ceramic Center, Inc. v Ceramica
Nuova D’Agostino, S. p. A.: The Eleventh Circuit Weighs in on Interpretation, Subjective Intent,
Procedural Limits to the Convention’s Scope, and the Parol Evidence Rule, 18 Journal of Law and
Commerce (1999) 259 (286) (Pace).
3 See Commentary on Arts 1–3 and 6.
4 Huber, Some introductory remarks on the CISG, 6 Internationales Handelsrecht (2006) 231 et seq. (Pace).
5 See Commentary on Art. 5; CISG-AC Opinion no 12.
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scope. If the answer is affirmative, the relevant solution to the issue will be either
expressly provided in the CISG or should be found by various gap-filling techniques;7 if
the answer is negative, the otherwise applicable law or rules of law should govern the
issue.
Determining whether an issue is governed by the Convention (expressly or 4
impliedly) has proved to be often difficult in practice and represents the source of
much controversy both in legal doctrine and case law. Namely, more than forty
different legal issues have so far been identified where the answer was not always
clear.8 This number is steadily increasing as the trend in applying the CISG (and
publishing decisions thereon) increases and given the complexities of modern devel-
opments in the field of international trade. However, such a development is not a
desired one, since diverging views on whether an issue is covered by the CISG or not
represent a serious obstacle to achieving the fundamental goal of the Convention –
uniformity in its application. Consequently, classification of a relevant legal issue as
falling in or outside the scope of the CISG should always be carefully made with due
regard to the international character of the Convention and the need to enable and
preserve its uniform application.
2. Drafting history
During the drafting process, certain matters were purposefully omitted from the CISG’s 5
scope of application since they were considered to be too controversial and such that a
uniform solution could lead to an excessively difficult and time-consuming process for the
intended goal.9 Consequently, despite certain attempts to include a validity provision in the
CISG,10 the text of Art. 4 remained to a large degree the same as the language of its
predecessor Art. 8 ULIS and was adopted without opposition. The differences lie in the fact
that, unlike the CISG, the ULIS did not deal with the issues of formation of contracts (as
they were covered by ULF); hence, unlike the CISG, these issues where excluded from ULIS.
Also, unlike the CISG, the ULIS only made reference to parties’ obligations arising out of
sales contracts and not to their rights. However, such minor differences should not prevent
one from using available ULIS case law on Art. 8 for guidance in interpreting Art. 4 CISG.11
Interestingly enough, the reverse process has also been noted in case law – i. e. using case
law under Art. 4 CISG for the purposes of interpretation of Art. 8 ULIS and its scope of
application.12
7See Commentary on Art. 7.

8Namely, on a survey of the reported case law more than 50 issues have been identified as potentially
falling in or outside the scope of the CISG.
9 Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2004), p. 99; Herber, in: Schlechtriem,
Commentary (1998), Art. 4 para. 4; Secretariat Commentary on 1978 Draft, Art. 4 (now Art. 4) para. 4.
10 See Eiselen/Kritzer, in: Kritzer/Vanto/Vanto/Eiselen, International Contract Manual, Vol. 4
§ 84:34(c)(iii).
11 As Mann correctly stated: “[i]t is simply common sense that if the Convention adopts a phrase
which appears to have been taken from one [uniform law] where it is used in a specific sense, the
international legislators are likely to have that sense in mind and to intend its introduction into the
Convention.” See Mann, Uniform Statutes in English Law, 99 Law Quarterly Review (1983) 376 (383)
(Pace); see also Audit, The Vienna Sales Convention and the Lex Mercatoria, in: Carbonneau (ed.), Lex
Mercatoria and Arbitration: A Discussion of the New Law Merchant (1998), p. 188.
12 Supreme Court of Israel (Israel), 17 March 2009, Pamesa Ceramica v Yisrael Mendelson Ltd, CISG-
Online 1980 (Pace) (with respect to concurrent remedies under uniform and domestic law).
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1. Matters explicitly governed by the Convention
6 Art. 4(a) explicitly lists the matters as to which the Convention prevails over domestic
law – i. e. the formation of sales contracts and the rights and obligations of the parties
arising from it. Accordingly, Arts 14 et seq. provide specific rules on formation, and Arts
25 et seq. provide specific rules on the rights and obligations of the parties. Nevertheless,
these are not “the only issues” the CISG governs, rather the issues which are “without
any doubt” governed by the Convention.13 Undisputedly, the Convention also covers
the interpretation of the parties’ statements and conduct (Art. 8), the relevance of the
parties’ practices and usages (Art. 9), formal requirements for contracts (Art. 11),
modifications and termination of contracts (Art. 29) and establishes rules for the
interpretation of the Convention and gap-filling (Art. 7).
7 a) Formation of sales contract. As far as the formation of the contract is concerned,
the Convention merely governs the issue of the objective requirements for the conclu-
sion of the contract – i. e. the technical process thereof, the so-called ‘external
consensus’ by means of offer and acceptance.14 Issues of validity of the contract, the
so-called ‘internal consensus’ are, with few exceptions, explicitly excluded from the
domain of the Convention and left to the otherwise applicable domestic law.15 Further-
more, the objective scope of the Convention is limited to the contracts of sale and
should not be extended to contracts of a different type.16
8 b) Rights and obligations of the seller and the buyer. Besides issues in relation to the
formation of contract, the Convention delineates its scope to rights and obligations of
the seller and the buyer arising from the sales contract (Part. III). At the same time, the
Convention gives wide leeway to party autonomy (Art. 6) and allows derogations from
its provisions, subject to a ‘validity check’ of included clauses in accordance with the
rules of otherwise applicable law or rules of law.17
9 The Convention adheres to the principle of privity of contract and is only concerned
with the rights of the seller and the buyer and not with the rights of third parties to make
direct claims against the parties to the sales contract, or vice versa,18 e. g. the CISG does
not cover claims by sub-purchasers against the seller for defects of the goods.19 Likewise,
13Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2004), p. 97.

14Ferrari in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2004), p. 98; Herber, in: Schlechtriem,
Commentary (1998), Art. 4 para. 7; Huber, Some introductory remarks on the CISG, 6 Internationales
Handelsrecht (2006) 231 (Pace); Kröll, Selected Problems Concerning the CISG’s Scope of Application, 25
Journal of Law and Commerce (2005–2006) 39 (42) (Pace); Schwenzer/Hachem, in: Schlechtriem/Schwenzer,
Commentary (2016), Art. 4 para. 8; Oberster Gerichtshof (Austria) 22 October 2001 (Agricultural products),
CISG-Online 613 (Pace); Oberlandesgericht Graz (Austria) 24 February 1999 (Military weapons) CISG-
Online 797 (Pace); Zivilgericht Basel (Switzerland) 21 December 1992 (Textiles), CISG-Online 55 (Pace).
15 See infra II.2.a.
16 See infra II.1.c.
17 See infra 2.1.
18 Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2004), p. 98; Heuzé, Vente Inter-
nationale (2000), p. 82; Kröll, Selected Problems Concerning the CISG’s Scope of Application, 25 Journal
of Law and Commerce (2005–2006) 39 (47) (Pace); Mather, Choice of Law for International Sales Issues
Not Resolved by the CISG, 20 Journal of Law and Commerce (Spring 2001) 155 (159) (Pace); Schwenzer/
Schmidt, Extending the CISG to Non-Privity Parties, 13 Vindobona Journal of International Commercial
Law and Arbitration (1/2009) 109 (116) (Pace).
19 See Cour d’appel de Rennes (France) 13 May 2016 (Roofing), CISG-Online 2743; U.S. District Court,
New Jersey (U.S.) 19 March 2012 (Photograph printing and processing machine), CISG-Online 2357
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the CISG is not concerned with the effects that the contract might have on third parties,
e. g. the CISG does not cover whether a third party has a security interest in the goods
sold to the buyer.20 Hence, the existence and exercise of these rights need to be
determined in accordance with the otherwise applicable law.
The Convention also limits its application to issues arising out of the contract. Non- 10
contractual entitlements even between the same parties are not governed by the Conven-
tion. It has been repeatedly confirmed in case law that unjustified enrichment claims21 and
tort claims22 do not fall within the CISG purview. Also, a prevailing view is that the issue of
pre-contractual liability is not amongst the issues governed by the CISG.23
c) Other contracts excluded. The CISG restricts its application to contracts of sale. 11
Hence, it should neither apply to contracts concluded in relation to the sales contract
(contracts for carriage, insurance contracts, etc.) nor should it be applied to contracts of
a different type. The relevant legal qualification of the transaction in question should be
made by reference to the express provisions of the Convention determining the parties’
obligations (Arts 30 and 53) and not to the domestic law.24 Consequently, if the
(Pace); Cour d’appel de Rouen (France) 19 December 2006 (Potato seedling), CISG-Online 1933 (Pace);
see also Federal District Court, SD of New York (USA) 19 July 2007, Cedar Petrochemicals, Inc. v Dongbu
Hannong Chemical Co., Ltd., CISG-Online 1509 (Pace); Federal District Court, MD of Pennsylvania
(U.S.) 16 August 2005, American Mint LLC v GOSoftware, Inc., CISG-Online 1104 (Pace); District Court
of Minnesota (U.S.) 9 March 1999, KSTP-FM v Specialized Communications, CISG-Online 471 (Pace);
Cour de Cassation (France) 5 January 1999, Thermo King v Cigna Insurance, CISG-Online 431 (Pace);
Bundesgerichtshof (Germany) 12 February 1998 (Air cleaning installation), CISG-Online 343 (Pace). It
has been stated, however, that this rule might be subject to exception where the third party (manufac-
turer) has been actively involved in selling the goods to the buyer, even though he was not formally a
party to the contract. See Honnold/Flechtner, Uniform Law (2009), Art. 4 para. 63; Federal District Court,
ND of California (U.S.) 27 July 2001, Asante Technologies v PMC-Sierra, CISG-Online 616 (Pace).
20 Federal Northern District Court of Illinois (U.S.) 28 March 2002, Usinor Industeel v Leeco Steel
Products, CISG-Online 1326 (Pace); Bundesgerichtshof (Germany) 12 February 1998 (Air cleaning
installation), CISG-Online 343 (Pace).
21 Supreme Court (Israel) 17 March 2009, Pamesa Ceramica v Yisrael Mendelson Ltd, CISG-Online
1980 (Pace) (note: decided under ULIS); Bundesgericht (Switzerland) 7 July 2004 (Cable drums), CISG-
Online 848 (Pace); Oberster Gerichtshof (Austria) 10 March 1998, CISG-Online 356 (Pace); Oberlandes-
gericht München (Germany) 8 February 1995 (Automobiles), CISG-Online 143 (Pace).
22 Federal District Court, ED of Arkansas (U.S.) 23 December 2009, Electrocraft Arkansas, Inc. v
Electric Motors, Ltd et al., CISG-Online 2045 (Pace); Supreme Court (Israel) 17 March 2009, Pamesa
Ceramica v Yisrael Mendelson Ltd, CISG-Online 1980 (Pace) (note: decided under ULIS); Multi-Member
Court of First Instance of Athens (Greece) 1 January 2009 (Bullet-proof vest), CISG-Online 2228 (Pace);
Federal District Court, ED of Kentucky (USA) 18 March 2008, Sky Cast, Inc v Global Direct Distribution,
LLC, CISG-Online 1652 (Pace); Federal District Court of New York (U.S.) 10 May 2002 Geneva
Pharmaceuticals Tech. Corp. v Barr Labs. Inc., CISG-Online 653 (Pace); District Court, ED of Pennsylva-
nia (U.S.) 29 August 2000, Viva Vino Import v Farnese Vini, CISG-Online 675 (Pace); Oberlandesgericht
Thüringen (Germany) 26 May 1998 (Live fish), CISG-Online 513 (Pace).
23 Huber, Some introductory remarks on the CISG, 6 Internationales Handelsrecht (2006) 234 (Pace);
Korpela, Article 74 of the United Nations Convention on Contracts for the International Sale of Goods,
Pace Review of the Convention on Contracts for the International Sale of Goods (CISG) 2004–2005
(2006) 94; Neumayer/Ming, Convention de Vienna (1993), Art. 4 para. 11; Schwenzer/Hachem, in:
Schlechtriem/Schwenzer, Commentary (2016), Art. 4 para. 18; Multi-Member Court of First Instance of
Athens (Greece) 1 January 2009 (Bullet-proof vest), CISG-Online 2228 (Pace).
24 By applying this methodology in at least one case a license agreement was classified as a ‘contract of
sale of movable property’ within the meaning of the CISG. See Rechtbank Midden-Nederland (the
Netherlands) 25 March 2015 (Software programme), CISG-Online 2591. Similarily, repurchase agree-
ments under the leasing contracts were deemed to be subject to the CISG, see Bundesgerichtshof
(Germany) 28 May 2014 (Bowling alleys), CISG-Online 2513 (Pace). However, in at least one case, in
this author’s view, the court erred when resorting to domestic law in order to qualify the legal transaction
that was the subject matter of the dispute, whereas such assesment could have been made possible against
the provisions of the CISG (as putative lex causae). Namely, the agreement which was the subject matter
of the dispute was found to ‘include more than sales of goods’, as the parties in the agreement stipulated
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Article 4 11 Part I. Sphere of Application and General Provisions
underlying transaction does not encompass the basic obligations of the buyer and the
seller, it will most likely fall outside the ambit of the CISG. This was found to be true for
leasing contracts,25 franchising contracts,26 barter transactions,27 distribution agree-
ments,28 joint venture agreements,29 etc. Yet, it has been generally held that the CISG
may apply to individual sales transactions arising from framework agreements,30 and
that a repurchase obligations in leasing agreements should be subject to the CISG.31
Application of the CISG to ‘mixed contracts’ is governed by Art. 3.32 However, the legal
qualification the parties attached to the contract (i. e. its title) should not be decisive in
determining whether the Convention applies or not,33 while party automony remains
supreme where agreeing to application of the CISG (even in the previosly mentioned
excluded types of contracts).34
exhibition and sales. The Court held that “[t]he stipulation on exhibition and storage was the step before
the sale of furniture. Only disputes arising during the placing of orders or thereafter pertain to the sales
relationship. Because the parties disputed as to whether the three installments of furniture were for
exhibition or for sales, the Court should not apply CISG only; it should apply the relevant [domestic] laws
[…] to decide whether the parties established the legal relation of sales.” See Supreme Court (China)
21 September 2005 (Furniture) CISG-Online 1611 (Pace).
25 See Huber, in: Huber/Mullis, The CISG (2007), p. 48; Schlechtriem, Uniform Sales Law – The
Experience with Uniform Sales Laws in the Federal Republic of Germany, Juridisk Tidskrift (1991/1992)
1 (10) (Pace); Arbitral Award (Foreign Trade Court of Arbitration attached to the Serbian Chamber of
Commerce) 15 July 2008 (Milk packaging equipment), CISG-Online 1795 (Pace).
26 Bundesgerichtshof (Germany) 23 July 1997, “Benetton II” (Fashion textiles), CISG-Online 276 (Pace).
27 Federal Arbitration Court for the Moscow Region (Russia) 26 May 2003, CISG-Online 836 (Pace). But
for a different view with regard to barter transactions see: Arbitral Award (Tribunal of International
Commercial Arbitration at the Ukraine Chamber of Commerce and Trade) 15 April 2004, CISG-Online
1103 (Pace).
28 High Commercial Court (Serbia) 22 April 2008, CISG-Online 1990 (Pace); Arbitral Award (Foreign
Trade Court attached to the Serbian Chamber of Commerce) 13 November 2007 (Mineral water and
wooden pallets), CISG-Online 1794; District Court, Southern District, New York (U.S.) 1 Jun 2006
(Beverages), Multi-Juice, S.A., Snapple Hellas, S.A., and New Age Beverages Hellas v. Snapple Beverage
Corp., and Mistic Brands, Inc., CISG-Online 1229 (Pace); District Court, Northern District, Illinois,
Eastern Division (U.S.) 6 October 2003 (Beer), CISG-Online 1225 (Pace); District Court, ED of Pennsyl-
vania (U.S.) 29 August 2000, Viva Vino Import v Farnese Vini, CISG-Online 675.
29 Federal District Court, ED of Pennsylvania (U.S.) 29 March 2004, Amco Ukrservice et al. v American
Meter Company, CISG-Online 1664 (Pace); Tribunale d’appello des Kantons Tessin (Switzerland)
15 December 1998, CISG-Online 422.
30 High Commercial Court (Serbia) 22 April 2008, CISG-Online 1990 (Pace); Arbitral Award (Foreign
Trade Court of Arbitration attached to the Serbian Chamber of Commerce) 28 January 2009 (Medica-
ments) CISG-Online 1856 (Pace); Arbitral Award (Foreign Trade Court attached to the Serbian Chamber
of Commerce) 13 November 2007 (Mineral water and wooden pallets), CISG-Online 1794; Oberlandes-
gericht München (Germany) 28 January 1998 (Leather goods), CISG-Online 339 (Pace); Bundesgericht-
shof (Germany) 23 July 1997 “Benetton II” (Fashion textiles), CISG-Online 276 (Pace); Oberlandesgericht
München (Germany) 9 July 1997 (Leather goods), CISG-Online 282 (Pace); Oberlandesgericht München
(Germany) 9 July 1997 (Fitness equipment), CISG-Online 281 (Pace); Obergericht des Kantons Luzern
(Switzerland) 8 January 1997 (Blood infusion devices), CISG-Online 228 (Pace); Oberlandesgericht
Düsseldorf (Germany) 11 July 1996 (Lawn mower engines), CISG-Online 201 (Pace); Fovárosi Biróság
Budapest (Hungary) 19 March 1996 (Instruments), CISG-Online 289 (Pace); Oberlandesgericht Koblenz
(Germany) 17 September 1993 (Computer chip), CISG-Online 91(Pace); Gerechtshof Amsterdam (Neth-
erlands) 16 July 1992, Box Doccia Megius v Wilux International, CISG-Online 48 (Pace).
31 Bundesgerichtshof (Germany) 28 May 2014 (Bowling alleys), CISG-Online 2513 (Pace).
32 See Commentary on Art. 3.
33 Pavic/Djordjevic, Application of the CISG Before the Foreign Trade Court of Arbitration at the
Serbian Chamber of Commerce – Looking Back at the Latest 100 Cases, 28 Journal of Law and
Commerce (2009) 1 (22 et seq.) (Pace); Arbitral Award (Foreign Trade Court of Arbitration attached to
the Serbian Chamber of Commerce) 15 July 2008 (Milk packaging equipment), CISG-Online 1795 (Pace);
Supreme Court (Poland), 10 November 2005 (Furniture) CISG-Online 2073 (Pace).
34 For application of the CISG to distributorship agreement based on party’s agreement see Arbitral
Award, ICC 11849/2003 (Fashion products) CISG-Online 1421(Pace).
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2. Matters explicitly excluded from the Convention

The Convention expressly lists several examples of issues which it is not concerned 12
with. The list is not exhaustive, as evidenced by the use of words ‘in particular’,35 i. e.
there may be numerous other issues that the Convention is not concerned with, such as
issues of agency, limitation periods and recovery of attorneys’ fees.36 These particular
issues mentioned in Art. 4 were excluded because they were deemed so controversial
that achieving a uniform solution would entail an overly difficult and time-consuming
process.37 However, even where an issue falls under the list of excluded matters, it does
not a priori mean that the issue is excluded from the Convention. On the contrary, if
the issue relates to matters ‘expressly provided in this Convention’, the language of the
second sentence of Art. 4 precludes application of domestic law and leaves the issue
within the CISG ambit.38 Just as the interpretation of the terms used in the first sentence
of Art. 4 should not be too narrow, the interpretation of the terms used in the second
sentence of Art. 4 should not be too wide. Otherwise, this may lead to considerable
limitations on the scope of application of the CISG, a result contradictory to the
unifying attempts in the field of international sales law.
a) The validity of the contract or of any of its provisions or of any usage. In order to 13
specify the extent of the ‘validity’ exception, one has to first determine what issues the
validity covers. However, there is no universal definition of “validity”.39 As a matter of
fact, there can be as many definitions of validity as the number of Contracting States to
the CISG.40 Not surprisingly, the conception of validity has been often described as a
potential ‘black hole’ which may remove issues from the Convention’s universe.41
35 Ferrari, Implementations of the Convention on Contracts for the International Sale of Goods
(CISG), 7 International Business Law Journal (1998) 835 (836); Khoo, in: Bianca/Bonnel, Commentary
(1987), Art. 4 para. 2.4; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 4 para. 4.
36 See infra II.3.a. et seq.
37 Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2004), p. 99.
38 Ferrari, Implementations of the Convention on Contracts for the International Sale of Goods
(CISG), 7 International Business Law Journal (1998) 835 (836). For example, although the issue of
consideration is considered a matter of validity under some national laws, the existence or lack of
consideration for concluding a contract and its impact to validity of the contract is not an issue to be dealt
under the national law if it arises out of a contract governed by CISG. The CISG contains exhaustive rules
on formation of contracts that override the domestic validity concepts, such as consideration. See infra
II.2.cc.
39 Prof. Schlechtriem has suggested the following definition of a validity: “if a contract is rendered void
ab initio, either retroactively by a legal act of the state or of the parties such as avoidance for mistake or
revocation of one’s consent under special provisions protecting certain persons such as consumers, or by
a ‘resolutive’ condition (i. e. a condition subsequent) or a denial of approval of relevant authorities, the
respective rule or provision is a rule that goes to validity and therefore is governed by domestic law and
not by the CISG.” (Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 4 para. 7).
According to one court’s definition, the validity issue is “any issue by which the domestic law would
render the contract void, voidable or unenforceable’. See Federal District Court of New York (U.S.)
10 May 2002, Geneva Pharmaceuticals Tech. Corp. v Barr Labs. Inc., CISG-Online 653 (Pace); also cited
in District Court, Western District Washington at Tacoma (U.S.) 13 April 2006 (Raspberry Roots),
Barbara Berry, S.A. de C.V. v. Ken M. Spooner Farms, Inc., CISG-Online 1354. This definition was
borrowed from one of the scholarly works on the topic. See Hartnell, Rousing the Sleeping Dog: The
Validity Exception to the Convention on Contract for the International Sale of Goods, 18 Yale Journal of
International Law (1993) 1 (20) (Pace).
40 Hartnell, Rousing the Sleeping Dog: The Validity Exception to the Convention on Contract for the
International Sale of Goods, 18 Yale Journal of International Law (1993) 1 (20) (Pace).
41 Koneru, The International Interpretation of the UN Convention on Contracts for the International
Sale of Goods: An Approach Based on General Principles, 6 Minnesota Journal of Global Trade (1997)
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14 The need for an autonomous and uniform interpretation of the Convention dictates
the understanding of validity in the international context of a transaction and detached
from national perceptions on the matter in order to avoid diverging results.42 The
substance rather than the label or characterization of the domestic competing rule
determines whether it is displaced by the Convention.43 Hence, the interpretation of
“validity” is not initially a question of domestic law.44
15 Even when the relevant issue is one that concerns the validity of the contract or
any of its provisions and usages under the domestic law, an examination needs to
be made whether such an issue is expressly or implicitly dealt with in the Conven-
tion.45 If the answer is affirmative, the rules of the Convention displace the domestic
validity rule.46 This is what the Convention expressly requires by using the ‘except
as otherwise expressly provided in this Convention’ language in the second sentence
of Art. 4.
16 Most commentators agree that validity encompasses issues of fraud, duress, uncon-
scionability, misrepresentation, incapacity and mistake (subject to certain exceptions).
Further examples arise from domestic or international regulations prohibiting certain
sales such as embargos or export bans and restrictions, public policy reasons, etc.47 In
cases like these, the issue should be deemed excluded from the CISG’s scope and
governed by otherwise applicable law.
17 aa) Capacity and authority. The first prerequisite for a validly concluded contract is
that the parties have the required legal capacity to enter into a particular contract.
105 (145) (Pace); Winship, Commentary on Professor Kastely’s Rhetorical Analysis, 8 Northwestern
Journal of International Law and Business (1988) 623 (636 et seq.) (Pace).
42 Bridge, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2004), p. 243; Ferrari, in: Ferrari/
Flechtner/Brand, Draft Digest and Beyond (2004), p. 100; Huber, Some introductory remarks on the
CISG, 6 Internationales Handelsrecht (2006) 231 (Pace); Kröll, Selected Problems Concerning the CISG’s
Scope of Application, 25 Journal of Law and Commerce (2005–2006) 39 (40); Kruisinga, (Non-
)conformity in the 1980 UN Convention on Contracts for the International sale of Goods: a uniform
concept?, (2004), pp. 189 et seq.; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 4.
para. 7. Cf. Hartnell, Rousing the Sleeping Dog: The Validity Exception to the Convention on Contract
for the International Sale of Goods, 18 Yale Journal of International Law (1993) 1 (47 et seq.) (Pace).
43 Honnold/Flechtner, Uniform Law (2009), Art. 4 para. 65; Khoo, in: Bianca/Bonell, Commentary
(1987), Art. 4 para. 3.3.5.

44 But see Longobardi, Disclaimers of Implied Warranties: the 1980 United Nations Convention on
Contracts for the International sale of Goods, 53 Fordham Law Review (1985) 863 (871 et seq.) (Pace).
45 Kröll, Selected Problems Concerning the CISG’s Scope of Application, 25 Journal of Law and
Commerce (2005–2006) 39 (54) (Pace); Zeller, CISG and the Unification of International Trade Law
(2007), pp. 69 et seq.
47 Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2004), p. 98; Heiz, Validity of
Contracts Under the United Nations Convention on Contracts for the International Sale of Goods, April
11, 1980, and Swiss Contract Law, 20 Vanderbilt Journal of Transnational Law (1987) 639 (Pace);
Henschel, The Conformity of Goods in International sales, An analysis of Article 35 in the United Nations
Convention on Contracts for the International Sale of Goods (CISG) (2005), pp. 132 et seq.; Huber, Some
introductory remarks on the CISG, 6 Internationales Handelsrecht (2006) 231 (Pace); Lookofsky, Under-
standing the CISG (2008), pp. 22 et seq.; Mather, Choice of Law for International Sales Issues Not
Resolved by the CISG, 20 Journal of Law and Commerce (2001) 155 (162) (Pace); Schlechtriem, in:
Schlechtriem/Schwenzer, Commentary (2005), Art. 4 para. 7; Schwenzer/Fountoulakis, International Sales
Law (2007), p. 49; Winship, The scope of the Vienna Convention on International Sales Contracts, in:
Galston/Smit, International sales: The United Nations Convention on Contracts for the International sale
of Goods (1984), Chapter 1 footnote 78 (Pace); Rechtbank Midden-Nederland (Netherlands) 25 March
2015 (Software programme), CISG-Online 2591; Federal Court of Appeals (9th Cir.) (U.S.) 8 November
2007, Barbara Berry, S. A. de C. V. v Ken M. Spooner Farms, Inc., CISG-Online 1603 (Pace);
Bundesgerichtshof (Germany) 23 July 1997, “Benetton II” (Fashion textiles), CISG-Online 276 (Pace).
70 Djordjević
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This requirement is almost always met in international business. However in case
that it is disputed, the issue of capacity should be deemed outside the scope of the
Convention.48
More contentious are issues regarding the conclusion of international sales contracts 18
by agents and the scope of the agent’s authority. Here it should be noted that the
Convention does not regulate questions of agency.49 Hence, the otherwise applicable law
should apply to these issues.50
bb) Formal validity. Issues of the formal validity of contracts are the most obvious 19
examples of the scope of the ‘unless otherwise explicitly provided’ restriction to second
sentence of Art. 4. Although in some countries the requirement of written form may be
deemed an issue of validity of sales contracts, the CISG express regulation of the issue in
48 Bonell, The CISG, European Contract Law and the Development of a World Contract Law, 56
American Journal of Comparative Law (2008) 1 (3); Herber, in: Schlechtriem, Commentary (1998), Art. 4
para. 11; Honnold/Flechtner, Uniform Law (2009), Art. 4 para. 66; Neumayer/Ming, Convention de
Vienna (1993), Art. 4 para. 10; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 4
para. 11; Schwenzer/Hachem, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 4 para. 32; Handels-
gericht des Kantons Aargau (Switzerland) 26 November 2008 (Fruit and vegetables), CISG-Online 1739
(Pace); Tribunal Cantonal du Valais (Switzerland) 27 April 2007 (Oven), CISG-Online 1721 (Pace);
Arbitral Award, Tribunal of International Commercial Arbitration at the Russian Federation Chamber of
Commerce and Industry, 9 June 2004, CISG-Online 1239 (Pace); Oberster Gerichtshof (Austria) 22 Octo-
ber 2001 (Agricultural products), CISG-Online 613 (Pace); Arbitral Award (CIETAC) 22 May 1997
(Soybean oil), CISG-Online 1164 (Pace); Oberlandesgericht Düsseldorf (Germany) 8 January 1993 (Tinned
cucumbers), CISG-Online 76 (Pace); Landgericht Hamburg (Germany) 26 September 1990 (Textiles),
49 Eiselen/Kritzer, in: Kritzer/Vanto/Vanto/Eiselen, International Contract Manual, Vol. 4 § 84:33(a);
Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2004), p. 101; Honnold/Flechtner, Uniform
Law (2009), Art. 4 para. 66; Neumayer/Ming, Convention de Vienna (1993), Art. 4 para. 10; Schlechtriem,
in: Schlechtriem/Schwenzer, Commentary (2005), Art. 4 para. 11; Schwenzer/Fountoulakis, International
Sales Law (2007), p. 49.
50 So far this rule has been followed in practice without a single exception. See Rechtbank Midden-
Nederland (Netherlands) 25 March 2015 (Software programme), CISG-Online 2591; Oberlandesgericht

Schleswig (Germany) 24 October 2008 (Shop furnishings), CISG-Online 2020 (Pace); Landgericht Land-
shut (Germany) 12 June 2008 (Metalic slabs), CISG-Online 1376 (Pace); Tribunal Cantonal du Valais
(Switzerland) 27 April 2007 (Oven), CISG-Online 1721 (Pace); Cour d’appel de Versailles (France)
13 October 2005 (Caterpillar toys), CISG-Online 1433 (Pace); Tribunal Cantonal Valais (Switzerland)
19 September 2005 (Fiberglass composite materials), (Pace); Tribunal Cantonal du Valais (Switzerland)
27 May 2005 (Welding devices), CISG-Online 1137 (Pace); Arbitral Award (CIETAC) April 2005
(Caprolactam), (Pace); First Intermediate People’s Court of Shanghai (China) 23 March 2004 (Chemical
products), CISG-Online 1497 (Pace); Arbitral Award, (CIETAC) 12 March 2004 (Fireworks), CISG-
Online 1599 (Pace); Tribunale di Padova (Italy) 25 February 2004 (Agricultural products), CISG-Online
819 (Pace); Arbitral Award (CIETAC) 7 March 2002 (Lube oil), CISG-Online 974 (Pace); Oberster
Gerichtshof (Austria) 22 October 2001 (Agricultural products), CISG-Online 613 (Pace); Tribunale di
Vigevano (Italy) 12 July 2000, Rheinland Versicherungen v Atlarex, CISG-Online 493 (Pace); Oberlan-
desgericht Graz (Austria) 15 June 2000 (Ski shoes), CISG-Online 799 (Pace); Gerechtshof Arnhem
(Netherlands) 18 April 2000, CISG-Online 1897 (Pace); Arbitral Award, ICC 10 329, 1 January 2000
(Industrial product), CISG-Online 1173 (Pace); Handelsgericht des Kantons Aargau (Switzerland) 11 June
1999 (Granular plastic), CISG-Online 494 (Pace); Oberlandesgericht Graz (Austria) 24 February 1999
(Military weapons), CISG-Online 797 (Pace); Handelsgericht des Kantons Zürich (Switzerland) 30 No-
vember 1998 (Lambskin coat), CISG-Online 415 (Pace); Landgericht Berlin (Germany) 24 March 1998
(Knitwear), CISG-Online 742 (Pace); Handelsgericht Zurich (Switzerland) 30 November 1998 (Lambskin
coat), CISG-Online 415 (Pace); Oberster Gerichtshof (Austria) 20 March 1997 (Mono ammonium
phosphate), CISG-Online 269 (Pace); Appellationsgericht Tessin (Switzerland) 12 February 1996 (Copy
paper), CISG-Online 233 (Pace); Obergericht des Kantons Thurgau (Switzerland) 19 December 1995
(Cloth), CISG-Online 496 (Pace); Amtsgericht Alsfeld (Germany) 12 May 1995 (Flagstone tiles), CISG-
Online 170 (Pace); Federal Court of South Australia, Adelaide (Australia) 28 April 1995, Roder v
Rosedown, CISG-Online 218 (Pace); Kammergericht Berlin (Germany) 24 January 1994 (Wine), CISG-
Online 130 (Pace); Landgericht Hamburg (Germany) 26 September 1990 (Textiles), CISG-Online 21
(Pace).
Djordjević 71
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Art. 11 (subject to Arts 12 and 96)51 makes it clear that its provisions override the
otherwise applicable validity provisions of otherwise applicable domestic law. Conse-
quently, unless when dealing with contracts where one of the parties has its place of
business in a state that declared a reservation under Art. 96, or where the parties expressly
agreed that the contract is invalid unless in a written form, the question of formal validity
of a contract should not arise in disputes over a contract governed by CISG.52
20 cc) Consideration and causa. Some national legal systems require something more
than an offer and acceptance mechanism in order for a contract to be concluded. These
requirements are generally recognized as consideration and causa.53 However, such
conditions should not be construed as validity issues under the CISG since the
formation of contract is exhaustively governed by the CISG. Hence, there is no need
for importing further ‘validity’ elements to it and the contract should not be invalidated
for alleged lack of consideration or causa.54
21 dd) Mistake, fraud and concurrent remedies. Mistake is one of the common
examples of a validity issue. The CISG, as a matter of principle, does not govern
validity issues. Accordingly, it does not regulate mistake. Nonetheless, some provisions
of the CISG contain rules that govern issues that would be treated as issues of mistake
under the domestic law. Consequently, where the mistake relates to the characteristics
of the goods (Arts 35 et seq. and Arts 45 et seq. apply) or creditworthiness or ability of
the other party to perform the contract (Art. 71 applies), the majority view is that the
rules of the otherwise applicable law give way to those of the CISG, since the
Convention exhaustively deals with those matters.55 On the contrary, in all other
51 E. g. in once case before CIETAC in a dispute between Chinese seller and U.S. buyer, the formal
validity of the contract was determined in accordance with the Chinese domestic law despite the fact that
the CISG was found to be the governing law of the contract (Chinese law, unlike the CISG, requires that a
contract be signed and sealed in order to be valid). The reasoning of the arbitrators was correct since
China is one of the countries that filed a declaration under Art. 96. See Arbitral Award (CIETAC)
3 December 2003 (False hair), CISG-Online 1469 (Pace). See also Federal District Court, New Jersey (U.S.)
7 October 2008, Forestal Guarani, S. A. v Daros International, Inc., CISG-Online 1779 (Pace); Federal
District Court, SD of Florida (U.S.) 19 May 2008, Zhejiang Shaoxing Yongli Printing and Dyeing Co., Ltd
v Microflock Textile Group Corporation, CISG-Online 1771 (Pace).
52 It should be noted that even in contracts where the parties agreed to a no-oral modification clause, a
party may be precluded by its conduct form asserting such a provision to the extent that the other party
has relied on that conduct. See Commentary on Art. 29(2), paras 16–25.
53 See Zweigert/Kötz, Comparative Law (1998), pp. 356 et seq.
54 Bridge, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2004), p. 244; Butler, The Doctrines of
Parol Evidence Rule and Consideration – A Deterrence to the Common Law Lawyer?, in: Celebrating
Success: 25 Years United Nations Convention on Contracts for the International Sale of Goods (2005),
p. 62 (Pace); Eiselen/Kritzer, in: Kritzer/Vanto/Vanto/Eiselen, International Contract Manual, Vol. 4
§ 84:34(c); Huber, Some introductory remarks on the CISG, 6 Internationales Handelsrecht (2006) 232
(Pace); Garro, Reconciliation of Legal Traditions in the U. N. Convention on Contracts for the
International Sale of Goods, 23 International Lawyer (1989) 443 (453 et seq.) (Pace); Lookofsky, Under-
standing the CISG (2008), p. 23; Perales Viscasillas, in: Ferrari/Fletchner/Brand, The Draft Digest
and Beyond (2004), p. 260 et seq., with further references in footnote 10. See also Schlechtriem, in:
Schlechtriem/Schwenzer, Commentary (2005), Art. 16 para. 2; Federal District Court, WD of Michigan
(U.S.) 17 December 2001, Shuttle Packaging Systems v Tsonakis et al., CISG-Online 773. However, in
another U.S. decision, the court erred by regarding the issue of consideration as a validity issue governed
by domestic law. See Federal District Court of New York (U.S.) 10 May 2002, Geneva Pharmaceuticals
Tech. Corp. v Barr Labs. Inc., CISG-Online 653 (Pace). For criticism of this decision see: DiMatteo et al.,
The Interpretative Turn in International Sales Law: an Analysis of Fifteen Years of CISG Jurisprudence,
24 Northwestern Journal of international law and Business (2004) 299 footnotes 167–169 (Pace); Perales
Viscasillas, in: Ferrari/Fletchner/Brand, The Draft Digest and Beyond (2004), pp. 260 et seq.
55 Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2004), p. 98; Herber, in: Schlechtriem,
Commentary (1998), Art. 4 para. 23; Kröll, Selected Problems Concerning the CISG’s Scope of Applica-
tion, 25 Journal of Law and Commerce (2005–2006) 39 (55 et seq.); Magnus, Incorporation of Standard
72 Djordjević
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Chapter I. Sphere of Application 22 Article 4

cases, where the CISG does not address the situation in question, the rules of the
Convention give way to those of the domestic law.56
Furthermore, it is submitted that where the CISG governs the issue of‘mistake’ there 22
should be no concurrent recourse to domestic remedies for invalidity.57 Thus, a buyer
who has lost the right to rely on non-conformity by not complying with Art. 39 notice
requirements, should not be allowed to have recourse to domestic remedies for mistake,
since the CISG provides a comprehensive remedial system for non-conformity of the
goods including the issue of mistake in relation to the quality of the goods.58 A different
solution would undermine the basic values of the CISG including the availability of
avoidance in case of non-conformity as a remedy of last resort.59 The interest in security
of transactions and legal certainty further warrant such a conclusion, since national laws
may vary to a large extent with regards to remedies available for this kind of mistake.60
If the domestic law would be allowed to draw more extensive legal consequences than
the CISG based on the same operative set of facts, the uniformity reached by the
Convention would be severely jeopardized.61
Contract Terms under the CISG, FS Kritzer (2008), p. 310 (Pace); Schlechtriem, in: Schlechtriem/
Schwenzer, Commentary (2005), Art. 4 para. 13; Huber, Some introductory remarks on the CISG, 6
Internationales Handelsrecht (2006) 232 (Pace); Henschel, The Conformity of Goods in International
sales, An analysis of Article 35 in the United Nations Convention on Contracts for the International Sale
of Goods (CISG), (2005), p. 131 with further references in footnote 193; Schroeter, Defining the Borders
of Uniform International Contract Law: the CISG and Remedies for Innocent, Negligent, or Fraudulent
Misrepresentation, 58 Vill. L. Rev. (2013) 553 (577); Schwenzer/Hachem, in: Schlechtriem/Schwenzer,
Commentary (2016), Art. 4 para. 36; Rechtbank van Koophandel, Hasselt (Belgium) 19 April 2006, Brugen
Deuren BVBA v Top Deuren VOF, CISG-Online 1389 (Pace); Landgericht Aachen (Germany) 14 May
1993 (Electronic hearing aid), CISG-Online 86 (Pace). For a different view leading to application of
otherwise applicable domestic law see Bundesgericht (Switzerland) 11 December 2000 (Fitted kitchen),
CISG-Online 1319 (Pace) (note, however, that the court found CISG to be applicable to the contract
although it was clear that the goods were bought for household use).
56 Central District Court Seoul (Republic of Korea) 21 September 2012 (Window shade), CISG-Online
2774; Arbitral Award, ICC 13184/2011, CISG-Online 2724 (Pace); Bundesgericht (Switzerland) 22 De-
cember 2000, Roland Schmidt GmbH v Textil-Werke Blumenegg AG, CISG-Online 628 (Pace); Fovárosi
Biróság Budapest (Hungary) 1 July 1997 (Used timber machinery), CISG-Online 306 (Pace); Oberlandes-
gericht (Austria) 20 March 1997 (Mono ammonium phosphate), CISG-Online 269 (Pace); Handelsgericht
des Kantons St. Gallen (Switzerland) 24 August 1995 (Cleaning products) CISG-Online 247.
57 Herber, in: Schlechtriem, Commentary (1998), Art. 4 para. 13; Heuzé, Vente Internationale (2000),
pp. 248 et seq.; Honnold/Flechtner, Uniform Law (2009), Art. 4 para. 240; Huber, Some introductory
remarks on the CISG, 6 Internationales Handelsrecht (2006) 232 (Pace); Kröll, Selected Problems Concern-
ing the CISG’s Scope of Application, 25 Journal of Law and Commerce (2005–2006) 39 (55 et seq.) (Pace);
Kruisinga, (Non-)conformity in the 1980 UN Convention on Contracts for the International sale of Goods:
a uniform concept?, (2004), pp. 92 et seq.; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005),
Art. 4 para. 13; Schwenzer/Hachem, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 4 para. 36. But
some authors argue that recourse to domestic remedies is still available under these circumstances. See
Hartnell, Rousing the Sleeping Dog: The Validity Exception to the Convention on Contracts for the
International Sale of Goods, 18 Yale Journal of International Law (1993) 77 (Pace). Cf. Lookofsky, In Dubio
Pro Conventione? Some Thoughts About Opt-Outs, Computer Programs and Preëmption Under the 1980
Vienna Sales Convention (CISG), 13 Duke Journal of Comparative and International Law (2003) 279 et seq.
(Pace); Neumayer/Ming, Convention de Vienna (1993), Art. 39 para. 4.
58 Rechtbank van Koophandel, Hasselt (Belgium) 19 April 2006, Brugen Deuren BVBA v Top Deuren
VOF, CISG-Online 1389 (Pace); Oberster Gerichtshof, (Austria) 13 April 2000 (Machines), CISG-Online
576 (Pace); Landgericht Aachen (Germany) 14 May 1993 (Electronic hearing aid), CISG-Online 86 (Pace).
59 See Commentary on Arts 35, 45 et seq. For an elaborate discussion on concurrent remedies under the
CISG see Commentary on Art. 5 paras 18–27.

60 See Zweigert/Kötz, Comparative Law (1998), pp. 410 et seq.
61 As Prof. Schlechtriem amply stated, deciding otherwise would open the door for national legislators
to deviate from the Convention at will by creating tort claims for every buyer if the object of a sales
contract is defective and the buyer suffers a purely economic loss. See Schlechtriem, Uniform Sales Law –
Djordjević 73
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23 It has been unanimously held in legal doctrine and case law that where the buyer has
been induced to conclude the contract by fraud, such a validity issue is not governed by the
CISG and needs to be resolved by domestic law (giving the buyer recourse to remedies for
fraud).62 By the same token, whether the contract’s validity is affected by the allegations of
usury should be determined under the otherwise applicable domestic law.63
24 ee) Incorporation and validity of standard terms. The CISG does not contain a
separate provision dealing with the incorporation of standard terms into the contract.
Nevertheless, the prevailing view in doctrine and case law is that the CISG rules on the
formation and interpretation of parties’ declarations must answer when, in which form
and under what conditions standard contract terms are effectively incorporated into a
sales contract (this also includes the problem of the battle of forms).64 Consequently,
The Experience with Uniform Sales Laws in the Federal Republic of Germany, Juridisk Tidskrift (1991/
92) 1 (14) (Pace).
62 Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2004), p. 98; Henshel, The Conformity of
Goods in International Sales, An analysis of Article 35 in the United Nations Convention on Contracts for the
International Sale of Goods (CISG) (2005), p. 131; Honnold/Flechtner, Uniform Law (2009), Art. 4. para. 65;
Huber, Some introductory remarks on the CISG, 6 Internationales Handelsrecht (2006) 232 (Pace); Lookofsky,
Understanding the CISG (2008), p. 23; Schlechtriem, The Borderland of Tort and Contract: Opening a New
Frontier? 21 Cornell International Law Journal (1988) 467 (474) (Pace); Central District Court Seoul (Republic
of Korea) 21 September 2012 (Window shade), CISG-Online 2774; District Court for the Eastern District of
Missouri, Eastern Division (USA) 10 January 2011, Semi-Materials Co., Ltd. v. MEMC Electronic Materials,
Inc., CISG-Online 2168 (Pace); Federal District Court, ED of Arkansas (U.S.) 23 December 2009, Electrocraft
Arkansas, Inc. v Electric Motors, Ltd et al., CISG-Online 2045 (Pace); District Court, Southern District of Ohio,
Western Division (U.S.), 26 March 2009, Miami Valley Paper, LLC v. Lebbing Engineering & Consulting
GmbH, CISG-Online 1880 (Pace); U.S. District Court, Minnesota (U.S.) 1 July 2008 (Organic kosher Inulin),
CISG-Online 1774 (Pace); Kantonsgericht St. Gallen (Switzerland) 13 May 2008 (Skid chains and adaptors),
CISG-Online 1768 (Pace); Federal District Court, Ohio (U.S.) 10 October 2006, Miami Valley Paper, LLC v
Lebbing Engineering & Consulting GmbH, CISG-Online 1362 (Pace); Federal District Court, SD of New York
(U.S.) 23 August 2006, TeeVee Tunes, Inc. et al v Gerhard Schubert GmbH, CISG-Online 1272 (Pace);
Arbitral Award (CIETAC) 21 October 2005 (Sheet metal producing system), CISG-Online 1472 (Pace);
District Court, ND of Alabama (U.S.) 27 April 2005, Treibacher Industrie, A. G. v TDY Industries, Inc.,
CISG-Online 1178 (Pace); Arbitral Award (CIETAC) 31 May 1999 (Indium ingot), CISG-Online 1254 (Pace);
Oberlandesgericht Hamburg (Germany) 5 October 1998 (Circut boards), CISG-Online 473 (Pace); Arbitral
Award (Handelskammer Zürich) 31 May 1996, Soinco v NKAP, CISG-Online 1291 (Pace); Oberlandesgericht
Köln (Germany) 21 May 1996 (Used car), CISG-Online 254 (Pace).
63 Supreme Court (Slovenia), 8 April 1998 (Caprolactum), CISG-Online 1957 (Pace).
64 Schwenzer/Hachem, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 4 para. 12; CISG-AC
Opinion no 13; Huber, Standard Terms under the CISG, 13 Vindobona Journal of International
Commercial Law and Arbitration (2009) 123 (125); Kröll, Selected Problems Concerning the CISG’s
Scope of Application, 25 Journal of Law and Commerce (2005–2006) 39 (47) (Pace); Magnus, Incorpora-
tion of Standard Contract Terms under the CISG, FS Kritzer (2008), pp. 305 et seq (Pace); Perales
Viscasillas, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2004), p. 265; Schlechtriem, in: Schlech-
triem/Schwenzer Commentary (2005), Art. 19 para. 20; Rechtbank Gelderland (Netherlands) 6 November
2013 (Hardware), CISG-Online 2590; Oberlandesgericht Celle (Germany) 24 July 2009 (Multimedia
recorders), CISG-Online 1906 (Pace); Landgericht Landshut (Germany) 12 June 2008 (Metalic slabs for
building construction) CISG-Online 1703 (Pace); Oberlandesgericht Oldenburg (Germany) 20 December
2007 (Industrial tools), CISG-Online 1644 (Pace); Tribunale di Rovereto (Italy) 21 November 2007
(Mirrors), CISG-Online 1590 (Pace); Oberlandesgericht Frankfurt am Main (Germany) 26 June 2006
(Printed Goods) CISG-Online 1385 (Pace); Oberster Gerichtshof (Austria), 31 August 2005 (Tantalum
powder) CISG-Online 1093 (Pace); Landgericht Neubrandenburg (Germany) 3 August 2005 (Pitted sour
cherries), CISG-Online 1190 (Pace); Oberlandesgericht Linz (Austria) 23 March 2005 (Conveyor band),
CISG-Online 1376 (Pace); Hoge Raad (Netherlands) 28 January 2005, B. V. B. A. Vergo Kwekerijen v
Defendant, CISG-Online 1002 (Pace); Oberlandesgericht Karlsruhe (Germany) 20 July 2004 (Shoes),
CISG-Online 858 (Pace); Oberlandesgericht Düsseldorf (Germany) 21 April 2004 (Mobile car phones),
CISG-Online 915 (Pace); Oberlandesgericht Düsseldorf (Germany) 30 January 2004 (Generators), CISG-
Online 821 (Pace); Langericht Trier (Germany) 8 January 2004 (Synthetic window parts), CISG-Online
910 (Pace); Oberster Gerichtshof (Austria) 17 December 2003 (Tantalum powder), CISG-Online 828
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this issue should not be regarded as excluded from the CISG scope of application. In
line with this stance, the CISG Advisory Council Opinion and the relevant case law
confirm a party’s right to be supplied with the standard terms of the other party in a
way reasonably accessible to him, and in the language that he can reasonably be
expected to understand.65
The material validity of standard terms, on the other hand, should not be deemed 25
governed by the CISG and should be subject to the otherwise applicable law.66 However,
as with the other ‘unless otherwise expressly provided in the Convention’ exceptions,
the domestic validity test of a standard term may be avoided if the relevant issue is
governed by the Convention. For example, in a case where parties have agreed on
notification of the intention to avoid the contract within a reasonable time, the
Convention may prove to be a sufficient basis which will uphold the validity of such a
clause since its contents are in line with the general principles of the CISG.67 On the
other hand, there may be instances where the validity check under domestic law may
not prove sufficient for the purposes of the CISG (e. g. domestic law validates a
provision excluding the buyer’s rights for non-conformity). In such instances, even if
the domestic law upholds the validity of such a term, the clause should be deemed
invalid under the CISG if it contradicts the fundamental principles of the Convention.68
(Pace); Bundesgerichtshof (Germany) 9 January 2002 (Powdered milk), CISG-Online 651 (Pace); Bundes-
gerichtshof (Germany) 31 October 2001 (Machinery), CISG-Online 617 (Pace); Oberlandesgericht
Braunschweig (Germany) 28 October 1999 (Frozen meat), CISG-Online 510 (Pace); Arrondissements-
rechtbank Rotterdam (Netherlands) 14 October 1999 (Sheepskin), CISG-Online 1312 (Pace). For a
different view see: Landgericht München (Germany) 29 May 1995 (Computer hardware), CISG-Online
235 (Pace).
65 CISG-AC Opinion no 13; Rechtbank Gelderland (Netherlands) 6 November 2013 (Hardware), CISG-
Online 2590; U.S. District Court, E.D. of California (U.S.) 21 January 2010 (Centrifuge), CISG-Online
2089 (Pace); Landgericht Stuttgart (Germany) 15 October 2009 (Printing machine), CISG-Online 2019
(Pace); Oberlandesgericht Celle (Germany) 24 July 2009 (Multimedia recorders), CISG-Online 1906
(Pace); Rechtbank Utrecht (Netherlands) 21 January 2009 (Sesame seeds), CISG-Online 1814 (Pace);
Landgericht Landshut (Germany) 12 June 2008 (Metalic slabs for building construction) CISG-Online
1703 (Pace); Tribunale di Rovereto (Italy) 21 November 2007 (Mirrors), CISG-Online 1590 (Pace);
Oberster Gerichtshof (Austria), 31 August 2005 (Tantalum powder) CISG-Online 1093 (Pace); Land-
gericht Neubrandenburg (Germany) 3 August 2005 (Pitted sour cherries), CISG-Online 1190 (Pace);
Oberlandesgericht Düsseldorf (Germany) 21 April 2004 (Mobile car phones), CISG-Online 915 (Pace);
Langericht Trier (Germany) 8 January 2004 (Synthetic window parts), CISG-Online 910 (Pace); Bundes-
gerichtshof (Germany) 31 October 2001 (Machinery), CISG-Online 617 (Pace).
66 Huber, Standard Terms under the CISG, 13 Vindobona Journal of International Commercial Law
and Arbitration (2009) 123 (131); Magnus, Incorporation of Standard Contract Terms under the CISG,
FS Kritzer (2008), p. 306 (Pace); Schlechtriem/Butler, CISG (2009), para. 58; Ferrari, in: Ferrari/Flechtner/
Brand, Draft Digest and Beyond (2004), p. 101; Oberster Gerichtshof (Austria) 7 September 2000
(Tombstones), CISG-Online 642 (Pace); Landgericht Heilbronn (Germany) 15 September 1997 (Film
coating machine), CISG-Online 562; Arrondissementsrechtbank Zutphen (Netherlands) 29 May 1997,
Aartsen v Suykens, CISG-Online 546 (Pace); Amtsgericht Nordhorn (Germany) 14 June 1994 (Shoes),
105 (147 et seq.) (Pace); Amtsgericht Nordhorn (Germany) 14 June 1994 (Shoes case), CISG-Online 259
(Pace).
Commerce (2005–2006) 39 (55) (Pace); Oberlandesgericht Düsseldorf (Germany) 21 April 2004 (Mobile
car phones), CISG-Online 915 (Pace); Oberster Gerichtshof (Austria) 7 September 2000 (Tombstones),
CISG-Online 642 (Pace). Cf. Farnsworth, Review of Standard Forms or terms Under the Vienna
Convention, 21 Cornell International Law Journal (1988) 439 (441): “Taken together, articles 6 and 4
create a tripartite hierarchy, with domestic law on validity at the top, the agreement of the parties in the
middle, and the Convention at the bottom.”
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26 ff) Validity of penalty clauses. Although the CISG contains an extensive list of
remedies in case of a breach of contract, it does not regulate the issue of penalty clauses
(also referred to as liquidated damages or agreed sums).69 Whereas the issue was found
to be extremely important for removing uncertainties and obstacles to the flow of
international trade, it was also found that it raises too many complex problems that
could not be adequately addressed at the time.70 It was thus left to UNCITRAL to deal
with the issue of penalty clauses more extensively at some later stage.71 Admittedly,
there are no obstacles for the parties to provide for such a clause (remedy) in their
contract, in accordance with Art. 6 CISG.72 The validity of such a clause, according to
the prevailing view, is an issue excluded from the Convention and thus governed by the
otherwise applicable law.73 Nevertheless, these domesticly tailored rules should not
69 However, it should be noted that during the drafting process of the CISG there was considerable
support for the idea that the Uniform Law should regulate liquidated damages clauses. A provision on
liquidated damages was considered at the 1977 UNCITRAL review of the Working Group ‘Sales’ draft.
See Honnold, Documentary History (1989), p. 354.
70 Stoll, in: Schlechtriem, Commenatry (1998), Art. 4 para. 46.
71 This resulted in the 1983 Uniform Rules on Contract Clauses for an Agreed Sum Due upon Failure
of Performance (www.uncitral.org).
105 (141 et seq.) (Pace); Arbitral Award (Foreign Trade Court of Arbitration attached to the Serbian
Chamber of Commerce) 15 July 2008 (Milk packaging equipment), CISG-Online 1795 (Pace); Federal
District Court, MD of Pennsylvania (U.S.) 6 January 2006, American Mint LLC v GOSoftware, Inc.,
CISG-Online 1175 (Pace); Arbitral Award, ICC 9978, 1 March 1999, CISG-Online 708 (Pace).
73 Chengwei, Remedies in International Sales: Perspectives from CISG, UNIDROIT Principles and
PECL (2007), pp. 540 et seq.; Hachem, Fixed Sums in CISG Contracts, 13 Vindobona Journal of
International Commercial Law and Arbitration (2009) 217 (222 et seq.) (Pace); Stoll/Gruber, in:
Schlechtriem/Schwenzer, Commentary (2005), Art. 4 para. 49; Arbitral Award (Foreign Trade Court of
Arbitration attached to the Serbian Chamber of Commerce) 31 May 2010 (Mobile Shear Baler), CISG-
Online 2262(Pace); Arbitral Award (Foreign Trade Court of Arbitration attached to the Serbian Chamber
of Commerce) 15 July 2008 (Milk packaging equipment), CISG-Online 1795 (Pace) (penalty clause was
found to be valid under domestic law); Oberlandesgericht Hamburg (Germany) 25 January 2008 (Café
inventory), CISG-Online 1681 (Pace) (penalty clause was found to be valid under domestic law); Arbitral
Award (CIETAC) 20 September 2006 (Welding machine) CISG-Online 1473 (Pace); Arbitral Award
(Tribunal of International Commercial Arbitration at the Russian Federation Chamber of Commerce and
Industry Russia) 13 April 2006, CISG-Online 1944 (Pace); Arbitral Award (Tribunal of International
Commercial Arbitration at the Russian Federation Chamber of Commerce and Industry Russia) 1 March
2006, CISG-Online 1941 (Pace) (penalty clause was found to be valid, but its amount was reduced under
domestic law); Arbitral Award (Tribunal of International Commercial Arbitration at the Russian
Federation Chamber of Commerce and Industry) 13 January 2006, CISG-Online 1622 (Pace) (penalty
clause was found to be valid, but its amount was reduced against the general principle of reasonableness
under the CISG); Arbitral Award (CIETAC) 9 November 2005 (DVD machines), CISG-Online 1444
(Pace); Arbitral Award (Tribunal of International Commercial Arbitration at the Russian Federation
Chamber of Commerce and Industry) 27 April 2005, CISG-Online 1500 (Pace) (penalty clause was found
to be valid, but its amount was reduced under domestic law); Arbitral Award (Tribunal of International
Commercial Arbitration at the Russian Federation Chamber of Commerce and Industry) 9 June 2004,
CISG-Online 1239 (Pace) (penalty clause was found to be valid under domestic law, but it was acknowl-
edged that had the English law applied such clause would not be upheld); Tribunale di Padova (Italy)
25 February 2004 (Agricultural products), CISG-Online 819 (Pace) (case only mentions that validity of
penalty clauses is not governed by the CISG as an example of excluded issues); Tribunale di Vigevano
(Italy) 12 July 2000, Rheinland Versicherungen v Atlarex, CISG-Online 493 (Pace) (case only mentions
that validity of penalty clauses is not governed by the CISG as an example of excluded issues); Arbitral
Award, ICC 9978, 1 March 1999, CISG-Online 708 (Pace) (penalty clause was found to be valid under
domestic law; aggrieved party’s recourse to Art. 74 calculation of damages was impaired); Arbitral Award
(Tribunal of International Commercial Arbitration at the Russian Federation Chamber of Commerce and
Industry) 10 January 1998, CISG-Online 2122 (Pace) (penalty clause was found to be valid, but its
amount was reduced under domestic law); Arbitral Award (Tribunal of International Commercial
Arbitration at the Russian Federation Chamber of Commerce and Industry) 5 June 1997, CISG-Online
76 Djordjević
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ignore the realities of international sales. Thus, domestic provisions on the protection of
the obligor should be applied against the underlying principles of the CISG.74
gg) Validity of usages. Art. 4(a) clearly states that the CISG does not govern the 27
validity of usages. Hence it is undisputed that the otherwise applicable law should
apply.75 The question of the existence of a usage is not a question of validity, rather a
question of fact that should be answered by an inquiry into the relevant trade sector.76
b) The effects on the property of the goods sold. The CISG also explicitly excludes 28
from its scope of application the effects which the contract may have on the property
in the goods sold.77 This issue is exclusively governed by the otherwise applicable
law.78 Moreover, the proprietary aspects of security interests in the goods sold (e. g.
1247 (Pace) (penalty clause was found to be valid and its amount reduced on the basis of Article 7.4.13 of
the UNIDROIT Principles referred to as international usages under Art. 9(2) CISG); Rechtbank van
koophandel Hasselt (Belgium) 21 January 1997, Epsilon v Interneon, (Pace) CISG-Online 360 (Pace)
(penalty clause was found to be invalid under domestic law); Hof van Beroep Antwerpen (Belgium)
18 June 1996 (Clothes), CISG-Online 758 (Pace) (penalty clause was found to be valid but its amount was
reduced under domestic law); Arbitral Award, ICC 7645/1995 (Crude metal) CISG-Online 844 (Pace)
(penalty clause was found to be valid under domestic law but the conditions for its excercise were found
not to be met); Gerechtshof Arnhem (Netherlands) 22 August 1995, Diepeveen-Dirkson v Nieuwenhoven
Veehandel, CISG-Online 317 (Pace) (penalty clause was found to be valid; the Court also held that no
provision in CISG (not even Arts 8 or 77) provides a basis for reduction of a contractual penalty and that
consequently this issue is subject to domestic law); Oberlandesgericht München (Germany) 8 February
1995 (Automobiles), CISG-Online 143 (Pace) (the court dismissed the seller’s argument that the bank
guaranty for the sale price should serve as a penalty for not taking delivery by the buyer by application of
domestic law); Arbitral Award, ICC 7197, 1 January 1992 (Failure to open letter of credit and penalty
clause), CISG-Online 36 (Pace) (penalty clause was found to be valid under domestic law and the
aggrieved party was entitled to full amount of damages irrespective of the limit set by the penalty clause).
But see Koneru, The International Interpretation of the UN Convention on Contracts for the Interna-
tional Sale of Goods: An Approach Based on General Principles, 6 Minnesota Journal of Global Trade
(1997) 105 (142) (Pace) stating that the validity of such clauses should be judged in light of the CISG
general principles and not the domestic law, in particular the good faith requirement under Art. 7(1).
Also see Commentary on Art. 7 footnote 123 stating that all issues related to penalty clauses are governed
by the CISG since CISG governs all remedies for breach of contract. Consequently, questions of
formation, validity and moderation of these clauses, irrespective of their function should be resolved
under the general principles of CISG. Similarily see Arbitral Award (Foreign Trade Court of Arbitration
attached to the Serbian Chamber of Commerce) 27 July 2011 (Copper wire rod), CISG-Online 2276
(Pace).
74 CISG-AC Opinion no 10.
75 Oberster Gerichtshof (Austria) 22 October 2001 (Agricultural products), CISG-Online 613 (Pace);
Oberster Gerichtshof (Austria) 21 March 2000 (Wood), CISG-Online 641(Pace); Oberster Gerichtshof
(Austria) 15 October 1998 (Timber), CISG-Online 380 (Pace).
76 Oberster Gerichtshof (Austria) 21 March 2000 (Wood), CISG-Online 641 (Pace); Oberlandesgericht
Dresden (Germany), 9 July 1998 (Terry cloth), CISG-Online 559 (Pace). See Commentary on Art. 9
para. 34.
77 Tribunale d’appello Ticino (Switzerland) 20 April 2016 (Cans of a bottling machine), CISG-Online
2759; Supreme Court (Poland) 25 June 2015 (Hyperbaric chamber), CISG-Online 2782; Oberlandesgericht
München (Germany) 5 March 2008 (Stolen car), CISG-Online 1686 (Pace); Arbitral Award, CIETAC,
18 April 2008 (PTA powder), CISG-Online 2057 (Pace); Arbitral Award (Tribunal of International
Commercial Arbitration at the Russian Federation Chamber of Commerce and Industry Russia) 13 April
2006 CISG-Online 1944 (Pace); Federal District Court of Illinois (U.S.) 28 March 2002, Usinor Industeel v
Leeco Steel Products, CISG-Online 1326 (Pace); Federal Court of South Australia, Adelaide (Australia)
28 April 1995, Roder v Rosedown, CISG-Online 218 (Pace); Bundesgerichtshof (Germany) 15 February
1995 (Key press machine), CISG-Online 149 (Pace). But see Federal Bankruptcy Court, ND of Ohio (USA)
10 April 2001, Victoria Alloys, Inc. v Fortis Bank SA/NV, CISG-Online 589 (Pace) citing Art. 53 in
support of the proposition that payment or non-payment of the price was significant in determining
whether the title to the goods has passed to the buyer.
78 For a comparative overview of law on transfer of property see: Drobnig, Transfer of Property, in:
Hartkamp et al. (eds), Towards a European Civil Code (1998), pp. 495 et seq.
Djordjević 77
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retention of title) will in principle be governed by the otherwise applicable law.79 The
CISG also does not deal with the priority of rights in the goods between the seller and
a third party creditor.80
3. Other (non)contentious matters

29 It has been correctly stated that distinguishing matters covered by the Convention
from those which are not is much easier when it comes to issues explicitly mentioned in
Art. 4 than those which are not mentioned.81 While the exclusion of certain matters
from the CISG ambit has been undisputed in case law and doctrine, other issues
resulted in diverging solutions.
30 a) Limitation of actions. The limitation period for claims arising from international
sales contracts governed by the CISG has unanimously been held to be a matter
excluded from the CISG’s sphere of application82 with the exception of one court
79 Tribunale d’appello Ticino (Switzerland) 20 April 2016 (Cans of a bottling machine), CISG-Online
2759; Supreme Court of British Columbia (Canada) 13 May 2015 (Steel), CISG-Online 2734; Arbitral
Award (Foreign Trade Court of Arbitration attached to the Serbian Chamber of Commerce) 15 July 2008
(Milk packaging equipment), CISG-Online 1795 (Pace); Court of Appeals Athens (Greece) 4861/2006
(Automobile catalyst) (Pace); Federal District Court of Illinois (USA) 28 March 2002, Usinor Industeel v
Leeco Steel Products, CISG-Online 1326 (Pace); Federal Court of South Australia, Adelaide (Australia)
28 April 1995, Roder v Rosedown, CISG-Online 218 (Pace); Oberlandesgericht Koblenz (Germany)
16 January 1992 (Motor yacht), CISG-Online 47 (Pace).
80 Federal District Court of Illinois (U.S.) 28 March 2002, Usinor Industeel v Leeco Steel Products,

American Journal of Comparative Law (2008) 1 (3); Eiselen/Kritzer, in: Kritzer/Vanto/Vanto/Eiselen,

International Contract Manual, Vol. 4 § 84:33(b); Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and
Beyond (2004), p. 106; Huber, Some introductory remarks on the CISG, 6 Internationales Handelsrecht
(2006) 234 (Pace); Janssen/Kiene, The CISG and Its General Principles, in: Janssen/Meyer, CISG
Methodology (2009), pp. 268 et seq.; Neumayer/Ming, Convention de Vienna (1993), Art. 4 para. 12;
Poznan District Court (Poland) 16 October 2015 (Flowers),, CISG-Online 2780; Bundesgericht (Switzer-
land) 18 May 2009 (Packaging machine), CISG-Online 1900 (Pace); Multi-Member Court of First Instance
of Athens (Greece) 1 January 2009 (Bullet-proof vest), CISG-Online 2228 (Pace); Supreme Court (Slovak
Republic) 19 June 2008 (Health care products), CISG-Online 1875 (Pace); Supreme Court (Slovak
Republic) 30 April 2008 (Health care products) CISG-Online 1873 (Pace); Audiencia Provincial de
Valencia (Spain) 13 March 2007 (Coconut), CISG-Online 1719 (Pace); Oberlandesgericht Köln (Germany)
13 February 2006 (Woollen cloth), CISG-Online 1219 (Pace); Arbitral Award (Foreign Trade Court of
Arbitration attached to the Serbian Chamber of Commerce) 24 January 2006 (Australian wool), CISG-
Online 2274 (Pace); Cour d’appel de Versailles (France) 13 October 2005 (Caterpillar toys), CISG-Online
1433 (Pace); Regional Court Bratislava (Slovak Republic) 11 October 2005 (Fur), CISG-Online 1858
(Pace); Oberlandesgericht Linz (Austria) 8 August 2005 (Spacers for insulation glass), CISG-Online 1087
(Pace); Kantonsgericht Nidwalden (Switzerland) 23 May 2005 (Farm machines), CISG-Online 1086
(Pace); Arbitral Award (Tribunal of International Commercial Arbitration at the Russian Federation
Chamber of Commerce and Industry) 9 June 2004, CISG-Online 1239 (Pace); Arbitral Award (Tribunal
of International Commercial Arbitration, Ukrainian Chamber of Commerce and Trade) 15 April 2004,
CISG-Online 1103 (Pace); Tribunale di Padova (Italy) 25 February 2004 (Agricultural products case),
CISG-Online 819 (Pace); Kantonsgericht Schaffhausen (Switzerland) 27 January 2004 (Model locomo-
tives), CISG-Online 960 (Pace); Arbitral Award, ICC 11 333, 1 January 2002 (Machine), CISG-Online
1420 (Pace); Oberster Gerichtshof (Austria) 14 January 2002 (Cooling system), CISG-Online 643 (Pace);
Cour d’appel de Paris (France) 6 November 2001, Traction Levage SA v Drahtseilerei, CISG-Online 677
(Pace); Oberster Gerichtshof (Austria) 22 October 2001 (Agricultural products case), CISG-Online 613
(Pace); Rechtbank van Koophandel Ieper (Belgium) 29 January 2001 (Cooling installations), CISG-Online
606 (Pace); Oberster Gerichtshof (Austria) 7 September 2000 (Tombstones), CISG-Online 642 (Pace);
Tribunale di Vigevano (Italy) 12 July 2000, Rheinland Versicherungen v Atlarex, CISG-Online 493 (Pace);
Arbitral Award (Tribunal of International Commercial Arbitration at the Russian Federation Chamber of
Commerce and Industry) 6 June 2000, CISG-Online 1249 (Pace); Oberlandesgericht Braunschweig
(Germany) 28 October 1999 (Frozen meat), CISG-Online 510 (Pace); Oberlandesgericht Hamburg
78 Djordjević
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decision where the answer to this question is somewhat unclear; i. e. it implies that the
CISG governs this issue yet that the recourse to general principles cannot help
determining the applicable limitation period.83
b) Procedural issues. Many of the contentious issues regard so-called procedural 31
issues. Namely, in determining the scope of Art. 4, it has been repeatedly stated that the
CISG is about contracts (substantive law) and not procedure (procedural law),84 and
hence certain ‘procedural matters’ were deemed excluded from its scope. On the other
hand, it has been correctly stated that in interpreting international conventions, all
abstract distinctions between substantive and procedural laws may be counterproduc-
tive.85 This is because the distinction between substance and procedure varies in
different jurisdictions.86 Consequently, instead of qualifying an issue as either proce-
dural or substantive, one should answer the question whether the matter is covered by
the CISG or not. Otherwise, the efforts on harmonizing the law of international sales
would be in vain and the doors for the application of domestic rules and standards in
this sphere would be wide open.87
c) Issues of jurisdiction and dispute resolution clauses. It is generally recognized 32
that the CISG is not concerned with the jurisdiction of courts and arbitration tribu-
(Germany) 5 October 1998 (Circuit boards), CISG-Online 473 (Pace); Oberster Gerichtshof (Austria)
25 June 1998, CISG-Online 352 (Pace); Oberlandesgericht München (Germany) 21 January 1998 (Insulat-
ing materials), CISG-Online 536 (Pace); Arbitral Award, CIETAC, 19 December 1997 (Steel), CISG-
Online 1418 (Pace); Cour de Justice de Genève (Switzerland) 10 October 1997, Filinter v Moulinages
Poizat, CISG-Online 295; Landgericht Heilbronn (Germany) 15 September 1997 (Film coating machine),
CISG-Online 562; Oberster Gerichtshof (Austria) 24 October 1995 (Galvanized wire case), CISG-Online
166 (Pace); Landgericht Düsseldorf (Germany), 11 October 1995 (Generator), CISG-Online 180 (Pace);
Oberlandesgerich Hamm (Germany) 9 June 1995 (Window elements), CISG-Online 146 (Pace); Arbitral
Award, ICC 7660, 23 August 1994 (Battery machinery), CISG-Online 129 (Pace).
83 The court held that the limitation period was a matter governed by but not expressly settled in the
Convention (reference to Art. 39), but nevertheless resolved the issue by reference to applicable
domestic law. See Cour d’appel de Paris (France) 6 November 2001, Traction Levage SA v Drahtseilerei,
CISG-Online 677.
84 Ferrari, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2004), Art. 4 para. 33; Flechtner/
Lookofsky, Viva Zapata! American Procedure and CISG Substance in a U. S. Circuit Court of Appeal, 7
Vindobona Journal of International Commercial Law and Arbitration (2003) 93 et seq. (Pace); Herber, in:
Schlechtriem, Commentary (1998), Art. 4 para. 20; Khoo, in: Bianca/Bonell, Commentary (1987), Art. 2
para. 3.2; Lookofsky, Walking the Article 7(2) Tightrope Between CISG and Domestic Law, 25 Journal of
Law and Commerce (2005–2006) 87 (98 et seq.) (Pace); Neumayer/Ming, Convention de Vienna (1993),
Art. 4 para. 13; Saidov, The Law of Damages in International Sales – The CISG and other International
Instruments (2008) p. 163; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 4 paras
19 and 22; Schwenzer/Hachem, The CISG – Successes and Pitfalls, 57 American Journal of Comparative
Law (2009) 457 (471); Tribunal Cantonal du Valais (Switzerland) 21 February 2005 (CNC machine),
CISG-Online 1193 (Pace); Federal Court of Appeals (7th Cir.) (U.S.) 19 November 2002, Zapata Hermanos
v Hearthside Baking, CISG-Online 684 (Pace); Cour de Justice de Genève (Switzerland) 15 November
2002 (Window frames), CISG-Online 853 (Pace); Bundesgericht (Switzerland) 11 July 2000, Gutta-Werke
AG v Dörken-Gutta Pol. and Ewald Dörken AG, CISG-Online 627.
85 Gotanda, When Recessions Create Windfalls: The Problems of Using Domestic Law to Fix Interest
Rates under Article 78 CISG, 13 Vindobona Journal of International Commercial Law and Arbitration
(2009) 229 (234) (Pace); Orlandi, Procedural Law Issues and Law Conventions, 5 Uniform Law Review
(2000) 23 (25) (Pace).
86 Boele Woelki, The Limitation of Actions in International Sale of Goods, 4 Uniform Law Review
(1999-3) 621–650; Gotanda, Awarding Interest in International Arbitration, 90 American Journal of

International Law (1996) 40 (50); Orlandi, Procedural Law Issues and Law Conventions, 5 Uniform Law
Review (2000) 23 (26) (Pace); Schroeter, Defining the Borders of Uniform International Contract Law: the
CISG and Remedies for Innocent, Negligent, or Fraudulent Misrepresentation, 58 Vill. L. Rev. (2013) 553
(560).
87 Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Introduction, p. 7.
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nals.88 There are specific international instruments that govern the issues of validity of
forum selections clauses89 and, if applicable, they have priority over the CISG in
accordance with Art. 90.90 However, whether the choice of forum clause is effectively
incorporated into the contract can be a matter resolved under the CISG rules on
formation.91
33 Similarly, whether an arbitration agreement is properly concluded may be one of the
debated issues in a dispute arising out of a contract containing an arbitration clause and
otherwise governed by the CISG. In such a case, the doctrine of severability requires
that an arbitration agreement be treated differently than the sales contract it is
embedded in.92 There should be no automatism in applying the CISG to the issues of
formation and validity of the arbitration clause given that specially tailored rules exist
that determine (possibly different) applicable laws to different aspects of the arbitration
agreement – its formation, formal validity and substantive validity.93 While it has been
generally recognized that the CISG can perhaps apply to the issues on the formation of
arbitration agreements (offer and acceptance)94 and (unlikely) to their interpretation, it
88 Ferrari, Choice of Forum and CISG: Remarks on the Latter’s Impact on the Former, in: Flechtner/
Brand/Walter, Drafting Contracts (2007), p. 104; Kröll, Selected Problems Concerning the CISG’s Scope
of Application, 25 Journal of Law and Commerce (2005–2006) 39 (43) (Pace); Magnus, Incorporation of
Standard Contract Terms under the CISG, FS Kritzer (2008), p. 308; Bundesgerichtshof (Germany)
25 March 2015 (Replacement parts for ships), CISG-Online 2588; Bundesgericht (Switzerland) 11 July
2000, Gutta-Werke AG v Dörken-Gutta Pol. and Ewald Dörken AG, CISG-Online 627 (Pace); Handels-
gericht des Kantons Zürich (Switzerland) 26 April 1995 (Saltwater isolation tank), CISG-Online 248;
Cámara Nacional de Apelaciones en lo Commercial (Argentina), 14 October 1993, Inta v Officina
Meccanica, CISG-Online 87 (Pace).
89 E. g. jurisdiction agreements are dealt with by, inter alia, Brussels I Regulation, Lugano Convention
and the 2005 Hague Convention on Choice of Court Agreements. Arbitration agreements are dealt with
by, inter alia, 1958 UN Convention on the Recognition and Enforcement of Foreign Arbitral Awards and
1961 European Convention on International Commercial Arbitration.
90 Magnus, Incorporation of Standard Contract Terms under the CISG, FS Kritzer (2008), pp. 308 et
seq.; District Court, Western District of Wisconsin (U.S.) 7 July 2009, Amit Israeli v. Dott. Gallina S.r.l.,
Dario Gallina and David Gallina, CISG-Online 1962 (Pace); Kantonsgericht Zug (Switzerland) 11 De-
cember 2003 (Plastic granulate), CISG-Online 958 (Pace).
91 Federal District Court, ED of California (U.S.) 21 January 2010, Golden Valley Grape Juice and Wine,
LLC v Centrisys Corporation et al., CISG-Online 2089 (Pace); Langericht Trier (Germany) 8 January 2004
(Synthetic window parts), CISG-Online 910 (Pace); Oberlandesgericht Braunschweig (Germany) 28 Octo-
ber 1999 (Frozen meat), CISG-Online 510 (Pace).
92 Blackaby/Partasides/Redfern/Hunter, Redfern and Hunter on International Arbitration (2009),
para. 2.89 et seq.; Born, International Commercial Arbitration (2009), Vol. I p. 311 et seq.; Gaillard/Savage,
Fouchard Gaillard Goldman on International Commercial Arbitration (1999), paras 389 et seq.; Lew/
Mistellis/Kröll, Comparative International Commercial Arbitration (2003), paras 6-1 et seq.; Poudret/Besson,
Comparative Law of International Arbitration (2007), pp. 132 et seq. See also Art. 16(1) UNCITRAL Model
Law on International Commercial Arbitration.
93 In one case an application for enforceability of an arbitral award was denied since the court found
that the arbitration clause had not become a legally effective part of the contract according to Art. II (2) of
the 1958 New York Convention, which requires a written agreement of the parties. The court argued, that
an arbitration clause, as provision concerning the settlement of disputes, is always considered to alter the
offer materially under Art. 19(3) CISG, thus the silence of the respondent cannot be considered as
acceptance of the applicant’s general terms and conditions containing an arbitration clause. As a result,
since the lack of form has not been cured during arbitral proceedings, the court had no other option than
to deny recognition of an arbitral award. See Oberlandesgericht Frankfurt am Main (Germany) 26 June
2006 (Printed goods), CISG-Online 1385 (Pace).
94 See District Court, SD of New York (U.S.) 14 April 1992, Filanto v Chilewich, CISG-Online 45 (Pace);
Federal Appellate Court (9th Circuit) (USA) 5 May 2003, Chateau des Charmes Wines Ltd. v Sabaté USA,
Sabaté S. A., CISG-Online 767 (Pace); Tribunal Supremo, (Spain) 17 February 1998, CISG-Online 1333;
Tribunal Supremo, (Spain) 17 February 1998, (Pace); Landgericht Hamburg (Germany) 19 June 1997
(Hazelnuts), CISG-Online 283.
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is not very likely that the CISG will govern their substantive validity, and, it is
submitted, that it will never be relevant for their formal validity.95
d) Burden of proof and standard of proof. Whether the burden of proof is covered 34
by the CISG or not is subject to lengthy debates. The majority view argues that it is
within the scope of the CISG and derives this conclusion from Art. 79 and a systematic
reading of the Convention.96 In addition, according to some views, Art. 2(a) also
addresses the issue of burden of proof although tacitly, and thus blocks the application
of national non-uniform law.97 At least one author has advocated for the rules on
burden of proof to be deemed governed by the CISG by deriving them from the rules on
contract interpretation provided for in Art. 8, which are considered as rules of
evidence.98 Furthermore, Arts 25, 35(2)(b) and 44 have been cited as representative of
general principles of the Convention from which the rule on burden of proof can be
derived from.99
The contents of the burden of proof principle under the CISG have been described by 35
the rule ‘ei incumbit probatio qui dicit, non qui negat’.100 This means that, on the one
95 Koch, The CISG as the Law applicable to Arbitration Agreements?, FS Kritzer (2008), pp. 285–286;
Mistellis, CISG and Arbitration, in: Janssen/Meyer, CISG Methodology (2009), pp. 394 et seq.; Kröll,
Selected Problems Concerning the CISG’s Scope of Application, 25 Journal of Law and Commerce (2005–
2006) 39 (43 et seq.) (Pace). For a different view see: Walker, Agreeing to Disagree: Can We Just Have
Words? CISG Article 11 and the Model Law Writing Requirement, 25 Journal of Law and Commerce
(2005–06) 153–165.
96 Ferrari, Burden of Proof under the United Nations Convention on Contracts for International Sale of
Goods (CISG), 5 International Business Law Journal 835 (2000) 666; Herber, in: Schlechtriem, Commen-
tary (1998), Art. 4 para. 22; Kröll, Selected Problems Concerning the CISG’s Scope of Application, 25
Journal of Law and Commerce (2005–2006) 39 (48) (Pace); Kruisinga, (Non-) conformity in the 1980 UN
Convention on Contracts for the International sale of Goods: a uniform concept? (2004), p. 159; Orlandi,
Procedural Law Issues and Law Conventions, 5 Uniform Law Review (2000) 23 (27 et seq.); Perales
Viscasillas, Battle of the Forms and the Burden of Proof: An Analysis of BGH 9 January 2002, 6
Vindobona Journal of International Commercial Law and Arbitration (2002) 217 (228) (Pace); Schwen-
zer/Hachem, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 4 para. 25; Magnus, Die allgemeinen
Grundsätze im UN-Kaufrecht, 59 RabelsZ (1995) 485 footnote 86 et seq. (Pace).
97 Perales Viscasillas, Battle of the Forms and the Burden of Proof: An Analysis of BGH 9 January 2002,
6 Vindobona Journal of International Commercial Law and Arbitration (2002) 217 (227) (Pace);
Bundesgerichtshof (Germany) 9 January 2002 (Powdered milk), CISG-Online 651 (Pace).
98 Henschel, The Conformity of Goods in International sales, An analysis of Article 35 in the United
Nations Convention on Contracts for the International Sale of Goods (CISG) (2005), pp. 111 et seq.
99 See footnotes 90–92 supra and footnote 94 infra.
100 Tribunal Cantonal du Valais (Switzerland) 27 April 2007 (Oven), CISG-Online 1721 (Pace);
Oberster Gerichtshof (Austria) 12 September 2006 (CD media), CISG-Online 1364 (Pace); Handelsgericht
des Kantons Zürich (Switzerland) 22 December 2005 (Retail fashion clothes), CISG-Online 1195 (Pace);
Tribunal Cantonal Valais (Switzerland) 19 September 2005 (Fiberglass composite materials), (Pace);
Tribunal Cantonal du Valais (Switzerland) 27 May 2005 (Welding devices), CISG-Online 1137 (Pace);
Federal Court of Appeals (7th Cir.) (U.S.) 23 May 2005, Chicago Prime Packers, Inc. v Northam Food
Trading Co., CISG-Online 1026 (Pace); Kantonsgericht Nidwalden (Switzerland) 23 May 2005 (Farm
machines), CISG-Online 1086 (Pace); Bundesgericht (Switzerland) 7 July 2004 (Cable drums), CISG-
Online 848 (Pace); Obergericht des Kantons Bern (Switzerland) 11 February 2004 (Wire and cable), CISG-
Online 1191 (Pace); Bundesgericht (Switzerland) 13 November 2003 (Used laundry machine), CISG-
Online 840 (Pace); Tribunale di Rimini (Italy) 26 November 2002, Al Palazzo S. r. l. v Bernardaud di
Limoges S. A., CISG-Online 737 (Pace); Landgericht Saarbrücken (Germany) 2 July 2002 (Tiles), CISG-
Online 713 (Pace); Federal Court of Appeals (4th Cir.) (USA) 21 June 2002, Schmitz-Werke v Rockland,
CISG-Online 625 (Pace); Bundesgerichtshof (Germany) 9 January 2002 (Powdered milk), CISG-Online
651 (Pace); Bundesgericht (Switzerland) 15 September 2000, FCF S. A. v Adriafil Commerciale S. r. l.,
CISG-Online 770 (Pace); Tribunale di Vigevano (Italy) 12 July 2000, Rheinland Versicherungen v Atlarex,
CISG-Online 493 (Pace); Tribunale di Pavia (Italy) 29 December 1999, Tessile v Ixela, CISG-Online 678
(Pace); Handelsgericht des Kantons Zurich (Switzerland) 10 February 1999 (Art books), CISG-Online 488
(Pace); Handelsgericht Zurich (Switzerland) 30 November 1998 (Lambskin coat), CISG-Online 415
(Pace); Audiencia Provincial de Barcelona (Spain) 20 June 1997 (Dye for clothes), CISG-Online 338
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hand, the party has to prove the existence of the factual prerequisites contained in the
legal provision from which it wants to derive beneficial legal consequences; and, on the
other, that a party claiming an exception has the burden of proving the factual
prerequisites of that exception.101
36 The minority view relies on the legislative history of the Convention and treats the
issue of burden of proof as one of procedural character that should be governed by
domestic law.102 However, as previously mentioned, interpreting the Convention against
the domestic perceptions of the substance-procedure dichotomy undermines the basic
goals the Convention aims to achieve. Moreover, with respect to the matter of burden of
proof, it goes against the interpretative methods suggested in Art. 7. In this author’s
opinion, the burden of proof rule can be substantiated by the Convention’s general
principle that a party invoking a right has to prove the factual prerequisites justifying it.
Furthermore, the issue of burden of proof is closely linked to the substantive law that a
rule on its allocation has to be derived from the CISG.103
37 Another issue closely related to the issue of burden of proof deserves special attention
– the standard of proof. Surprisingly, the vast majority of cases and authors who follow
the view that burden of proof is covered by the CISG do not find the issue of standard
of proof to also be governed by the Convention bur rather leave it to the lex fori.104 Only
(Pace); Gerechtshof Arnhem (Netherlands) 21 May 1996, Maglificio Esse v Wehkamp, CISG-Online 1290
(Pace); Handelsgericht des Kantons Zurich (Switzerland) 26 April 1995 (Saltwater isolation tank), CISG-
Online 248 (Pace); Arrondissementsrechtbank Zwolle (Netherlands) 1 March 1995, Wehkamp v Maglificio
Esse, CISG-Online 372 (Pace); Landgericht Düsseldorf (Germany) 25 August 1994 (Fashion goods case),
CISG-Online 451 (Pace); Landgericht Frankfurt (Germany) 6 July 1994 (Chocolate products case), CISG-
Online 257 (Pace); Oberlandesgericht Innsbruck (Austria) 1 July 1994 (Garden flowers case), CISG-Online
107 (Pace); Handelsgericht des Kantons Zurich (Switzerland) 9 September 1993 (Furniture), CISG-Online
79 (Pace).
101 Ferrari, Burden of Proof under the United Nations Convention on Contracts for International Sale
of Goods (CISG), 5 International Business Law Journal 835 (2000) 667. In line with this view see
Audiencia Provincial de Valencia (Spain) 7 June 2003 (Grape juice), CISG-Online 948 (Pace) (“[even if]
the issues related to burden of proof were not governed by the Convention, but taking into account its
systematic structure [at least] some principles can be inferred. Taking into account that the liability for
defects of the goods constitutes a core aspect of the seller’s obligations by virtue of the contract, it is the
seller who must demonstrate the lack of defects at the moment of passing of risk. The buyer assumes the
burden of proof in regard to the reasonable examination and the notification of the lack of conformity
and, once having accepted the goods without notifying of lack of conformity, the burden of proof
regarding the existences of defects at the moment of the passing of risk passes to the buyer”).
102 Flechtner, Selected Issues Relating to the CISG’s Scope of Application, 13 Vindobona Journal of
International Commercial Law and Arbitration (2009) 91 (102 et seq.); Khoo, in: Bianca/Bonell,
Commentary (1987), Art. 2 para. 3.2; Lookofsky, Understanding the CISG (2008), p. 84, footnote 117;
Rosett, Critical Reflections on the United Nations Convention on Contracts for the International Sale of
Goods, 45 Ohio State Law Journal (1984) 265 (281) (Pace). See also Arbitral Award, ICC 9926, 1 January
2007, (Chemical compound), CISG-Online 1850 (Pace); Arbitral Award (Foreign Trade Court of
Arbitration attached to the Serbian Chamber of Commerce) 21 February 2005 (Young chickens), CISG-
Online 2038 (Pace); Cour de Justice de Genève (Switzerland) 15 November 2002 (Window frames), CISG-
Online 853 (Pace); Helsinki Court of Appeals (Finland) 26 October 2000 (Plastic carpets), CISG-Online
1078 (Pace); Arbitral Award, ICC 7399, 1 January 1993 (Shoe), CISG-Online 748 (Pace). In one case the
issue remained unresolved, i. e. the court did not take any definite view on the topic: Cantone del Ticino,
Corte d’Appello, (Switzerland) 15 January 1998 (Cocoa beans case), CISG-Online 417 (Pace). In another
case the court resolved the issue by application of domestic law but based on Art. 7(2) CISG:
Bezirksgericht der Saane (Switzerland) 20 February 1997 (Spirits case), CISG-Online 426 (Pace).
103 Bianca, in: Bianca/Bonell, Commentary (1987), Art. 36 para. 3.1; Ferrari, in: Ferrari/Flechtner/
Brand, Draft Digest and Beyond (2004), p. 111 with further references in footnote 87; Schlechtriem, in:
104 Henschel, The Conformity of Goods in International sales, An analysis of Article 35 in the United
Nations Convention on Contracts for the International Sale of Goods (CISG) (2005), p. 112; Kruisinga,
(Non-)conformity in the 1980 UN Convention on Contracts for the International sale of Goods: a
uniform concept? (2004), p. 167; Lookofsky, Understanding the CISG (2008), p. 131; Orlandi, Procedural
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recently there have been different voices heard on this topic.105 However, if one accepts
the view that burden of proof is covered by the CISG, then it is only logical that its
counterpart – standard of proof – is governed by the Convention as well. Arguments on
how the question is a procedural issue and therefore not governed by the Convention,
should be dismissed for the same reasons regarding the question of burden of proof.
Furthermore, a relevant general principle that determines the required standard of proof
under the CISG can be derived from the Convention – the principle of reasonable-
ness.106 Hence, in this author’s view, the relevant standard of proof under the CISG
should be the one of reasonable certainty.107
e) Set-off. It is clear that the issue of set-off is not expressly governed by the 38
Convention. However, this should not automatically mean that the issue of set-off is
excluded from the CISG. Rather, one should look into the provisions of the Convention
in search for the answer to this question.
According to the prevailing view expressed in case law and doctrine,108 set-off is not 39
governed by the Convention. The rarely expressed reasoning in support of this position
Law Issues and Law Conventions, 5 Uniform Law Review (2000) 23 (28) (Pace). Also see: Bundesgericht
(Switzerland) 17 December 2009 (Watches), CISG-Online 2022 (Pace); Kantonsgericht Nidwalden (Swit-
zerland) 23 May 2005 (Farm machines), CISG-Online 1086 (Pace); Cour de Justice de Genève (Switzer-
land) 15 November 2002 (Window frames), CISG-Online 853 (Pace); Bundesgerichtshof (Germany)
9 January 2002 (Powdered milk), CISG-Online 651 (Pace).
105 Hachem/Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 4 para. 26; Saidov, The
Law of Damages in International Sales – The CISG and other International Instruments (2008), p. 165;
Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 74 para. 66; CISG-AC Opinion no 6,
para. 2.1. et seq.
106 Bonell, in: Bianca/Bonell, Commentary (1987) Art. 7 para. 2.3.2.2.
107 See also: Saidov, The Law of Damages in International Sales – The CISG and other International
Instruments (2008), pp. 168 et seq.; Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 74
para. 67.
American Journal of Comparative Law (2008) 1 (3); Eiselen/Kritzer, in: Kritzer/Vanto/Vanto/Eiselen,

International Contract Manual, Vol. 4 § 84:33(c); Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and
Beyond (2004), p. 108; Honnold/Flechtner, Uniform Law (2009), Art. 4 para. 70; Schlechtriem, in:
Schlechtriem/Schwenzer, Commentary (2005), Art. 4 para. 22 a; Huber, Some introductory remarks on
the CISG, 6 Internationales Handelsrecht (2006) 234 (Pace); Oberlandesgericht Celle (Germany) 29 Jan-
uary 2015 (Equipment for laboratory), CISG-Online 2618 (Pace); Bundesgerichtshof (Germany) 23 June
2010, CISG-Online 2129 (Pace); High Court, Seoul (Republic of Korea) 23 July 2009 (Duck feathers)
CISG-Online 2507 (Pace); Katowice Court of Appeals (Poland) 22 January 2009 (Aluminium profiles),
CISG-Online 2787; Multi-Member Court of First Instance of Athens (Greece) 1 January 2009 (Bullet-proof
vest), CISG-Online 2228 (Pace); Appellationsgericht Basel-Stadt (Switzerland) 26 September 2008 (Packa-
ging machine), CISG-Online 1732 (Pace); Oberlandesgericht Köln (Germany) 19 May 2008 (Pesticide),
CISG-Online 1700 (Pace); Bundesgericht (Switzerland) 20 December 2006 (Machines), CISG-Online 1426
(Pace); Oberlandesgericht Köln (Germany) 13 February 2006 (Woollen cloth), CISG-Online 1219 (Pace);
Handelsgericht des Kantons Zürich (Switzerland) 22 December 2005 (Retail fashion clothes), CISG-Online
1195 (Pace); Oberlandesgericht Linz (Austria) 23 March 2005 (Conveyor band), CISG-Online 1376
(Pace); Oberlandesgericht Stuttgart (Germany) 20 December 2004 (Decorative paper), CISG-Online 997
(Pace); Bundesgericht (Switzerland) 7 July 2004 (Cable drums), CISG-Online 848 (Pace); Oberlandesger-
icht Düsseldorf (Germany) 28 May 2004 (Television sets), CISG-Online 850 (Pace); Tribunale di Padova
(Italy) 25 February 2004 (Agricultural products), CISG-Online 819 (Pace); Landgericht Bielefeld (Ger-
many) 12 December 2003 (Frozen salmon), CISG-Online 905 (Pace); Oberlandesgericht Düsseldorf
(Germany) 25 July 2003 (Rubber sealing parts), CISG-Online 919 (Pace); Landgericht Mönchengladbach
(Germany) 15 July 2003 (Filters), CISG-Online 813 (Pace); Landgericht Saarbrücken (Germany) 2 July
2002 (Tiles), CISG-Online 713 (Pace); Oberster Gerichtshof (Austria) 14 January 2002 (Cooling system),
CISG-Online 643; Arbitral Award, Chamber of National and International Arbitration of Milan,
28 September 2001 (Steel wire case), CISG-Online 1582 (Pace); Bundesgerichtshof (Germany) 9 January
2002 (Powdered milk), CISG-Online 651; Oberster Gerichtshof (Austria) 22 October 2001 (Gasoline and
gas oil case), CISG-Online 614 (Pace); Tribunale di Vigevano (Italy) 12 July 2000, Rheinland Versicher-
ungen v Atlarex, CISG-Online 493 (Pace); Amtsgericht Duisburg (Germany) 13 April 2000 (Pizza
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claims that set-off should be deemed inadmissible under the CISG given that the
Convention does not completely govern problems related to set-offs (e. g., the determi-
nation of the requisites which must exist in order to balance mutual debts); and given
that this issue was not addressed during the drafting process.109
40 On the other hand, there is a growing consensus amongst some authors and courts
that where both claims arise from the same transaction governed by the CISG, they can
be offset against each other (e. g. the buyer’s claim for damages for non-conformity can
be offset against the seller’s claim for payment of the price), as allowed by the general
principles underlying Arts 81(2), 84(2) and 88(3).110
41 In this author’s opinion, the latter view should be preferred. Not only can it be stated
that set-off is an issue governed by, even though not expressly settled in, the Convention,
the CISG’s general principles provide a sufficient basis for establishing all relevant criteria
for exercising a right to set-off where receivables arise from the same contract. Namely, the
CISG is based on the principle that declarations extinguishing obligations need to be made
by notice to the other party (Art. 26) – hence, set-off needs to be declared. Furthermore,
such notices are effective upon dispatch (Art. 27). The mutuality of claims and the identity
cartons), CISG-Online 659 (Pace); Ontario Court of Appeal (Canada) 26 January 2000 Nova Tool v.
London Industries, CISG-Online 582 (Pace); Oberlandesgericht München (Germany) 11 March 1998
(Cashmere sweaters), CISG-Online 310 (Pace); Kantonsgericht Freiburg (Switzerland) 23 January 1998
(Commercial laundry machine), CISG-Online 423 (Pace); Landgericht Hagen (Germany) 15 October
1997 (Socks), CISG-Online 311 (Pace); Gerechtshof ‘s Hertogenbosch (Netherlands) 2 October 1997, Van
Dongen Waalwijk Leder v Conceria Adige, CISG-Online 550 (Pace); Oberlandesgericht Hamburg
(Germany) 4 July 1997 (Tomato concentrate case), CISG-Online 1299 (Pace); Landgericht München
(Germany) 6 May 1997 (Cars), CISG-Online 341(Pace); Oberlandesgericht Düsseldorf (Germany) 24 April
1997 (Shoes), CISG-Online 385 (Pace); Oberlandesgericht Düsseldorf (Germany) 11 July 1996 (Lawn
mower engines), CISG-Online 201 (Pace); Landgericht Duisburg (Germany) 17 April 1996 (Textiles),
CISG-Online 186 (Pace); Tribunal Cantonal Vaud (Switzerland) 11 March 1996 (Aluminium granules),
CISG-Online 333 (Pace); Obergericht des Kantons Thurgau (Switzerland) 19 December 1995 (Cloth),
CISG-Online 496 (Pace); Oberlandesgericht Stuttgart (Germany) 21 August 1995 (Machinery), CISG-
Online 150 (Pace); Oberlandesgericht Hamm (Germany) 9 June 1995 (Window elements), CISG-Online
146 (Pace); Landgericht München (Germany) 20 March 1995 (Rancid bacon), CISG-Online 164 (Pace);
Arrondissementsrechtbank Middelburg (Netherlands) 25 January 1995, CISG-Online 374; Oberlandesger-
icht Koblenz (Germany) 17 September 1993 (Computer chip), CISG-Online 91 (Pace); Arrondissements-
rechtbank Roermond (Netherlands) 6 May 1993, Gruppo IMAR v Protech Horst, CISG-Online 454
(Pace); Arrondissementsrechtbank Arnhem (Netherlands) 25 February 1993, P. T. Van den Heuvel v
Santini Maglificio Sportivo de Santini, CISG-Online 98 (Pace); Kantonsgericht Freiburg (Switzerland)
28 January 1990 (Commercial laundry machine), CISG-Online 423 (Pace). In one case the buyer’s claim
for set-off was rejected on the grounds that he has lost the rights to rely on non-conformity since he did
not give timely notice thereof. Admissibility of the set-off under the CISG was not addressed in this case.
See Landgericht Berlin (Germany) 24 March 1998 (Knitwear), CISG-Online 742 (Pace).
109 See Tribunale di Padova (Italy) 25 February 2004 (Agricultural products case), CISG-Online 819
(Pace). See also: Ferrari, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2004), Art. 4 para. 39;
Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 4 para. 22 a.
110 Bridge, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2004), pp. 251 et seq.; Kröll, Selected
Problems Concerning the CISG’s Scope of Application, 25 Journal of Law and Commerce (2005–2006) 39
(48) (Pace); Magnus, Die allgemeinen Grundsätze im UN-Kaufrecht, 59 RabelsZ (1995) 485 (footnotes 67
et seq.) (Pace); Schwenzer/Hachem, in: Schlechtriem/Schwenzer, Commentary (2010), Art. 4 para. 28;
CISG-AC Opinion no 9, para. 3.23, stating that a general denial of set-off as a subject dealt with by the
Convention is too widely stated (Pace). See also: Bundesgerichtshof (Germany) 24 September 2014
(Tools), CISG-Online 2545 (Pace); Bundesgerichtshof (Germany) 14 May 2014 (Coffee products), CISG-
Online 2493 (Pace); Landgericht Stuttgart (Germany) 29 October 2009 (Artificial turf), CISG-Online 2017
(Pace); Oberlandesgericht München (Germany) 19 October 2006 (Auto), CISG-Online 1394 (Pace);
Kantonsgericht Schaffhausen (Switzerland) 20 October 2003 (Aluminium foil film wrap), CISG-Online
957 (Pace); Amtsgericht Duisburg (Germany) 13 April 2000 CISG-Online 659 (Pace); Oberlandesgericht
Hamburg (Germany) 26 November 1999 (Jeans), CISG-Online 515 (Pace); Oberlandesgericht München
(Germany) 28 January 1998 (Leather goods), CISG-Online 339 (Pace); Oberlandesgericht Munich (Ger-
many) 9 July 1997 (Leather goods), CISG-Online 282 (Pace).
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of their nature (‘of the same kind’) as requirements for set-off can also be derived from the
CISG’s general principles.111 The same applies for the ‘ascertainment’ requirement.112
Finally, it is worth noting that the preponderant part of cases where set-off was deemed
inadmissible relates to situations where the receivables requested to be offset did not arise
under the same transaction. This author agrees that in such an instance the CISG should
not be applied. However, it is submitted that since most of these cases regarded a different
kind of set-off (set-off of claims arising out of different transactions), they should not serve
as confirmation of the exclusion of set-off under the CISG in all circumstances.113
f) Recovery of attorneys’ fees. Recovery of attorneys’ fees incurred in litigation over 42
claims arising out of contracts governed by the CISG is another area where diverging
views have been expressed in legal doctrine and case law. Amongst the authors who
advocate recourse to domestic law to resolve this matter, there are authors who find it
a matter of procedural law and consequently not governed by the CISG,114 authors
who base their argument on the drafter’s intent (i. e. lack of an intent to have this issue
covered by the CISG),115 authors who find recovery of attorneys’ fees under the CISG
in contravention with the principle of equality of the parties to the sales contract,116
and authors who find the CISG principles not well-suited to deal with the calculation
of attorneys’ fees as recoverable loss.117 Also, many authors justify their position by
combining two or more of these reasons.118 On the other hand, the group of authors
advocating for recovery of attorneys’ fees under the CISG provisions base their
arguments on the plain wording of Art. 74 and principles of full compensation,
foreseeability, mitigation and reasonableness.119 As for the case law, it seems that the
111See Commentary on Art. 84.

112Schwenzer/Hachem, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 4 para. 28.
113 E. g. in one case the court explicitly emphasized that: “[a]s the CISG does not deal with set-offs – as
here, claims from another than the actual sales contract in question- their legitimacy and effect are not
governed by the CISG but by the supplemental applicable national law.” (emphasis added). See
Oberlandesgericht Karlsruhe (Germany) 20 July 2004 (Shoes), CISG-Online 858 (Pace).
114 Flechtner, Recovering Attorneys’ Fees as Damages under the UN Sales Convention: A Case Study on
the New International Commercial Practice and the Role of Case Law in CISG Jurisprudence, with
Comments on Zapata Hermanos Sucesores, S. A. v Hearthside Baking Co.’ 22 Northwestern Journal of
International Law and Business (2002) 121 (153 et seq.) (Pace); Huber, in: Huber/Mullis, The CISG
(2007), p. 278; Lookofsky, Walking the Article 7(2) Tightrope Between CISG and Domestic Law, 25
Journal of Law and Commerce (2005–2006) 87 (98 et seq.) (Pace); Stoll/Gruber, in: Schlechtriem/
Schwenzer Commentary (2005), p. 757.
115 Flechtner/Lookofsky, Viva Zapata! American Procedure and CISG Substance in a U. S. Circuit Court
of Appeal, 7 Vindobona Journal of International Commercial Law and Arbitration (2003) 93 (98) (Pace);
Lookofsky/Flechtner, Zapata Retold: Attorneys’ Fees Are (Still) Not Governed by the CISG, 26 Journal of
Law and Commerce (2006–2007) 1 (2) (Pace); Mullis, Twenty-Five Years On – The United Kingdom,
Damages and the Vienna Sales Convention, 71 RabelsZ (2007) 44 (Pace).
116 CISG-AC Opinion no 6, para. 5.4; Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016),
Art. 74 para. 30.

117 Flechtner, Recovering Attorneys’ Fees as Damages under the UN Sales Convention: A Case Study on
the New International Commercial Practice and the Role of Case Law in CISG Jurisprudence, with
Comments on Zapata Hermanos Sucesores, S. A. v Hearthside Baking Co. 22 Northwestern Journal of
International Law and Business (2002) 121 (152) (Pace); Gotanda, Awarding Damages under the United
Nations Convention on the International Sale of Goods: A Matter of Interpretation, 37 Georgetown
Journal of International Law (2005) 95 (131 et seq.) (Pace); Keily, How Does the Cookie Crumble? Legal
Costs under a Uniform Interpretation of the United Nations Convention on Contracts for the Interna-
tional Sale of Goods, Nordic Journal of Commercial Law of the University of Turku (2003), § 6.2(c) et
seq. (Pace); Mullis, Twenty-Five Years On – The United Kingdom, Damages and the Vienna Sales
Convention, 71 RabelsZ (2007) 35 (44 et seq.) (Pace).
118 See supra footnotes 108–111.
119 Piltz, Litigation Costs as Eeimbursable Damages in DiMatteo, International Sales Law – A global
Challenge (2014), pp. 286 et seq; Diener, Recovering Attorneys’ Fess under CISG: An Interpretation of
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majority of the awards and judgments where the CISG was applied is in line with the
former standpoint given that the recovery of attorneys’ fees was almost always
required and awarded on the basis of the procedural law of the forum.120
43 In this author’s opinion, the issue is excluded from the CISG ambit since it does not
constitute a loss suffered by the aggrieved party ‘as a consequence of the breach’ but
rather as a consequence of litigation (arbitration). The difference results from the nature
of litigation itself, since its initiation (filing a claim in the court and delivering the claim
to the defendant) transforms the two-party relationship, i. e. a sales contract (buyer-
seller), into a three party relationship, i. e. litigation (plaintiff-court/arbitration tribunal-
defendant). Hence, the legal basis for the recovery of attorneys’ fees incurred in
litigation is in the litigation itself and not in the breach of the contract which was the
reason for initiating the proceedings.121 Consequently, it is fair to say that both parties
have suffered financially as a result of litigation, and not necessarily as a result of the
breach – since these expenses are incurred even if the court finds that there has been no
breach of contract. In other words, they can exist independently from the breach.
Furthermore, the amount of the incurred expenses will depend not only on the
behaviour of the breaching party but also on the extent of the court’s orders and
instructions. This makes the causal link between the breach and this type of loss
interrupted. Consequently, it is submitted that once the proceedings are instituted, the
incurred attorneys’ fees become a loss that is too distinct from the usual loss suffered as
a consequence of breach of contract thus not allowing for its recovery under the CISG.
Hence, the application of general principles of the CISG to resolve the issue is not
warranted and the relevant solution should be found in the otherwise applicable
domestic law.
44 g) Interest rate on sums in arrears. The question of an applicable interest rate
naturally arises in any dispute over an international sales contract. However, while the
entitlement to interest of the creditor is made clear in Art. 78, there is no relevant provision
that fixes the applicable interest rate in the Convention.122 Consequently, a wide variety of
different solutions to this question has been suggested in both legal doctrine and case law.
Article 74, Nordic Journal of Commercial Law (2008) note 45; Felemegas, An Interpretation of Article 74
CISG by the U. S. Circuit Court of Appeals, 15 Pace International Law Review (2003) 91 (Pace); Zeller,
Damages under the Convention on Contracts for the International Sale of Goods (2005), pp. 143 et seq.
120 There are more than 2,500 cases from 45 jurisdictions available at the Pace database. Yet, to the best
of our knowledge, less than ten invoke Art. 74 CISG as the applicable law for the issue of recovery of
attorneys’ fees (merely 0.4 % of all reported cases). See: Rechtbank van Koophandel Hasselt (Belgium)
25 February 2004, K BVBA v BV, CISG-Online 831 (Pace); Court of Appeal in Turku (Finland) 12 April
2002 (Forestry equipment), CISG-Online 660 (Pace); Arbitral Award (CIETAC) 11 February 2000,
(Silicon metal), CISG-Online 1529 (Pace); Arbitral Award, (CIETAC) 12 February 1999, (Nickel plating
machine production line equipment case), CISG-Online 1113 (Pace); Amtsgericht Berlin-Tiergarten
(Germany) 13 March 1997, CISG-Online 412 (Pace); Arbitral Award (Schiedsgericht der Handelskammer
Hamburg) 21 March 1996 (Chinese goods), CISG-Online 187 (Pace); Arbitral Award, CIETAC, 14 May
1996 (Down coat), CISG-Online 1125 (Pace); Amtsgericht Augsburg (Germany) 29 January 1996 (Shoe
case), CISG-Online 172 (Pace), Arbitral Award, ICC 7585, 1 January 1992 (Foamed board machinery),
CISG-Online 105 (Pace). For criticism of some of these decisions see: Flechtner, Recovering Attorneys’
Fees as Damages under the UN Sales Convention: A Case Study on the New International Commercial
Practice and the Role of Case Law in CISG Jurisprudence, with Comments on Zapata Hermanos
Sucesores, S. A. v Hearthside Baking Co., 22 Northwestern Journal of International Law and Business
(2002) 121 (127 et seq.) (Pace).
121 Such an understanding of the legal nature of attorneys’ fees seems universal since none of the
national legal systems (both the ‘American rule’ and ‘English rule’ jurisdictions) treat the issue of
recovery of attorneys’ fees as one governed by the damages provisions. See Djordjevic, ‘Mexican
Revolution’ in CISG Jurisprudence and Case-law: Attorney’s Fees as (Non)recoverable Loss for Breach
of Contract, FS Christa Jessel Holst (2010), footnote 7 (Pace).
122 See Commentary on Art. 78 paras 15, 19–28.
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Some find this question as not being governed, i. e. excluded from the CISG, hence they
directly search for an answer in the otherwise applicable law. Some find it governed, but not
expressly settled in the Convention – thus they apply different general principles to resolve
the issue or, in the absence of those, apply the otherwise applicable law. Finally, some look
at international usages in answering this question.123 The issue is further complicated by the
fact that scholars who advocate for a same approach (e. g. exclusion form the CISG)
propose different solutions to the matter.124
In this author’s opinion, despite the fact that the Contracting States have consciously 45
left a gap concerning the rate of interest,125 this question should not be deemed excluded
from the CISG since the issue of entitlement to interest is explicitly governed by the
Convention. Consequently, the applicable interest rate, being an issue naturally tied to
the issue of interest (such as the time of accrual of interest, or the formalities needed to
exercise this right), should be considered as a matter governed by but not expressly settled
in the Convention and should be resolved by application of the CISG general principles.126
This is the only approach that enables fostering the CISG goal of uniformity in
its interpretation and certainty and predictability in international trade transactions;
goals which can successfully be met by a combined application of the principle of full
compensation and the principle of prohibiting overcompensation (windfall) of the cred-
itor.127 Determining the applicable interest rate in such a manner preserves the system of
123 For an extensive overview of these diverging approaches see: CISG-AC Opinion no 14; Behr, The Sales
Convention in Europe: From Problems in Drafting to Problems in Practice, 17 Journal of Law and Commerce
(1998) 263 (Pace); Chengwei, Recovery of Interest, 1 Nordic Journal of Commercial Law of the University of
Turku (2003) (Pace); Corterier, Interest in Uniform Application – How to Solve the UN Sales Law’s Interest
Rate Problem Under Article 78 CISG and Article 84 CISG, Review of the Convention on Contracts for the
International Sale of Goods (2002–2003) 1 (2004) (Pace); Ferrari, Uniform Application and Interest Rates
Under the 1980 Vienna Sales Convention, Cornell Review of the Convention on Contracts for the Interna-
tional Sale of Goods (1995) 3 (Pace); Garbers, The Dogmatic and Practical Implications of Article 78 of the
United Nations Convention on Contracts for the International Sale of Goods on Claims for Interest under
International Sales Contracts (2003) (Pace); Kizer, Minding the gap: Determining interest rates under the UN
Convention for the International Sale of Goods, 65 University of Chicago Law Review (1998) 1279 (Pace);
Mazzotta, CISG Article 78: Endless Disagreement Among Commentators, Much Less Among the Courts
(2004) (Pace); Pavic/Djordjevic, Application of the CISG Before the Foreign Trade Court of Arbitration at
the Serbian Chamber of Commerce -Looking Back at the Latest 100 Cases, 28 Journal of Law and
Commerce (2009) 1 (51 et seq.); Thiele, Interest on Damages and Rate of Interest Under Article 78 of the
U. N. Convention on Contracts for the International Sale of Goods, 2 Vindobona Journal of International
Commercial Law and Arbitration (1998) 3 (Pace); Zoccolillo, Determination of Interest Rate Under the 1980
United Nations Convention on Contracts for the International Sale of Goods: General Principles vs. National
Law, 1 Vindobona Journal of International Commercial Law and Arbitration (1997) 3 (Pace).
124 Amongst those who prefer application of national law to the issue propose application of lex causae,
others the law of debtor’s seat, the law of the seller’s country, the law of the country of the currency, or
the law of the place of performance; amongst those favouring uniform determination of interest rate
based on CISG general principles, some use the principle of full compensation, while others resort to the
principle of full restitution. See footnote 122 supra.
125 See Commentary on Art. 78 paras 2–3.
126 The CISG Advisory Council also advocates for determining a relevant interest rate under both
Art. 78 and Art. 84(1) (albeit with a different purpose and thus in a different manner) by recourse to
general principles underlying the Convention. See CISG-AC Opinion no 9, para. 3.25; CISG-AC Opinion
no 14.
127 See Gotanda, When Recessions Create Windfalls: The Problems of Using Domestic Law to Fix
Interest Rates under Article 78 CISG, 13 Vindobona Journal of International Commercial Law and
Arbitration (2009) 229 (236 et seq.); Pavic/Djordjevic, Application of the CISG Before the Foreign Trade
Court of Arbitration at the Serbian Chamber of Commerce – Looking Back at the Latest 100 Cases, 28
Journal of Law and Commerce (2009) 1 (59); Arbitral Award (Foreign Trade Court of Arbitration
attached to the Serbian Chamber of Commerce) 28 January 2009 (Medicaments), CISG-Online 1856
(Pace). For the principle of full compensation and principle of windfall prevention as the CISG general
principles see: CISG-AC Opinion no 8.
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remedies set by the Convention (damages and interest as separate remedies) whilst not
making the damages provisions redundant (as they would had been had the interest
amounted at all times to the full amount of loss, a result that would be reached by
application of the principle of full compensation exclusively) and not jeopardizing the
compensatory nature of interest (as the principle of full restitution does).128 In concreto,
the proposed solution usually entails the application of the savings rate for the currency in
the creditor’s place of business (or the place for payment). With similar considerations in
mind, aiming to compensate the time value of money for the creditor whilst not exposing
the debtor to unpredictable solutions, an alternative approach might be used. This
approach, advocated by the CISG Advisory Council, is also focused on the creditor’s place
of business and results in application of the laws of the country where creditor has its place
of business.129
46 h) Other issues. The CISG does not govern the assignment of claims,130 assign-
ment of contracts,131 assumption of debts,132 the acknowledgment of debts133
and the admission of liability.134 Likewise, the CISG does not contain the
rules on seniority of payments,135 currency of payment136 and the manner of pay-
128 The purpose of interest is to compensate an aggrieved party for the loss of the use of money. See
Gotanda, Supplemental Damages in Private International Law (1998), p. 14.

130 Handelsgericht des Kantons Aargau (Switzerland) 26 November 2008 (Fruit and vegetables), CISG-
Online 1739 (Pace); District Court Trnava (Slovak Republic) 17 September 2008 (Chicken products),
CISG-Online 1991 (Pace); Arbitral Award, Foreign Trade Court of Arbitration attached to the Serbian
Chamber of Commerce, 15 September 2008 (Feta cheese), CISG-Online 2269 (Pace); Oberlandesgericht
Hamburg (Germany) 25 January 2008 (Café inventory), CISG-Online 1681 (Pace); Tribunal Cantonal du
Valais (Switzerland) 23 May 2006 (Suits), CISG-Online 1532 (Pace); Tribunale di Padova (Italy)
25 February 2004 (Agricultural products), CISG-Online 819 (Pace); Supreme Court (Poland) 19 Decem-
ber 2003, “O. O.” AG in M. v Leszek W. & Zbigniew W., CISG-Online 1222 (Pace); Oberster Gerichtshof
(Austria) 7 September 2000 (Tombstones), CISG-Online 642 (Pace); Tribunale di Vigevano (Italy) 12 July
2000, Rheinland Versicherungen v Atlarex, CISG-Online 493 (Pace); Rechtbank Arnhem (Netherlands)
8 April 1999, CISG-Online 1339; Oberster Gerichtshof (Austria) 25 June 1998, CISG-Online 352 (Pace);
Bundesgerichtshof (Germany) 12 February 1998 (Air cleaning installation), CISG-Online 343 (Pace);
Obergericht des Kantons Thurgau (Switzerland) 19 December 1995 (Cloth), CISG-Online 496 (Pace);
Cour d’appel de Grenoble (France) 13 September 1995, Caito Roger v Société française de factoring, CISG-
Online 157 (Pace); Oberlandesgericht Hamm (Germany) 8 February 1995 (Socks), CISG-Online 141
(Pace); Bezirksgericht Arbon (Switzerland) 9 December 1994 (Cloth), CISG-Online 376 (Pace).
131 Bundesgerichtshof (Germany) 15 February 1995 (Key press machine), CISG-Online 149 (Pace).
132 Regional Court Kosice (Slovak Republic) 22 May 2007 (Plastic bottles) CISG-Online 1898 (Pace);
Landgericht Heidelberg (Germany) 2 November 2005 (Natural stones), CISG-Online 1416 (Pace); Ober-
ster Gerichtshof (Austria) 24 April 1997 (Processing plant), CISG-Online 291 (Pace).
133 Bundesgericht (Switzerland) 17 October 2000, Severin Wagner AG v Günter Lieber, CISG-Online
1053 (Pace); Oberlandesgericht Hamm (Germany) 23 June 1998 (Furniture), CISG-Online 434 (Pace).
134 Bundesgerichtshof (Germany) 9 January 2002 (Powdered milk), CISG-Online 651.
135 Magnus, Die allgemeinen Grundsätze im UN-Kaufrecht, 59 RabelsZ (1995) 485 (footnote 94 et seq.)
(Pace).
136 Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2004), p. 109; Schlechtriem, in:
Schlechtriem/Schwenzer, Commentary (2005), Art. 4 para. 23; Tribunal Cantonal du Valais (Switzerland)
28 January 2009 (Fiberglass composite materials), CISG-Online 2025 (Pace); Cámara Nacional de
Apelaciones en lo Commercial de Buenos Aires (Sala A) (Argentina) 31 May 2007, Sr. Carlos Manuel del
Corazón de Jesús Bravo Barros v Salvador Martı́nez Gares, CISG-Online 1517 (Pace); Tribunal Cantonal
du Valais (Switzerland) 27 April 2007 (Oven), CISG-Online 1721 (Pace); Tribunal Cantonal du Valais
(Switzerland) 23 May 2006 (Suits), CISG-Online 1532 (Pace); Tribunal Cantonal du Valais (Switzerland)
27 May 2005 (Welding devices), CISG-Online 1137 (Pace); Tribunal Cantonal Valais (Switzerland)
19 September 2005 (Fiberglass composite materials), (Pace); Juzgado Commercial Buenos Aires (Argen-
tina) 17 March 2003, Wacker-Polymer Systems GmbH v Quiebra v Glaube S. A. et al., CISG-Online 1844
(Pace); Oberster Gerichtshof (Austria) 22 October 2001 (Gasoline and gas oil), CISG-Online 614 (Pace);
Handelsgericht des Kantons Zürich (Switzerland) 30 November 1998 (Lambskin coat), CISG-Online 415
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ment.137 It also does not regulate the right of retention,138 right of lien,139 punitive
damages,140 injunctive reliefs,141 validity of limitation of liability clauses142 or disclaimer
of liability clauses,143 novation144 and the validity of settlement agreements.145 Hence, to all
these issues the otherwise applicable law or rules of law should be applied.146 On the other
hand, the issue of estoppel is a matter covered by the CISG as an expression of the good
faith principle or venire contra factum proprium,147 and recourse to domestic law should be
excluded.

The PICC and the PECL do not contain a comparable provision. Rather, relevant 47
provisions limiting the scope of the PICC with respect to a certain matter are included
in chapters or sections dealing with such matters. In any event, since the intended scope
(Pace); Tribunal Cantonal du Valais (Switzerland) 30 June 1998 (Granite stones), CISG-Online 419
(Pace); Oberlandesgericht Frankfurt am Main (Germany) 20 April 1994 (New Zealand mussels), CISG-
Online 125 (Pace). In one case the court considered currency of payment as an issue governed but not
expressly settled in the Convention. Yet, in the absence of general principles that would govern the issue it
applied the otherwise applicable domestic law – that lead it to the same result – application of currency at
the seller’s place of business. See Landgericht Berlin (Germany) 24 March 1998 (Knitwear), CISG-Online
742 (Pace). The minority view deems the issue governed by the relevant general principle that in case of
doubt payment of the purchase price has to be made in the currency at the creditor’s place of business.
See Magnus, Die allgemeinen Grundsätze im UN-Kaufrecht, 59 RabelsZ (1995) 485 (footnote 82) (Pace);
Kammergericht Berlin (Germany) 24 January 1994 (Wine), CISG-Online 130 (Pace).
137 Tribunal Cantonal du Valais (Switzerland) 23 May 2006 (Suits), CISG-Online 1532 (Pace); Hof van
Beroep, Gent (Belgium) 31 January 2002, CISG-Online 1349.

138 Oberlandesgericht Stuttgart (Germany) 20 December 2004 (Decorative paper), CISG-Online 997
(Pace).
139 District Court, Eastern District Michigan (U.S.) 28 September 2007 (Sport bar assembly system),
Easom Automation Systems, Inc. v. Thyssenkrupp Fabco, Corp., CISG-Online 1601 (Pace).
140 Federal District Court, SD of New York (U.S.) 30 March 2010, Guangxi Nanning Baiyang Food
Co. Ltd. v Long River International, Inc., CISG-Online 2091 (Pace).

141 Oberster Gerichtshof (Austria) 28 July 1999 (Pipes), CISG-Online 2021 (Pace).
142 District Court for the Middle District of Tennessee, Nashville Division (U.S.) 18 July 2011, MSS, Inc.
v. Maser Corporation, CISG-Online 2222 (Pace) (the enforceability of the limitations on consequential
damages provision was upheld under domestic law); Cour de Cassation (France) 13 February 2007, CISG-
Online 1561; Arbitral Award CIETAC CISG/2000/17 (Souvenir coins) CISG-Online 1614 (Pace) (the
clause was found reasonable and valid under domestic law).
143 District Court for the Western District of Pennsylvania (U.S.) 25 July 2008 (Locomotives), Norfolk
Southern Railway Company v. Power Source Supply, Inc., CISG-Online 1776 (Pace) (disclaimer of
liability was found to be valid under domestic law); Cour de Cassation (France) 13 February 2007,
CISG-Online 1561.
144 Arbitral Award, ICC 7331, 1 January 1994 (Cowhides), CISG-Online 106 (Pace).
145 Landgericht Aachen (Germany) 14 May 1993 (Electronic hearing aid), CISG-Online 86 (Pace).
146 CISG Advisory Council has recently advocated that even where the provisions of the domestic law
are applied on protection of the obligee, the international character of the contract and the general
principles underlying the CISG should be observed, including the principles of freedom of contract and
reasonableness. See CISG-AC Opinion no 17.
147 Eiselen/Kritzer, in: Kritzer/Vanto/Vanto/Eiselen, International Contract Manual, Vol. 4 § 84:33(f);
Ferrari, Implementations of the Convention on Contracts for the International Sale of Goods (CISG), 7
International Business Law Journal (1998) 835 (838); Oberlandesgericht Karlsruhe (Germany) 25 June
1997 (Surface protective film), CISG-Online 263 (Pace); Arbitral Award (Internationales Schiedsgericht
der Bundeskammer der gewerblichen Wirtschaft in Österreich), SCH-4318, 15 June 1994, CISG-Online
120 (Pace); Arbitral Award (Internationales Schiedsgericht der Bundeskammer der gewerblichen
Wirtschaft in Österreich), SCH-4366, 15 June 1994, CISG-Online 691; Gerechtshof ‘s Hertogenbosch
(Netherlands) 26 February 1992, Melody v Loffredo, h. o. d. n. Olympic, CISG-Online 65 (Pace). Cf.
Arrondissementsrechtbank Amsterdam (Netherlands) 5 October 1994, Tuzzi Trend Tex Fashion v Keijer-
Somers, CISG-Online 446 (Pace).
Djordjević 89
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of application of these documents is much wider than the intended scope of the CISG,
the important parallels cannot be drawn by comparing the abovementioned articles
with Art. 4 CISG.
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Article 5
This Convention does not apply to the liability of the seller for death or personal
injury caused by the goods to any person.
Bibliography: Lookofsky, In Dubio Pro Conventione? Some Thoughts about Opt-outs, Computer
Programs and Preëmption Under the 1980 Vienna Sales Convention (CISG), 13 Duke Journal of
Comparative and International Law (2003) 263; Schlechtriem, The Borderland of Tort and Contract –
Opening a New Frontier?, 21 Cornell International Law Journal (1988) 467; Zeller, CISG and the
Unification of International Trade Law (2007), p. 64; CISG-AC Opinion no 12, Liability of the Seller for
Damages Arising out of Personal Injuries and Property Damage Caused by Goods and Services Under
the CISG, 20 January 2013, Rapporteur: Professor Hiroo Sono, School of Law, Hokkaido University,
Sapporo, Japan; CISG-AC Opinion no 6, Calculation of Damages under CISG Article 74, 2006,
Rapporteur: Professor John Y. Gotanda, Villanova University School of Law, Villanova, Pennsylvania,
USA.
Outline
1. General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
2. Drafting History . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
1. Death or personal injury caused by the goods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
2. Death or personal injury caused by other means . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
3. Death or personal injury of third parties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
a) Claims advanced by third parties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
b) Claims advanced by the buyer to be indemnified . . . . . . . . . . . . . . . . . . . . . . . 10
4. Liability for property damage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
5. Concurrent remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
1. General
The CISG provides the buyer with the right to claim damages for any foreseeable loss 1
suffered as a result of the seller’s breach of contract, including (but not limited to) the
delivery of non-conforming goods (Arts 45(1)(b), 74).1 Art. 5, on the other hand,
effectively excludes from the scope of the Convention certain claims for damages arising
out of non-contractual product liability (e. g. loss arising from defective goods).2 For
claims of this nature, domestic law will apply instead.3
Under the CISG, this concept of product liability refers expressly and solely to 2
liability for death or personal injury caused by the goods. Claims for property damage
do not fall under the Art. 5 exclusion and are thus actionable under the Convention.
Furthermore, it is clear that product liability under the CISG does not refer to
claims arising outside the buyer/seller contractual relationship and consumer claims
1
CISG-AC Opinion no 12, para. 1.1.
2
Schlechtriem, Uniform Sales Law – The UN-Convention on Contracts for the International Sale of
Goods (1986) p. 33; Khoo in: Bianca/Bonell, Commentary (1987), Art. 5 para. 2.3; Enderlein/Maskow,
International Sales Law (1992), p. 45.
3 CISG-AC Opinion no 12, para. 1.2
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against manufacturers, producers and the like (Arts 2(a), 4).4 Although this clear core
principle5 of Art. 5 has failed to attract significant scholarly writing and case law, there
has been an argument as to whether it applies to buyer’s claims to be indemnified for
personal injury suffered by his customers and the extent to which the CISG pre-empts
domestic law when concurrent remedies may be available.
2. Drafting History
3 Art. 5 has no predecessor in the ULIS,6 however, it has been suggested that to the
extent that product liability is characterized as non-contractual, its exclusion from the
ULIS was understood as an unwritten rule.7
4 The actual text of Art. 5 was not submitted until the 1980 Vienna Conference in a
proposal of the US delegation,8 which was subsequently consolidated in a joint proposal
with Finland and France.9 The reason given for the inclusion of this text was to ensure
that “complex” domestic product liability rules would not be displaced by the Conven-
tion.10 Despite considerations for a more extensive provision, as initially proposed by
the Finish representative,11 to exclude liability for damage caused by the goods to the
goods or other property, the framers of the CISG chose to omit unqualified references
to ‘product liability’ generally and ‘property damage’ explicitly due to lack of consensus
among the delegates.12 In this sense, property damage has been implicitly excluded from
the scope of Art. 5.

1. Death or personal injury caused by the goods
5 Regardless of whether domestic product liability rules apply in a particular case,13
Art. 5 completely excludes liability for death or personal injury of the buyer caused by
the goods from the scope of the CISG. This includes all pecuniary and non-pecuniary
4 See discussion in the Honnold, Documentary History (1989), pp. 466–467; Winship, Changing
Contract Practices in the Light of the United Nations Sales Convention: A Guide for Practitioners, 29
International Lawyer (1995) 525 (excerpt on ‘Products Liability Claims’) (Pace).
6 Schwenzer/Hachem, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 5 para. 1; Honnold/Flecht-
ner, Commentary (2009), Art. 5 para. 71 footnote 1; Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and
Beyond (2003), p. 102.
Goods (1986) p. 33.

8 A/CONF.97/C.1/L.4. See Honnold, Documentary History (1989), pp. 393, 657. CISG-AC Opinion no
12, para. 2.1.3.

9 A/CONF.97/C.1/L.51. See Honnold, Documentary History (1989), pp. 393, 657. CISG-AC Opinion no
12, para. 2.1.3.

10 Schwenzer/Hachem, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 5 para. 1; Khoo in:
Bianca/Bonell, Commentary (1987), Art. 5 para. 2.1; Schlechtriem, Uniform Sales Law – The UN-
Convention on Contracts for the International Sale of Goods (1986) p. 33. CISG-AC Opinion no 12,
para. 2.1.4. See also, Schlechtriem, Requirements of Application and Sphere of Applicability of the CISG,
36 Victoria University of Wellington Law Review (2005) 781 (792) who notes that the drafters of the
CISG did not want to interfere with the general products liability issue that had emerged in the 1960 s and
established new rules of strict liability.
11 A/CONF.97/C.1/L.21. See Honnold, Documentary History (1989), pp. 393, 657. This extension was
indeed supported by many of the representatives at the Diplomatic Conference including the UK,
Denmark, the German Democratic Republic, Norway and Egypt. See Honnold, Documentary History
(1989), pp. 466–467.
12 Honnold, Documentary History (1989), pp. 466–467.
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damages flowing from the death or personal injury, including medical expenses, loss of
earnings, pain and suffering, loss of faculty and amenity. All such claims must be
brought under the appropriate domestic law which will be determined by private
international law rules in accordance with Art. 7.14 Claims for loss of profit or damage
to property caused by the same goods, however, will be governed by the CISG.15
As domestic law will exclusively govern claims based on death and personal injury, 6
the requirements stipulated in the CISG normally necessary for the enforcement of
claims for damages will also be excluded.16 Thus, although it is normally necessary for
the buyer to give notice of non-conformity within a reasonable time or in any event
within two years in order to claim damages for defective goods (Art. 39), the fact that
notice was not given would not necessarily preclude the buyer from claiming damages
for personal injury under domestic law. In this case, limitations such as notice
requirements, are regulated by domestic law, not the CISG.
2. Death or personal injury caused by other means

Although Art. 5 provides that the Convention will not apply to the liability of the 7
seller for death or personal injury ‘caused by the good’, this does not mean that personal
injury arising from the provision of labour or other ancilliary services, such as in the
course of delivering the goods, falls within the scope of the CISG. The essence of Art. 5
is to remove from the sphere of application the complex area of the law dealing with
product liability17 and and to leave the recovery of personal injury to domestic law.18 As
the CISG Advisory Council notes that there is no reason to make a distinction between
defective services and defective goods.19
3. Death or personal injury of third parties

Although it has been argued that Art. 5 should apply regardless of whether the 8
personal injury was to the buyer himself, his employees, his customers or third parties,20
this has been held to be not necessarily so.21
a) Claims advanced by third parties. It is unquestionable that claims advanced by 9
persons who are not party to a CISG contract will not be governed by the CISG.22 Thus,
any third party to which the original goods have been re-sold to will have no claim
against the original seller under the CISG. This is a natural conclusion in light of
Art. 4.23 The same can also be said for product liability claims from the employees of the
buyer24 and, pursuant to Art. 2(a), of product liability claims brought by consumers
against manufacturers and producers, irrespective of whether or not they purchase
directly from the manufacturer.
14CISG-AC Opinion no 12, para. 2.1.1.

15CISG-AC Opinion no 12, para. 2.1.1.
16 Khoo in: Bianca/Bonell, Commentary (1987), Art. 5 para. 2.3.
17 Khoo in: Bianca/Bonell, Commentary (1987), Art. 5 para. 2.1.
18 CISG-AC Opinion no 12, para. 2.2.2.
21 See Oberlandesgericht Düsseldorf (Germany) 2 July 1993 (Veneer cutting machine), CISG-Online 74
(Pace), discussed at para. 12.

23 Lookofsky, The 1980 United Nations Convention on Contracts for the International Sale of Goods,
in: Herbots/Blanpain, International Encyclopaedia of Laws – Contracts (2000), Art. 5 para. 67; Schwenzer/
Hachem, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 5 para. 4.
24 Honnold/Flechtner in: Commentary (2009), Art. 5 para. 71.
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10 b) Claims advanced by the buyer to be indemnified. As Art. 5 is perhaps “unfortu-
nately worded”,25 opinion is divided as to whether liability to indemnify the buyer for
the death or personal injury of third parties caused by the goods (and in particular
defective goods) is also excluded. One view is that the text of Art. 5 (‘to any person’)
should be given an all-inclusive interpretation to the effect that, as a third party is ‘any
person,’ the buyer’s claims for indemnification should also be excluded from the scope
of the Convention and be governed by the applicable domestic law. In other words, this
view excludes outright all claims arising from personal injury before considering the
kind of loss the buyer is claiming damages for. This all-inclusive interpretation appears
to be in accord with the legislative intent of the Convention26 and has received support
from the majority of commentators.27 Proponents argue that allowing the buyer to
claim his customers’ injuries as damages of his own would lead to an undesirable
collision of product liability with sales law remedies under the CISG.28 They further add
that if such claims fall within the ambit of the CISG, in some cases, the buyer would be
prevented from making claims against the seller if the injury did not arise until after the
period for making claims for non-conforming goods under the CISG had already past
(see Art. 39).29 This is a general question of whether the CISG pre-empts domestic
product liability law and will be discussed in detail below (infra paras 18 et seq.).
11 The alternative view is that the buyer is merely seeking to recover the economic loss
of having to compensate his customers rather than trying to hold the seller liable for
death or personal injury. In this sense, the buyer’s claim should be understood as one of
consequential loss covered by Art. 74 and not excluded by Art. 5.30 This view was
adopted in one of the few reported cases on Art. 5 in what has been heralded by one
commentator as a “gratifying” and “sensible commercial interpretation”31 by the Ger-
man court.32 Although the court made no direct reference to Art. 5, it did rule that a
25Fawcett/Harris/Bridge, International Sale of Goods in the Conflict of Laws (2005), p. 951.

26See Honnold, Documentary History (1989), p. 644 for comments by Mr. Plantard (France) explain-
ing that the “words [‘to any person’] had been introduced in deference to the wishes of certain
delegations in order to clarify the meaning of the provisions of [the] article … on the question of a
claim by one of the parties to the contract against the other resulting from a claim against the former
asserted by a third party.”
Goods (1986) p. 33; Khoo in: Bianca/Bonell, Commentary (1987), Art. 5 para. 2.2; Enderlein/Maskow,
International Sales Law (1992), p. 45; Lookofsky, The 1980 United Nations Convention on Contracts for
the International Sale of Goods, in: Herbots/Blanpain, International Encyclopaedia of Laws – Contracts
(2000), Art. 5 para. 67; Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 103;
Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 5 para. 7; Huber, Some introductory
remarks on the CISG, 6 Internationales Handelsrecht (2006) 228 (232) (Pace); Kashiwagi, in: Sugiura/
Kubota (eds), Wein baibai jouyaku no jitsumu kaisetsu (Practical Commentary on the Vienna Sales
Convention) (2009), p. 20; Schlechtriem/Butler, CISG (2009), para. 39.
28 Schlechtriem, Commentary on Oberlandesgericht Düsseldorf 2 July 1993 (Pace).
Goods (1986) p. 33; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 5 para. 7.
30 In support of this view see: Lookofsky, In Dubio Pro Conventione? Some Thoughts about Opt-outs,
Computer Programs and Preëmption Under the 1980 Vienna Sales Convention (CISG), 13 Duke Journal
of Comparative and International Law (2003) 263 (287); Fawcett/Harris/Bridge, International Sale of
Goods in the Conflict of Laws (2005), p. 952; Schwenzer/Hachem, in: Schlechtriem/Schwenzer, Commen-
tary (2016), Art. 5 paras 8–10 and Art. 74 para. 14.
31 Bridge, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 246; cf critics of this decision,
Karollus, Judicial Interpretation and Application of the CISG in Germany 1988–1994, Cornell Review of
the Convention on Contracts for the International Sale of Goods (1995) p. 58; Ferrari, in: Ferrari/
Flechtner/Brand, Draft Digest and Beyond (2003), p. 103; Schlechtriem, Commentary on Oberlandesger-
icht Düsseldorf 2 July 1993 (Pace).
32 Oberlandesgericht Düsseldorf (Germany) 2 July 1993 (Veneer cutting machine), CISG-Online 74
(Pace).
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German buyer’s claim to be indemnified for liabilities to his customers (namely, a
Russian sub-purchaser whose employees suffered death and personal injury due to a
faulty cutting machine) is governed by the CISG and allowed for compensation under
Arts 45, 74.
In this author’s opinion, the alternative view is preferred.33 Although the legislative 12
history suggests a literal interpretation of Art. 5, too much emphasis on this should be
avoided. It is suggested that adopting a literal interpretation of Art. 5 runs contrary to
the observance of the international character of the CISG and promotion of uniformity
that the Convention seeks to attain in international trade (Art. 7(1)). Fawcett/Harris/
Bridge elucidate this contravention by noting that treating a buyer’s claim to be
indemnified for the death or personal injury of his customers caused by defective goods
as a matter of domestic law and dealing with claims for recovery or price reduction that
arise from the same defective goods separately under the CISG “would lead to an untidy
dépeçage” in respect of the buyer’s claims against the seller.34
Instead, “a dynamic and progressive approach to the interpretation of the Conven- 13
tion should be taken into consideration, particularly catering to developments of
international trade law.”35 This can be done by adopting a practical approach to the
interpretation of Art. 5 and first determining the kind of loss the buyer is claiming for.
While it is true that the origin of the buyer’s claim for indemnification is personal
injury, the actual claim, however, is one of “balance sheet loss”36 or consequential
economic loss stemming from having to compensate his customers.37 In order to ensure
the uniform application of the CISG, this consequential loss should be treated as every
other consequential loss arising from CISG contracts.38 In other words, there should be
no difference in the way the CISG handles this consequential loss than from one flowing
from damage to the property of the buyer’s customers, which, as discussed below, is not
necessarily excluded from the CISG.39 Such a distinction would be illogical40 and
deprive the buyer of the opportunity of full compensation under the CISG, a general
principle which must not be overlooked when interpreting its provisions (Art. 7(2)).41
4. Liability for property damage

Art. 5 does not exclude a seller’s liability for property damage from the scope of the 14
Convention.42 Thus, with respect to property damage, instead of resorting to the
33
See also CISG-AC Opinion no 12, para. 2.3.2, which also agrees with this approach.
34
Fawcett/Harris/Bridge, International Sale of Goods in the Conflict of Laws (2005), p. 951; see also
Zeller, CISG and the Unification of International Trade Law (2007), p. 68. Cf. Schlechtriem, in:
Schlechtriem/Schwenzer, Commentary (2005), Art. 5 para. 7 who argues that a dépeçage in this case is
“reasonable and appropriate”.
35 See supra Art. 7 para. 36 (or to be replaced with the second edition – this commentary – if the text
has changed).
36 Bridge, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 246. CISG-AC Opinion no
12, para. 2.3.2.

37 Schwenzer/Hachem, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 5 paras 8–10. Fawcett/
Harris/Bridge, International Sale of Goods in the Conflict of Laws (2005), p. 952.

39 Fawcett/Harris/Bridge, International Sale of Goods in the Conflict of Laws (2005), p. 952.
40 Zeller, CISG and the Unification of International Trade Law (2007), p. 67.
41 On this point see Zeller, CISG and the Unification of International Trade Law (2007), pp. 66–68.
42 For case law recognition see: Handelsgericht Zürich (Switzerland) 26 April 1995 (Saltwater isolation
tank), CISG-Online 248 (Pace). For recognition among commentators see for example: Schlechtriem,
Uniform Sales Law – The UN-Convention on Contracts for the International Sale of Goods (1986) p. 34;
Khoo in: Bianca/Bonell, Commentary (1987), Art. 5 para. 3.2; Enderlein/Maskow, International Sales Law
(1992), p. 46; Lookofsky, In Dubio Pro Conventione? Some Thoughts about Opt-outs, Computer
Programs and Preëmption Under the 1980 Vienna Sales Convention (CISG), 13 Duke Journal of
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applicable domestic law, buyers must claim for damages under the CISG pursuant to
Arts 45(1)(b) and 74, subject to limitations such as foreseeability and notification
requirements (Arts 38, 39).43 As discussed below (infra paras 18 et seq.), a buyer will
not be able to claim for damages under a more lenient national law, if for example he
cannot meet these requirements.
15 In the assessment of what property damage will be actionable under the CISG,
reference should be made to the buyer/seller contractual relationship. In this sense,
property damage will include not only damage to the buyer’s property, but also
damage to the goods themselves and damage to property to which the goods are
combined, commingled or processed with in the normal course of business or use.44 It
will not necessarily include damage to property that is not ‘caused by the goods’. As
discussed above (supra paras 7–8), an assessment will need to be made on a case-by-
case basis whether loss of this nature can be said to have arisen from the buyer/seller
contractual relationship.45 This approach was followed by the Commercial Court in
Zurich, where the buyer sued for water damage due to a leaky saltwater isolation tank
and damage to the buyer’s staircase, which occurred as a result of the inaccurate
transport of the tank.46 Along with recognising the right to claim for the water
damage,47 the court found the damage to the buyer’s staircase to be contractual in
nature and within the scope of the CISG because the contract included “delivery of the
tank and installation”.48 Where defective goods give rise to both property damage and
personal injury of the buyer, it has been suggested that the CISG will govern liability
for the former, but not the latter.49
16 With respect to damage to the property of third parties, Art. 4 excludes claims
brought by third parties who are not party to the CISG contract. Claims brought by a
buyer seeking to recover the economic loss of having to compensate his customers for
property damage caused by the goods will, on the other hand, be actionable under the
CISG as this is recognised as a consequential loss flowing from the breach of contract
(Art. 74).50 Thus, for example, a buyer of ‘removable’ protective film used to protect his
products during transport may recover the economic loss of having to reimburse his
customer’s expenditures in cleaning an adhesive residue left after the faulty film is
removed.51
Comparative and International Law (2003) 263 (287); Schlechtriem/Butler, CISG (2009), para. 40;
Schwenzer/Hachem, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 5 para. 2; see also CISG-AC
Opinion no 12, para. 3.1.1.
43 This lack of notice was detrimental to the buyers claim under the CISG in Handelsgericht Zürich
(Switzerland) 26 April 1995 (Saltwater isolation tank), CISG-Online 248 (Pace).

44 This view is also endorsed by CISG-AC Opinion no 12, para. 3.2.
45 Arguing that liability for damage to property not ‘caused by the goods’ should be settled on the basis
of applicable domestic law see: UNCITRAL, Digest of Case Law on the CISG, Art. 5 para. 3.
46 Handelsgericht Zürich (Switzerland) 26 April 1995 (Saltwater isolation tank), CISG-Online 248
(Pace).
47 However, the buyer lost his right to claim damages by failing to make timely notice pursuant to
Art. 39.
48 Ibid.
49 Schwenzer/Hachem, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 5 para. 5; Spanogle/Win-
ship, International Sales Law – A Problem-Oriented Coursebook (2000), pp. 82–83; Enderlein/Maskow,
International Sales Law (1992), p. 46.
50 CISG-AC Opinion no 6,, para. 6; for recognition in the commentary see: Infra, Art. 74 paras 23–24
(see Art. 74 (1st edition, paras 23–24 (p. 997) – to be replaced with a reference to second edition of this
commentart on “consequential loss”); Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2010),
Art. 74 para. 32.
51 Bundesgerichtshof (Germany) 25 November 1998 (Surface protective film), CISG-Online 353 (Pace).
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5. Concurrent remedies
As property damage claims and claims to indemnify the buyer for losses suffered by 17
his customers fall within the scope of the CISG, the question now arises as to whether
the CISG should be applied to the exclusion of domestic tort law claims.52 In other
words, does the CISG pre-empt the applicability of domestic law with respect to these
claims or will domestic law remain applicable concurrently with the CISG? The
practical importance of this matter is often illustrated by the fact that in order to claim
damages for defective goods under the CISG, the buyer must notify the seller of any
non-conformity within a reasonable time or in any event within two years (Art. 39),
whereas the notice requirement of many legal systems is either longer or non-existent.53
If concurrent remedies were permitted (and the non-conformity held to give rise to
tortious claims), the buyer may be able to in effect circumvent the CISG limitations on
recovery. Whilst these limitations may be inappropriate for the protection of interests
such as death and personal injuries, as noted by the CISG Advisory Council, in some
instances “[t]hese limitations may be appropriate for the protection of “contractual
interests” created by the contract and for which the parties bargained.”54
The CISG itself is silent in regards to concurrent remedies. The reported case law, 18
however, does offer some guidance. As noted by the 2012 UNCITRAL Digest, some
courts have held that the CISG does not pre-empt the applicability of domestic law wih
respect to tort claims or those based on the seller’s negligent or fraudulent misrepresenta-
tion.55 The starting point for these courts56 appears to be an examination as to the nature
of the claim: “a tort that is in essence a contract claim and does not involve interests
existing independently of contractual obligations (such as goods that cause bodily injury)
will fall within the scope of the CISG regardless of the label given to the claim.”57
Scholarly opinion is divided as to how this issue should be resolved, with a “spectrum 19
of opinions” both justifying and rejecting the application of the CISG to the exclusion of
domestic law.58
Honnold is the leading supporter in favour of the view that the CISG operates to the 20
exclusion of domestic tort law.59 He argues that “domestic rules that turn on substan-
52 This author is using reference to domestic “tort” law, but this need not necessarily be the case. As
Schlechtriem persuasively argues, insofar as domestic law applies concurrently with the CISG, it is
irrelevant whether domestic law treats the remedy as contractual, quasi-contractual, or extra-contractual.
Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 5 para. 12; confirmed in Schwenzer/
Hachem, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 5 para. 15. Also in agreement see
Honnold/Fechtner, Uniform Law (2009), Art. 4 para. 65 who argues that domestic law labelling (e. g.
“tort” or “product liability”) is not conclusive in determining whether the rule is displaced by the CISG. It
is the “substance rather than the label or characterization of the competing rule of domestic law that
determines whether it is displaced by the Convention.” In agreement, see Khoo in: Bianca/Bonell,
Commentary (1987), Art. 4 para. 3.3.5.
53 While this issue is raised by most commentators over the last 20 years, interestingly enough, it has
yet to arise in the reported case law.

55 UNCITRAL, Digest of Case Law on the CISG (2012), Art. 5 para. 4.
56 U.S. District Court, Eastern District of Arkansas (United States) 23 December 2009 (Refridgerator
motors), CISG-Online 2045 (Pace); U.S. District Court, Southern District of Ohio (United States)
26 March 2009 (Paper winding machine), CISG-Online 1880 (Pace).
57 U.S. District Court, Eastern District of Arkansas (United States) 23 December 2009 (Refridgerator
motors), CISG-Online 2045 (Pace).

58 Eiselen, in: Kritzer/Vanto/Vanto/Eiselen, International Contract Manual, Vol. 4 § 84:42, who offers a
survey of some of these opinions looking at Enderlein/Maskow, Honnold, Khoo, Lookofsky and
Schlechtriem.
59 Also in agreement, see Enderlein/Maskow, International Sales Law (1992), pp. 43, 46.
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tially the same facts as the rules of the Convention must be displaced by the Conven-
tion” as allowing the concurrent application of domestic law “would destroy the
Convention’s basic function to establish uniform rules (Art. 7(1)).”60 He suggests that
this approach most likely captures the result intended by the drafters because if they had
intended domestic law to be preserved on a particular matter they would have explicitly
excluded that matter from the CISG, as was done, for example, in Art. 2.61 Flechtner
agrees and further adds that allowing concurrent remedies only for property damage
would result in a strange set of priorities. He argues that this would create a preference,
not necessarily intended by the drafters, for property damage claims over claims for
death and personal injury as property damage claimants would have their choice of
remedies either under the CISG or domestic law, whereas personal injury claimants
would be limited to domestic law only.62
21 In support of concurrent remedies, opinions are varied. For example, Bridge argues
that, unlike with contract, there is no concept of tort under the CISG that could limit
the application of domestic tort rules.63 He suggests that this should be treated as a
matter of domestic law and that if the drafters intended to deprive the buyer of the
freedom to sue in tort, then they should have done so explicitly.
22 Also championing this view, Schlechtriem suggests that in resolving this issue a
distinction needs to be made between “contractual interests” and “extra-contractual
duties” which protect “interests such as health and property existing independently of
contractual obligation.”64 He argues that it is the essence of contractual interests which
is regulated by CISG rules and remedies, and that these should not be altered or
changed by domestic law. According to Schlechtriem, consequential loss resulting from
property damage (and, it is suggested, from having to reimburse customers’ claims) is in
the field of extra-contractual remedies “outside the principal domain of interests created
by contracts and protected by contractual remedies.”65 In this situation, he argues,
concurrent application of domestic tort law may be justified.
23 Schwenzer/Hachem also support concurring domestic remedies, though in a slightly
more limited sense. They argue that with respect to property damage particularly, a
distinction needs to be made between property damage which results as a breach of
contract and that which results as a “breach of standard safety expectations and where it
was only coincidence that the buyer and not a third party was harmed.”66 Under this view
the CISG applies exclusively to the former, but not the latter as the CISG is not concerned
with general duties of safety, which not only protect the buyer but also third parties.
24 Lookofsky warns of “stretching” the CISG “beyond its essential design”.67 He argues
that a pre-emption of domestic tort law should not be done lightly, pointing to the fact
that a State’s accession to the CISG only demonstrates its willingness to substitute its
60 Honnold/Flechtner, Uniform Law (1999), Art. 5 para. 73; affirmed in Honnold/Flechtner, Uniform
Law (2009), Art. 5 para. 73. See also Khoo in: Bianca/Bonell, Commentary (1987), Art. 5 para. 3.2.
61 Ibid.
62 Honnold/Flechtner, Uniform Law (2009), Art. 5 para. 73.
63 Bridge, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 246.
64 Schlechtriem, The Borderland of Tort and Contract – Opening a New Frontier?, 21 Cornell
International Law Journal (1988) 473–474.

65 Ibid. Also in support of this view see Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond
(2003), p. 104–105.
66 Schwenzer/Hachem, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 5 para. 14; see also
Schwenzer/Hachem, The CISG – Successes and Pitfalls, 57 American Journal of Comparative Law (Spring
2009) 457 (469–472).
67 Lookofsky, In Dubio Pro Conventione? Some Thoughts about Opt-outs, Computer Programs and
Preëmption Under the 1980 Vienna Sales Convention (CISG), 13 Duke Journal of Comparative and
International Law (2003) 263 (289).
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domestic sales law with the CISG rules, not an intention to place its contract and tort
regimes “under one CISG roof”.68 For Lookofsky, concurrent remedies pose little threat
to the uniform interpretation of the CISG, as this could still be attained if the courts of
Contracting States, when faced with similar facts, interpret the applicable Convention
remedies as “non-exclusive”.69
In this author’s opinion, domestic law should be excluded where the CISG would 25
otherwise provide remedies for the loss suffered. The question is, therefore, whether the
claim involves interests that exist independently of contractual obligations. To the
extent that the interests, for which the buyer is seeking protection are independently
“tortious” or “extra-contractual”, application of domestic law should be permited.70
It is suggested that allowing the concurrent application of domestic law in relation 26
to the protection of contractual interests would contravene the parties’ intention in
contracting under the CISG.71 The CISG prescribes both remedies and limitations to
these remedies with respect to certain kinds of loss. Insofar as property damage and
claims for indemnification can be found to fall within the scope of the CISG as
consequential loss, limitations provided by the CISG should not be allowed to be
circumvented by the operation of domestic tort law (e. g. by allowing domestic tort law
to displace Art. 39 limitations). In other words, when parties contract under the CISG,
they do so with the intent that its provisions should not be excluded by the operation
of domestic law. It would clearly be contrary to this intention to allow the application
of domestic law remedies when the kind loss suffered is already provided for under
the Convention. In return for imposing strict liability on the seller in the case of non-
conforming goods, buyers have made a compromise by submitting to Convention
limitations, such as foreseeability and notice requirements. Courts should hold buyers
to their compromises otherwise the fair balance between buyers and sellers devised by
the Convention may be disrupted.72

Neither the PICC nor the PECL contain comparable provisions dealing with death or 27
personal injury specifically or product liability generally. “Radically” different from the
CISG,73 however, damages for non-pecuniary loss resulting from death or personal
injury may be recoverable under both the PICC (Art. 7.4.2(2)) and the PECL
(Art. 9:501(2)(a)).74 The reason for this has been attributed as not so much as a
difference in approach between the CISG and these unifying instruments, but rather to
the compromise made at the Vienna Conference and the wish to remove product
liability rules from the sphere of the Convention.75
68
Ibid. at 288.
69
Ibid.
70 CISG-AC Opinion no 12, paras 3.1.6 and 3.3.2. Although it is admitted that these these qualifications
or labels are essentially dependant on the determination of the national court before whom the matter
comes and in this sense lack universal appeal.
71 This intention can be presumed from either the express inclusion of the CISG or, where the parties
have not expressly excluded the CISG, in cases of default application pursuant to Art. 1.
73 Eiselen, Remarks on the Manner in which the UNIDROIT Principles of International Commercial
Contracts May Be Used to Interpret or Supplement Article 74 of the CISG (2004) (Pace).
74 See also Chengwei, Remedies for Non-Performance: Perspectives from CISG, UNIDROIT Principles
& PECL (2003) para. 13.4 (Pace).

75 Eiselen, Remarks on the Manner in which the UNIDROIT Principles of International Commercial
Contracts May Be Used to Interpret or Supplement Article 74 of the CISG (2004) (Pace).
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28 In Book VI (Non-contractual liability arising out of damage caused to another), the

DCFR, unlike the CISG, provides specifically for the recovery of non-economic loss
including death and personal injury (e. g. Art. VI. – 2:201).
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Article 6
The parties may exclude the application of this Convention or, subject to article 12,
derogate from or vary the effect of any of its provisions.
Bibliography: Bridge, The Bifocal World of International Sales: Vienna and Non-Vienna, in: Cranston
(ed.) Making Commercial Law (1997), p. 277; Ferrari, Remarks on the UNCITRAL Digest’s Comments
Article 6 CISG, 25(1) Journal of Law and Commerce (2005/2006) 13; CISG-AC Opinion no 16, Exclusion
of the CISG under Article 6, Rapporteur: Dr Lisa Spagnolo, Adopted by the CISG Advisory Council
following its 19th meeting in Pretoria, South Africa on 30 May 2014; Fountoulakis, The Parties Choice of
“Neutral Law” in International Sales Contracts, VIII European Journal of Law Reform 303–329 (2005);
Lookofsky, Opt-outs under Article 6, 13 Duke Journal of Comparative Law (2003) 272, Schlechtriem,
Requirements of Application and Sphere of Applicability of the CISG, 4 Victoria University of Wellington
Law Review (2005) 781; Schroeter, To Exclude, to Ignore or to Use? Empirical Evidence on Courts’,
Parties’ and Counsels’ Approach to CISG, https//ssrn.com/abstract=1981742; Spagnolo, CISG Exclusion
and Legal Efficiency (2014).
Outline
1. General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1. Party autonomy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
a) Dispositive character of the CISG. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
b) Conditions for the derogation or exclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
2. Methods of opting out. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
a) Choice of law methods. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
b) Contractual methods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
3. Derogation from or modification or exclusion of the CISG. . . . . . . . . . . . . . . . 14
a) Bases for derogation or modification or exclusion. . . . . . . . . . . . . . . . . . . . . . . 15
aa) Implied . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
bb) Express. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
b) Derogation from the CISG . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
c) Modification of the CISG . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
4. Opting in – agreements to apply the CISG . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26

1. General
Party autonomy and freedom of contract are essential features of the CISG. The 1
Convention, throughout its text, provides for the primacy of party autonomy in respect
of the content of sales contracts. In other words, it “affirms and preserves the absolute”
freedom “of the parties to determine the content of their contract”.1 More specifically,
Art. 6 provides that parties to a sales contract may expressly or impliedly derogate from
some or all2 of the provisions of the Convention. It also implies that the parties may
decide to subject their contract to the CISG even if the CISG is not applicable by
operation of Arts 1, 2 and 3.
1
Schlechtriem/Butler, CISG (2016), p. 3.
2
Bridge, The International Sale of Goods (2007), para. 11.42; Ferrari, CISG Rules on Exclusion and
Derogation: Article 6, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2004).
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2 The CISG applies automatically when the conditions of the Convention are satisfied.
This could have the consequence that certain businesspeople are caught by surprise.
Art. 6 ensures that standard terms (or standard form) contracts elaborated by commod-
ities or other trading associations are valid even when they opt out of the CISG, where
the CISG would have otherwise been applicable. Indeed, many standard form contracts
(e. g. GAFTA3 and FOSFA4) are governed by English law and opt out of the CISG.5
During the comments before the diplomatic conference that led to the adoption of the
CISG it was noted that “traders … should feel reassured” by the non-mandatory or
“enabling statute” character of the Convention.6 The conference rejected the sugges-
tion, almost without any discussion, that party autonomy should be limited by a
principle of good faith.7
3 While party autonomy is welcome by both the business world and commentators, it
is also acknowledged that the variation in substantive rights under the Convention,
rather than complete exclusion of the CISG, would significantly complicate the applica-
tion of CISG remedies.8
2. Drafting history
4 There is significant literature on the drafting history of Art. 6 and its comparison
with its predecessors: it is clear that Art. 6 CISG follows Art. 3 ULIS and Art. 2 ULF.9
Art. 6 is identical to Art. 5 of the Draft Convention.
5 During the drafting negotiations of the CISG it was suggested that any exclusion of
the Convention should be conditioned on the valid choice of an applicable domestic
law. UNCITRAL decided not to adopt any restriction. If it is clear that the parties opt
out of the CISG, then conflict of laws rules will determine which law is applicable.10
6 Art. 3 ULIS in its second sentence provided that a total or partial exclusion of the
application of the Uniform Law “may be express or implied.” Such references did not
survive in the CISG as it was thought that references to “implied” exclusion might
encourage courts to conclude, on insufficient grounds, that the Convention had been
wholly excluded.11
3 Grain and Feed Trade Association: http://www.gafta.com. See, in particular, clause 29 in the GAFTA
Contract no 100: http://www.gafta.com/write/MediaUploads/Contracts/2010/100.pdf.

4 Federation of Oils, Seeds and Fats Association: http://www.fosfa.org/.
5 Bridge, The International Sale of Goods (2007), para. 11.42 and footnote 197. He also notes that the
major trading associations exclude all conventions, even the predecessors of the CISG, namely ULIS
and ULF.
6 Winship, The Scope of the Vienna Convention of International Sales Contracts, in: Galston/Smit
(eds), International Sales: The United Nations Convention on Contracts for the International Sales of
Goods (1984, 1999), at 1–33 with reference to the Comments by the Swiss government, A/CONF.97/8,
Add.2, p. 7, also with support expressed by Egypt, Korea and Chile, A/CONF.97/C.1/SR.4, paras. 60, 61
and 74, reprinted in Official Records, pp. 252–253.
7 A/CONF.97/C.1/SR.3 paras 53–65, reprinted in Official Records, pp. 247–248.
8 Erauw/Flechtner, Remedies under the CISG and Limits to their Uniform Character, in: Sarcevic/
Volken (eds), The International Sale of Goods Revisited (2001), p. 35 at 66.

9 Ferrari, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2008), Art. 6 paras 1–4; Schlechtriem,
in: Schlechtriem/Schwenzer, Commentary (2005), Art. 6 para. 1; Magnus, in: Staudinger Kommentar
(2005), Art. 6 paras 5–7. A comparison of Art. 6 with its antecedent counterparts in ULIS and ULF is
available at http://www.cisg.law.pace.edu/cisg/text/matchup/matchup-u-06.html.
10 Honnold/Flechtner, Commentary (2009), Art. 6 para. 75.
11 Official Records, p. 17, UNCITRAL YB II, A/CN.9/SER.A/1970, p. 55, para. 45; Honnold, Documen-
tary History (1989), p. 61.
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1. Party autonomy
Parties to a sales contract are free to agree terms or rules of law which supplement, 7
modify or replace the CISG. Such party autonomy may be exercised in many different
ways. For example, a seller and a buyer from CISG Contracting States may decide to
submit their contract to the law of a non-Contracting State (e. g. English law). In that
respect choice of court or arbitration clauses are also relevant to the extent that a court
of a Contracting State that would normally apply the CISG would have to determine
whether a choice of law submitting to a third country law is effective or not and whether
the mandatory rules of the forum are applicable.12 Art. 6, of course, states that the
Convention is not mandatory law of a Contracting State.13 A choice of law in favour of
the law of a Contracting State would normally lead to the application of the CISG, as it
will be discussed infra. It has also been argued that the freedom of contract provided for
in Art. 6 only extends to the level of substantive law while associated choice of law
clauses would be governed by the conflict of laws rules of the deciding court.14 It is also
generally understood that the CISG would govern the manner in which the CISG may
be excluded, modified or derogated from.15
a) Dispositive character of the CISG. The CISG has a dispositive character16 so that 8
contracting parties may derogate from or exclude its application.17 This is manifested by
Art. 6 and other provisions, such as Arts 30, 35 and 53, which state that performances
are to be in accordance with the contract and the Convention.
Exceptions to the dispositive character can be found in Art. 12 and in Part IV of the 9
Convention. The former relates to the form requirements pursuant to Art. 11 which do
not apply when one of the contracting parties has its place of business in a Contracting
State which has made a reservation pursuant to Art. 96. Thus, it would follow that strict
12 See EC Regulation no 593/2008 on the Law Applicable to Contractual Obligations (Rome I), Arts 3
and 9; Bridge, International Sale of Goods (2007), para. 1.23.

13 Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 6 para. 4. See also, e. g., that a
court has stated that Art. 55, relating to open-price contracts, is only applicable where the parties have not
agreed anything to the contrary – Cour d’appel Grenoble (France) 26 April 1995 (Candy), CISG-Online
153 (Pace); another court observed that Art. 39, relating to the notice requirement, is not mandatory and
can be derogated from – Landgericht Giessen (Germany) 5 July 1994 (Women’s clothes), CISG-Online
111 (Pace). In the same vein, the Austrian Supreme Court has concluded that article 57 also can be
derogated from – Oberster Gerichtshof (Austria) 10 November 1994 (Chinchilla furs), CISG-Online 117
(Pace).
14 Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 6 para. 15.
15 CISG-AC Opinion 16, Rule 2 and related comments. There is also empirical evidence of the various
approaches taken by parties, counsel on the matter of exclusion, derogation of modification of the CISG.
See Schroeter, To Exclude, to Ignore or to Use? Empirical Evidence on Courts’, Parties’ and Counsels’
Approach to CISG, https//ssrn.com/abstract=1981742.
16 Ferrari, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2013), Art. 6 para. 5 with further
references. See also Audit, Vente Internationale (1990), p. 37; Landgericht Stendal (Germany) 12 October
2000, CISG-Online 592 (Pace); Juzgado Nacional de Primera Instancia en lo Comercial (Argentina),
6 October 1994, CISG-Online 378 (Pace).
17 For express references to the dispositive character of the Convention, see Corte Supreme di
Cassazione (Italy) 19 June 2000 (Metal processing plant), CISG-Online 1317 (Pace); see Oberster
Gerichtshof (Austria) 21 March 2000 (Wood case), CISG-Online 641 (Pace); Oberster Gerichtshof
(Austria) 15 October 1998 (Timber), CISG-Online 380 (full text of the decision); Handelsgericht Wien
(Austria) 4 March 1997, CISG-Online 743; Tribunal Cantonal Valais (Switzerland) 29 June 1994 (Furni-
ture), CISG-Online 134.
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form requirements of a Contracting State (with express reservation to that effect)

cannot be derogated from by virtue of Art. 6.18 The other exception relates to Part IV,
which is addressed to Contracting States and not to contracting parties so that its
application cannot be controlled by the parties.19
10 b) Conditions for the derogation or exclusion. There are no formal conditions for
the derogation or exclusion of the CISG. It suffices that the parties to the sales contract
express their agreement to that effect, but such agreement does not require any specific
form.20 Nothing in the language of the CISG suggests otherwise. Thus, it is for the
competent court or tribunal to determine which law is to be applied by operation of
conflict of laws rules.21 There is an argument amongst scholars as to which law would
be applicable to the validity of an agreement seeking to exclude or derogate from the
CISG; as there is no relevant case law, the debate appears to be purely academic.22 It is
the view of this author that an agreement of the parties aiming to exclude the CISG
should be seen as a stand-alone agreement and should be governed by the law it selects
or failing that by the law applicable by virtue of conflict of laws rules.
2. Methods of opting out

11 Parties may opt out of the CISG in part (derogation or modification) or in total
(exclusion) by either choosing a governing law other than the CISG or by drafting their
contract in a detailed form and excluding the CISG, or at least specific parts of it (most
typically Part III) in this way. The other option is to refer to standard terms and
conditions, which is quite common in the commodities trade. The reference to standard
terms upstage specific parts of the CISG by active choice of specific rules of law.
12 a) Choice of law methods. Choice of law clauses are a common occurrence in
international commerce. More than 80 % of international contracts will normally
contain a choice of law clause. In this way the parties may purport to opt out of the
CISG and subject their contract to another law. This can be done by either choosing
the law of a non-Contracting State (e.g. English law) or by specifically choosing only
the domestic sales law of a Contracting State. The parties may also decide to make
a jurisdiction agreement in favour of a non-Contracting State without a specific
agreement of applicable substantive law to govern the contract, expecting that the
court will then choose its own domestic law as the governing law; a jurisdiction
agreement in favour of a non-Contracting State would not normally (or necessarily)
have the effect of derogating or excluding the application of the CISG. However,
18 Schroeter, Freedom of contract: Comparison between provisions of the CISG (Article 6) and
counterpart provisions of the Principles of European Contract Law, 6 Vindobona Journal of International
Commercial Law and Arbitration (2002-2) 257 (261).
19 See Tribunale die Vigevano (Italy) 12 July 2000, CISG-Online 493, Schlechtriem, in: Schlechtriem/

20 See Ferrari, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2008), Art. 6 para. 12; Ferrari/
Saenger, Internationales Vertragsrecht, Art. 6 para. 2; Bonell, in: Bianca/Bonell, Commentary (1987),
Art. 6 para. 4; Winship, The Scope of the Vienna Convention, in: Galston/Smit (eds), International Sales:
The United Nations Convention on Contracts for the International Sales of Goods (1984, 1999), pp. 1–33.
21 See e.g., Arbitral Award, Foreign Trade Court of Arbitration Attached to the Serbian Chamber of
Commerce in Belgrade, 17 August 2009 (vegetable fats case), CISG-Online 2039 (Pace); Federal Court of
Australia (Australia) 20 May 2009, Olivaylle Pty Ltd v Flottweg GMBH & Co KGAA, CISG-Online 1902
(Pace); Supreme Court of Wales (Australia) 13 October 2006, Italian Imported Foods Pty Ltd v Pucci
S. r. l., CISG-Online 1494 (Pace).
22 See Ferrari, in Schlechtriem/Schwenzer, Kommentar (German ed. 2013), paras 13–14 with further
references in footnotes 51–59.
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parties should be cautious and study the law of the jurisdiction they have selected
before finally agreeing to it.
b) Contractual methods. The most common way to opt out of the CISG, and most 13
specifically its Part III, is by drafting the sales contract in a way that renders the CISG
either obsolete or inapplicable, e. g. by drafting a very detailed contract. By using this
method the parties insert directly in their contracts specific rules of law they wish to
abide by, unlike the choice-of-law method where the parties indirectly make such
insertion, i.e. they choose a law and by the choice of law the choose rules of law to the
derogation or exclusion of the CISG. For many years, one of the major obstacles to the
development and application of the Convention was that most standard contract forms
for international sales contained no reference whatsoever to the CISG or if a reference
was contained it was to the effect of excluding its application. It seems that this situation
is now changing. For example, the ICC Model International Sales Contract for
manufactured goods intended for resale has been adapted to be consistent with the
CISG.23 In the United States it seems that most U.S. exporters continue to opt out of the
CISG in their contracts, although even in the U.S. the CISG is gaining more accep-
tance.24 In certain industries, however, and most typically in commodities sales, there is
usually an express opting out of the CISG.25
3. Derogation from or modification or exclusion of the CISG

The actual derogation from or modification of the CISG may be effected impliedly 14
(typically by choice of another law) or expressly (with a positive choice of another law
and negative choice of the CISG). It would be useful to examine the derogation from the
CISG separately from the modification of the CISG after the discussion about the
various bases for derogation or modification.
a) Bases for derogation or modification or exclusion. A derogation from or 15
modification or exclusion of the Convention’s provisions may be by implied or express
agreement of the parties.
aa) Implied. A good number of court decisions and arbitration awards have dealt 16
with the question of implied derogation or modification or exclusion of the Convention.
Indeed most courts acknowledge the validity of an implied exclusion,26 provided that
23
ICC Publications No 738E, (2013).
24
See McMahon, Drafting CISG Contracts and Documents and Compliance Tips for Traders (2004),
available at http://www.cisg.law.pace.edu/cisg/contracts.html.
Making Commercial Law (1997), p. 277; Mullis, Termination for Breach of Contract in C. I. F. Contracts
Under the Vienna Convention and English Law: Is there a substantial Difference, FS Guest (1997),
pp. 137 et seq., emphasizing the lack of a developed case law. See also, in particular, clause 29 of GAFTA
Contract no 100: http://www.gafta.com/write/MediaUploads/Contracts/2010/100.pdf.
26 See Cour d’appel de Rouen (France), 26 September 2013 (glue) CISG-Online 2551; Oberster
Gerichtshof (Austria) 2 April 2009 (boiler) CISG-Online 1889; Arbitral Award, ICC Court of Internatonal
Arbitration Award 11333 of 2002 (machines) CISG-Online 1420 (Pace); Oberster Gerichtshof (Austria)
22 October 2001 (Gasoline and gas oil), CISG-Online 614 (Pace); Cour de cassation (France) 26 June 2001
(Auto parts), CISG-Online 600 (Pace); Audiencia Provincial de Alicante (Spain) 16 November 2000
(Shoes), CISG-Online 1318 (Pace); Tribunale di Vigevano (Italy) 12 July 2000 (Sheets of vulcanized
rubber used in manufacture of shoe soles), CISG-Online 493 (Pace); Oberlandesgericht Dresden (Ger-
many) 27 December 1999 (Chemical products), CISG-Online 511 (Pace); Oberlandesgericht München
(Germany) 9 July 1997 (Leather goods), CISG-Online 282 (Pace); Landgericht München (Germany)
29 May 1995 (Computer hardware), CISG-Online 235 (Pace); Oberlandesgericht Celle (Germany)
24 May 1995 (Used printing) CISG-Online 152 (Pace).
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the (implied) intention of the parties27 is clear28 and real29. However, there is nothing in
the language of the Convention indicating the possibility of implied exclusion.30 There
are, however, also a few cases suggesting, at least in respect of exclusion, that an
exclusion cannot be effected impliedly.
17 There are different ways in which the parties can impliedly exclude the CISG. For
example and most typically, the parties choose the law31 of a non-Contracting State to
govern their contract.32
18 The situation is less clear when the parties choose the law of a Contracting State to
govern their contract without any reference to the CISG in their contract. In such a
situation case law is not unanimous. Most likely mistakenly, some arbitral awards33
and several court decisions34 suggest that such a choice amounts to an implied
exclusion of the Convention, because otherwise the choice would have no practical
meaning. Such an approach, however, does not try to ascertain the true intent of the
parties, it simply second-guesses it. The majority of the cases, however, takes a
different view. Most court decisions from many different jurisdictions35 and arbitral
27 According to CISG-AC Opinion 16, Rule 3, the intent of the parties to exclude the CISG must be
determined in accordance with Art. 8 CISG. See in this respect comments 3-1 to 3.8 following this black
letter rule.
28 See Oberlandesgericht Linz (Austria) 23 January 2006 (car) CISG-Online 1377 (Pace); Tribunal
Cantonal du Jura (Switzerland) 3 November 2004 CISG-Online 965 (Pace); Court of Appeals (5th Circuit)
(U.S.), BP International, Ltd. and BP Exploration & Oil, Inc v Empresa Estatal Petroleos de Ecuador,
et al. Empresa Estatal Petroleos de Ecuador and Saybolt, Inc., 11 June 2003, corrected on 7 July 2003
(Gasoline) CISG-Online 730; Oberster Gerichtshof (Austria) 22 October 2001 (gasoline) CISG-Online 614.
29 See Tribunal Cantonal du Jura (Switzerland) 3 November 2004 CISG-Online 965 (Pace).
30 See Landgericht Landshut (Germany) 5 April 1995 (Sport clothing case); Federal Court of Interna-
tional Trade (U.S.) 24 October 1989, Orbisphere Corp. v United States, CISG-Online 7 (Pace). There is
also an award to the same effect: Arbitral Award, Tribunal of International Commercial Arbitration at the
Russian Federation Chamber of Commerce and Industry, Award 54/1999, 24 January 2000, CISG-Online
1042 (Pace).
31 Whether such a choice is to be deemed to be valid and enforceable depends on the rules of private
international law applied by the deciding court of tribunal.

32 See Oberlandesgericht Linz (Austria) 23 January 2006 (car) CISG-Online 1377 (Pace); Tribunal
Cantonal du Jura (Switzerland) 3 November 2004 CISG-Online 965 (Pace); District Court, Northern
District of Illinois (U.S.), 29 January 2003, Ajax Tool Works Inc., v Can-Eng. Manufacturing Ltd
(fluidized bed furnace) CISG-Online 772 (Pace); Audiencia Provincial de Alicante (Spain) 16 November
2000 (Shoes), CISG-Online 1318 (Pace), where the parties implicitly excluded application of the
Convention by providing that their contract should be interpreted in accordance with the law of a non-
Contracting State and by submitting their petitions, statements of defence, and counterclaims in
accordance with the domestic law of the forum (a Contracting State); Oberlandesgericht Düsseldorf
(Germany) 2 July 1993 (Veneer cutting machine), CISG-Online 74 (Pace).
33 See Tribunal of International Commercial Arbitration at the Russian Federation Chamber of
Commerce and Industry (Russian Federation), 16 March 2005, CISG-Online 1480 (Pace); Tribunal of
International Commercial Arbitration at the Russian Federation Chamber of Commerce and Industry
(Russian Federation), 12 April 2004, CISG-Online 1208 (Pace); Tribunal of International Commercial
Arbitration at the Russian Federation Chamber of Commerce and Industry (Russian Federation),
11 October 2002, CISG-Online 893 (Pace);Arbitral Award, Ad hoc Florence Arbitration, 19 April 1994
(Leather/textile wear), CISG-Online 124 (Pace).
34 See Hof’s-Hertogenbosch (Netherlands), 13 November 2007, Adex International Ltd v. First Interna-
tional Computer Europe B.V., unpublished; Cour d’appel Colmar (France) 26 September 1995 (Ceramic
baking dishes/cake pans, soufflé pans, etc.), CISG-Online 226 (Pace); Kantonsgericht des Kantons Zug
(Switzerland) 16 March 1995 (Cobalt), CISG-Online 230 (Pace); Tribunale Civile de Monza (Italy)
14 January 1993 (Ferrochrome), CISG-Online 540 (Pace).
35 Bundesgerichtshof (Germany), 11 May 2010 (aluminium rings) CISG-Online 2125 (Pace); Oberster
Gerichtshof (Austria) 2 April 2009 (boiler), CISG-Online 1889 (Pace); Polimeles Protodikion Athinon
(Greece) case 4505/2009 (materials for bullet-proof vests) CISG-Online 2228 (Pace); Rechtbank Rotter-
dam (Netherlands) 5 November 2008 (crabs) CISG-Online 1817; District Court, Eastern District Michiagn
(U.S.), 28 September 2007, Easom Automation Systems, Inc v hyssenkrupp Fabco, Corp (Sport bar
106 Mistelis
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awards36 correctly argue the contrary, i. e. the CISG is the law for international sales in
the Contracting State whose law the parties chose. The parties’ choice is not mean-
ingless, rather it identifies the national law to be used for filling gaps in the
Convention37 avoiding at the same time any unnecessary recourse to private interna-
tional law. In other words, the choice of the law of a Contracting State does not
exclude the Convention’s applicability, since it forms an integral part of the national
law of that state and is the specific law to be applied for international sales (especially
where more than one system of sales law exist, such as in the United States and
China). It also follows that if the parties clearly chose the domestic law of a
Contracting State, rather than the law of the State in general or its international law
specifically, the Convention must be deemed excluded.38 A prime example would be
assembly system) CISG-Online 1601; Oberlandesgericht Linz (Austria) 23 January 2006 (car) CISG-
Online 1377 (Pace); Oberster Gerichshof (Austria) 26 January 2005 (mushrooms) CISG-Online 1045;
Court of Appeals (5th Circuit) (U.S.), BP International, Ltd. and BP Exploration & Oil, Inc v Empresa
Estatal Petroleos de Ecuador, et al. Empresa Estatal Petroleos de Ecuador and Saybolt, Inc., 11 June 2003,
corrected on 7 July 2003 (Gasoline) CISG-Online 730; Oberster Gerichtshof (Austria) 14 January 2002
(Cooling system), CISG-Online 643 (Pace); Hof van Beroep Gent (Belgium) 15 May 2002 (Design of radio
phone), CISG-Online 746 (Pace); Cour d’appel Paris (France) 6 November 2001 (Cables), CISG-Online
677 (Pace); Supreme Court of Queensland (Australia) 17 November 2000 (Scrap steel), CISG-Online 587
(Pace); Oberlandesgericht Frankfurt (Germany) 30 August 2000 (Yarn), CISG-Online 594 (Pace); Bun-
desgerichtshof (Germany) 25 November 1998 (Surface protective film), CISG-Online 353 (Pace); Ober-
landesgericht München (Germany) 21 January 1998 (Insulating materials), CISG-Online 536 (Pace);
Kantonsgericht Nidwalden (Switzerland) 3 December 1997 (Furniture), CISG-Online 331 (Pace); Bundes-
gerichtshof (Germany) 23 July 1997 (Benetton II fashion textiles), CISG-online 276 (Pace); Oberlandesger-
icht München (Germany) 9 July 1997 (Fitness equipment), CISG-Online 281 (Pace); Oberlandesgericht
Karlsruhe (Germany) 25 June 1997 (Surface protective film), CISG-Online 263 (Pace); Handelsgericht des
Kantons Zürich (Switzerland) 5 February 1997 (Sunflower oil), CISG-Online 327 (Pace); Cour de
cassation (France) 17 December 1996 (Ceramic baking dishes/cake pans, soufflè pans, etc.), CISG-Online
220 (Pace); Landgericht Kassel (Germany) 15 February 1996 (Marble slab), CISG-Online 191 (Pace),
Oberlandesgericht Hamm (Germany) 9 June 1995 (Window elements), CISG-Online 146 (Pace); Re-
chtbank s’Gravenhage (Netherlands) 7 June 1995 (Apple trees), CISG-Online 369 (Pace); Oberlandesger-
icht München (Germany) 8 February 1995 (Plastic granules), CISG-Online 142 (Pace); Oberlandesgericht
Köln (Germany) 22 February 1994 (Rare hard wood), CISG-Online 127 (Pace); Oberlandesgericht Koblenz
(Germany) 17 September 1993 (Computer chip), CISG-Online 91 (Pace); Oberlandesgericht Düsseldorf
(Germany) 8 January 1993 (Tinned cucumbers), CISG-Online 76 (Pace).
36 See Tribunal of International Commercial Arbitration at the Russian Federation Chamber of
Commerce and Industry (Russian Federation), 22 October 2004, CISG-Online 1359 (Pace); Tribunal of
International Commercial Arbitration at the Russian Federation Chamber of Commerce and Industry
(Russian Federation), 17 September 2003, CISG-Online 979 (Pace); Tribunal of International Commercial
Arbitration at the Russian Federation Chamber of Commerce and Industry (Russian Federation), 25 June
2003, CISG-Online 978 (Pace); Arbitral Award, ICC Court of Internatonal Arbitration Award 11333 of
2002 (machines) CISG-Online 1420 (Pace); Arbitral Award, ICC 9448/1999 (Roller bearings), CISG-
Online 707 (Pace); Arbitral Award, ICC 9187/1999 (Coke), CISG-Online 705 (Pace); Arbitral Award,
Arbitration-Schiedsgericht der Handelskammer Hamburg, 21 March 1996 and 21 June 1996 (Chinese
goods), CISG-Online 465 (Pace); Arbitral Award, Arbitration Court attached to the Hungarian Chamber
of Commerce and Industry, 17 November 1995 (Mushrooms), CISG-Online 250 (Pace); Arbitral Award,
ICC 8324/1995 (Magnesium); Arbitral Award, ICC 7844/1994 (Radio equipment), CISG-Online 567
(Pace); Arbitral Award, ICC 7660/1994 (Battery machinery), CISG-Online 129 (Pace); Arbitral Award,
ICC 7565/1994 (Coke), CISG-Online 566 (Pace); Arbitral Award, ICC 6653/1993 (Steel bars), CISG-
Online 71 (Pace); Arbitral Award, Arbitration-Internationales Schiedsgericht der Bundeskammer der
gewerblichen Wirtschaft – Wien, 15 June 1994 (SCH-4366) (Rolled metal sheets), CISG-Online 121
(Pace).
37 Circuit Court of Appeals, 5th Circuit (U.S.) 11 June 2003, B. P. Petroleum International Ltd. v
Empresa Estatal Petroleos de Ecuador, CISG-Online 730 (Pace).

38 District Court, Southern District of New York (U.S.) 29 May 2009, Doolim Corp. v. R Doll, LLC, et al.
(garments), (Pace); Oberster Gerichtshof (Austria), 4 July 2007 (cars) CISG-Online 1560 (Pace); Oberlan-
desgericht Frankfurt (Germany) 30 August 2000 (Yarn), CISG-Online 594 (Pace); Oberlandesgericht
Frankfurt (Germany) 15 March 1996 (Fashion textiles), CISG-Online 275 (Pace).
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when the parties choose the Italian Codice civile rather than Italian Law. Some may
even argue that a reference to Texas law rather than U.S. law would also be sufficient
to exclude the application of the CISG.39
19 For an exclusion of the CISG by way of a reference to domestic law, it is essential that
the contracting parties have knowingly consented to the exclusion of the Convention.
As such it is unnecessary whether the parties are aware of the fact that the CISG is the
normally applicable law; such awareness or knowledge is not required for the applica-
tion of the Convention. If the parties are not aware of the Convention’s applicability
and argue on the basis of a domestic law merely because they in error believe that
domestic law applies, a court may and even should apply the Convention.40
20 According to few court decisions, the fact that the parties incorporated an INCO-
TERM into their agreement does not constitute an implied exclusion of the Conven-
tion,41 unless the trade terms are incompatible or inconsistent with the CISG.42 Such
line of decisions is undisputedly correct. For such an approach, it is irrelevant in
practice whether the national court recognizes the principle of jura novit curia (i. e. the
duty of and presumption that the court knows or at least has to ascertain the law) or
not.43 The Convention ought to apply if it is not expressly and unambiguously excluded.
21 There is also an arguable question as to whether a choice of a forum may also lead to
the implied exclusion of the Convention’s applicability. This would normally be the case
where the chosen forum is in a non-Contracting State and the local legal culture would
imply that the local court normally applies local law; the case of course is different in
legal systems where the courts always look at conflict of laws and there is no
requirement that the parties have to plead and prove foreign law for the court to apply
the foreign law. However, where there is evidence that the parties wanted to apply the
law of the chosen forum and that forum is located in a Contracting State, courts or
arbitral tribunals will normally apply the Convention.44 In this author’s experience, even
if the parties choose, for example, LCIA arbitration to be seated in London one cannot
and should not assume automatic application of English law and exclusion of the CISG.
Although the LCIA does not publish its awards, it is well known that the CISG has been
applied in many LCIA arbitration cases with their seat in London.
22 bb) Express. Parties to a sales contract can exclude the application of the Convention by
express agreement to that effect. Such exclusion agreements may at the same time indicate
the parties’ choice of law governing the contract or they may merely exclude the application
of the CISG. Where the parties exclude the CISG and select the applicable law in the course
of legal proceedings,45 the law applicable will be that designated by the rules of private
39 Such as scenario can be seen, but is not adequately discussed, in U.S. Circuit Court of Appeals (5th
Circuit) (U.S.) 1993, Beijing Metals & Minerals v American Business Center Inc., 993 F.2 d 1178.
40 See Oberlandesgericht Celle (Germany) 24 May 1995 (Used printing), CISG-Online 152 (Pace).
41 See, e. g., Oberster Gerichtshof (Austria) 22 October 2001 (Gasoline and gas oil case), CISG-Online
614 (Pace).
42 Obergericht Kanton Bern (Switzerland) 19 May 2008, CISG-Online 1738 (Pace).
43 Oregon Court of Appeals (U.S.) 12 April 1995, GPL Treatment Ltd. v Louisiana-Pacific Group, CISG-
Online 147 (Pace); Cour de cassation (France) 26 June 2001 (Auto parts), CISG-Online 600 (Pace);
Arbitral Award, ICC 8453/1995 (Medical machine), CISG-Online 1275 (Pace).
44 Arbitral Award, Schiedsgericht der Hamburger freundlichen Arbitrage, 29 December 1998 (Cheese)
CISG-Online 638 (Pace); Arbitral Award, Arbitration-Schiedsgericht der Handelskammer Hamburg,

21 March 1996 and 21 June 1996 (Chinese goods), CISG-Online 465 (Pace).
45 This is, e. g., the case in Germany; see, for example, Oberlandesgericht Köln (Germany) 26 August
1994 (Market study), CISG-Online 132 (Pace); Oberlandesgericht Saarbrücken (Germany) 13 January
1993 (Doors), CISG-Online 83 (Pace); this is also the case in Switzerland, see Handelsgericht Kanton
Zürich (Switzerland) 10 February 1999 (Art books), CISG-Online 488 (Pace).
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international law of the deciding court (forum),46 with the rather predictable result of the
primary application of the law chosen by the parties.47 Where the parties expressly exclude
the Convention but do not choose the applicable law, the governing law is to be identified
by means of the private international law rules of the forum. This will lead either to the law
most closely connected to the contract often by way of establishing a strong connecting
factor, such as characteristic performance and the like. It appears that in the majority (often
80 or 85 %) of international commercial contracts parties will make a choice of law.
b) Derogation from the CISG. It is the express language of Art. 6 that parties may 23
derogate from the CISG. This may be a partial or total derogation. Total derogation
would normally be effected by reference to a domestic sales or contract law, rather than a
reference to national law. For example, a reference to U.S. law would and should not be
sufficient to exclude or derogate from the CISG, but a reference to Texas law would as
this may be seen as an implied reference to State sales law. Similarly, a reference to the
Greek Civil Code rather than to Greek law would be sufficient to derogate from the CISG
while the CISG would retain some limited applicability.48 A reference to a national civil
code may not necessarily lead to the exclusion of the CISG, where the domestic sales law,
for example, does not regulate sales contracts amongst businesspersons, or only applies to
commercial persons but the contracting persons do not qualify as such.49
The extent or degree of derogation is not always easy to ascertain. As far as total 24
derogation is concerned, commentators50 agree that this is exceptional and cannot be
assumed by the reference to a domestic sales law, Incoterms51 or a contract drafted in
much detail (regulatory contract) that aims at replacing the provisions of the Conven-
tion. National courts at variable degrees are recognising the importance of the CISG and
its unification role and increasingly find ways to apply the CISG in addition to the
different choice the parties may have made.52
c) Modification of the CISG. It is the express language of Art. 6 that parties may 25
modify the provisions of the CISG. This may be a partial modification. Modification is
particularly appropriate when the parties are satisfied with the Convention itself but feel
46 See Bundesgerichtshof (Germany) 23 July 1997 (Fashion textiles), CISG-Online 276 (Pace); Oberlan-
desgericht Frankfurt (Germany) 15 March 1996 (Fashion textiles), CISG-Online 284 (Pace).
47 Where the rules of private international law of the forum are those laid down either in the 1955
Hague Convention on the Law Applicable to International Sales of Goods Convention, 510
U. N. T. S. 149, in the 1980 Rome Convention on the Law Applicable to Contractual Obligations (United
Nations, Treaty Series, vol. 1605, No. 28 023), the EC Regulation 593/2008 on the Law Applicable to
Contractual Obligations, or in the 1994 Inter-American Convention on the Law Applicable to Contrac-
tual Obligations (Organization of American States Fifth Inter-American Specialized Conference on
Private International Law: Inter-American Convention on the Law Applicable to International Contracts,
March 17, 1994, OEA/Ser.K/XXI.5, CIDIPV/doc.34/94 rev. 3 corr. 2, March 17, 1994, available on the
Internet at <http://www.oas.org/juridico/english/Treaties/b-56.html>), the law chosen by the parties
(party autonomy or lex voluntatis) will govern. See also Foreign Trade Court of Arbitration attached to
the Serbian Chamber of Commerce (Serbia) 17 August 2009 (Pace).
48 See, Oberlandesgericht Oldenburg (Germany) 20 December 2007, CISG Online 1644; Arbitral Award,
CIETAC, 24 March 1998, CISG Online 930.

49 See, Oberlandesgericht Linz (Austria) 23 January 2006, CISG Online 1377 (Pace). See also Schwenzer/
Hachem, in: Schlechtriem/Schwenzer, Commentary (2010), Art. 6 para. 25

50 Schwenzer/Hachem, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 6 para. 25; Ferrari, in:
Schlechtriem/Schwenzer, Kommentar (German ed. 2003), Art. 6. para. 30; Witz/Salger/Lorenz, Kommen-
tar (2016), Art. 6 paras. 17–20.
51 See Oberster Gerichtshof (Austria) 22 October 2001, CISG-Online 614 (Pace); Hof van Beroep
Antwerpen (Netherlands) 22 January 2007, CISG Online 1586 (Pace).

52 See the wealth of cases in http://www.iicl.law.pace.edu/cisg/page/annotated-text-cisg-article-6. More
recent cases seem to appreciate the importance of CISG and find ways for an application of the
Convention.
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that certain aspects (such as delivery) may be better served by different arrangements
(often contractual clauses, Incoterms or other soft law). In this respect the Convention
serves commercial needs in an exemplary form and works well in most industries,
including the commodities trade.53
4. Opting in – agreements to apply the CISG

26 The CISG does not deal with the issue of opting in, i. e. the situation when the parties
may wish the Convention to govern their contracts when their contract would normally
apply, either because the conditions of Art. 1 are not met or because this is a contract of
sale not covered by the CISG (pursuant to Art. 2 or to Art. 3). For example, an English
seller selling goods to Portugal may wish to subject the sales contracts to the CISG
rather than to the English law that would have otherwise been applicable. Leaving aside
the issue as to whether the CISG would be applied as a set of rules of law rather than a
Convention or international law which has been incorporated into a domestic legal
system (an issue important in international litigation, but not in international arbitra-
tion where parties can easily choose rules of law rather than law),54 the question is an
important one and it seems to be resolved in favour of opting in.55
27 Article 4 of the 1964 ULF, expressly provided for the power of parties to “opt in”.
The lack of similar provision in the CISG should not be read as an automatic rejection
of the possibility to opt in. It was understood that such an express opt in provision was
not necessary.56 Case law seems to agree with this, as there is substantial practice where
courts confirm the power of the parties to opt in to the CISG57 and actually parties do
from time to time opt in to the CISG.

28 Comparable provisions as to extent of party autonomy and the ability of the parties
to exclude or modify relevant rules can be found in the PICC, PECL and DCFR.
29 Pursuant to Art. 1.5 PICC, parties may exclude the application of the PICC or
derogate from or vary the effect of any of their provisions. However, it is also acknowl-
edged that certain provisions are of a mandatory nature, although it is not always easy
to ascertain which rules of law may have such character.58 The only such limitation one
53 Schlechtriem, Requirements of Application and Sphere of Applicability of the CISG, 36 Victoria
University of Wellington Law Review (2005) 781; Winsor, The Applicability of the CISG to Govern Sales
of Commodity Type Goods, 14 Vindobona Journal of International Commercial Law and Arbitration
(2010) 83 et seq.; Zeller, Commodities Sale and CISG, FS Kritzer (2008), pp. 627–639; Schwenzer/Hachem,
The CISG – Successes and Pitfalls, 57 American Journal of Comparative Law (2009) 457 (478).
54 See Lew/Mistelis/Kröll, Comparative International Commercial Arbitration (2003), paras 18–34, 18–
35 and 18–41 et seq.

55 See UNCITRAL, Digest of Case Law on the CISG, Art. 6. See also Audit, Vente Internationale (1990),
p. 40. According to Bonell, in: Bianca/Bonell, Commentary (1987), pp. 63–64, the issue of the possibility
of “opting-in” arises only where State courts are involved, since generally the parties are not allowed to
select by virtue of a choice of law an international convention, instead of a particular domestic law.
56 But see also the specific proposal by GDR: Official Records, pp. 86, 252–253.
57 Tribunale di Padova (Italy) 11 January 2005, CISG-Online 967 (Pace). See Xiamen Intermediate
People’s Court (China), 5 September 1994 (fish power case), CISG-Online 464 (Pace); See also Ferrari,
Remarks on the UNCITRAL Digest’s Comments on Article 6 CISG, 25 Journal of Law and Commerce
(2005–06) 13 (14, 34).
58 For a comparison between the UNIDROIT Principles and the CISG see Borisova, Remarks on the
Manner in which the UNIDROIT Principles May Be Used to Interpret or Supplement Article 6 of the
CISG, http://www.cisg.law.pace.edu/cisg/principles/uni6.html#ed. See also Felemegas (ed.), An Interna-
tional Approach to the Interpretation of the United Nations Convention on Contracts for the Interna-
tional Sale of Goods (1980) as Uniform Sales Law (2006), pp. 39–44.
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may readily identify in the CISG is Art. 12 as the language of Art. 6 CISG indicates. Of
course, one cannot overemphasize the fact that the PICC overall are of a dispositive
nature providing a set of guideline rules for international contracts and as such any
mandatory character would be indicative of the importance of a rule of law in the PICC
system and would be of a different nature than a mandatory rule of law in international
or domestic law.
In the PECL the comparable provisions are Arts 1:102 and 1:103. Art. 1:102(1) 30
provides that the freedom of contract is subject to “good faith and fair dealing, and
the mandatory rules established” in PECL and in para. (2) it is established that “the
parties may exclude the application of any of the Principles or derogate from or vary
their effects, except as otherwise provided by these Principles”. Art. 1:103 clarifies the
role of mandatory rules of law of national, supranational and international law applic-
able by operation of relevant conflict of laws rules. The PECL have the aspiration to
create a system suitable for adoption by national or international legislators and
coordinate the application of dispositive and mandatory rules.59
Finally, the DCFR provides for party autonomy and its limits in Art. 1:102. Freedom 31
of contract is subject to any applicable mandatory rules (para. 1), while parties may
“exclude the application of any…rules relating to contracts or…the rights and obliga-
tions arising from them, or derogate from or vary their effects, except as otherwise
provided”. The DCFR provides a normative system very similar to that created by the
PECL and equally has the aspiration of being a model for consideration or adoption by
national and international legislators.
59 For a comparison between the PECL and the CISG see Schroeter, Freedom of contract: Comparison
between provisions of the CISG (Article 6) and counterpart provisions of the Principles of European
Contract Law, 6 Vindobona Journal of International Commercial Law and Arbitration (2002-2) 257–266.
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Chapter II
General Provisions
Article 71
(1) 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.
(2) Questions concerning matters governed by this Convention which are not
expressly settled in it are to be settled in conformity with the general principles on
which it is based or, in the absence of such principles, in conformity with the law
applicable by virtue of the rules of private international law.
Bibliography: Andersen, Defining Uniformity in Law, 1 Uniform Law Review (2007) 5; Bonell, L’Inter-
pretazione del Diritto Uniforme alla Luce dell’ Art. 7 della Convenzione di Vienna Sulla Vendita
Internazionale, Rivista di diritto Civile (1986); Ferrari, Uniform interpretation of the 1980 Uniform Sales
Law, 24 Georgia Journal of International and Comparative Law (1994-95) 183; Gebauer, Uniform Law,
General Principles and Autonomous Interpretation, 4 Uniform Law Review (2000) 683; Kastley, Unifica-
tion and Community: A Rhetorical Analysis of the United Nations Sales Convention, 8 Northwestern
Journal of International Law and Business (1988) 574; Magnus, General Principles of UN-Sales Law, 3
International Trade and Business Law Annual (1997) 33; Martı́nez Can ~ellas, La interpretación y la
integración de la Convención de Viena sobre compraventa internacional de mercaderı́as de 11 de abril de
1980 (2004); Van Alstine, Dynamic Treaty Interpretation, 146 University of Pennsylvania Law Review
(1998) 687; Zeller, Four-Corners – The Methodology for Interpretation and Application of the UN (2003)
(Pace);
CISG-AC Opinions: CISG-AC Opinion no 4, Contracts for the Sale of Goods to Be Manufactured or
Produced and Mixed Contracts (Article 3 CISG), 24 October 2004. Rapporteur: Professor Pilar Perales
Viscasillas, Universidad Carlos III de Madrid (at http://www.cisg-ac.org); CISG-AC Opinion no 6,
Calculation of Damages under CISG Article 74, Spring 2016. Rapporteur: Professor John Y. Gotanda,
Villanova University School of Law, Villanova, Pennsylvania, U.S. (at http://www.cisg-ac.org); CISG-AC
Opinion no 9, Consequences of Avoidance of the Contract, 15 November 2008. Rapporteur: Professor
Michael Bridge, Tokyo, Japan (at http://www.cisg-ac.org); CISG-AC Opinion no 10, Agreed Sums Payable
upon Breach of an Obligation in CISG Contracts, 3 August 2012. Rapporteur: Dr. Pascal Hachem, Bär &
Karrer AG, Zurich, Switzerland (at http://www.cisg-ac.org); CISG-AC Opinion no 12, Liability of the
Seller for Damages Arising Out of Personal Injuries and Property Damage Caused by Goods and Services
under the CISG, 20 January 2013. Rapporteur: Professor Hiroo Sono, School of Law, Hokkaido
University, Sapporo, Japan (at http://www.cisg-ac.org); CISG-AC Opinion no 13, Inclusion of Standard
Terms under the CISG, 20 January 2013. Rapporteur: Professor Sieg Eiselen, College of Law, University of
South Africa, Pretoria, South Africa (at http://www.cisg-ac.org); CISG-AC Opinion no 14, Interest under
Article 78 CISG, 21 and 22 October 2013. Rapporteur: Professor Doctor Yes˛im M. Atamer, Istanbul Bilgi
University, Turkey (at http://www.cisg-ac.org); CISG-AC Opinion no 16, Exclusion of the CISG under
Article 6, 30 May 2014. Rapporteur: Doctor Lisa Spagnolo, Monash University, Australia (at http://
www.cisg-ac.org).
Outline
1. Interpretation of the Convention (Art. 7(1)). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
a) General remarks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
b) Interpretative principles of the CISG. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
aa) Internationality and uniformity. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
1 Arts 7, 9, 11, 12 and 13 are written under the Research Project of Plan Nacional de I+D del Ministerio
de Economı́a y Competitividad (DER2013-48401-P) and (DER2016-78572-P).
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Chapter II. General Provisions 1–2 Article 7

bb) Irrelevance of precedent derived from domestic law . . . . . . . . . . . . . . . 18
cc) Good faith . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
(i) Drafting history . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
(ii) Good faith as a principle of interpretation of the Convention 23
(iii) Good faith as a substantive principle to be applied to the
formation and the performance of the contract. . . . . . . . . . . . . . . . 24
(iv) Pre-contractual liability under the CISG. . . . . . . . . . . . . . . . . . . . . . . . 31
c) Tools for the interpretation of the Convention . . . . . . . . . . . . . . . . . . . . . . . . . . 37
aa) Literal interpretation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
bb) Legislative history. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
cc) The Preamble of the CISG . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
dd) Case law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
ee) Doctrine . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
ff) Other tools . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
2. Gap-filling within the CISG (Art. 7.2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
a) General remarks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
b) Matters excluded from the CISG. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
c) Internal gaps within the CISG. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
aa) General Principles embodied in the CISG . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
bb) General Principles external to the CISG: Lex Mercatoria and the
PICC . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67

The main objective of the Convention – to provide a universal set of rules of law 1
applicable to any international sale of goods – is enshrined in Art. 7. Art. 7 provides a
method to ensure that the Convention is applied in a uniform way so as to remove legal
barriers to international trade2. The drafters established autonomous interpretative
criteria based upon the principles of internationality, uniformity and good faith
(Art. 7(1)), and an autonomous gap-filling method through the application of general
principles inherent to the CISG (Art. 7(2)). To apply Art. 7(2) a distinction should be
drawn between internal gaps (lacunae praeter legem), i. e., an issue that it is unresolved,
and external gaps (lacunae intra legem), i. e., issues intentionally excluded, and matters
expressly outside the Convention3.
Art. 7 is considered to be the most important provision within CISG since the 2
Convention’s success depends upon the direction taken by courts and arbitral tribunals
with respect to interpretation and gap-filling. It has been considered the centre-piece of
the CISG – and other uniform international law instruments as well, since it is their
source of inspiration – as it applies throughout the Convention in order to protect the
Convention’s integrity by interpreting or filling gaps in a uniform way, hence achieving
an autonomous interpretation and application of the Convention4. It tries to avoid
forum shopping, i. e. choosing a forum with jurisprudence more favourable to one of
the parties5, and achieve the goal of making minimum interference with the rules of
private international law.
2 A goal recognized by several Courts: see in support of the application of the CISG to Hong-Kong:
United States District Court, Northern District of Illinois (U.S.) 3 September 2008 (refrigerators and
freezers), CNA Int’l Inc. v Guangdong Kelon Electronical Holdings et al., CISG-Online 2043 (Pace).
3 For a description of the different terminology employed by scholars: Janssen/Kiene, The CISG and Its
General Principles, in: Janssen/Meyer (eds), CISG Methodology (2009), 263–265.

4 Art. 7 CISG applies throughout the Convention, including the interpretation of usages of trade.
5 On this point, see: Ferrari, Forum shopping et droit materiel uniforme, Journal du Droit International
(2002) 383 (383 et seq.). In agreement: Witz, L’interprétation de la CVIM: Divergences dans l’interpréta-
tion de la Convention de Vienne, in: Ferrari, The 1980 Uniform Sales Law (2003), p. 279 (280).
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3 The system introduced by Art. 7 has proven to be very successful in practice and has
been well received by scholars and jurisprudence. This is due not only to the sensible
choice made by the drafters and hence the quality of the rule, but also to the efforts
made by several institutions, scholars, and case law to achieve a widespread and
uniform interpretation and application of the Convention. For this reason, and due to
the fact that Art. 7(1) is addressed to its interpreters, Art. 7(1) ought to be considered an
imperative provision for the parties6. It is highly questionable whether derogation from
such a general principle would be valid or enforceable under various domestic laws or
any general principles for international trade practice.
4 Art. 7(2), however, is in part dispositive, and the parties may agree that in absence of
general principles within CISG, resort should be had to soft law rules before turning to
domestic law7. This consideration relies on the fact that reference to domestic law in
Art. 7(2) is a conflict of law rule which can be displaced by the parties.
5 There is a strong link between Art. 7 paras 1 and 2. On the one hand, interpretation
techniques should be used for gap-filling and thus the interpretative criteria set forth in
para. 1 also applies to para. 2. On the other hand, some general principles on which the
CISG is based (Art. 7(2)) also apply to the interpretation of the Convention (Art. 7(1)). It is
sometimes difficult to draw a line between interpretation and gap-filling, and indeed in
some instances it is unnecessary: the combination of both techniques may be adapted to
include new technical and economic developments in the Convention8. Furthermore, an
interplay between Arts 7 and 8 CISG can be observed, particularly when applying to the
interpretation of the contract some of the general principles upon which the CISG is based9.
6 The ULIS did not have any rule on the interpretation of the Uniform Law, although
its drafters were clear that in order to apply the law, the rules of private international
law were excluded (Art. 2 ULIS). The purpose of this provision was clear: to achieve a
uniform application of the text thus avoiding recourse to the rules of private interna-
tional law as that method may lead to different results.

1. Interpretation of the Convention (Art. 7(1))
7 a) General remarks. The inclusion of this provision in the CISG arises from the
desire of the drafters to avoid dangers and risks that may result in the interpretation and
application of an international text, creating uniform rules in countries belonging to
different legal systems and thus with distinctive interpretative rules and principles. In
other words, it means the recognition of a provision largely ignored during the process
of unification of the sales of goods that was introduced in the 1978 Draft Project. The
6 Bonell, in: Bianca/Bonell, Commentary (1987), Art. 7 para. 3.3 (Pace); Bridge, in: Ferrari/Flechtner/
Brand, Draft Digest and Beyond (2003), p. 253, in regard to Art. 7(1). In case law: Arbitral Award,
Compromex, 30 November 1998 (sweets), CISG-Online 504 (Pace).
7 See the applicable law clause proposed by Illescas Ortiz/Perales Viscasillas, Derecho Mercantil Inter-
nacional (2003), p. 84. The clause reads as follows: “The law applicable to the present contract is the UN
Convention on Contracts for the International Sale of Goods. Issues not expressly settled by the Convention
or by its general principles, shall be resolved in accordance with the UNIDROIT Principles for International
Commercial Contracts and subsidiary by the Law of the State” (translation by the author).
8 Schwenzer/Hachem, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 7 para. 5; and Schlech-
triem/Witz, Convention de Vienne sur les Contrats de Vente Internationale de Marchandises (2008),
para. 80.
9 See for example: Rule 8 CISG-AC Opinion no 10. But see denying the application of the good faith
principle as a guiding principle for the interpretation of the contract: Schmidt-Kessel, in: Schlechtriem/

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Convention creates an almost self-sufficient system detached from the usual interpreta-
tion of domestic laws and by which attention should be paid to certain principles in
order to interpret the Convention. By doing so, risks derived from the application of
interpretative rules specific to a domestic legal system – which are inadequate for a text
originated, elaborated, applied and approved in an international context – is avoided,
and at the same time an international, autonomous and uniform interpretation and
application of the Convention is achieved10. In any case, a balance must be achieved
between the international origin of the Convention and the fact that the CISG is
inserted in the general structure of each domestic law.
Despite the fact that Art. 7 is silent on the issue, scholars are in agreement as to the 8
way (method) in which interpretation is to be done: a wide interpretation of the CISG
that is to be complemented by a literal (grammatical), teleological, systematic and
historical interpretation supported by the gap-filling system contained in para. 211. A
wide interpretation of the CISG as a principle is not incompatible with a restrictive
interpretation of certain provisions or terms within the Convention, such as for example
a restrictive interpretation of Art. 79 CISG12 or Art. 44 CISG13.
The CISG should not be interpreted in light of public international law14, and 9
especially in accordance with the 1969 Vienna Convention on the Law of Treaties15.
Although some scholars are in disagreement, the 1969 Convention is generally con-
sidered to only apply in regard to CISG Part IV16. Very few cases rely on the 1969
Convention and even when relying on it, it is suggested that the same result would have
been achieved if applying the criteria set forth in Art. 7 which is the lex specialis17.
10 Cf. Bonell, L’Interpretazione del Diritto Uniforme alla Luce dell’Art. 7 della Convenzione di Vienna
Sulla Vendita Internazionale, Rivista di diritto Civile (1986) 221 (221 et seq.); Ferrari, Uniform
interpretation of the 1980 Uniform Sales Law, 24 Georgia Journal of International and Comparative
Law (1994) 183 (200 et seq.) (Pace); and Perales Viscasillas, Una aproximación al artı́culo 7 de la
Convención de Viena de 1980 sobre compraventa internacional de mercaderı́as. (Aplicaciones concretas
en la parte II de la Convención), Cuadernos de Derecho y Comercio (1995) 55 (55 et seq.). Or at least a
“high degree of consistency”: Bergsten, Methodological Problems in Drafting of the CISG, in: Janssen/
Meyer (eds), CISG Methodology (2009), p. 31.
11 Schwenzer/Hachem, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 7 (see comment in text)
paras 21 et seq.; Volken, The Vienna Convention: Scope, Interpretation and Gap-filling, in: Volken/
Sarcevic (eds), International Sale of Goods (1986), p. 19 (19 et seq.) (Pace); Melis, in: Honsell, Kommentar
(1997), Art. 7 (see comment in text) para. 11; Witz/Salger/Lorenz, Kommentar (2000), Art. 7 paras 18–25.
12 Oberlandesgericht München (Germany), 5 March 2008 (stolen car), CISG-Online 1686 (Pace), but
also considering further that the concept of seller’s liability must be given an extensive interpretation.
13 Art. 44 is an exception, and as such must be narrowly interpreted: Saarländisches Oberlandesgericht
(Germany) 17 January 2007 (atural stone marble panels), CISG-Online 1642 (Pace).
14 See: Secretariat Explanatory Note to Art. 5 (identical to Art. 7) of the UN Convention on the Use of
Electronic Communication in international contracts (2005), para. 107: “It follows a practice in private
law treaties to provide self contained rules of interpretation, without which the reader would be referred
to general rules of public international law on the interpretation of the treaties that might not be entirely
suitable for the interpretation of private law provisions”.
15 Available at http://untreaty.un.org/ilc/texts/instruments/english/conventions/1_1_1969.pdf. But see:
Magnus, Tracing Methodology in the CISG: Dogmatic Foundations, in: Janssen/Meyer (eds), CISG
Methodology (2009), pp. 46–52.
16 Volken, The Vienna Convention: Scope, Interpretation and Gap-filling, in: Volken/Sarcevic (eds),
International Sale of Goods (1986), p. 19 (38) (Pace); Martı́nez Can ~ellas, La interpretación y la integra-
ción de la Convención de Viena sobre compraventa internacional de mercaderı́as de 11 de abril de 1980
(2004) p. 134; Honnold, Uniform Law (2009), paras 103 seq.; Enderlein, Ley Uniforme y su aplicación por
jueces y árbitros, Revista de la Facultad de Derecho de la Universidad Complutense, Curso 1987–1988,
229 (233); Schwenzer/Hachem, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 7 para. 23.
17 See Martı́nez Can ~ellas, La interpretación y la integración de la Convención de Viena sobre
compraventa internacional de mercaderı́as de 11 de abril de 1980 (2004) p. 109 in relation with the
Arbitral Award, Netherlands Arbitration Instituut, 15 October 2002 (condensate crude oil mix), CISG-
Online 740 or 780 (Pace).

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10 b) Interpretative principles of the CISG. The principles of interpretation of the CISG
are those expressly considered in Art. 7(1): international character, uniformity in its
application and the observance of good faith in international trade.
11 This provision is universally recognized through most uniform commercial law texts,
particularly those emanating from UNCITRAL and UNIDROIT18. Resorting to the general
principles is not always necessary i. e., when the Convention itself gives the interpretative
standards to apply to specific situations such as in Art. 10 when determining the relevant
place of business where a party has offices in more than one location.
12 However, in some instances, the CISG uses broad and general terms that might create
divergent interpretations of the convention. For example, in Art. 3 the use of the terms
“substantial part” and “preponderant part”, the concepts of fundamental breach under
Art. 25, specific performance in Art. 28, impediment under Art. 79, etc. The risk of using
abstract terms is that judges may reach different interpretations, especially if the interpreta-
tions are based on the meaning of these terms in the light of their domestic legal, economic,
and social concepts19. However, these terms – and others, e. g. good faith, validity, goods20,
sale, place of business21, conformity, intellectual property22 – under CISG have their own
meaning separate from national concepts and thus an international interpretation and a
uniform and autonomous CISG understanding of these notions ought to be achieved
(Art. 7(1))23. In this regard, some of the undefined terms and principles – like the use of the
word reasonable – are used to provide a flexible interpretation of the CISG and thus permit
its adaptation to the specific circumstances of the case at hand and to its present application.
13 In this sense, the Convention creates its own terminology displacing similar concepts
under domestic law; the meaning of CISG terms are to be found within the CISG and
not in domestic laws. The Convention, through its uniform and autonomous concepts24,
methodology25 and progressive awareness, tries to achieve an international, concrete,
predictable, and uniform interpretation.
18 And recognized by the courts, see e. g.: Audiencia Provincial de Valencia (Spain) 7 June 2003
(concentrate grape juice), Cherubino Valsangiacomo, S.A. v American Juice Import, Inc., CISG-Online
948 (Pace) (www.cisgspanish.com). Infra III.
19 See also Witz, L’interprétation de la CVIM: Divergences dans l’interprétation de la Convention de
Vienne, in: Ferrari, The 1980 Uniform Sales Law (2003), p. 279 (284).
20 I.a., adopting a wide concept of “goods” on the basis of Art. 7.1 CISG as to include tangible and intangible:
Rechtbank Midden-Nederland (Netherlands) 25 March 2015 (software programm), Corporate Web Solutions
Ltd. v Vendorlink B.V., CISG-Online 2591. The autonomous concept is flexible enough as to include capacity
contracts in the gas industry: Perales Viscasillas, Las conexiones internacionales por gasoductos: contratos de
interconexión y de capacidad, Revista de Derecho de la Competencia y la Distribución, 2017, No 20.
21 See Brekoulakis, Art. 10, para. 10 (in this commentary); Schwenzer/Hachem, in: Schlechtriem/

22 See Kröll, Art. 42, para. 12 (in this commentary): “reference to “intellectual property” in Art. 42
should be understood in the broad sense adopted in various international conventions, evidencing a
broad international consensus”.
23 Tribunale di Padova (Italy) 25 February 2004 (agricultural products), SO.M.AGRI s.a.s. di Ardina
Alessandro & C. v Erzeugerorganisation Marchfeldgemüse, GmbH & Co. KG, CISG-Online 819 (Pace). See
also Court of Appeal of New Zealand (New Zealand) 22 July 2011 (trucks), CISG-Online2215 (Pace) consider-
ing only valid an interpretation based upon case law and scholarly writing on CISG in regard to Art. 35.
24 Such as conformity of the goods: Appelationshof Bern (Switzerland) 11 February 2004 (cables), CISG-
Online 1191 (Pace). Also the international and autonomous concept of the “salc of goods” and thus an
extended concept o the contract is found for example in Art. 3 CISG. See CISG-AC, opinion No 4. However,
recently in a narrow and domestic interpretation: SAP Guipuzcoa (Spain) 6 June 2017 (rollers) where the
buyer provided the “construction plans”, the Court considered the transaction as a work contract without
considering Art. 3.1 CISG. Similarly without considering the Convention: Cámara Nacional de Apelaciones
en lo Commercial (Argentina) 27 February 2015 (books) in relation with a “contrato estimatorio”.
25 See Audiencia Provincial de Valencia (Spain) 7 June 2003 (concentrated grape juice), Cherubino
Valsangiacomo, S.A. v American Juice Import, Inc., CISG-Online 948 (Pace) (www.cisgspanish.com).
Also De Ly, Uniform interpretation: What is being done? Official efforts, in: Ferrari, The 1980 Uniform

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In any case, the CISG also adopts different bases for certain issues than those 14
considered in domestic laws, i. e., the division between procedural and substantive
matters26 or the remedies for defects in the goods, to the extent that the CISG is the
preferred model to be followed in modern contract law. The domestic law of the forum
should only be considered when the CISG refers to a concept foreign to uniform
substantive law, such as when referring to private international law27, although in this
area also international private law uniform instruments might be considered28.
Finally, it is useful to note that divergent interpretations of the CISG do arise in 15
certain situations. This is seen in particular when it is unclear whether a matter is to be
considered an internal or external gap, from unclear drafting of a rule due to legal
compromise, such as in the case of irrevocable offers under Art. 16(2)(a), or when two
provisions within the Convention apparently contradict each other, such as Arts 14 and
55 in relation to open price contracts.
aa) Internationality and uniformity. Art. 7(1) mandates that “in the interpretation of 16
the Convention, regard is to be had to its international character and to the need to
promote uniformity in its application”. In order to take into account the international
character of the Convention, consideration is to be given to the international framework
of the application and permanent development of uniform law rules. Internationality
and uniformity are functionally interrelated and interdependent29.
The goal of uniform interpretation of the Convention aims to ensure that uniform 17
rules will be considered the common denominator in international business transac-
tions, independent from the nationality of the parties, the place of performance, or the
kind of goods30. Although uniformity does not mean an equal solution in all cases31,
there is a possibility to adapt the solutions provided by the CISG to the particular
circumstances of each case, especially when applying undefined terms or general
Sales Law (2003), p. 335 (344): “uniform interpretation creates a new methodology in which different
interpretation techniques from different legal traditions are being blended”.
26 See Giovannucci, Procedural Law Issues and Uniform Law Conventions, Uniform Law Review (2000)
23 (23 et seq.) A paradigmatic situation is that of attorney’s fees where case law and scholars and clearly
in disagreement as to whether it is a substantive or procedural issue. Cf.: CISG-AC Opinion no 6, paras
5.1 et seq.
27 For such a conclusion: Ferrari, Do Courts interpret the CISG Uniformly?, in: Ferrari (ed.), Quo
Vadis CISG? Celebrating the 25th anniversary of the United Nations Convention on Contracts for the
International Sale of Goods (2005), p. 6 (10), Tribunale di Padova (Italy) 11 January 2005 (rabbits),
Ostroznik Savo v La Faraona soc. coop. a.r.l., CISG-Online 967 (Pace); and Tribunale di Padova (Italy)
25 February 2004 (agricultural products), SO.M.AGRI s.a.s. di Ardina Alessandro & C. v Erzeugerorga-
nisation Marchfeldgemüse, GmbH & Co. KG, CISG-Online 819 (Pace). According to Ferrari, The CISG’s
interpretative goals, its interpretative method and its general principles in case law (Part I), IHR, 4/2013,
pp. 145–146, the concept of “party” is to be found in domestic private international law rules because
agency contracts are not covered by CISG.
28 See Preamble of The Hague Principles on choice of law in international commercial contracts
(approved on 19 March 2015): “They may be used to interpret, supplement and develop rules of private
international law”.
29 Felemegas, Part One. Introduction, in: Felemegas (ed.), An International Approach to the Interpreta-
tion of the United Nations Convention on Contracts for the International Sale of Goods (1980) as
Uniform Sales Law (2007), p. 12.
30 U.S. District Court for the Southern District of New York (U.S.) 26 March 2002 (magnetic resonance
imaging system (“MRI”)), CISG-Online 615 (Pace): The CISG aims to bring uniformity to international
business transactions, using simple, non-nation specific language.
31 Relative uniformity: DiMatteo/Dhooge/Greene/Maurer/Pagnattro, International Sales Law. A Critical
Analysis of CISG Jurisprudence (2005), pp. 10–11; Andersen, Defining Uniformity in Law, Uniform Law
Review (2007) 5 (50 et seq.); Flechtner, The future of the Sales Convention: In defense of diversity (some
non-uniformity) in interpreting the CISG, in: Festschrifft für Ingeborg Schwenzer zum 60. Geburtstag
(2011), Band II, pp. 493–514.

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principles within the CISG. At the same time, the application of the CISG in a
uniform way implies the need to find also a good solution from a legal technical side,
i. e., convincing and authoritative32. In any case, “uniformity does not mean that the
Convention should be frozen in time and independent of evolving circumstances”33 as
evidenced by the importance that the Convention adjusts to the interpretations and
gap-filling of the contract by the usages of trade (Art. 9), which might change over
time34. Furhtermore the objective to reduce transaction costs speaks in favour of a
uniform interpretation35.
18 bb) Irrelevance of precedent derived from domestic law. International interpretation
of the Convention further means that application of domestic rules of interpretation to
the Convention is to be avoided.36 In general, an autonomous interpretation detached
from the traditional concepts, principles, rules and terms of a domestic legal system is to
be sought, unless these domestic concepts are also commonly and internationally
recognized37.
19 There are a number of examples where not only courts, but also arbitral tribunals rely
on domestic standards when interpreting the CISG. In particular, when there is an
analogous domestic provision to that of the Convention, some courts rely on cases on
the domestic provision for interpreting the CISG38. However, this kind of interpretation
32 See Gebauer, Uniform Law, General Principles and Autonomous Interpretation, Uniform Law
Review (2000) 686 (692).

33 Sekolec, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 2; Magnus, Tracing Meth-
odology in the CISG: Dogmatic Foundations, in: Janssen/Meyer (eds), CISG Methodology (2009), pp. 45–
46. Other international uniform law instruments are an example: The 1958 New York Convention on the
Recognition and Enforcement of Foreign Arbitral Awards has been subject to a progressive interpretation
of the term “agreement in writing” in Art. II.2 as to the point that UNCITRAL has rendered a
Recommendation on the interpretation of such term to present times. See UNCITRAL Recommendation
regarding the interpretation of Art. II (2) and Art. VII (1) of the Convention on the Recognition and
Enforcement of Foreign Arbitral Awards (New York, 1958), 7 July 2006. See also comments to Art. 13
para. 10.
34 Hackney, Is the United Nations Convention on the International Sale of Goods Achieving Uni-
formity?, 61 Louisiana Law Review (2001) 473 (476).

35 Flechtner, Uniformity and Politics: Interpreting and filling gaps in the CISG. Festschrift für Ulrich
Magnus zum 70 Geburstag. Sellier (2014), pp. 194–195.

36 See Secretariat Commentary on 1978 Draft Convention, Art. 6 (now Art. 7) para. 1; Audiencia
Provincial de Valencia (Spain) 7 June 2003 (concentrated grape juice), Cherubino Valsangiacomo, S.A. v
American Juice Import, Inc., CISG-Online 948 (Pace) (www.cisgspanish.com); Oberlandesgericht Frank-
furt a. M. (Germany) 20 April 1994 (mussels from New Zealand), CISG-Online 125 (Pace) confirmed by
Bundesgerichtshof (Germany) 3 April 1996 (cobalt sulphate), CISG-Online 135 (Pace); Tribunale di Pavia
(Italy) 29 December 1999 (high fashion textiles), Tessile 21 S.r.l. v Ixela S.A., CISG-Online 678 (Pace);
Tribunale di Rimini (Italy) 26 November 2002 (porcelain tableware), CISG-Online 737 (Pace); and
Tribunal di Vigevano (Italy) 12 July 2000 (sheets of vulcanized rubber used in manufacture of shoe soles),
CISG-Online 493 (Pace); Oberster Gerichtshof (Austria) 23 May 2005 (coffee machines), CISG-Online
1041 (Pace); Bundesgerichtshof (Germany) 2 March 2005 (frozen pork meat), CISG-Online 999 (Pace);
Juzgado Primera Instancia núm.1 de Fuenlabrada (Spain) 11 May 2012 (machine), Instalaciones y
FabricacionesIndustriales, S.A. v PM di Pizzolato Giorgio & C., S.A.S., CISG-Online 2464 (Pace); and
Juzgado de Primera Instancia e Instrucción, No 2 de La Almunia de Don ~a Godina (Spain) 28 November
2013 (cheese), CISG-Online 2532 (Pace).
37 Bundesgerichtshof (Germany) 2 March 2005 (frozen pork meat), CISG-Online 999 (Pace).
38 It is particularly the case of U.S. courts that resort to domestic law in order to interpret CISG. For
example: generally; U.S. Federal Appellate Court, 4th Circuit (U.S.) 21 June 2002 (drapery fabric), Schmitz-
Werke v Rockland, CISG-Online 625 (Pace); burden of proof and § 2–314 UCC in comparison with
Art. 35(2) CISG: U.S. Federal Appellate Court 7th Circuit (U.S.) 23 May 2005 (pork ribs), Chicago Prime
Packers, Inc. v Northam Food Trading Co., Chicago Prime Packers, Inc. v Northam Food Trading Co.,
CISG-Online 1026 (Pace); contract formation under Art. 2 UCC: U.S. Federal District Court New York
(U.S.) 19 March 2005 (generic pharmaceutical ingredient), Genpharm Inc. v Pliva-Lachema A.S, CISG-
Online 1006 (Pace); Art. 50 CISG in relation with § 2–714 UCC as considered by U.S. District Court,

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Chapter II. General Provisions 19 Article 7

is not in line with the parameters set forth in Art. 7(1). First, these courts are reading
the CISG domestically. Second, developed case law on domestic provisions is heavily
attached to national roots and domestic interpretations and thus it is not apt to
interpret the CISG39 when there are similarities in the terms used40, or when a term
appears to be adopted from a domestic system41. Third, one cannot rely on the faux
amis, i. e., identical words in the CISG and domestic law might well mean different
things and may have been developed differently since the CISG adopts a neutral and a-
Southern District of New York (U.S.) 22 May 1990 (rubber sealing members), Interag Company Ltd. v
Stafford Phase Corporation, CISG-Online 19 (Pace); Art. 79 CISG and case law on § 2–615 UCC: U.S.
District Court Northern District of Illinois Eastern Division (U.S.) 6 July 2004 (used railroad rails), Raw
Materials Inc., v Manfred Forberich GmbH & Co., KG, CISG-Online 925 (Pace); and Interim Arbitral
Award, AAA, 23 October 2007 (frozen chicken parts), Macromex Srl. v Globex International Inc., CISG-
Online 1645 (Pace): “If the CISG and its case law fail to provide the necessary information the next step is
to look beyond that to private law (…). Analytic approaches of American courts have certainly included
analogizing to the UCC to clarify Art. 79 of the CISG (…). This approach is persuasive as the UCC
contains a provision on commercially reasonable substitutes (…) that are quite similar (…). The
relevance of using the UCC to interpret the CISG depends on whether the UCC has been interpreted
in such a way that would provide more guidance than the CISG and its provisions. As one scholar put it:
“where no principle can be found, gap-filling by uniform rules is impossible, and one has to revert to
domestic law. [Thus], recourse to domestic law is unavoidable in most cases.” (…)”. It is clear that when
those cases refer to the case law on the CISG at least USA cases are included. However, international
CISG cases were considered by: U.S. District Court Eastern District of Louisiana (U.S.) 17 May 1999
(mammography units), Medical Marketing v Internazionale Medico Scientifica, CISG-Online 387
(Pace). See also Canton of Ticino: Pretore della giurisdizione di Locarno Campagna (Switzerland) 27 April
1992 (furniture), CISG-Online 68 (Pace), pointing out that the procedure to notify the lack of
conformity of the goods under the CISG follows the same principles as in Swiss Law, thus Swiss
scholarly writing and case law were considered pertinent to the interpretation of the CISG.
39 Also critical with those U.S. cases: Ferrari, Do Courts interpret the CISG Uniformly?, in: Ferrari
(ed.), Quo Vadis CISG?. Celebrating the 25th anniversary of the United Nations Convention on Contracts
for the International Sale of Goods (2005), p. 6 (6 seq.); and Flechtner, The CISG in US Courts: The
Evolution (and Devolution) of the Methodology of Interpretation, in: Ferrari (ed.), Quo Vadis CISG?.
Celebrating the 25th anniversary of the United Nations Convention on Contracts for the International
Sale of Goods (2005), p. 93 et seq.), but also pointing out other decisions from the U.S. and other
countries in which an international understanding of CISG; see also Honnold, Uniform Law (2009),
para. 92. See Audiencia Provincial de Pontevedra (Spain) 19 December 2007 (frozen seafood), CISG-
Online 1688 (Pace) (www.cisgspanish.com) denying the use of case law on the Spanish Commercial Code
to interpret the CISG.
40 But see: U.S. Federal District Court of New York (U.S.) 6 April 1998 (shoes), Calzaturificio Claudia v
Olivieri Footwear, CISG-Online 440 (Pace): “The Second Circuit has cautioned that case law interpreting
UCC provisions is not “per se applicable.” (…). Although the CISG is similar to the UCC with respect to
certain provisions, it differs from the UCC with respect to others, including the UCC’s writing
requirement for a transaction for the sale of goods and parol evidence rule. Where controlling provisions
are inconsistent, it would be inappropriate to apply UCC case law in construing contracts under the
CISG”. See also: U.S. Court of Appeals, 2nd Circuit (U.S.) 6 December 1995 (compressors for air
conditioners), Rotorex Corp. v Delchi Carrier, S. p. A., CISG-Online 140 (Pace): “Because there is
virtually no case law under the Convention, we look to its language and to “the general principles” upon
which the Convention it is based […]. Case law interpreting analogous provisions of Art. 2 of the UCC,
may also inform a court where the language of the relevant CISG provisions tracks that of the UCC.
However, UCC case law “is not per se applicable”; Federal Appellate Court, 8th Circuit (U.S.) 14 February
2011 (inulin), Dingxi Longhai Dairy, Ltd. v Becwood Technology Group L.L.C, CISG-Online 2256
(Pace).
41 But see: Magnus, Tracing Methodology in the CISG: Dogmatic Foundations, in: Janssen/Meyer (eds),
CISG Methodology (2009), pp. 40–41; and Schwenzer/Fountoulakis, International Sales Law (2007), p. 63
referring to the foreseeability rule under Art. 74. Cautious: Gabriel, Contracts for the sale of Goods: A
Comparison of Domestic and International Law (2004), pp. 49–50: because the need to interpret the
CISG internationally and because it is not clear why specific language within CISG was adopted: a
mixture of more than one tradition. Contrary: Ferrari, Homeward Trend: What, Why and Why not, in:
Janssen/Meyer (eds), CISG Methodology (2009), pp. 171 et seq, particularly pp. 85–192 comparing the
foreseeability rule under common law and CISG and concluding that the rules are rather different.

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national language42. Finally, relying exclusively on domestic case law when interpreting
the CISG might have legal consequences43. The same conclusion applies to domestic
scholarly writings44. In light of the above, when interpreting the CISG it is only possible
to resort to domestic case law when all other relevant interpretation and gap-filling
techniques have been exhausted, including the use of foreign case law, scholarly writing,
and other international uniform law instruments.
20 Despite those situations, an increased tendency in observing the mandate of Art. 7(1)
has been seen in domestic case law and thus there has been a gradual increase in the use
of the specific and diverse techniques to interpret and fill gaps within the Convention45,
including the use of modern international uniform law instruments. This development
in the interpretation of the Convention is due to several factors: the increasing number
of countries that have ratified the Convention, the abundant information easily available
on the CISG, the success of other international uniform law instruments, such as the
PICC and PECL, the success and growing number of international commercial arbitra-
tions, the fact that comparative law and domestic law are increasingly using interna-
tional uniform law in different ways (contributing to an interpretation of the legal texts
at the light of international uniform law instruments), and finally the increased effort in
educating international operators on the specificities of uniform international commer-
cial law.
21 cc) Good faith. The last principle of interpretation considered in Art. 7(1) is good
faith: in the interpretation of the Convention regard is to be had to the need to the
observance of good faith in international trade.
42 Cf. Felemegas, Part One. Introduction, in: Felemegas (ed.), An International Approach to the
Interpretation of the United Nations Convention on Contracts for the International Sale of Goods
(1980) as Uniform Sales Law (2007), pp. 141–142. Therefore, it is erroneous to maintain that: “The CISG
is the international analogue to Article 2 of the Uniform Commercial Code (“UCC”)”: US Federal
Appellate Court 7th Circuit (U.S.) 23 May 2005 (pork ribs), Chicago Prime Packers, Inc. v Northam
Food Trading Co, CISG-Online 1026 (Pace). Also the “faux-amis” might create problems, e. g. the term
“fundamental breach” in CISG is not the same as it counterpart in common law systems. See: Honnold,
Uniform Words and Uniform Application. The 1980 Sales Convention and International Juridical
Practice, in: Schlechtriem (ed.). Einhetliches Kaufrecht und Nationales Obligationenrecht (1987), p. 115
(115 et seq.). However, some decisions insist on relying on similar provisions of domestic law: “§ 2–614
UCC is a useful guide in addressing the question of substitute performance under the CISG”: US Federal
District Court of New York (U.S.) 20 August 2008 (acrylic yarn), Hilaturas Miel, S. L. v Republic of Iraq,
43 Bundesgerichtshof (Germany) 2 March 2005 (frozen pork meal), CISG-Online 999 (Pace) (CLOUT
774) where “the Federal Court of Justice reversed the judgment of the Higher Regional Court and
amended the Regional Court’s verdict. It held that the Higher Regional Court had reached its decision
incorrectly by referring to precedents of the national jurisdiction only”. Consideration of both domestic
provisions and the CISG was not however considered a ground to reverse the judgment of an appellate
Court: Sentencia del Tribunal Surpremo (Spain) 16 May 2007 (water apparatus), CISG-Online 1638
(Pace) (www.cisgspanish.com) which considered that consideration to the rules of the Commercial Code
was to the extent to reinforce the decision and that the same result would have been achieved under
domestic law. A manifest disregard of the law might be considered a ground for denying the confirmation
of an arbitration award under certain jurisdictions or as a ground to deny the recognition and
enforcement of an award under the 1958 New York Convention. However, in those situations strict
conditions need to be met. An opportunity to consider this issue was lost by a seller in an international
sale of goods contract where it did not contest the arbitrator’s decision to use the UCC to help clarify the
CISG, but rather that the arbitrator misapplied the UCC: U.S. Federal District Court New York (U.S.)
16 April 2008 (frozen chicken parts), Macromex Srl. v Globex International, Inc., CISG-Online 1653
(Pace).
44 Court of Appeal of New Zealand (New Zealand) 22 July 2011 (trucks), CISG-Online 2215 (Pace)
stating that resort to authorities dealing with domestic law is not permissible.
45 See Ferrari, Have the Dragons of Uniform Sales Law Been Tamed?. Ruminations on the CISG’s
Autonomous Interpretation by Courts, FS Kritzer (2008), p. 134 (156 et seq.).

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(i) Drafting history. The placement of good faith as a general principle of interpretation 22
of the Convention may go unnoticed to a reader that is not familiar with the process of
elaboration of international instruments, since good faith was exiled to a remote province
as part of a compromise only detected by analysing the official records46. Good faith was
placed as a principle of interpretation of the Convention due to a compromise between
delegations – mainly of civil law background – that were in favour of a wider application
of good faith as a standard of conduct during the formation of the contract. Other
delegations – particularly from common law background – were in favour of deleting the
good faith provision as it was too vague and would lead to uncertainty in its application by
judges who may be influenced by their own legal system47. After several proposals, it was
agreed to move good faith to the interpretative provisions of the 1978 Draft Project
(Art. 6). Several unsuccessful attempts48 were made during the Diplomatic Conference
held in Vienna to place good faith as a standard of conduct of the parties during the
formation and performance of the contract or to locate it in the Preamble. In the end, no
substantial changes were made in the drafting and Art. 7 was finally approved.
(ii) Good faith as a principle of interpretation of the Convention. Considering the 23
actual place of the principle of good faith, it is clear that it is an important principle to
the interpretation of the Convention and thus acts as a framework or guide to the
judge or arbitrator. Furthermore, good faith may function to limit abuse by the
parties49 and as a principle that modulates the parties’ conduct during the formation
and performance of the contract, thus giving the interpreter the opportunity to decide
the way in which the provisions of the Convention and its undetermined concepts
should be interpreted50. In any case, as it happens with the other principles embodied
in Art. 7(1), good faith plays an important role in filling gaps of the Convention
(Art. 7(2)). To this regard, according to the dynamic approach of the CISG and its
adaptation to present times51, the observance of good faith in international trade
ought to be considered a moral or ethical standard to be followed by businesspersons,
projecting fundamental ethical values in international sales contracts. As certain
ethical values are elevated to principles that ought to be protected, their infringement
– e. g., violations of human rights in the production of contractual goods – could well
be reflected in contractual sanctions, particularly it may amount to a fundamental
breach of the contract. Arguably this is not a question of validity, which is outside the
scope of the CISG52. Not only an autonomous concept of validity applies to the
Convention and only those matters related to defects of consent are outside CISG, but
46 As recognized by Eörsi, A propos the Vienna Convention on Contracts for the International Sale of
Goods, 31 American Journal of Comparative Law (1983) 333 (349 and 354) (Pace).
47 See: Honnold, Documentary History (1989), pp. 369, 476 and 659.
48 See proposal of the Italian delegation: A/CONF.97/C.1/S. R.5, at A/CONF.97/19, paras or 14 et seq.,
pp. 276 et seq.

49 Martı́nez Can~ellas, La interpretación y la integración de la Convención de Viena sobre compraventa
internacional de mercaderı́as de 11 de abril de 1980 (2004) p. 144.
50 Audiencia Provincial de Girona (Spain), 21 January 2016 (live molluscs), Alexandridis G. & CO.
OESC v Treatment Servimant, SL, CISG-Online 2729 correcting on the basis of the principle of good
faith, the principle of full compensation that was initially considered to determine the dies a quo of the
interest rate in a situation in which the first claim was made nearly two years after the payment was due,
without the Court finding an explanation for such a delay.
51 Van Alstine, Dynamic Treaty Interpretation, 146 University of Pennsylvania Law Review (1998) 687
(780 seq.) (Pace); and Alán Barrera, La integración de lagunas en la Convención de las Naciones Unidas
sobre los contratos de compraventa internacional de mercaderas, in: Jorge Oviedo Alban ed., Obligaciones
y Contratos en el Derecho Contemporaneo, Diké Biblioteca Jurı́dica (2010) 311–355.
52 But see considering it outside the Convention: Schwenzer/Leisinger, Ethical Values and International
Sales Contracts, FS Hellner (2007), p. 249 (262).

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also modern sensibilities permeate the interpretation of the Convention and its rules.
Needless to say, ethical values might be express or implied terms of the contract via
Arts 9(1) or amount to international trade usages under 9(2)53.
24 (iii) Good faith as a substantive principle to be applied to the formation and the
performance of the contract. Scholars disagree as to the role of good faith in specific
situations. One position that strictly follows the legislative history of this provision is
that the good faith principle cannot be considered a standard of behaviour of the parties
during the formation of contract54. Other authors disagree55, giving a prominent role to
the good faith principle.
25 Despite the legislative history of this provision and its present placement, the better view
is that the principle of good faith permeates the whole text of the Convention56, deriving
53 See Art. 9 para. 18. Schwenzer/Leisinger, Ethical Values and International Sales Contracts, FS Hellner
(2007), p. 249 (263 seq.). Further discussion: Butler, The CISG- A secret weapon in the fight for a fairer
world. 35 Years CISG and Beyond. International Commerce and Arbitration, vol.19. Edited by Ingeborg
Schwenzer. Eleven International Publishing, 2016, pp. 295–316; for the remedial system: Nalin, International
Fair Trade (Fair Trade in International Contracts and Ethical Standards. International Commerce and
Arbitration, vol.19. Edited by Ingeborg Schwenzer. Eleven International Publishing, 2016, pp. 317–340.
54 Schwenzer/Hachem, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 7 para. 17. “The maxim
of “observance of good faith in international trade”, therefore, concerns the interpretation of the
Convention only and cannot be regarded as having prevailed”, although recognizing an indirect relation-
ship with the interpretation of the contract and to concretize rights and obligations established by the
provisions of the CISG; Schlechtriem/Witz, Convention de Vienne sur les Contrats de Vente Internatio-
nale de Marchandises (2008), para. 77; Huber/Mullis, The CISG (2007), p. 8; Farnsworth, The Convention
on the International Sale of Goods from the Perspective of the Common Law Countries. La Convenzione
di Vienna dell”11 aprile 1980, Quaderni di Giurisprudenza Commerciale (1981) 5 (5 et seq.); Honnold,
Uniform Law (2009), para. 94, although pointing out to a liberal application of such principle under CISG
(id., para. 95); Felemegas, Part One. Introduction, in: Felemegas (ed.), An International Approach to the
Interpretation of the United Nations Convention on Contracts for the International Sale of Goods (1980)
as Uniform Sales Law (2007), p. 13. Going too far Schwenzer, CESL and CISG, in The Evolution of Global
Trade Over the Last Thirty years, Mexico, UNAM (2014), p. 338 considering that a far reaching principle
of good faith under CISG is hardly reconcilable with the necessity of certainty and predictability in
commercial transactions and would not be recognized by common law lawyers. An intermediate position
is that of Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), pp. 154–155, who states
that good faith does not impose on the parties additional obligations unless derived from the CISG
provisions. Id., The CISG’s interpretative goals, its interpretative method and its general principles in case
law (Part I), IHR, 4/2013, pp. 154–155.
55 Bonell, L’Interpretazione del Diritto Uniforme alla Luce dell’Art. 7 della Convenzione di Vienna Sulla
Vendita Internazionale, Rivista di diritto Civile (1986) 235 et seq.; Enderlein/Maskow, International Sales
Law (1992), pp. 53 et seq.; Martı́nez Can ~ellas, La interpretación y la integración de la Convención de
Viena sobre compraventa internacional de mercaderı́as de 11 de abril de 1980 (2004) pp. 142, 148 seq.,
pp. 323 et seq.; Vázquez Lepinette, La compraventa internacional de mercaderı́as. Una visión jurispru-
dencial (2000) pp. 163 et seq.; Zeller, Four-Corners -The Methodology for Interpretation and Application
of the UN Convention on Contracts for the International Sale of Goods (2003), Chapter 4 (Pace). Oviedo
Albán, El sistema de fuentes del contrato de compraventa internacional de mercancı́as, in: Estudios de
contratación internacional. Régimen uniforme e internacional privado (2004), p. 256 (pp. 261 et seq.);
Galán Barrera, Los Principios de Interpretación de la Convención de las Naciones Unidas sobre los
contratos de compraventa internacional de mercaderı́as, in: Estudios de Contratación Internacional.
Régimen uniforme e internacional privado (2004), p. 305 (320 et seq.), pointing out that good faith is of
utmost importance to sanction notorious corruption practices of multinational enterprises; Bell, How the
Fact of Accepting Good Faith as a General Principle of the CISG Will Bring More Uniformity, Review of
the Convention on Contracts for the International Sale of Goods (CISG) (2005–2006) (18 et seq.),
pointing out that a general duty to act in good faith under the CISG is derived from the uniformity
principle; Witz/Salger/Lorenz, Kommentar (2000), Art. 7 paras 12 et seq.
56 The Secretariat Commentary on 1978 Draft, Art. 6 (now Art. 7) para. 3 recognizes that the good faith
principle applies to Part II and Part III, and thus points out that there are several manifestations of the
good faith principle throughout the Convention: Arts 16(2)(b), 21(2), 29(2), 37, 38, 40, 49(2), 64(2), 82,
85–88. The principle is even broader and applies to more aspects of the interpretation and application of
the Convention (id., para. 4).

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from it specific duties and rights to the parties. As pointed out “the confidence and
expectations generated between the parties are guided by the contractual principle of good
faith. The principle of good faith provides a basis for the expectation that contractual
duties will be duly performed. It requires a model of conduct socially accepted by the
parties at the time of the conclusion of the contract. It imposes a code of behaviour on
both parties, calling each to consider the interests of the other contracting party. These
codes represent a collaborative component within the contractual relationship”57. And that
in order to create uniformity of rules validly applied in international contracts, the CISG
“structured the concept of a contract based upon two fundamental pillars, namely, freedom
of contract and objective good faith”58.
Although this development of the good faith principle seems contrary to the 26
intention of the drafters, it is coherent with the dynamic approach to the interpretation
of the Convention and its evolution in international commercial law. It is therefore
suggested that good faith is now playing a substantive role detached from domestic law,
a result that may be attributed to the evolution in understanding the values of the
Convention59. The international and autonomous concept of good faith60 and its
substantive role is derived not only from the CISG itself – and particularly from the
reasonableness principle61 – but also from case law and scholarly writing.
Specific manifestations of good faith are also found within the CISG, as it encourages 27
parties to act in good faith, thus evidencing that good faith is also a substantive
provision and not only a mere interpretative principle of the CISG. Manifestations of
good faith as a standard of conduct are found in Arts 8, 16(2)(b), 29(2) and 80 that
reflect the estoppel principle also known as the venire contra factum proprium62, which
57 Tribunal de Justiça do Rio Grande do Sul (Brazil) 20 May 2009 (electrical discharge machine), CISG-
Online 2368 (Pace). Similarly: Tribunal of International Commercial Arbitration at the Russian Federa-
tion Chamber of Commerce and Industry Arbitration (Russian Federation) 8 February 2008 (natural gas),
58 Tribunal de Justiça do Rio Grande do Sul (Brasil) 14 February 2017 (frozen chicken legs), (www.cisg-
spanish.com); and Tribunal de Justiça do Rio Grande do Sul (Brasil) 30 March 2017 (electric motors)
(cisgspanish.com), which also referred to the good faith as “the greatest canon of international trade
relations Governed by the new Lex mercatoria”, consdering both art. 7.1 CISG and art. 1.7 PICC.
(780) (Pace).
60 Arbitral Award, Compromex, 30 November 1998 (sweets), CISG-Online 504 (Pace).
61 The reasonable principle has been considered of the same character of good faith within domestic
legal systems: see Hof Amsterdam (Netherlands) 5 January 1978 (gold and jewelry), Amran v Tesa, (Pace):
an ULIS case referring to the “buona fede” in art. 1375 of the Italian Code Civil and “goede trouw” (good
faith) in art. 1374 of the Dutch Civil Code at that time in place. In regard to Art. 8(2) CISG: Bundesgericht
(Switzerland) 5 April 2005 (triethylen tetramin (“TETA”)), CISG-Online 1012 (Pace); and Kantonsgericht
Freiburg (Switzerland) 23 January 1998 (laundry machine), T. Maschinenbau GmbH v T. Maschinenver-
trieb AG., CISG-Online 423 (Pace).
62 Arbitral Award, Internationales Schiedsgericht der Bundeskammer der gewerblichen Wirtschaft-
Wien, 15 June 1994 (cold-rolled sheets), CISG-Online 120 and 121 (Pace), which expressly states citing
Arts 7, 16(2)(b) and 29(2), that the principle of estoppel or, to use another expression, the prohibition of
venire contra factum proprium, represents a special application of the general principle of good faith. See
also recognizing estoppel from Arts 7(1) and 80: Oberlandesgericht Karlsruhe (Germany) 25 June 1997
(foil), CISG-Online 263 (Pace); Audiencia Provincial de Navarra (Spain) 27 December 2007 (machine for
repair of bricks) (Pace) (www.cisgspanish.com); Oberlandesgericht München (Germany) 15 September
2004 (leather for furniture), CISG-Online 1013 (Pace): considering that good faith under Art. 7(1) CISG
“pave the way for the consideration of established and fixed principles of the national legal systems of the
Contracting States, created as concrete ideals of the principle of good faith”; and that “the prohibition of
venire contra factum proprium can apply to the interpretation of the provisions of the CISG”; BGH
(Germany) 26 September 2012 (clay), CISG-Online 2348 (Pace) in relation to Art. 80 CISG; and
Tribunale di Rimini (Italy) 26 November 2002 (porcelain tableware), CISG-Online 737 (Pace) (obiter
dicta), without referring to any particular provision of the Convention. The principle also precludes one

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is also a general principle of the lex mercatoria63. It is also found in Art. 4064 and in the
recognition of other general principles such as the prohibition of abuse of rights
stemmed from Art. 46(1), the loyalty principle65, the duty not to impair each other’s
expectations that the contract will be performed which is often interpreted as requiring
the parties’ continuous commitment to the bargain,66 and the principle of mitigation of
damages in Art. 7767.
28 Among those duties particularly important is the duty to cooperate that have found
particular applications during the formation of the contract, such in relation with the
incorporation of standard terms deriving duties of information towards the receipient of
the standard terms68. To that extent it would contradict the principle of good faith in
international trade as well as the common cooperation and information-sharing obliga-
tion of the parties to impose the contracting partner with a responsibility to inquire
regarding unsent contractual documents would burden him with the risks and dis-
advantages of unknown opposing terms and conditions69. It has been correctly pointed
out that the principle of cooperation is seen under different angles within CISG: a) rules
of communication of information in the interest of the other party; b) a duty to
cooperate by acting in the interest of the other party (Arts 85–88 CISG); c) rules that
party from relying on a written form for the conclusion of a contract if he did not inform the other:
Oberster Gerichtshof (Austria), 6 February 1996 (propane gas), CISG-Online 224 (Pace), citing Art. 29(2)
CISG. Among the scholars: Honnold, Uniform Law (2009), para. 99; Kee/Opie, The Principle of
Remediation, FS Kritzer (2008), p. 232 (232 et seq.); Neumann, The duty to cooperate in international
sales. The scope and role of Art. 80 CISG. Sellier (2011), p. 156. Minority view estoppel under domestic
law: Arrondissementsrechtbank Amsterdam (The Netherlands) 5 October 1994 (textiles), Tuzzi Trend Tex
Fashion, GmbH v W.J.M. Keijzer-Somers, CISG-Online 446 (Pace); and U.S. District Court, Northern
District of Illinois, Eastern Division (U.S.) 29 January 2003 (fluidized bed furnace), Ajax Tool Works, Inc.
v Can-Eng Manufacturing Ltd, CISG-Online 772 (Pace).
63 Principle, no I.7 (Central at http://www.tldb.net). Arbitral Award, Tribunal of International Com-
mercial Arbitration at the Russian Federation Chamber of Commerce and Industry, 27 July 1999 (goods),
CISG-Online 779 (Pace) citing the good faith principle under Art. 7(1) and considering also estoppel as a
principle of the lex mercatoria.
64 Hof van Beroep Antwerpen (Belgium) 27 June 2001 (tiles) (Pace); Oberlandesgericht Köln (Germany)
21 May 1996 (used car), CISG-Online 254 (Pace): “when there is fraudulent conduct of the seller, the
inapplicability of Art. 35(3) CISG follows from Art. 40 in connection with Art. 7(1) CISG”. Art. 40 is an
expression of the principles of fair trading that underlie also many other provisions of the CISG, and it is
by its very nature a codification of a general principle: Arbitral Award, SCC, 5 June 1998 (4,000 tons rail
press), Beijing Light Automobile Co., Ltd. v Connell Limited Partnership, CISG-Online 379 (Pace).
65 Appellate Tribunal of Helsinki (Finland) 26 October 2000 (plastic grass carpets), CISG-Online 1078
(Pace); Tribunal de Justiça do Rio Grande do Sul (Brasil) 14 February 2017 (frozen chicken legs)
(cisgspanish.com); and Tribunal de Justiça do Rio Grande do Sul (Brasil) 30 March 2017 (electric motors)
(cisgspanish.com). The loyalty principle is expressly recognized in Arts 5.3 PICC and 1:202 PECL.
66 See, Saidov, Article 71, para 2.
67 BGH (Germany) 26 September 2012 (Clay), CISG-Online 2348 (Pace) in relation to Art. 80 CISG. The
Court made further the following reasoning: “it is not expressly settled in the CISG how to treat cases in
which both parties to the contract contributed to the damage by committing independent breaches of
contract. Pursuant to Art. 7(2) CISG, this question has to be answered in light of the general principles
underlying Arts. 77 and 80 CISG. In case of dividable remedies, like damages, the respective party’s
contribution to the damage has to be reasonably taken into account. It is the general opinion that both
provisions are an expression of the duty under Art. 7(1) CISG to safeguard good faith in international trade”.
68 Bundesgerichtshof (Germany) 31 October 2001 (machinery), CISG-Online 617 (Pace). Also: Foreign
Trade Court of Arbitration attached to the Yugoslav Chamber of Commerce (Serbia) 9 December 2002
(aluminium), CISG-Online 2123 (Pace); Bundesgerichtshof (Germany) 9 January 2002 (milk powder),
N.S.M.b.v. v Molkerei A. M. GmbH & Co. KG, CISG-Online 651 (Pace); Oberlandesgericht Celle (Germany)
24 July 2009 (Broadcasters case) (multimedia recorders), a. t. AG v A. GmbH, CISG-Online 1906 (Pace).
69 Cfr. Oberlandesgericht Hamburg (Germany) 15 July 2010 (medical equipment), CISG-Online 2448
(Pace); Appellate Court Naumburg (Germany) 13 February 2013 (cereal), CISG-Online 2455 (Pace);
Oberlandesgericht Koblenz (Germany) 24 February 2011 (clay), CISG-Online 2301 (Pace).

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requires steps to be taken by one or both parties (Arts 54 and 60a); and d) a duty to
refrain from not cooperating70.
In terms of the interpretation of the contract, the contra proferentem rule might 29
be considered also as a principle derived from good faith71 without loosing its in-
dependent character as such which plays an important role when using general terms
and conditions.
Case law has recognized good faith not only plays a role within the Convention for 30
interpretation, but also plays a seminal role throughout the Convention to modulate its
content72 and be used as a standard of conduct for the parties during the formation73,
particularly if general terms and conditions are used74, or when the offer and acceptance
process is not identified and the contract is concluded through a more complex
mechanism75.
Furthermore, the good faith principle served during the performance of contract 31
to sanction a particular conduct of the parties76, for example in an international distribu-
70Neumann, pp. 110–113.

71BGH (Germany) 28 May 2014 (bowling alleys), CISG-Online 2513 (Pace); CISG-AC Opinion n 13.
72 The good faith principle in Art. 7(1) CISG extends its application to arbitration clauses and helps the
courts to determine the content of the contract in accordance with the expectation of the parties. See:
Audiencia Provincial de Navarra (Spain) 27 December 2007 (machine for repair of bricks), (Pace)
(www.cisgspanish.com), and Audiencia Provincial de Navarra (Spain) 22 September 2003 (motors for
production of electricity), (Pace) (www.cisgspanish.com).
73 Oberlandesgericht Celle (Germany) 24 May 1995 (printing machine), CISG-Online 152 (Pace); Hof’s-
Gravenhage (Netherlands) 23 April 2003 (wheat flour), CISG-Online 903 (Pace), also considering that: “A
company secret does not deserve protection in jure in a situation in which good faith demands to speak
out”; Arbitral Award, Tribunal of International Commercial Arbitration at the Russian Federation
Chamber of Commerce and Industry, 24 November 1998 (equipment), CISG-Online 1525 (Pace);
Arbitral Award, Compromex, 30 November 1998 (sweets), CISG-Online 504 (Pace).
74 Bundesgerichtshof (Germany) 31 October 2001 (machinery), CISG-Online 617 (Pace); Oberlandes-
gericht Düsseldorf (Germany) 25 July 2003 (rubber sealing members), CISG-Online 919 (Pace); Oberlan-
desgericht Düsseldorf (Germany) 21 April 2004 (car phones), CISG-Online 915 (Pace); Landgericht
Neubrandenburg (Germany) 3 August 2005 (sour cherries), CISG-Online 1190 (Pace); Rechtbank Rotter-
dam (Netherlands) 25 February 2009 (fruits), Fresh-Life International B.V. v Cobana Fruchtring GmbH
& Co., KG, CISG-Online 1812 (Pace): The court considered that, having regard to the general principle of
good faith in international trade as provided for in Article 7(1) CISG, it is not sufficient for the
application of general conditions to refer to such conditions in the offer without making the text of the
conditions available before or at the time of the conclusion of the contract.
75 Such as when there is a letter of intent (agreement on principles): Hof van Beroep Gent (Belgium)
15 May 2002 (design of pagers), N.V.A.R. v N.V.I., CISG-Online 746 (Pace), considering that it engages
the parties to continue the negotiations in good faith.
76 Cour d’Appel de Grenoble, Chambre Commerciale (France) 22 February 1995 (jeans), S.a.r.I. Bri
Production “Bonaventure” v Société Pan African Export, CISG-Online 151 (Pace) the conduct of the
buyer was contrary to the good faith principle and was aggravated during the procedure as to the extent
that it was considered an abuse of procedure; Arbitral Award, Hungarian Chamber of Commerce and
Industry Court of Arbitration, 17 November 1995 (mushrooms), CISG-Online 250 (Pace) (Unilex);
Jiangsu Higher People’s Court (China) 19 February 2001 (excavating machines), Tai Hei Business Co.,
Ltd. v Jiangsu Shun Tian International Group Nantong Costume Import and Export Company, CISG-
Online 1636 (Pace); Cour d‘appel de Colmar (France) 12 June 2001 (air-conditioning system for trucks),
CISG-Online 694 (Pace); Oberlandesgericht Hamburg (Germany) 28 February 1997 (iron molybdenum),
CISG-Online 261 (Pace); Oberlandesgericht Hamm (Germany) 12 November 2001 (memory module),
CISG-Online 1430 (Pace); Landgericht Saarbrücken (Germany) 26 March 1996 (fixture for ice-cream
parlor), CISG-Online 391 (Pace); Arbitral Award, Tribunal of International Commercial Arbitration at
the Russian Federation Chamber of Commerce and Industry, 27 May 2005 (unidentified goods), CISG-
Online 1456 (Pace); Arbitral Award, Hungarian Chamber of Commerce and Industry Court of Arbitra-
tion, 17 November 1995 (mushrooms), CISG-Online 250 (Pace) (Unilex); Tribunale di Busto Arsizio
(Italy) 13 December 2001 (machinery for recycling of plastic bags), Expoplast C.A. v Reg Mac s.r.l., CISG-
Online 1323 (Pace). See Supreme Court (Poland) 11 May 2007 (leather to manufacture shoes), CISG-
Online 1790 (Pace) reversing and remanding the lower decision mandating the court to analyse the

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tion contract a seller was held liable towards the buyer when the former appointed a new
sole distributor in China without giving the buyer reasonable notice for making suitable
arrangements for the stock there by impeding buyer to resell the stock77; prevents a party
from taking undue advantage of the remedies provided in case of breach of the other
party’s obligations78; or to derive particular duties, such as the duty to promptly
communicate the lack of conformity of the goods under Art. 39 CISG79.
32 In this respect, a position closer to civil law systems has been adopted, as opposed to
the common law view in which there is no general recognition of good faith and fair
dealing duty during the formation and negotiations of the contract80. Later develop-
ments in international uniform law instruments have also expressly recognized the role
of the good faith principle as being in line with civil law traditions81.
33 As to the content of good faith, an international and uniform approach should prevail
disregarding interpretations based on domestic law82 and equally, the risks derived from
the vagueness of the term should be avoided to reduce its inherent unpredictability.
Good faith is inferred from usages and practices in several instruments of international
contract law and widely used standard forms and trade terms83.
34 It is not clear whether a concrete principle to protect the weaker party is derived from
good faith. Although some scholars have so held84, presumably by considering them as
consumers, the parties in international trade are businessman or professionals and thus
equal or similar bargaining power is presumed85. Consumer transactions are outside the
scope of CISG (Art. 2 (a)).
35 (iv) Pre-contractual liability under the CISG. The understanding of the role of the
good faith principle in comparative law is profound and dogmatic and has clear
consequences in the treatment of pre-contractual liability. The majority of scholars
consider it to be a matter outside the scope of the Convention based on the legislative
dispute in light of the good faith principle; Among scholars: Sheehy, Good Faith in the CISG: The
Interpretation Problems of Art. 7, Review of the Convention on Contracts for the International Sale of
Goods (CISG) (2005–2006) 172 (172 et seq.,) analysing case law on this issue that shows a broader
application of good faith beyond the interpretation of the CISG; and Zeller, The observance of Good Faith
in International Trade, in: Janssen/Meyer (eds), CISG Methodology (2009), pp. 133 et seq.
77 Shanghai High People’s Court (China) 21 September 2011 (electronic equipment), Comac SpA v
Shanghai Swift Mechanical & Electronic Equipment Co., Ltd., CISG-Online 2318 (Pace).
78 Arbitral Award, ICC/11849, 2003 (fashion products) (Pace) (Unilex).
79 Appellate Court of Zaragoza, 31 March 2009 (pork shoulder) (www.cisgspanish.com).
80 § 1–304 UCC (2001). Obligation of Good Faith states that: Every contract or duty within [the
Uniform Commercial Code] imposes an obligation of good faith in its performance and enforcement.
81 PICC/PECL have provisions on good faith. Also: Principle no I.1: “The parties must act in
accordance with the standard of good faith and fair dealing in international trade” (Central at http://
www.tldb.net). Good faith as a general principle internationally accepted in trade: Arbitral Award, ICC
7331/1994 (cow hides) (Unilex).
82 Arrondissementsrechtbank Zwolle (Netherlands) 5 March 1997 (fish), CME Cooperative Maritime
Etaploise, S.A.C.V. v Bos Fishproducts Urk BV, CISG-Online 545 (Pace) (Unilex) considering that an
objective concept of good faith is derived from the CISG as well as the PICC which is different to
domestic French Law that follows a subjective approach.
84 Bonell, L’Interpretazione del Diritto Uniforme alla Luce dell’Art. 7 della Convenzione di Vienna Sulla
Vendita Internazionale, Rivista di diritto Civile (1986) 223 et seq.; Silva-Ruiz, La buena fe en la
Convención de las Naciones Unidas sobre los contratos de compraventa internacional de mercaderı́as,
in: Centenario del Código Civil I (1989) 111 (111 et seq.).
85 In agreement with this conclusion: Martı́nez Can ~ellas, La interpretación y la integración de la
Convención de Viena sobre compraventa internacional de mercaderı́as de 11 de abril de 1980 (2004),
p. 145. Principle no I.9 of Central list of principles of the lex mercatoria: “no weaker party exists in
international business transactions that need to be protected as if it were a consumer”. Central at http://
www.tldb.net).

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history: a proposal to regulate pre-contractual liability if expenses were made by one of
the parties before breaking off negotiations by the other was made by the former
Democratic Republic of Germany, and was rejected86.
However, there are certain instances in which the CISG governs the issue as provided in 36
Arts 16(2)(a) and (b)87, such as where a party sells the goods despite there being a binding
offer to a third party and consequently no contract can be concluded with the originally
anticipated buyer. This is also the case where pre-contractual liability is merged with
contractual liability. For example, when bad faith that originated during the pre-contractual
stage – e. g. defects in the goods not mentioned by the seller – causes its effects, namely
damages, during the performance of the contract. In this case, when there is concurrence of
pre-contractual and contractual liability, the latter absorbs the former and thus damages
under Arts 74–77 will apply88. Even when the parties have only come to a preliminary
agreement, pre-contractual liability may be considered under Art. 889. The same applies
when there is a letter of intent and one of the parties unlawfully ends the negotiations90.
c) Tools for the interpretation of the Convention
aa) Literal interpretation. Literal interpretation is considered the primary method for 37
the interpretation of the CISG91.
The Convention is equally authentic in six official languages and thus it is preferable 38
to avoid an interpretation of Convention terms in light of a national meaning or
meaning given by the different national legal systems. These interpretations have no
place in the CISG system92. Also, when approaching the problem of conflicting versions
of a term in the Convention, different interpretative criteria should be used to avoid the
prevalence of one of text over the other93; prima facie preference for the English version
86 See: Honnold, Documentary History (1989), p. 515. Among the scholars, see Schlechtriem, Uniform
Sales Law (1986), p. 57 (Pace). But see Bonell, Vertragsverhandlungen und culpa in contrahendo nach dem
Wiener Kaufrechtsübereinkommen, RIW (1990) 693 (700 et seq.), considering that during the formation of
the contract, pre-contractual liability is a gap and applies by analogy Art. 74 CISG and thus a damage
liability; the same solution is provided for in the comments to Art. 2.1.15 PICC. For criticism to the last
position within CISG, see Marchand, Les Limites de L’Uniformisation Matérielle du Droit de la Vente
Internationale. Mise en ouvre de la Convention des Nations-Unies du 11 avril 1980 sur la vente inter-
nationale de marchandises dans le contexte juridique suisse (1994), pp. 276 et seq. Under Principle IV.7.1
(Precontractual Liability) (a) A party who breaks off contract-negotiations in bad faith (i. e. when the other
party was justified in assuming that a contract would be concluded) is liable for the losses caused to the other
party (“culpa in contrahendo”).(b) It is bad faith, in particular, for a party to enter into or continue
negotiations when intending not to reach an agreement with the other party (Central at http://www.tldb.net).
87 See Perales Viscasillas, La formación del contrato de compraventa internacional de mercancı́as
(1996), pp. 145 et seq.

88 Marchand, Les Limites de L’Uniformisation Matérielle du Droit de la Vente Internationale. Mise en
ouvre de la Convention des Nations-Unies du 11 avril 1980 sur la vente internationale de marchandises
dans le contexte juridique suisse (1994), pp. 276 et seq.
89 Goderre, International Negotiations Gone Sour: Precontractual Liability under the United Nations
Sales Convention, 66 University of Cincinnati Law Review (1997) 257 (257 et seq.).
90 Hof van Beroep Gent (Belgium) 15 May 2002 (design of pagers), N.V.A.R. v N.V.I., CISG-Online 746
(Pace).
91 Oberster Gerichtshof (Austria) 23 May 2005 (coffee machines), CISG-Online 1041 (Pace). Among the
scholars, see: Eiselen, Literal Interpretation: The Meaning of the Words, in: Janssen/Meyer (eds), CISG
Methodology (2009), pp. 74 et seq.
92 It is enough to mention the problems raised by Art. 19 ULIS and the concept of delivery. See, Alcover
Garau, La transmission del riesgo en la compraventa mercantil. Derecho espan ~ol e internacional (1991),
pp. 87 et seq. Generally on the problems raised by the different language versions under CISG: Bergsten,
Methodological Problems in Drafting of the CISG, in: Janssen/Meyer (eds), CISG Methodology (2009),
pp. 18–21.
internacional de mercaderı́as de 11 de abril de 1980 (2004), p. 178; and Galán Barrera, Los Principios de

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should be rejected94 unless confirmed by other interpretative techniques. Equally, when

a conflict exists between the UN versions of CISG and the official text of the Conven-
tion in a non-official UN language (i. e., German, Italian, etc.), preference should be
given to the interpretation of the Convention based on the authentic intention derived
from the CISG in its official versions95, particularly taking into consideration the official
version of the text used for the non-official text and the language of the contract.
39 bb) Legislative history. The interpretation of the CISG in light of its legislative
history is particularly relevant in order to understand the evolution of the rules of the
Convention and thus to apprehend its finality and correctness. In regard to Art. 7(2),
the legislative history is an important element to discern when there is an internal or
external gap. The legislative history is supported by the guide offered by the legislative
records contained in 10 volumes (Yearbooks) as well as in the Official Records of the
Diplomatic Conference held in Vienna during the spring of 1980. In the Official
Records, the 1978 Draft Project – the immediate antecedent of CISG – is accompanied
by a commentary prepared by the UNCITRAL Secretariat that is frequently used by
scholars but also has been considered by case law96.
40 However, too much emphasis on the legislative history of the Convention should be
avoided. First, a dynamic and progressive approach to the interpretation of the Conven-
tion should also be taken into consideration, particularly catering to developments of
international trade law (case law, new international uniform instruments, development of
practices and usages, scholarly writing, new interpretative methods, comparative law, and
evolution in legal thinking). Second, the analysis of the legislative history itself may be
unclear or contentious97 and thus several readers analysing the same legislative history
Interpretación de la Convención de las Naciones Unidas sobre los contratos de compraventa internacio-
nal de mercaderı́as, in: Estudios de Contratación Internacional. Régimen uniforme e internacional
privado (2004), p. 305 (312–313). An example of several issues in regard to the interpretation of CISG
due to the use of the different languages: CISG-AC Opinion no 4, paras 2.1 and 4.1.
94 Bell, Taking the languages of the CISG seriously, in: Festschrifft für Ingeborg Schwenzer zum 60. Ge-
burtstag (2011), Band II, p. 151. On the contrary: Witz/Salger/Lorenz, Kommentar (2000), Art. 7 para. 20;
Schlechtriem/Hachem, in: Schlechtriem/Schwenzer, Commentary (2010), Art. 7 para. 22, consider that the
English text (and occasionally the French) expresses the intention of the Conference better than the other
versions; Magnus, Tracing Methodology in the CISG: Dogmatic Foundations, in: Janssen/Meyer (eds), CISG
Methodology (2009), p. 53. Or both English and French: Zeller, Four-Corners–The Methodology for
Interpretation and Application of the UN Convention on Contracts for the International Sale of Goods
(2003), Chapter 2 (6)(b) (Pace). Also: Bundesgericht (Switzerland) 13 November 2003 (used textile cleaning
machine), CISG-Online 840 (Pace), considering primarily English text and secondly French version in regard
to the German translation of the CISG.
95 See Oberlandesgericht Köln (Germany) 26 August 1994 (market research study), CISG-Online 132
(Pace), resorting to the English (goods) and French (merchandises) texts as compared with the term used
in the German translation (Waren) and concluding that a market analysis is not a sale of goods within the
meaning of Arts 1 or 3.
96 See Audiencia Provincial de Valencia (Spain) 7 June 2003 (concentrated grape juice), Cherubino
Valsangiacomo, S.A. v American Juice Import, Inc., CISG-Online 948 (Pace); and Interim Arbitral Award,
AAA, 23 October 2007 (frozen chicken parts), Macromex Srl. v Globex International Inc., CISG-Online
1645 (Pace).
97 Scholars are also in agreement and cautious with the legislative history. Honnold, Uniform Law (2009),
para. 91; Enderlein, Ley Uniforme y su aplicación por jueces y árbitros, Revista de la Facultad de Derecho de
la Universidad Complutense, Curso 1987–1988, 229 (235); Van Alstine, Dynamic Treaty Interpretation, 146
University of Pennsylvania Law Review (1998) 687 (747) (Pace); Martı́nez Can ~ellas, La interpretación y la
integración de la Convención de Viena sobre compraventa internacional de mercaderı́as de 11 de abril de
1980 (2004), p. 172; Zeller, Four-Corners–The Methodology for Interpretation and Application of the UN
Convention on Contracts for the International Sale of Goods (2003), Chapter 3(3)(c) (Pace). Lookofsky, in:
Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 221; id. Lookofsky, Understanding the CISG.
Wolters Kluwer, 2017, 3th edition, p. 31 and Felemegas, Part One. Introduction, in: Felemegas (ed.), An
International Approach to the Interpretation of the United Nations Convention on Contracts for the

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might arrive to different results. Thirdly, also in regard to the Secretariat Commentary,
certain reservations should be made: it is not an official commentary of the CISG and
thus countries used to this system – i. e. common law systems – should not consider it as
such; even if considered similar or functionally equivalent to an official commentary,
sometimes the statements of the Secretariat are influenced by the legal framework of its
drafters or even assume a position that was not finally reflected in the provision.
Finally, the 1964 ULIS and ULF may also play an interesting role in assessing the 41
development of some of the rules of the Convention, and have been used as such by
scholars for comparative analysis. Reference to ULIS and ULF case law was important
when Convention first came into force due to the fact that the texts were similar and
consolidated case law on CISG was lacking. However, this case law is mostly German-
oriented and has no bearing on the CISG today.
cc) The Preamble of the CISG. The value of the Preamble to the interpretation of the 42
Convention, is not expressly addressed in the CISG. Unlike other international instru-
ments, the wording of Art. 7(1) needs to be interpreted in regard to the object and
purpose as set forth in the Preamble98. The Preamble thus has a substantive role in
establishing criteria to direct the interpreter and is not a mere philosophical-legal
declaration of principles99. It ought to be considered whether the Preamble could be a
useful aid in interpreting the CISG and filling gaps. While some scholars favour the use
of the Preamble100, others have expressly rejected this possibility101.
In this author’s view, the Preamble emphasizes the goals of the Convention as also 43
provided in Art. 7: universality, uniformity and internationality. At the same time, the
goal of removing legal barriers and the promotion of development of international trade
as stated in the Preamble helps to understand the dynamic approach of the Convention
towards its interpretation and gap-filling, and legitimate together with other elements
an approach on which recourse to external general principles of the CISG is possible102.
International Sale of Goods (1980) as Uniform Sales Law (2007), p. 19. Trying to reconcile the dynamic
interpretation with the legislative intention stating that the former might try to ascertain the presumed will
of the legislator, which is the main goal of the CISG’s interpretation: Gruber, Legislative intention and the
CISG, in: Janssen/Meyer (eds), CISG Methodology (2009), pp. 91 et seq.
98 See Art. 6 UNIDROIT Convention on International Financial Leasing (Ottawa, 28 May 1988); Art. 4
UNIDROIT Convention on International Factoring (Ottawa, 28 May 1988); Art. 5 UNIDROIT Conven-
tion on International Interests in Mobile Equipment (Cape Town, 2001), as well as Art. 7(1) UN
Convention on the Assignment of Receivables (2001).
99 See Torsello, The CISG’S impact on Legislators: The Drafting of International Contract Law
Conventions, in: Ferrari, The 1980 Uniform Sales Law (2003), p. 230 (236 and 271).
100 See Grigera, The UN Convention on Contracts for the International Sale of Goods, in: Horn/
Schmitthoff (eds), The Transnational Law of International Commercial Transactions (1982), p. 92; Kastley,
Unification and Community: A Rhetorical Analysis of the United Nations Sales Convention, 8 North-
western Journal of International Law and Business (1988) 574 (594) (Pace); Schlechtriem, in: Schlechtriem/
Schwenzer, Commentary (2005), Preamble paras 7 and 8; but see more precisely: Schwenzer/Hachem, in:
Schlechtriem/Schwenzer, Commentary (2010), Preamble para. 4; Maskow, The Convention on the Interna-
tional Sale of Goods from the Perspective of the Socialist Countries, in: la Vendita Internazionale (1981),
p. 57; Adame Goodard, Reglas de Interpretación de la Convención sobre compraventa internacional de
mercaderı́as, Diritto del Commercio Internazionale (1990) 103 (109), who derives from it two interpretative
criteria from equality and mutual benefit, respectively: reciprocity and proportional equality; and Torsello,
The CISG’s impact on Legislators: The Drafting of International Contract Law Conventions, in: Ferrari, The
1980 Uniform Sales Law (2003), 230 (271), considering that those Conventions that after CISG adopt minor
changes such as “the express reference to the Preamble, may well be regarded as improvements of the rule
coherently in line with the basic philosophy underlying the CISG’s provision”.
101 Schlechtriem, Uniform Sales Law (1986), p. 38; and Schlechtriem, in: Schlechtriem/Schwenzer,
Commentary (2005), Preamble paras 7 and 8.

102 Perales Viscasillas, The Role of the UNIDROIT Principles and the PECL in the interpretation and
gap-filling of CISG, in: Janssen/Meyer (eds), CISG Methodology (2009), pp. 287 et seq.

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On the contrary, principles of equality and mutual benefit, as considered in the

Preamble, do not seem applicable since they refer to relationships among the states. At
least one Court has referred to the Preamble in order to apply the pro-Convention
principle103.
44 dd) Case law. Case law should be considered as one of the primary sources104 of the
interpretation of the Convention and one of the main tools to achieve consistency
among the decisions rendered under the CISG. A consistent body of case law is
progressively being built under the CISG and an increasing tendency to rely on foreign
case law is gradually observed. Due to diverse initiatives, case law on the CISG is easily
accessible and understood by the operators of international trade: CLOUT and
Digest105, UNILEX106, the Pace Database107 and its autonomous network108, and CISG-
Online109 are the most important tools to understand what arbitral tribunals and courts
are doing when interpreting and applying the CISG, and to the promotion of the
Convention and its understanding.
45 International case law is a persuasive authority albeit not binding110. Here, a critical
assessment is needed. First, a line needs to be drawn between plainly “wrong cases” on
103 U.S. Federal District Court of New York (U.S.) 10 May 2002 (chemicals), Geneva Pharmaceuticals
Tech. Corp. v Barr Labs. Inc., CISG-Online 653 (Pace). Using the Preamble, the Court concludes that the
expressly stated goal of developing uniform international contract law to promote international trade
indicates the intent of the parties to the treaty to have the treaty pre-empt state law causes of action. Same
conclusion in: U.S. Federal District Court of California (U.S.) 27 July 2001 (electronic components),
Asante Technologies v PMC-Sierra, CISG-Online 616 (Pace). Also but without referring to the Preamble:
a common law claim for quantum merit is pre-empted by the CISG to the extent that the CISG governs
the issue: U.S. Federal District Court of New Jersey (U.S.) 7 October 2008 (lumber products), Forestal
Guarani, S. A. v Daros International, Inc. (Pace).
104 Lookofsky, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 216 (217), who considers
case law as the single most important source of CISG. Id. Lookofsky, Unterstanding, p. 32.
105 Case Law on UNCITRAL Texts and Digest at http://www.uncitral.org. An instrument that a Court
is obliged to observe: Juzgado Cuarto de lo Civil de Tijuana, Baja California (México) 3 September 2010
(metals), (www.cisgspanish.com), and thus the need to consider foreign decisions in order to reach a
uniform interpretation.
106 Available at http://www.unilex.info. It is also an important database for PICC.
107 Available at http://www.cisg.law.pace.edu. According to the database the top ten countries are:
Germany, China, Russia, Netherlands, Switzerland, Belgium, Austria, U.S., France and Spain.
108 Countries databases are located in important CISG states, like Spain (www.cisgspanish.com),
France, Belgium, etc. All of them at: http://www.cisg.law.pace.edu/network.html.

109 Available at http://www.cisg-online.ch.
110 The same conclusion in Tribunal di Vigevano (Italy) 12 July 2000 (sheets of vulcanized rubber used
in manufacure of shoe soles), CISG-Online 493 (Pace); Tribunale di Pavia (Italy) 29 December 1999 (high
fashion textiles), Tessile 21 S.r.l. v Ixela S.A., CISG-Online 678 (Pace); Tribunale di Rimini (Italy)
26 November 2002 (porcelain tableware), CISG-Online 737 (Pace); and Tribunale di Padova (Italy)
25 February 2004 (agricultural products), SO.M.AGRI s.a.s. di Ardina Alessandro & C. v Erzeugerorga-
nisation Marchfeldgemüse, GmbH & Co. KG, CISG-Online 819 (Pace). Also U.S. District Court Eastern
District of Louisiana (U.S.) 17 May 1999 (mammography units), Medical Marketing v Internazionale
Medico Scientifica, CISG-Online 387 (Pace), although considering the BGH, 8 March 1995 (a German
case on CISG) as a precedent or at least as an authoritative opinion. See also: High Court of New Zealand
(New Zealand) 30 July 2010 (trucks), RJ & AM Smallmon v Transport Sales, Ltd., CISG-Online 2113
(Pace): “the Convention must be applied and interpreted exclusively on its own terms, having regard to
the principles of the Convention and Convention-related decisions in overseas jurisdictions”; and Court
of Appeal of New Zealand (New Zealand), 22 July 2011 (Trucks), RJ & AM Smallmon v Transport Sales
Limited and Grant Alan Miller, CISG-Online 2215 (Pace). For a consideration of case law as semi-
binding, see: Juzgado Primera Instancia núm.1 de Fuenlabrada (Spain) 11 May 2012 (Machine),
Instalaciones y FabricacionesIndustriales, S.A. v PM di Pizzolato Giorgio & C., S.A.S., CISG-Online
2464 (Pace). The majority of the scholars are also in agreement, inter alia, Martı́nez Can ~ellas, La
interpretación y la integración de la Convención de Viena sobre compraventa internacional de mercader-
ı́as de 11 de abril de 1980 (2004), p. 131 and pp. 201–202; Schwenzer/Hachem, in: Schlechtriem/

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the CISG, as opposed to different legitimate views on the CISG111. An example of the
former is a U.S. Court decision stating that the parol evidence rule applies within the
CISG, while later decisions have strongly denied that position112. Also in this category
are decisions that adopt a myopic and domestic interpretation of the CISG. An
example of the latter is the different interpretations with respect to interest rates.
Second, a consolidated trend on the interpretation of a specific issue of the CISG
should be given regard by other courts, such as for example, in relation to the issue of
compliance with the regulatory provisions or standards of the importing country and
the criteria fixed by the BGH 8 January 1995113, and be well reasoned if a divergent
result is achieved114. Third, a decision on the CISG is not a better one just because it
comes from the highest court of a country. Rather, a good decision is persuasive, well-
reasoned and sensible with respect to the different tools of interpreting the CISG.
Thus, using a combination of different interpretation criteria as mentioned above,
including case law, is the preferable way to achieve a uniform and international
interpretation of the CISG. Finally, the importance of case law goes beyond the
uniform interpretation of the Convention as it is also used as a tool to assist the
negotiation and drafting process of the contract115.
Schwenzer Commentary (2016), Art. 7 para. 13; Ferrari, Do Courts interpret the CISG Uniformly?, in:
Ferrari (ed.), Quo Vadis CISG?. Celebrating the 25th anniversary of the United Nations Convention on
Contracts for the International Sale of Goods (2005), p. 6 (20 seq.), rejecting that there is no “suprana-
tional stare decisis”; DiMatteo/Dhooge/Greene/Maurer/Pagnattro, International Sales Law. A Critical
Analysis of CISG Jurisprudence (2005) pp. 4–5; and DiMatteo, Case Law Precedent and Legal Writing,
in: Janssen/Meyer (eds), CISG Methodology (2009), p. 114.
111 See the distinction in Witz, L’interprétation de la CVIM: Divergences dans l’interprétation de la
Convention de Vienne, in: Ferrari, The 1980 Uniform Sales Law (2003), p. 279 (282): “erreur d’inter-
prétation” and “interprétation divergente”. Also considering a critical approach to judicial interpretation
of the CISG: Lookofsky, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 216 (217);
Veneziano, Uniform interpretations: What is being done? Unofficial efforts and their impact, in: Ferrari,
The 1980 Uniform Sales Law. Old issues revisited in the light of recent experiences. Verona Conference
(2003) 325 (326); Curran, A Comparative Perspective on the CISG, in Drafting Contracts, p. 50.
112 Inter alia: U.S. Federal District Court of Illinois (U.S.) 27 October 1998 (aircraft parts), Mitchell
Aircraft Spares v European Aircraft Service (Pace); U.S. District Court for the Southern District Court of
New York (U.S.), 23 March 2015 (sports apparel), Korea Trade Ins. Corp. v Oved Apparel Corp., CISG-
Online 2608 (Pace). In some of these decisions the Courts also add the Letter of Transmittal from Ronald
Reagan, President of the United States, to the United States Senate, reprinted at 15 U. S. C. app. 70, 71
(1997), as an aid in the interpretation, see, inter alia: U.S. Federal Appellate Court 11th Circuit (U.S.)
29 June 1998 (ceramic tiles), MCC-Marble Ceramic Center v Ceramica Nuova D’Agostino, CISG-Online
342 (Pace). However, the documents used for the internal ratification to the CISG should not be
considered when interpreting the Convention due to its unilateral creation but might be used by the
courts as one among many of the interpretative criteria. See: Martı́nez Can ~ellas, Interpretación del
derecho mercantil uniforme internacional: el artı́culo 7.1 de la Convención de las Naciones Unidas sobre
compraventa internacional de mercaderı́as, 9 DeCita (2008) 79 (92).
113 In the famous “mussels case” that has created the doctrinal status around the world, See among
many decisions: Court of Appeal of New Zealand (New Zealand) 22 July 2011 (trucks), RJ & AM
Smallmon v Transport Sales Limited and Grant Alan Miller, CISG-Online 2215 (Pace). Among scholars:
Henschel, The impact of the UN CISG on the Harmonization of National and International non-
conformity Rules. Unification and Harmonization of International Commercial Law. Interaction of
Deharmonization?. Edited by Morten M.Fogt. Walters Kluwer (2012), pp. 37–55.
114 See Veneziano, Uniform interpretations: What is being done? Unofficial efforts and their impact, in:
Ferrari, The 1980 Uniform Sales Law. Old issues revisited in the light of recent experiences. Verona
Conference (2003) p. 325 (325); Martı́nez Can ~ellas, La interpretación y la integración de la Convención
de Viena sobre compraventa internacional de mercaderı́as de 11 de abril de 1980 (2004) p. 132;
Lookofsky, CISG foreign case law: how much regard should we have? in: Ferrari/Flechtner/Brand, Draft
Digest and Beyond (2003), p. 216 (218 seq.).
115 Sekolec, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 3; Witz, Contract Drafting
under the CISG, 10 International Law Review of Wuhan University (2008–2009), pp. 132–135 (129–137).

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46 Several trends can be observed with respect to the use of case law by courts and
arbitral tribunals. First, civil law courts are becoming increasingly sensitive to foreign
case law116, while common law courts have begun to approach scholarly writings as a
source of interpretation117. Second, an increasing number of decisions by arbitral
tribunals, whether from civil or common law, are using foreign CISG cases, doctrinal
cases and other interpretative tools, such as soft law instruments. Third, as a general
observation, courts are becoming more sensitive to the globalization of contract law
and thus one can observe a growing tendency in the use of international instru-
ments to interpret or supplement domestic and international contracts118. These
instruments, created after the CISG, contemplate an “international common law”
and provide a dynamic approach towards their interpretation where courts and
arbitral tribunals assume an active role to the point that they are legitimised to
construct substantive solutions for gaps in the CISG119. Furthermore, as case law has
helped to develop default rules based on the CISG’s general principles and other
international instruments, the CISG is increasingly being understood as a general code
for the international sale of goods and, in some respects, as a code for international
commercial law.
116 Examples of the use of international case law and international doctrine are, inter alia: Bundesger-
icht (Switzerland) 13 November 2003 (used textile cleaning machine), CISG-Online 840 (Pace), pointing
out the importance of resorting to the CISG data bases to achieve a uniform interpretation of the
Convention (Art. 7(1)), citing an impressive number of CISG cases; Tribunale di Pavia (Italy) 29 De-
cember 1999 (high fashion textiles), Tessile 21 S.r.l. v Ixela S.A., CISG-Online 678 (Pace) and Tribunale di
Forli (Italy) 11 December 2008 (shoes) and 16 February 2009 (cisterns and related accessories) (Pace); for
good examples from the common law world see U.S. Federal District Court of Illinois (U.S.) 28 March
2002 (steel), Usinor Industeel v Leeco Steel Products, CISG-Online 696 (Pace); U.S. Federal District Court
(U.S.) 21 May 2004 (blast frozen pork back ribs), Chicago Prime Packers, Inc. v Northam Food Trading
Co., et al., CISG-Online 851 (Pace).
117 Bell, Uniformity through Persuasive International Authorities–Does Stare Decisis really Hinder the
Uniform Interpretation of the CISG?. FS Kritzer (2008), p. 35 (44).

118 Illustrative enough is the situation in Spain where the high Supreme Court is increasingly
considering the solutions found in international or regional contract law instruments like CISG/PICC/
PECL, see Perales Viscasillas, La aplicación jurisprudencial en Espan ~a de la Convención de Viena de 1980
sobre compraventa internacional, los Principios de UNIDROIT y los Principios del Derecho Contractual
Europeo: de la mera referencia a la integración de lagunas, La Ley (31 mayo 2007) 1 (2 seq.). It might be
that one of the reasons for that is that paragraph 1 is inspired in common law methodology while
paragraph 2 is in civil law. See Curran, Humanity’s Gain: Remarks on Similarity, Difference and the
Vienna Convention. In Emptio-Vendito InterNationes. Convention de Vienne sur la vente international
de merchandise, FS Neumayer (1997), pp. 80–81. Other courts do follow this approach, see: Federal Court
Australia (Australia), 24 October 2008 (cherries), Hannaford v Australian Farmlink Pty, Ltd. (Pace) in a
domestic case referring to CISG and PICC. An interesting case where domestic law (term “Knowledge”
was interpreted as actual knowledge using CISG as a tool where it uses an extended meaning which
captures constructive knowledge (Arts 2(a), 9(2), 38(3) and 49(2) CISG) with the words “knew or ought
to have known”. Therefore, the Court concluded interpreting domestic law than where the word “known”
is intended to have a meaning extending beyond its ordinary one, the legislature can be expected to spell
that out. See: Court of Appeal of New Zealand (New Zealand) 2 July 1998 (commercial property lease),
Tri-Star Customs and Forwarding Ltd. v Denning, CISG-Online 2453 (Pace). A similar approach using
CISG as an aid in the interpretation of domestic law: Court of Appeal of New Zealand (New Zealand)
3 October 2001 (shoes), Bobux Marketing Ltd. v Raynor Marketing Ltd., CISG-Online 2451 (Pace) in
relation with the good faith principle.
(691, 756 and 760 et seq.) (Pace); Andersen, Macro-systematic Interpretation of Uniform Commercial
Law: The Interrelation of the CISG and Other Uniform Sources, in: Janssen/Meyer (eds), CISG
Methodology (2009), pp. 207 et seq. See also DiMatteo/Dhooge/Greene/Maurer/Pagnattro, International
Sales Law. A Critical Analysis of CISG Jurisprudence (2005), pp. 20–22, considering CISG as a semi-
Code; and Magnus, Tracing Methodology in the CISG: Dogmatic Foundations, in: Janssen/Meyer (eds),
CISG Methodology (2009), p. 55 considering an “interconventional interpretation” of the CISG, includ-
ing also soft law instruments, such as PICC and PECL.

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ee) Doctrine. Scholarly writing is also an important tool for interpretation, par- 47
ticularly in civil law systems but also in common law systems120, where a signifi-
cant trend is observed in using scholarly work121. The role of legal literature is not only
to describe the state of affairs of a particular issue, but also to take a position on
critical issues attending to the improvements in uniform international law, case law,
commercial practices, and usages. Particularly, in light of the volume of cases available
on the CISG, critical positions on cases can be very useful guidance to other courts.
Consequently, even a minor position in the case law might turn to be a preferred
one if supported by a strong number of authors122. Also, interesting to note is that
even the most reputed scholars may change their original position on a certain issue
due to new developments or changes in the state of affairs. Scholarly work is not
binding even in civil law systems. It is usually an ancillary tool: the use of comparative
law as a source of interpretation123 in order to find the common core of legal
systems124. Comparative law is, however, more than just a method useful for the
interpretation of the CISG125; it is an element to consider in contrast with the CISG’s
solutions, since some of these solutions are in fact based on general principles derived
from comparative law126.
With the exception of Art. 8, the CISG has no rules on the interpretation of the 48
contract, although even this provision does not directly address the interpretation of the
contract but rather the interpretation of statements and conduct made by a party.
However, with respect to the interpretation of the contract, the general principles on
which the CISG is based, particularly good faith and the international character of the
Convention, may play an important role127.
ff) Other tools. Apart from the several attempts to achieve an autonomous, uniform 49
and international interpretation of CISG mentioned above, other ambitious proposals
have been made: the establishment of an international tribunal competent to deal
120 It is frequent that case law resorts to several scholarly works to support a specific interpretation of
the CISG. Inter alia: Interim Arbitral Award, AAA, 23 October 2007 (frozen chicken partsMacromex Srl.
v Globex International Inc., CISG-Online 1645 (Pace). And it has been considered an important tool for
the interpretation of the CISG by Audiencia Provincial de Valencia (Spain) 7 June 2003 (concentrated
grape juice), Cherubino Valsangiacomo, S.A. v American Juice Import, Inc., CISG-Online 948 (Pace)
(www.cisgspanish.com).
121 See e. g. the analysis of case law in Martı́nez Can ~ellas, La interpretación y la integración de la
Convención de Viena sobre compraventa internacional de mercaderı́as de 11 de abril de 1980 (2004)
pp. 253–255.
122 See Witz, L’interprétation de la CVIM: Divergences dans l’interprétation de la Convention de
Vienne, in: Ferrari, The 1980 Uniform Sales Law (2003), p. 279 (281).
123 Gebauer, Uniform Law, General Principles and Autonomous Interpretation, Uniform Law Review
(2000) 686 (690 seq.); Basedow, Uniform Law Conventions and the UNIDROIT Principles of Interna-
tional Commercial Contracts, Uniform Law Review (2000) 136 seems to consider it as a primary source.
124 Gerechtshof ‘s-Hertogenbosch (Netherlands) 16 October 2002 (plants), CISG-Online 816 (Pace).
125 See also expressing doubts: Schwenzer/Hachem, in: Schlechtriem/Schwenzer, Commentary (2016),
Art. 7 para. 24.

126 Felemegas, Part One. Introduction, in: Felemegas (ed.), An International Approach to the Inter-
pretation of the United Nations Convention on Contracts for the International Sale of Goods (1980) as
Uniform Sales Law (2007), p. 30, considering that a distinction should be made between those principles
extrapolated from specific provisions of the Convention and the general principles of comparative law on
which CISG as a whole is based.
127 Cour de Cassation (France) 30 June 2004 (cases made from polyurethane foam), CISG-Online 870
(Pace). But see Schmidt-Kessel, Article 8: in: Schlechtriem/Schwenzer, Commentary (2016), Art. 8 para. 31
in relation with the good faith principle.

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with CISG cases128; the creation of an international body of scholars129 or an infor-

mal interpretation committee similar to the one established by the ICC in regard to
UCP130; an international thesaurus131; and the establishment of a Permanent Editorial
Board that will recommend the common interpretation of the CISG as derived from
case law132. Finally, at least two different initiatives in interpreting CISG have
fructified: the PICC133 and The Convention on International Sale of Goods-Advisory
Council (CISG-AC)134.
50 The CISG-AC is a private initiative whose main objective is to promote a uniform
interpretation of the Convention following the mandate of Art. 7. The CISG-AC is
composed of scholars from around the world representing different legal backgrounds.
It renders Opinions on different controversial aspects of the Convention upon request
or on its own motion. So far the Opinions have been used by scholars around the world
as an authoritative (and in some cases binding) interpretation of the Convention135, but
more importantly they have an impact on practice136.
2. Gap-filling within the CISG (Art. 7.2)

51 The Convention provides that certain issues are outside its scope (i. e. Arts 2–5 and
54) and thus the applicable law or rules of law will be applied. At the same time, it is
clear that the Convention deals with formation and performance of sales contracts
(Art. 4). It is, however, more difficult to ascertain whether there is an internal gap, i. e., a
matter that is governed by CISG but that is not expressly settled in it, or an external gap,
i. e., a matter not governed by CISG at all, but by the applicable law.
52 a) General remarks. Art. 7(2) tries to resolve the problems that arise from issues
not expressly determined by the Convention137. One of the better achievements of
128 De Ly, Uniform interpretation: What is being done? Official efforts, in: Ferrari, The 1980 Uniform
Sales Law (2003), p. 335 (346 et seq.); and Martı́nez Can ~ellas, La interpretación y la integración de la
Convención de Viena sobre compraventa internacional de mercaderı́as de 11 de abril de 1980 (2004)
pp. 198 et seq. All of them sceptical. But see: Linarelli, The Economics of Uniform Laws and Uniform
Lawmaking, Wayne Law Review (2003) 1 (1 et seq.).
129 Adame Goodard, Reglas de Interpretación de la Convención sobre compraventa internacional de
mercaderı́as, Diritto del Commercio Internazionale (1990) 103 (113 seq.).

130 See De Ly, Uniform interpretation: What is being done? Official efforts, in: Ferrari, The 1980
Uniform Sales Law (2003), p. 335 (348 seq.), in favour of a voluntarily scheme under the auspices or not
of UNCITRAL in which the parties may agree to submit interpretation issues to an advisory committee.
131 Rogers, The Lexical Initiative for international commerce, FS Kritzer (2008), pp. 404 et seq.
132 Bonell, A Proposal for the Establishment of a “Permanent Editorial Board” for the Vienna Sales
Convention, in: International Uniform Law in Practice (1987), p. 241. Contrary: Report of UNCITRAL
on the Work of its 21st session. A/43/17, 1988.
133 See infra para. 61.
134 Available at http://www.cisg-ac.org.
135 Hahnkamper, Acceptance of an offer in light of electronic communications, 25 Journal of Law and
Commerce (Fall 2005/Spring 2006) 147 (148) (Pace) (Uncitral), in regard to Opinion no 1. Also: Charters,
Growth of the CISG with Changing Contract Technology: “Writing” in Light of the UNIDROIT
Principles and CISG-AC Advisory Council Opinion no 1, in: Felemegas (ed.), An International Approach
to the Interpretation of the United Nations Convention on Contracts for the International Sale of Goods
(1980) as Uniform Sales Law (2007), pp. 73 seq. (Pace).
136 Courts in the U.S., Germany, The Netherlands and Poland have for example referred to CISG-AC
Opinions Nos 1, 2, 3, 5, 6, 13 and 14. A List of those cases is available at www.cisg-ac.org.

137 Paragraph 2 derives from Art. 17 ULIS in general, except for the reference to the rules of private
international law that was included during the Diplomatic Conference due to a proposal of the old
Democratic Republic of Germany as a compromise between those that considered that the recourse to the
general principles was too vague as they are not formulated in the CISG and those that were afraid of the
direct recourse to national law. See Honnold, Documentary History (1989), pp. 62, 87, 476 et seq.

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the CISG is that it avoids premature recourse to national law by applying general
principles on which the CISG is based. While creating this self-sufficient system,
however, the CISG provides for a secondary recourse to domestic law as determined
by the conflict of laws rules of the forum. Further, recourse to domestic law is the
ultima ratio138.
It is clear that it was not the intention of the drafters to create a comprehensive, 53
long and complicated text on the international sale of goods, but rather to regulate the
main issues arising in a contract for the sale of goods, avoiding easy recourse to
domestic law when interpreting and applying the CISG. This is not to say that private
international law rules139 and hence domestic law is to be totally excluded. It may play
a role in relation to matters not within the scope of CISG and also as a last resort
when filling gaps. Also, parties might exclude the Convention totally or partially thus
giving room to domestic law (Art. 6). More importantly, in these instances, domestic
law might be replaced by other international uniform law instruments. The possibility
of opting out of the Convention and the existence of reservations does not, in this
author’s view, convert the Convention into a soft law instrument140. When opting out,
parties exercise the utmost principle of freedom of contract and this is consistent with
the non-mandatory character of the Convention (and in general in uniform interna-
tional commercial law texts). Furthermore, as mentioned above, it does not necessarily
endanger the unification of law, since the parties may well give room, totally or
partially, to other international rules. In any case, considering the above approach and
the systematic approach of the Convention itself, a broad interpretation should be
given to solutions by which general principles are found to fill the internal gaps of the
Convention.
b) Matters excluded from the CISG. The Convention expressly considers certain 54
contracts outside its scope. More specifically, services or labour contracts (Art. 3(2)) are
excluded, as well as specific transactions due to their purpose, such as consumer sales
(Art. 2(a)). Other exclusions are due to the kind of goods, as in the case of the electricity
(Art. 2(f)), or the type of sales contract, as in the case of a sale by auction (Art. 2(b)).
Finally, certain other matters are also excluded like the validity of the contract or any of
its provisions or of any usage (Art. 4(a)), the transfer of property of the goods (Arts 4(b)
and 30), and the liability of the seller for death or personal injury caused by the goods to
any person (Art. 5).
These express exclusions raise several issues of interpretation in certain instances. 55
First, some of the matters excluded are subject to exceptions that open the door for
their inclusion within the CISG, such as consumer transactions under Art. 2(a), or the
exclusions listed in Art. 4(a),(b). Second, some of these exclusions are open to
divergent interpretations due to the use of uncertain terms, such as the meaning of
preponderant part in Art. 3(2). Third, even when considering a plain and straightfor-
ward exclusion not subject to any limitation or vague terms, such as the exclusion in
138 Inter alia: Schwenzer/Hachem, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 7 para. 42;
and Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 170. In case law: “recourse to
domestic law is prohibited by Article 7”: High Court of New Zealand (New Zealand) 30 July 2010 (trucks),
RJ & AM Smallmon v Transport Sales, Ltd., CISG-Online 2113 (Pace).
139 For the impact of the private international law of the forum on along CISG (Arts 1.1 b), 95, 7(2),
92–94): Ferrari, CISG and Private International Law, in: Ferrari, The 1980 Uniform Sales Law (2003),
p. 19 (19 et seq.).
140 Contrary: see, inter alia: Sarcevic, The CISG and regional unification, in: Ferrari, The 1980 Uniform
Sales Law (2003), p. 3 (8 seq.)

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Art. 2(e) of the sales of ships, vessels, hovercraft or aircraft, or in Art. 5 in regard to
the liability of the seller for death or personal injury caused by the goods, or
proprietary issues (Art. 4 (b))141, scholars and case law open the door for different
interpretations that may result in the application of the Convention142. As a conse-
quence, depending on the methods and the weight given to the different interpretative
techniques, the total or partial exclusion or inclusion of the Convention on a matter
apparently outside the CISG might vary. For example, although the reason for
excluding the sale of ships, vessels, hovercraft or aircraft from the Convention is clear
(Art. 2(e), registration requirement in domestic law means that they are treated as
immovables), the interpretation of scholars and case law on the specific words therein
may vary from total exclusion to partial inclusion depending on the weight, size, or
navigability of the object.
56 c) Internal gaps within the CISG. First, the drafters intended matters governed by
the Convention that are not expressly provided for in it (internal gaps) to be dealt with
exclusively by the Convention. In this regard, as mentioned above, the legislative history
is an important element in ascertaining whether a specific issue is governed by the
CISG. Second, matters governed by the Convention are those issues that are within the
field of application of the Convention despite its classification under domestic law and
thus are matters covered by the provisions of the CISG143.
57 Once a gap is detected, the following hierarchy of solutions applies: first, specific
provisions of the CISG are applied directly by way of analogical technique created by
scholars and case law144; if the gap still cannot be filled, resort is to be had to the general
principles on which the CISG is based (internal principles) or in their absence to other
external principles and finally to the applicable domestic law.
58 Some issues within the CISG are so problematic that none of the possible solutions
are viable, such as in the case of the “battle of the forms”. Some scholars have
considered this situation an issue of validity and thus outside the scope of the
Convention by virtue of Art. 4(a). If considered, however, to be an internal gap, a
direct application of a provision of the CISG by analogy can be considered by applying
Arts 18 and 19 to resolve this issue and thus a last-shot rule applies. If it can be
considered that application of internal principles is possible, i. e., the good faith
141 See Torsello, Transfer of Ownership and the 1980 Vienna Sales Convention: A Regretful Lack of
Uniform Regulation?, International Business Law Journal (2000) 939 et seq.

142 For an interpretation of Art. 5, see: CISG-AC Opinion no 12.
143 Schlechtriem, Unification of the Law for the International Sale of Goods, in: Schlechtriem (ed.), XII
International Congress of Comparative Law (1986), p. 121 (129 et seq.); Magnus, Währunsfragen im
Einheitlichen Kaufrecht. Zugleich ein Beitrag zu seiner Lückenfüllung und Auslegung, RabelsZ (1989) 116
(119 et seq.).
144 Hellner, Gap-Filling by Analogy – Art. 7 of the U. N. Sales Convention in Its Historical Context, FS
Hjerner (1990), pp. 219 et seq.; Martı́nez Can~ellas, La interpretación y la integración de la Convención de
Viena sobre compraventa internacional de mercaderı́as de 11 de abril de 1980 (2004), pp. 317–320;
Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), pp. 159–160; Bernstein/Lookofsky,
Understanding the CISG in Europe (1997), p. 25; Felemegas, Part One. Introduction, in: Felemegas (ed.),
An International Approach to the Interpretation of the United Nations Convention on Contracts for the
International Sale of Goods (1980) as Uniform Sales Law (2007), pp. 26–27. And in case law, inter alia,
Arbitral Award, ICC 8324/1995 (mineral of maganese), CISG-Online 569 (Pace), stating that Arts 8 and 9
might be complemented by applying the usual techniques applied in legal reasoning: interpretation by
analogy, a contrario, etc; Supreme Court (Poland) 11 May 2007 (leather to manufacture shoes), CISG-
Online 1790 (Pace) reversing and remanding the lower decision, because an interpretation of Art. 71 by
analogy was not done; and many court decisions applying CISG Part II (Formation of the Contract) to
Art. 29 on the modification of the contract. See: Perales Viscasillas, Modification and Termination of the
Contract (Art. 29 CISG) 25 Journal of Law and Commerce (Fall 2005/Spring 2006) 167 (170) (Pace)
(UNCITRAL).

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principle (Art. 7(1)), then application of the knock-out rule would be foreseen; the
same is considered when a partial exclusion of Art. 19 is the thesis followed. External
principles applicable to this issue may be found in Art. 2.1.22 PICC that would serve
to fill the gap by also applying the knock out rule. Finally, domestic applicable law
would also be considered where other methods have failed, demanding a solution
outside the Convention145.
Case law and scholars are progressively drawing the line between issues covered and 59
not covered by the CISG. Some of these issues are clearly outside the scope of the CISG,
while others are gaps within the Convention where the courts were unable to find
general principles to fill them and thus resorted to domestic law. However, the
adscription of certain matters to one category or another is contentious and thus case
law and scholars are in disagreement as to whether the CISG or domestic law governs
certain issues.
One of those issues are penalty clauses that, although initially considered outside of 60
the scope of the CISG146, are presently considered under a pro Convention principle
approach147. In this author’s view one has to consider the function of the clause. If the
intention is exclusively to punish the breaching party, one might argue that its validity
might be assessed against domestic law, which might even consider that such clauses
are void (Art. 4(a)). Once considered valid under domestic law, the clause might be
analysed within the Convention’s general principles. Although this interpretation is
certainly more in line with the uniformity principle as compared with the solution
based on the entire exclusion from the Convention irrespective of the function of
the clause (Art. 4(a)), the author’s preferred view is to consider that the issue is
entirely governed by the CISG even if the clause is a true penalty clause because
the Convention adopts the philosophy to govern all remedies for the breach of
contract not only damages as proved by the treatment of the right of interest
(Art. 78) distinct from that of damages (Art. 74), more so if it is contractually agreed
by the parties as the CISG acknowledges the importance of this general principle
throughout the Convention. If, as ordinarily the case, the function of the clause is to
compensate (damage function) for the breach of the contract by one of the parties,
then there is no issue of validity at all since this matter is governed entirely by the
Convention148. These clauses are universally recognized and thus they are not only
covered by the CISG but also issues related to their moderation, if any and whether
pertinent, should be governed by the Convention. To this regard, in both situations,
the moderation would only and exceptionally be made if grossly contrary to the
145See infra Comments to Art. 19.

146Arbitral Award, ICC 7197/1992 (unidentified goods), CISG-Online 36 (Pace), Tribunale di Padova
(Italy) 25 February 2004 (agricultural products), SO.M.AGRI s.a.s. di Ardina Alessandro & C. v
Erzeugerorganisation Marchfeldgemüse, GmbH & Co. KG, CISG-Online 819 (Pace) (obiter dicta), and
Commerce and Industry, 1 March 2006 (unidentified goods) (Pace). Indifferent as to the same result
would be derived applying domestic Law: Oberlandesgericht Hamburg (Germany) 25 January 2008
(inventory for a café), CISG-Online 1681 (Pace). The CISG does not regulate the question of whether
the penalty the parties agreed upon can be moderated: Gerechtshof Arnhem (Netherlands) 22 August 1995
(live lambs), Diepeveen-Dirkson BV v Nieuwenhoven Veehandel, GmbH, CISG-Online 317 (Pace).
147 See Bridge, The International Sale of Goods. Law and Practice 2007, para. 11.38, considering that
penalty clauses are impliedly governed by the CISG and that a general principle derived from Art. 74
implies that penalties should be disallowed because they punish rather than compensate. For agreed sums,
see: CISG-AC Opinion no 10.
148 Impliedly considering that a penalty clause displaces Art. 74, although considering domestic law for
its moderation: SAP Madrid (Spain), 18 October 2007 (textiles), (www.cisgspanish.com).

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general principles of the CISG. In any case, the PICC (Art. 7.4.13) offer an inter-
pretative guide useful to consider in conjunction with the CISG. Noted that Art. 7.4.14
considers widely both functions of the clause: liquidated damage clause and penalty
clauses. Finally, in this author’s view, the general principle of full compensation
applies to the interpretation of the penalty clause and thus other damages are available
to the aggrieved party.
61 Similar developments are found in relation to other matters, but uncertainties remains in
some cases. However, most of them are just obiter dicta without a CISG in depth discussion
or a refinement: agency issues149, conditions for the conclusion of the contract150, transfer of
credit, rights and obligations151, framework distribution agreement152, although CISG
applies to contracts of sales concluded on the basis of the distribution agreement153, the
proof of defects of the goods154, the procedure to determine the nonconformity of the goods
delivered155, restitution of payment due to the avoidance of the contract156, prescription157,
149 Tribunale di Padova (Italy) 25 February 2004 (agricultural products), SO.M.AGRI s.a.s. di Ardina
Alessandro & C. v Erzeugerorganisation Marchfeldgemüse, GmbH & Co. KG, CISG-Online 819 (Pace)
(obiter dicta); Oberstergerichtshof (Austria) 22 October 2001 (agricultural products), CISG-Online 613
(Pace). Amtsgericht Alsfeld (Germany) 12 May 1995 (tiles), CISG-Online 170 (Pace); Kammergericht
Berlin (Germany) 24 January 1994 (wine), CISG-Online 130 (Pace); Cantonal Court of Valais (Switzer-
land), 27 May 2005 (Welding devices), CISG-Online 1137 (Pace): CISG does not apply to issues of
representative authority; transfer of authority is not governed by the CISG: Landgericht Landshut
(Germany), 12 June 2008 (Metallic slabs), CISG-Online 1703 (Pace); Oberlandesgericht Schleswig (Ger-
many), 24 October 2008 (Shop furnishings), CISG-Online 2020 (Pace): the CISG is not applicable because
it does not govern agency;. Among scholars: Ferrari, CISG and Private International Law, in: Ferrari, The
1980 Uniform Sales Law (2003), p. 19 (46).
150 Arbitral Award, ICC 7844/1994 (radio-communication equipment), CISG-Online 567 (Pace).
151 The transfer of the price of the sales contract to a third person: Oberlandesgericht Hamm (Germany)
8 February 1995 (socks), CISG-Online 141 (Pace); and Cour d’ appel de Grenoble (France) 13 September
1995 (cheese), Société francaise de Factoring international Factor France v Roger Caiato, CISG-Online
157 (Pace). It is not governed by the CISG: the transfer of the contract by agreement of the parties or by
operation of the law: Bundesgerichtshof (Germany) 12 February 1998 (air cleaning installation), CISG-
Online 343 (Pace) and Tribunale di Padova (Italy) 25 February 2004 (agricultural products), SO.M.AGRI
s.a.s. di Ardina Alessandro & C. v Erzeugerorganisation Marchfeldgemüse, GmbH & Co. KG, CISG-
Online 819 (Pace) (obiter dicta).
152 Court of Appeals in Warsaw (Poland) 15 May 2015 (dietary products), CISG-online 2783, CISG
does not apply neither to framework contracts nor to the exclusivity clause because it refers to the
distribution part of the agreement.
153 See further discussion with relevant cases: Perales Viscasillas, International distribution contracts
and CISG, in: Schwenzer/Atamer/Butler, Current Issues in the CISG and Arbitration (2013), pp. 43–58,
going forward and considering CISG applicable also to framework agreements with case law in favor.
154 Cámara Nacional de Apelaciones en lo Comercial (Argentina) 24 April 2000 (coal), Mayer Alejandro
v Onda Hofferle GmbH & Co., CISG-Online 699 (Pace).

155 Cámara Nacional de Apelaciones en lo Comercial (Argentina) 21 July 2002 (barley), CISG-Online
803 (Pace); Cámara Nacional de Apelaciones en lo Comercial de Buenos Aires (Sala A) (Argentina)
31 May 2007 (almonds), Sr. Carlos Manuel del Corazón de Jesús Bravo Barros v Salvador Martı́nez Gares,
156 Oberster Gerichtshof (Austria) 10 March 1998 (unidentified goods), CISG-Online 356 (Pace).
157 Cour d’appeal de Versailles (France) 13 October 2005 (chenilles en peluche), CISG-Online 1433
(Pace); Cour d’appeal de Paris (France) 6 November 2001 (cables), CISG-Online 677 (Pace), considered it
as a matter governed by the Convention, but not settled in it; and Oberstergerichtshof (Austria)
7 September 2000 (tombstones), CISG-Online 642 (Pace).

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assignment158, contributory negligence, i. e., joint contributors to the harm159, and set-off160
but not if the claims are based on the CISG161:
aa) General Principles embodied in the CISG. Recourse to the general principles on 62
which the CISG is based is an attempt to build a systematic interpretation of the CISG.
These general principles are discovered and built up progressively by case law and
scholars. However, recourse to the general principles adds further problems to the
method of filling gaps within the Convention. There is no enumeration of the general
principles in the CISG and as their content and effect are not established within the
Convention, there remains the obvious risk that interpreters would derive from the
Convention not only different principles but also divergence effects162; furthermore
some confusion is observed in several cases between application by analogy and the
application of a general principle163. There are several striking examples such the
interest rate in Art. 78164, the use of general terms and conditions or the battle of the
forms problem under Part II, where scholars and case law are in disagreement as to
whether they are issues governed by the Convention, and if governed, what general
principles are to be applied165.
158 Oberster Gerichtshof (Austria) 7 September 2000 (tombstones), CISG-Online 642 (Pace); Oberlan-
desgericht Hamburg (Germany) 25 January 2008 (inventory for a café), CISG-Online 1681 (Pace).
159 Arbitral Award, Bulgarian Chamber of Commerce and Industry, 24 April 1996 (coal), CISG-Online
435 (Pace).
160 Oberlandesgericht Dusseldorf (Germany), 25 July 2003 (rubber sealing parts), CISG-Online 919
(Pace); Oberlandesgericht Köln (Germany) 19 May 2008 (pesticide), CISG-Online 1700 (Pace). Also:
Kantonsgericht Freiburg (Switzerland) 23 January 1998 (laundry machine), T. Maschinenbau GmbH v T.
Maschinenvertrieb AG, CISG-Online 423; Tribunale di Padova (Italy) 25 February 2004 (agricultural
products), SO.M.AGRI s.a.s. di Ardina Alessandro & C. v Erzeugerorganisation Marchfeldgemüse GmbH
& Co. KG, CISG-Online 819 (Pace); and Decision 43 945/2007 of the Single-Member Court of First
Instance of Thessalonika (Greece) 2008 (clothes) (Pace).
A discussion among scholars: Schwenzer/Hachem, in: Schlechtriem/Schwenzer, Commentary (2016),
Art. 7 para. 29; Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), pp. 167–168.
161 Oberlandesgericht München (Germany) 9 July 1997 (leather goods), CISG-Online 282 (Pace);
Hanseatisches Oberlandesgericht Hamburg (Germany) 26 November 1999 (jeans), CISG-Online 515

(Pace); Arrondissementsrechtbank Arnhem (Netherlands) 25 February 1993 (clothes), P.R. Van den
Heuvel v Santini Maglificio Sportivo de Santini P&C S.A.S., CISG-Online 98 (Pace); Landesgericht
Mönchengladbach (Germany) 15 July 2003 (filter), CISG-Online 813 (Pace), in relation with Art. 84(2)
CISG; Landgericht Stuttgart (Germany), 29 October 2009 (artificial turf), CISG-Online 2017 (Pace): “A
set-off is at least admissible in the field of application of the CISG without an express provision as long as
the counterclaim is based on the same legal relationship”; Bundesgerichtshof (Germany), 14 May 2014
(coffee products), CISG-Online 2493 (Pace). See also: Bridge, in: Ferrari/Flechtner/Brand, Draft Digest
and Beyond (2003), pp. 251–252. It is also considered that set off is also derived from Art. 88.3 (CISG-AC
Opinion no 9, para 3.24). Contrary: Tribunale di Padova (Italy) 25 February 2004 (agricultural products),
SO.M.AGRI s.a.s. di Ardina Alessandro & C. v Erzeugerorganisation Marchfeldgemüse GmbH & Co. KG,
CISG-Online 819 (Pace): set-off is not governed by CISG “even when considering counterbalancing
credits arising from contracts subject to the Convention”.
162 This is particularly so since according to some scholars Art. 7(2) rejects the common law approach
to interpretation based upon a strict and literal reading: see Bell, How the Fact of Accepting Good Faith as
a General Principle of the CISG Will Bring More Uniformity, Review of the Convention on Contracts for
the International Sale of Goods (CISG) (2005–2006) 16.
163 An example where general principles were applied in a case of application by analogy is the case
decided by Warsaw Court of Appeals (Poland) 20 November 2008 (truck), CISG-Online 2539 (Pace)
where the Court of Appeals stated that the Convention does not expressly govern the consequences of the
termination of a contract as a result of the lapse of contractually established time limit. However, in light
of Art. 7 CISG, which calls for the application of the general principles, Art. 81(2) CISG was applied.
165 CISG-AC Opinion no 13. Other example is the burden of proof: Ferrari, CISG and Private
International Law, in: Ferrari, The 1980 Uniform Sales Law (2003), p. 19 (40 et seq.), that choose it to
illustrate the difficulties in distinguishing the internal and external gaps; and 2016 UNCITRAL, Digest of
Case Law on the CISG, Art. 7 para. 20.

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63 Since the Convention is neither a perfect model166 nor an exhaustive text, some
critical issues of divergent interpretation exist; transaction costs might be reduced
through drafting contract clauses tailored for contracts under CISG. Far from being a
disadvantage167, the vagueness of the content and enumeration of the general princi-
ples is compensated by the flexibility and adaptability of the Convention provisions to
permeate new general principles as the study and applicability of the Convention
grows.
64 Apart from the clear principles embodied in Art. 7 (principles of internationality,
uniformity and good faith), there are also several other principles easy to detect as
embodied in the general dispositions of the Convention. These are found in Arts 1–13,
particularly the reasonability principle (Arts 8, and inter alia 39, 43, 46, 70), freedom of
form and evidence (Art. 11), freedom of contract or party autonomy (Art. 6), the rules in
regard to the hierarchy of the norms, and the value of usages and practices established
between the parties. In Part II (Formation of the Contract), principles include: the receipt
or reception principle as a general principle for the effectiveness of declarations of will
within Part II (Art. 24), the principle of exchange of information168, the principle to
preserve the contract (Arts 19(2) and 21(2)), estoppel and venire contra factum proprium
(Arts 16(2)(b)) and 29(2)). In Part III principles include: the duty to cooperate (Arts
32(3), 48(2) and 60)169, pacta sunt servanda, favor executionis170, full compensation
(Art. 74)171, the duty to mitigate (Art. 77)172, the right to withhold performance (Arts 58
and 71173, 81(2), 85(2), and 86(1)), the synallagmatic principle (Arts 58, 71174 and 81(2)),
the avoidance of business disruption and economic waste (Arts 25 and 77)175, etc176.
166 Tallon, Damages, Exemption Clauses and Penalties, 40 American Journal of Comparative Law
(1992) 675 (675 seq.).

167 But see a negative view: Andersen, General Principles of the CISG–Generally Impenetrable?, FS
Kritzer (2008), p. 13 (13 et seq.).

168 Foreign Trade Court of Arbitration attached to the Yugoslav Chamber of Commerce (Serbia)
9 December 2002 (Aluminium), CISG-Online 2123 (Pace).

169 Honnold, Uniform Law (2009), para. 100; Beraudo, The United Nations Convention on Contracts
for the International Sale of Goods and arbitration, 5 ICC International Court of Arbitration Bulletin
(1994) 63. See: Art. 5.3 PICC. Foreign Trade Court of Arbitration attached to the Yugoslav Chamber of
Commerce (Serbia) 9 December 2002 (aluminium), CISG-Online 2123 (Pace).
170 National Commercial Court of Appeals, Division “A”, Buenos Aires (Argentina) 31 May 2007
(almonds), Sr. Carlos Manuel del Corazón de Jesús Bravo Barros v Salvador Martı́nez Gares (Pace)
referring to specific performance.
171 Recognized as a gap filler in regard to the interest rate in Art. 78, Arbitral–Awards, Internationales
Schiedsgericht der Bundeskammer der gewerblichen Wirtschaft – Wien (Austria), 15 June 1994 (rolled
metal sheets), No. SCH 4318/SCH-4366, CISG-Online 120/121 and also considering that the same result
would be derived from Art. 7.4.9 PICC; Foreign Trade Court attached to the Serbian Chamber of
Commerce (Serbia), 19 October 2009 (mineral water), CISG-Online 2265 (Pace); Foreign Trade Court
attached to the Serbian Chamber of Commerce (Serbia), 6 May 2010 (agricultural products and grains),
CISG-Online 2358 (Pace). Or the principle of full restitution derived from Arts 74 and 84(1) CISG to
determine the dies a quo for the interest rate: Audiencia Provincial de Girona (Spain), 21 January 2016
(live molluscs), Alexandridis G. & CO. OESC v Treatment Servimant, SL, CISG-Online 2729.
172 Inter alia: Bundesgerichtshof (Germany), 26 September 2012 (clay), CISG-Online 2348 (Pace).
173 The principle of simultaneous exchange of performances derives from Arts 58 and 71. Or exceptio
non adimpleti contractus (Arbitral Award, ICC/11849, 2003 (fashion products) (Unilex)). From this
principle it is derived that the buyer has the right to withhold payment of the price when the performance
rendered is not in conformity with the contract: Oberstergerichtshof (Austria) 8 November 2005 (machine
for recycling glass), CISG-Online 1156 (Pace).
174 Oberlandesgericht Köln (Germany), 19 May 2008 (pesticide), CISG-Online 1700 (Pace).
175 CISG-AC Opinion no 9, paras 3.11 and 3.23.
176 Scholars have drawn up several lists of general principles which might be considered ambitious and
are not always coincident. See: Magnus, General Principles of UN-Sales Law, International Trade and
Business Law Annual (1997) 33 (33 et seq.) (Pace); Honnold, Uniform Law (2009), paras 99 et seq.; Bonell,

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Further, other general principles apply to the whole Convention: the favor contractus 65
principle177 or favor negotii that might influence the interpretation178 and conclusion of
the contract and the pro-Convention principle. The pro-Convention principle, on the
one hand, dictates an interpretation in favour of the applicability of the CISG179, and as
a consequence an international and uniform interpretation (Art. 7) would decrease
transaction costs, and forum shopping as well as an exclusion of conflicts of law rules180.
On the other hand, this principle claims an extensive and broad interpretation of the
gap-filling rule, attaching to the CISG several matters that otherwise might fall outside
the scope of the Convention. To this regard, a high portion of the CISG is to be
considered general contract law rules and the fact that there is not a general contract
law treaty justifies a broader application of the Convention. Other general principles
include the principle of in dubio pro Conventione181, which considers the preference in
the applicability of the CISG before domestic law and the applicability of the CISG over
the purely domestic or national public order182; and the principle of equality between
buyers and sellers that was considered decisive to the interpretation of Art. 74 and to
conclude that attorney’s fees were not to be covered within that provision183.
Other principles need to be inferred from a process of abstraction and deduction on 66
specific provisions of the Convention184, e. g., case law has considered that the place of
payment of damages is the creditors place of business as derived from Art. 57(1)(a)
which deals with the place of payment of the purchase price185.
in: Bianca/Bonell, Commentary (1987), Art. 7 CISG para. 2.3.2.1 (Pace); Ferrari, in: Ferrari/Flechtner/
Brand, Draft Digest and Beyond (2003), pp. 160–170; Martı́nez Can ~ellas, La interpretación y la integra-
ción de la Convención de Viena sobre compraventa internacional de mercaderı́as de 11 de abril de 1980
(2004), pp. 322–337, considering the principles derived from scholarly work as well as for judicial or
arbitral decisions; Rosenberg, The Vienna Convention: Uniformity in Interpretation for Gap-Filling- An
Analysis and Application, 20 Australian Business Law Review (1992) 442 (449 et seq.); Janssen/Kiene, The
CISG and Its General Principles, in: Janssen/Meyer (eds), CISG Methodology (2009), 270–285; and
González Painemal, Interpretación e integración de la Convención de Viena de 1980 sobre los contratos
de compraventa internacional de mercaderı́as, Santiago de Chile (2013), pp. 178–195. See also 2016
UNCITRAL, Digest of Case Law on the CISG, Art. 7 paras 12 et seq.
177 See Keller, Favor contractus: Reading the CISG in favor of the contract, FS Kritzer (2008), p. 247
(247 et seq.).
178 See Zuppi, Art. 8, para. 31 in this commentary; Schmidt-Kessel, in: Schlechtriem/Schwenzer, Com-

179 See CISG-AC Opinion no 4, para. 4.4; CISG-AC Opinion no 16, comment 3.5 Or the principle favor
conventionis: Martı́nez Can ~ellas, La interpretación y la integración de la Convención de Viena sobre

compraventa internacional de mercaderı́as de 11 de abril de 1980 (2004), p. 316; and Moreno Rodrı́guez,
Derecho aplicable y arbitraje internacional, Thomson/Aranzadi (2014), pp. 246–247.
180 See De Ly, Uniform interpretation: What is being done? Official efforts, in: Ferrari, The 1980
Uniform Sales Law (2003), p. 335 (341). See advocating that CISG would reduce transaction costs: Lehn,
in: Flechtner/Brand/Walter, Drafting Contracts (2007), pp. 263–265.
181 As considered by several authors: Lookofsky, In dubio pro conventione? Some thoughts about opt-
outs, computer programs and pre-emption under the 1980 Vienna Sales Convention (CISG), 13 Duke
Journal of Comparative and International Law (Summer 2003) 263 (263 et seq.) (Pace); and Martı́nez
Can ~ellas, La interpretación y la integración de la Convención de Viena sobre compraventa internacional
de mercaderı́as de 11 de abril de 1980 (2004) pp. 130–131.
internacional de mercaderı́as de 11 de abril de 1980 (2004) p. 131.
184 Maskow, The Convention on the International Sale of Goods from the Perspective of the Socialist
Countries, in: la Vendita Internazionale (1981), pp. 57 et seq.; Adame Goodard, Reglas de Interpretación
de la Convención sobre compraventa internacional de mercaderı́as, Diritto del Commercio Internazionale
(1990) 103 (112); following Bonell, in: Bianca/Bonell, Commentary (1987), Art. 7 para. 2.3.2.2. (Pace).
185 Oberlandesgericht Düsseldorf (Germany) 2 July 1993 (veneer cutting machine), CISG-Online 74
(Pace). The better rule derived from Arts 57(1) and 7 is that such payment is to be made at the obligee’s
place of business. Therefore, one might go even further and infer that the place of payment of any

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67 bb) General Principles external to the CISG: Lex Mercatoria and the PICC. The
autonomous interpretation of the Convention is defined by some scholars through a
negative definition – no external concepts to interpret the CISG – and a positive one –
interpretation of the Convention within its system and objectives186. However, it is rather
controversial187 whether external principles may play a role in the interpretation and gap-
filling of the CISG absent an agreement of the parties188; from those that deny any role of
the external principles, and particularly PICC189, to those that identify the PICC as the
general principles on which the Convention is based (Art. 7(2) CISG)190. The common
understanding is that the PICC are generally not considered to be the general principles
of the CISG, but rather that it might be a tool to interpret the CISG191 or to fill its gaps,
particularly where there is no collision between them192, or even applied as an expression
of the good faith principle (Art. 7(1) CISG)193. The answer also depends upon the
applicable law to the contract as well as the dispute resolution method. In any case,
modern trends in the interpretation of the CISG allow considering the lex mercatoria and
monetary obligation under CISG is determined by the creditor’s place of business (see: CISG-AC Opinion
no 14, at 9). However, there are opposite views, see Ferrari, CISG and Private International Law, in:
Ferrari, The 1980 Uniform Sales Law (2003), p. 19 (43) and 2016 UNCITRAL, Digest of Case Law on the
CISG, Art. 7 para. 18, inter alia: Cour d’Appel de Paris (France) 14 January 1998 (elephants), Sté
Productions SCAP v Faggioni, CISG-Online 347 (Pace), unable to derive a general principle and thus
the Court held that Art. 57(1)(a) does not express a general principle on the place of payment, because in
the cases it governs the seller and the creditor coincide.
186 Torsello, The CISG’s impact on Legislators: The Drafting of International Contract Law Conven-
tions, in: Ferrari, The 1980 Uniform Sales Law (2003), p. 230 (235 et seq., note 229); Gebauer, Uniform
Law, General Principles and Autonomous Interpretation, Uniform Law Review (2000), p. 686 (686 et
seq.); Zeller, Four-Corners – The Methodology for Interpretation and Application of the UN Convention
on Contracts for the International Sale of Goods, 2003, Chapter 6 (Pace); Schwenzer/Hachem, in:
187 Cf. Perales Viscasillas, The Role of the UNIDROIT Principles and the PECL in the interprtation and
gap-filling of CISG, in: Janssen/Meyer (eds), CISG Methodology (2009), pp. 287 et seq.
188 See UNIDROIT Model Clauses for the Use of the UNIDROIT Principles of International Commer-
cial Contracts (2013) which provides a model clause for the use of PICC and CISG to be included in the
contract and a model clause for use after a dispute has arisen (Models 3 and 4). As pointed out in
comment 3 to Model Clause 4 by using it there would be an implied derogation of Art. 7.2 CISG.
189 Among the most recent ones: Flechtner, Uniformity and Politics: Interpreting and filling gaps in the
CISG. Festschrift für Ulrich Magnus zum 70 Geburstag. Sellier (2014), pp. 196–198 discussing the
“aggressive approach” v “more cautious approach”, critical to PICC considering that Art. 7.1 CISG
principles might conflict with those of PICC; and Fogt, Private International Law in the process of
harmonization of International Commercial Law: “The Ugly Duckling”?. Unification and Harmonization
of International Commercial Law. Interaction of Deharmonization?. Edited by Morten M.Fogt. Walters
Kluwer, (2012), pp. 97–98.
190 Curiously enough Comment 3 to Model clause 4 of the UNIDROIT Model Clauses (supra footnote
188) recognizes that the general principles under Art. 7.2 CISG “are as such not identical with the
UNIDROIT Principles”.
191 Magnus, Harmonization and Unification of Law by means of general principles. Unification and
Harmonization of International Commercial Law. Interaction of Deharmonization?. Edited by Morten

M.Fogt. Walters Kluwer (2012), p. 173 referring also to other principles but with more emphasis on
PICC.
192 Michaels, Preamble, Commentary on the UNIDROIT Principles of International Commercial
Contracts (PICC). Edited by Stefan Vogenauer, 2nd edition, Oxford University Press, 2015, No 110, in
so far as PICC reinstate the CISG’s general principles. But PICC cannot automatically and without
exception be used to supplement the CISG (id., No 124). Similarly: Monberg, The UNIDROIT Principles
– The Ugly Duckling of Gap-Filling Instruments under the CISG (2012) (Pace).
193 Gerechtshof’s Hertogenbosch (The Netherlands), 16 October 2002 (plants), CISG-Online 816 (Pace)
analysing an international sales of goods contacts under the CISG that, in order to achieve a uniform and
international solution, it should be interpreted in light of PICC (also PECL). The Tribunal considered the
comments to Arts 2.20 PICC and 2.104 PECL in the interpretation of the CISG.

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the PICC194, as a means of interpreting and supplementing the CISG when no general
principles within the Convention are found195 or as to be applied for matters excluded
from CISG such as limitation periods196 or to validity issues in a direct application of
chapter 3 PICC197- a solution that is based upon the uniformity principle (Art. 7(1))198.
Furthermore, after the UNCITRAL endorsement of the PICC, the legitimacy behind the
Principles to play an interpretative and supplementary role towards the CISG has
increased (Art. 7)199. This is particularly so since the endorsement is not restricted to the
use by the parties, as happens to be the case with other international instruments
endorsed by UNCITRAL200.
194 And to a lesser extent the PECL, since international instruments ought to prevail over regional
instruments: CISG-AC Declaration no 1, The CISG and Regional Harmonization, Rapporteur: Professor
Michael Bridge, London School of Economics, London, United Kingdom, 3 August 2012 (at http://cisg-
ac.org).
195 Cf. Perales Viscasillas, The Role of the UNIDROIT Principles and the PECL in the interpretation and
gap-filling of CISG, in: Janssen/Meyer, CISG Methodology (2009), pp. 287 et seq. Several courts and arbitral
awards have considered PICC as the general principles on which the CISG is based. See Arbitral Award,
ICC 8817/1997, 1 December 1997 (food products), CISG-Online 776 (Pace) (YCA, XXV, 2000), in relation
with an exclusive distribution contract in Spain and Portugal, where the sole arbitrator declared that the
CISG was applicable to the case as well as its general principles as embodied in the UNIDROIT Principles
mentioning Arts 9(1), 25, 64, 74 and 78 CISG. Particularly in relation with the rate of interests (Art. 78
CISG): Arbitral Award, ICC 8128/1995 (PICC and PECL), 1 January 1995 (chemical fertilizer), CISG-
Online 526 (Pace); Arbitral Award, ICC 8769/1996 (PICC), 1 December 1996 (electrical appliances plus
tooling), CISG-Online 775 (Pace); Supreme Economic Court of the Republic of Belarus, 20 May 2003 (fish
flour), Holzimpex, Inc. v Sozh State farm complex, CISG-Online 1040, directly applying PICC to fill the rate
of interest. Also in relation with hardship as an impediment under Art. 79 and so that under Art. 7(2) the
general principles “as incorporated inter alia in the Unidroit Principles of International Commercial
Contracts, the party who invokes changed circumstances that fundamentally disturb the contractual
balance, as mentioned in paragraph 1, is also entitled to claim the renegotiation of the contract”: Court of
Cassation (Belgium) 19 June 2009 (steel tubes), CISG-Online 1963 (Pace). Or as in Arbitral Award, ICC
12 460/2004 (Unilex): “CISG, as per its article 7, may be supplemented by those general principles which
have inspired its provisions and particularly those which have been substantiated and codified in the
UNIDROIT Principles of International Commercial Contracts and actually used in relation with the CISG
implementation. This can be observed in arbitral jurisprudence (see ICC Publication No. 642.2002) and in
various ICC precedents. At the hearing, the Tribunal raised the issue with the parties whether they might be
relevant. The Tribunal has accordingly concluded that the UNIDROIT Principles should provide guidance”.
See also: Arbitral Award, ICC 12 097/2003 (fashion products) (Unilex); Arbitral Award, ICC 11 638/2002
(unidentified goods). For a more detailed discussion, infra, Atamer, Art. 79, paras 78–86. Finally as usages
of trade in relation to CISG, considering Art. 6.1.9 PICC as a confirmation also of the general principles
embodied CISG: Corte Cubana de Arbitraje Comercial Internacional (Cuba), 30 September 2013 (lifting
platform), CISG-Online 2579 (Pace).
196 Audiencia Provincial de Madrid (Spain), 17 February 2015 (Garments), CISG-Online 2620 (Pace)
resorting to Art. 10.2 PICC. Contrary: Michaels, Preamble, Commentary on the UNIDROIT Principles of
International Commercial Contracts (PICC). Edited by Stefan Vogenauer, 2nd edition, Oxford University
Press (2015) No 126.
197 Perales Viscasillas, The Role of the UNIDROIT Principles, pp. 286 et seq; Tribunal de Justiça do Rio
Grande do Sul (Brasil) 30 March 2017 (electric motors) (cisgspanish.com) in relation with issues related
to the nullity of the contract.
198 Perales Viscasillas, The Role of the UNIDROIT Principles, pp. 286 et seq.
199 Report of the United Nations Commission on International Trade Law on the work of its fortieth
session Vienna, 25 June-12 July 2007 A/62/17 (Part I) General Assembly (http://www.uncitral.org), paras 210
et seq.: “Taking note that the Unidroit Principles 2004 complement a number of international trade law
instruments, including the United Nations Convention on Contracts for the International Sale of Goods
(1980)”, “Noting that the preamble of the Unidroit Principles 2004 states that (…)”, “Congratulating
Unidroit on having made a further contribution to the facilitation of international trade by preparing
general rules for international commercial contracts”, “Commends the use of the Unidroit Principles 2004,
as appropriate, for their intended purposes”. See resorting to the UNCITRAL Recommendation on
Incoterms 2000: Audiencia Provincial de Valencia (Spain) 7 June 2003 (concentrated grape juice), Cherubino
Valsangiacomo, S.A. v American Juice Import, Inc., CISG-Online 948 (Pace) (www.cisgspanish.com).
200 Cf. UNCITRAL YB (2000), paras 432–434.

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68 The majority of uniform international commercial law texts have a rule on inter-
pretation and gap-filling following the model of Art. 7 CISG201. In fact, UNCITRAL was
the first organization to insert a specific interpretation provision in its uniform law
instruments202, and thus a systematic interpretation of uniform law instruments is to be
followed203. According to this approach, a coherent interpretation among uniform law
instruments should be considered as a general principle of interpretation of uniform law
instruments; as a consequence the interpretation more favourable to coherence among
uniform international texts is to be preferred.
69 The influence of Art. 7 is not only seen in the instruments of UNCITRAL204, but also of
UNIDROIT205, as well as other regional texts, like the PECL and DCFR206. Usually the
model is reproduced in its entirety, although sometimes with minor changes. In a minority
number of the texts, substantive changes are considered due to the need to further develop
the rules, or accommodate them to the specificities of the subject matter of the instrument.
70 Contrary to the CISG, the PICC do not mention subsidiary recourse the national law207.
This omission is consistent with the creation of an autonomous self-sufficient system.
71 The recognition of the principle of good faith and fair dealing in Art. 1.7 PICC (also
in Art. 1:106 PECL)208, not expressly as a principle of interpretation of the PICC but as a
201 Before similar provisions with no reference to good faith: UN Convention on the Limitation Period
in the International Sale of Goods (14 June 1974) and Art. 3 of the Convention on the Carriage of Goods
by sea, 1978 (Hamburg Rules).
202 De Ly, Uniform interpretation: What is being done? Official efforts, in: Ferrari, The 1980 Uniform
Sales Law (2003), p. 335 (343).

203 See Ferrari, The relationship between international uniform contract law Conventions, Uniform
Law Review (2000) 76–78, who refers to the Conventions and justifying this approach on the basis that
the different Conventions have the same goal and in the existence of identical interpretation rules.
204 Follow Art. 7(1) CISG, e. g.: Art. 4 United Nations Convention on International Bills of Exchange
and International Promissory Notes of 1988; Art. 5 of the UNCITRAL Convention on Independent
Guarantee and Stand By Letters of Credit of 1995 that refers to good faith; Art. 8 UNCITRAL Model Law
on Cross Border Insolvency; Art. 5 UN Convention on independent guarantees and stand-by letters of
credit; Art. 5(1) of the UN Convention on the Use of Electronic Communications in international
contracts (2005); Art. 2 UN Convention on the contracts for the international carriage of goods wholly
or partly by sea (2008); Art. 6.1 UNIDROIT Convention on Agency in the International Sale of Goods
(Geneva, 17 February 1983); and Art. 4.1 UNIDROIT Model Law on Leasing (13 November 2008).
205 Art. 6 UNIDROIT Convention on Agency in the International Sale of Goods (Geneva, 17 February
1983) is a copy of Art. 7 CISG. Art. 5 of the UNIDROIT Convention on International Interests in Mobile
Equipment (Cape Town, 2001) follows Art. 7 CISG but it considers also the Preamble and there is no
reference to the good faith principle. Similar approach is seen in Art. 4 of the UNIDROIT Convention on
Substantive Rules for Intermediated Securities (2009) where also the principle of predictability in its
application is considered.
206 Art. 1:106 and Art. 1:201 PECL; Art. I.-1:102(3) and (4) DCFR are similar to Art. 7 CISG with some
departures do to the different scope of application.

207 The same approach is found in Art. 3(2) UNCITRAL Model Law on Electronic Commerce (1996);
Art. 4(2) UNCITRAL Model Law on Electronic Signature (2001); Art. 2(2) UNCITRAL Model Law on
International Commercial Conciliation (2002); Art. 2A UNCITRAL Model Law on International Com-
mercial Arbitration (1985 as amended in 2006); and Art. 4.2 UNIDROIT Model Law on Leasing
(13 November 2008).
208 More details: Magnus, Comparative editorial remarks on the provisions regarding good faith in
CISG Art. 7(1) and the UNIDROIT Principles Art. 1.7., in: Felemegas (ed.), An International Approach to
the Interpretation of the United Nations Convention on Contracts for the International Sale of Goods
(1980) as Uniform Sales Law (2007), pp. 45 et seq.; and Felemegas, Comparison between the provision
regarding the concept of good faith in CISG Art. 7 and the counterpart provisions of the PECL, in:
Felemegas (ed.), An International Approach to the Interpretation of the United Nations Convention on
Contracts for the International Sale of Goods (1980) as Uniform Sales Law (2007), pp. 268 et seq.

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mandatory standard of behaviour of the parties, is one of the greatest and most correct
innovations of the PICC. The drafters of the PICC were aware of the compromise that
embodied good faith during the discussions of the Vienna Sales Convention. They have
extracted good faith from the interpretative principles and have relocated it in an
independent disposition with a mandatory character (“The parties may not exclude or
limit this duty” Art. 1.7 (2) PICC). At the same time they have given to good faith its
natural content (“Each party must act in accordance with good faith and fair dealing in
international trade”). Art. 1.7 PICC is complemented by Art. 2.1.15 (Negotiations in
bad faith) and 2.1.16 (Duty of confidentiality).

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Article 8
(1) For the purposes of this Convention statements made by and other conduct of a
party are to be interpreted according to his intent where the other party knew or
could not have been unaware what that intent was.
(2) If the preceding paragraph is not applicable, statements made by and other
conduct of a party are to be interpreted according to the understanding that a
reasonable person of the same kind as the other party would have had in the same
circumstances.
(3) In determining the intent of a party or the understanding a reasonable person
would have had, due consideration is to be given to all relevant circumstances of the
case including the negotiations, any practices which the parties have established
between themselves, usages and any subsequent conduct of the parties.
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CISG and the Regulated Market, Washington University Global Studies Law Review (2005) 1; Cueto
Rua, Judicial Methods of Interpretation of the Law (1981); Dickerson, The Interpretation and Applica-
tion of Statutes (1975); Garro/Zuppi, Compraventa internacional de Mercaderı́as (2012); Kakzorowska,
Règles uniformes d’interpretation d’un contrat international, 68 Revue de Droit International et Droit
Comparé (1991), 294; Patterson, The Interpretation and Construction of Contracts, 64 Columbia
Law Review (1964) 833; Schmidt-Kessel, in Schlechtriem/Schwenzer, Article 8, 111; Schröter, Rückkauf-
verpflichtungen und ‘contra proferentem’-Regel unter dem UN-Kaufrecht, 5 IHR (2014); Schwenzer/
Fountoulakis/Dimsey, International Sales Law (2012); Vettori, The Interpretation of Good Faith and
According to Human Rights, Fundamental Freedoms and Constitutional Laws in the Common Frame
of Reference, Persona e Mercato (2009); Zeller, Determining the Contractual Intent of Parties under
CISG and Common Law–A Comparative Analysis, 4 European Journal of Law Reform (2000) 629;
Zuppi, La interpretación en la Convención de Viena de 1980 (CISG) – Compraventa internacional de
mercaderı́as, Revista Jurı́dica La Ley (1997) 1290; “The Parol Evidence Rule. A comparative study of the
Common Law, the Civil Law Tradition and Lex Mercatoria” 35 Ga. J. Int’l & Comp. L. 2, 233 (2007);
CISG-AC Opinion no 3, Parol Evidence Rule, Plain Meaning Rule, Contractual Merger Clause and the
CISG, 23 October 2004. Rapporteur: Professor Richard Hyland, Rutgers Law School, Camden, NJ, U.S.
(at http://www.cisg-ac.org).
Outline
I. Importance and Role of Provision . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
2. Legislative history . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
1. First Paragraph . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
a) The statement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
b) The meaning of “intent” . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
c) Objective and subjective intent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
2. The second paragraph: The reasonable understanding . . . . . . . . . . . . . . . . . . . . 23
3. The third paragraph . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
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I. Importance and Role of Provision

1. Introduction
Art. 8 governs the interpretation of statements or manifestations of intent exchanged 1
by the parties in a contract submitted to the control of the CISG. It excludes local rules
of interpretation per se, unless such local rule matches the practice or usage established
between the parties.1 It is divided into three paragraphs according to the way such
statements should be interpreted. The first paragraph resolves the case when the other
party knew, or should have known, the intention of the statement-maker. When neither
of these alternatives is applicable, the second paragraph explains that the statement
should be interpreted following the understanding of a reasonable person of the same
kind as the recipient in the same circumstances, with some examples of what should be
seen as “relevant circumstances” in the third paragraph. Art. 8 looks for the real
expression of will of the parties in the contract, establishing some steps for reaching
it.2 First, the subjective intention as far as the other party knows it. Second, if the
misunderstanding continues, then the objective intention should be observed, having
regard of all circumstances of the case.3
Notwithstanding the fact that the text refers to “statements” in particular, Art. 8 will 2
be applied when interpreting the contract in general. Moreover, it will even be referred
to for the interpretation of other possible legal relationships that arise between the
parties and go beyond the scope of the CISG.4 Art. 8 should be considered together with
Arts 7 and 9, which together form the pillars of the CISG in interpretation matters.
These articles form the core of the CISG with respect to questions related to the
understanding of an international contract and, notwithstanding Art. 65 and express
reference of Art. 12 when the parties are prevented from derogating or varying the effect
of CISG provisions6, which cannot be derogated from or varied without excluding the
CISG ex toto.7
1 OG Thurgau (Germany) 12 December 2006, CISG-Online 1566 (Pace); and LH Hamburg (Germany)
26 September 1990, CISG-Online 21 (Pace).

2 See HG Aargau (Germany) 26 November 2008, CISG-Online 1739 (Pace); AG Basel-Stadt (Switzer-
land) 26 September 2008, CISG-Online 1731 (Pace); and Zivilgericht Basel-Stadt, (Switzerland) 8 Novem-
ber 2006, CISG-Online 1732 (Pace).
3 See decision OG Zug (Switzerland) 8 November 2011, CISG-Online 2425 (Pace), nos 4 and 5.
4 See Schlechtriem, Internationales UN-Kaufrecht (2005), p. 49 para. 54. As an example, Schlechtriem
refers to the case of the so-called “general conditions of the contract” or Allgemeinene Geschäftsbedingen,
very popular in Europe among unions of attorneys counselling clients belonging to the same industry. See
an example of this going beyond the CISG in Tribunale di Rovereto (Italy) 21 November 2007, Takap
B. V. v Europlay S. r. l., Case 914/06, CISG-Online 1590 (Pace), and in the case decided by the BGH
(Germany) 26 June 2009, CISG-Online 1908 (Pace), See further infra II.2.
5 “The parties may exclude the application of this Convention or, subject to article 12, derogate from or
vary the effect of any of its provisions.”

6 See Art. 12: “Any provision of article 11, article 29 or Part II of this Convention that allows a contract
of sale or its modification or termination by agreement or any offer, acceptance or other indication of
intention to be made in any form other than in writing does not apply where any party has his place of
business in a Contracting State which has made a declaration under article 96 of this Convention. The
parties may not derogate from or vary the effect of this article.” [Emphasis added].
7 Several CISG provisions cannot be derogated by the parties despite Art. 6, unless they declare the
CISG as non-applicable as a whole. See for example the final provisions of Arts 89 to 101 which cannot be
derogated from despite not including a specific prohibition as seen with Art. 12. See Zuppi, La
interpretación en la Convención de Viena de 1980 (CISG) – Compraventa internacional de mercaderı́as),
Revista Jurı́dica La Ley (1997) 1290. It would be possible that the parties may agree to apply a specific
method of interpretation varying the alternatives offered in the CISG. However, the way the CISG should
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3 Art. 8 presents different alternatives for resolving problems that arise when the
parties’ intent regarding expressions of their will in a contract are in dispute. The first
paragraph is used for resolving conflicts in the subjective intent expressed by the
statement-maker when the other party knew or could not have been unaware of what
the statement-maker’s intent was when issuing the statement.8 If the other party was
unaware or could not have known the alleged stated subjective intent, then the CISG
resorts in the second paragraph to the understanding of a reasonable person of the same
kind as the recipient in the same circumstances. Presented in this way, Art. 8(1)
provides for the relevance of the actual intent of the statement-maker and, where this
would not be applicable, the second paragraph states the objective theory provided by
the reasonable person in the same circumstances which should be resolved following the
explanations given in the third paragraph.9 Accordingly, while determination of the
actual (subjective) intent seems to be an issue of fact for the existence of which evidence
has to be submitted, “the interpretation of the objective intent of a party’s statements
and conduct pursuant in Art. 8(2) CISG has to be done by the Arbitral Tribunal in the
light of the principle of good faith and is an issue of law.”10
4 However, Art. 8 leaves several questions unanswered.11 It does not explain, for
example, whether “intent” refers to the statement-maker’s actual intent or simply what
he stated, which can be problematic if the statement was different from what he actually
meant. Also, the text does not explain the consequences of being unable to determine
the statement-maker’s intent despite exhausting all methods provided by this article. A
similar question arises when the expressed intent concerns several aspects of the
contract and only part of the contract is unclear. Will this partial misunderstanding
affect the whole statement or only the parts that are unclear? It is clear that Art. 8 deals
with interpretation, however, would it be possible to confine its methods of gap filling to
only part of a statement?12
be interpreted and the interplay of such a specific clause in a given contract with the core principles of the
CISG will be decided by the interpreter in case of a conflict beyond the parties’ control.
8 See for example, decision of the Swiss BGH (Switzerland) 23 September 2013, CISG-Online 2560
(Pace) using Art. 8 for determining whether a certain point of the contract agreed between the parties
should be understood for them as fundamental or not. See also Cour d’appel de Grenoble (France) Société
Calzados Magnanni v. SARL Shoes General International, 21 October 1999, CISG-Online 574 (Pace),
where the seller had to interpret the indications and other behaviour of buyer “according to the buyer’s
intent where the seller knew or could not have been unaware what that intent was.” In relation with not
being unaware see U.S. District Court, District of Maryland (U.S.) CSS Antenna, Inc. v. Amphenol-Tuchel
Electronics, GmbH, 8 February 2011, CISG-Online 2177 (Pace) deciding that buyer knew or should have
known that seller intended the General Conditions to apply to their contract; in the same sense U.S.
District Court, Southern District of New York (U.S.) TeeVee Toons, Inc. (d/b/a TVT Records) & Steve
Gottlieb, Inc. (d/b/a Biobox) v. Gerhard Schubert GmbH, 23 August 2006, CISG-Online 1272 (Pace);
Audiencia Provincial de Cáceres (Spain) 14 July 2010, CISG-Online 2131 (Pace); and Audiencia Provincial
de Madrid, sección 14\ha (Spain) Sunprojuice DK, Als v. San Sebastian, S.c.A., 20 February 2007, CISG-
Online 1637 (Pace) (… seller could not ignore buyer’s intention since it signed the contract in which
quality conditions were established and which expressly identified the purpose of such conditions.)
9 See Hogg/Bishop/Barnhizer, Contracts – Cases and Theory of Contractual Obligation (2008) p. 146.
10 See Arbitral Award, ICC 9187/1999, June 1999 (Coke), CISG-Online 705 (Pace).
11 A Swiss case considered that the method of interpretation proposed by Art. 8 is the same method
developed in Switzerland from Art. 18 of the Swiss Code of Obligations. See Cour de justice de Genève
(Switzerland) 12 March 2010, CISG-Online 2426 (Pace).
12 Some gap-filling provisions are in the CISG for specific purposes such as the cases of lack of
determination of the place of delivery in Art. 31, or time for delivery in Art. 33. In Arbitral Award, ICC
9187/1999, June 1999 (Coke), CISG-Online 705 (Pace), it was stipulated that certain quality standards in
the contract of the sale of coke provided a reduction of price if the delivered coke does not met these
standards. The Tribunal decided that the defendant had to prove that it intended for the reduction
mechanism to be limited in a certain (minor) amount of reduction instead of a reduction to zero in case
of major discrepancies. “Further, defendant must provide evidence for the fact, that claimant knew or
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When no understanding can be obtained despite exhausting all the alternatives of 5
Art. 8, no juridical effect will take place between the parties. In the case of a partial
misunderstanding, the decision concerning whether that will affect the contract as a
whole, or only part of it, will depend on the significance of the statement. Thus, if the
statement-maker intended to determine the price of his indeterminate offer with the
statement made, following the rules of Art. 8, any lack of understanding will result in
the non-existence of the contract. However, when the statement of one party is not
related to the main elements of a contract, despite a lack of understanding, following the
rules of Art. 8 CISG, the contract will continue to bind the parties.
2. Legislative history
The Official Records of the Conference13 refer to Art. 9(3) ULIS,14 Arts 4(2),15 5(3),16 6
1217 and 13(2) ULF,18 as well as Arts 3, 4 and 5 of the 1972 UNIDROIT Draft of a Law
for the Unification of Certain Rules relating to Validity of Contracts of International
Sale of Goods (ULVC) as prior uniform law to this text. It has been mentioned that this
is the only article of the CISG, which refers to the former UNIDROIT draft as a
source.19 While the CISG refers to “other conduct” that should be interpreted in
accordance with the party’s “actual common intent”, the ULVC uses the word “acts”.
In addition, the ULVC included “where such intent can be established,” but this latter
requirement was suppressed as it was considered superfluous.20
1. First Paragraph
a) The statement. “Statement” in the sense of this article is any unilateral signifi- 7
cant act issued from one party to another that allows the latter to know, or be able to
know, what the statement meant. The statements mentioned in article 8 CISG must
relate to a matter govern by the Convention. Topics excluded from its scope by Art. 4
should have known this intent when signing the contract (Art. 8.1 CISG). Defendant does neither bring
forward substantial allegations nor proof in this respect.”
13 See U. N. Doc A/CONF.97/19.
14 Art. 9.3 ULIS: “Where expressions, provisions or forms of contract commonly used in commercial
practice are employed, they shall be interpreted according to the meaning usually given to them in the
trade concerned.”
15 Art. 4.2 ULF: “This communication may be interpreted by reference to and supplemented by the
preliminary negotiations, any practices which the parties have established between themselves, usage and
any applicable legal rules for contracts of sale.”
16 Art. 5. 3 ULF: “An indication that the offer is firm or irrevocable may be express or implied from the
circumstances, the preliminary negotiations, any practices which the parties have established between
themselves or usage.”
17 Art. 12 ULF: “1. For the purposes of the present Law, the expression “to be communicated” means to
be delivered at the address of the person to whom the communication is directed. 2. Communications
provided for by the present Law shall be made by the means usual in the circumstances.”
18 Art. 13 ULF: “2. Where expressions, provisions or forms of contract commonly used in commercial
practice are employed, they shall be interpreted according to the meaning usually given to them in the
trade concerned.”
19 See Farnsworth, in: Bianca/Bonell, Commentary (1987), Art. 8 para. 1.1. The first paragraph was
taken with small changes from Art. 3.2, the second paragraph from Art. 3.3 with the addition to the
quality of reasonable person the requirement to be of “the same kind as the other party.” The third
paragraph was taken from Art. 4.1 with two suppressions related to reasonability of the interpretation.
20 See Farnsworth, in: Bianca/Bonell, Commentary (1987), Art. 8 para. 1.2.
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CISG must be interpreted according to the law governing the subject if that would be
possible.21
8 The first paragraph of Art. 8 presents the so-called “subjective intent,” “will theory”
or “actual intent.” When the interpreter inquires whether the statement-maker has
sufficiently shown his intent or not, the answer remains in the limits of the objective or
subjective theories.22 Subjective intent theory looks into the statement-maker’s will
when that was known or could not be ignored by the recipient.23 The subjective intent
of a party must be manifested in some way for being recognizable as such.24
9 In contrast, the so-called “objective intent theory” looks into the actual intent of
the statement-maker and what a “reasonable man” would understand.25 When it is
impossible to determine subjective intent, then Art. 8(2), which requires the interpreter
to use the reasonable person test, comes into application. Here the meaning of the
statement will be what a reasonable person in the same shoes, as the recipient of the
statement would have understood. If, despite this further step, no interpretation is
possible, then no contract will be deemed to have been formed, and as contract validity
goes beyond the scope of the CISG (Art. 426), domestic law will be applied to resolve any
remaining conflict.27 A party who asserts that the other party knew or could not have
been unaware of the former party’s intent must prove it.28
10 The Commentary29 included in the Official Records of the Conference explains the
rules to be applied in the interpretation of the unilateral acts of each party and proposes
as examples: their communication relating the intended contract, the offer and accep-
tance, notices, etc.30 Art. 12 repeats the acts of offer and acceptance as examples of
21 See Schwenzer/Fountoulakis/Dimsey, International Sales Law (2012), Art. 8 p. 59; Garro/Zuppi,
Compraventa internacional de Mercaderı́as (2012), p. 82.

22 See Farnsworth, Contracts 4th ed. (2004) p. 114.
23 See U.S. District Court, Southern District of New York (U.S.) Hanwha Corporation v. Cedar
Petrochemicals, Inc., 18 January 2011, CISG-Online 2178 (Pace), not accepting as evidence of subjective
intent self-serving declarations of how they respectively viewed the other side’s offers and counter-offers;
and U.S. District Court, Southern District of New York (U.S.) TeeVee Toons, Inc. (d/b/a TVT Records) &
Steve Gottlieb, Inc. (d/b/a Biobox) v. Gerhard Schubert GmbH, 23 August 2006, CISG-Online 1272
(Pace), quoting Federal Appellate Court (11th Circuit) (U.S.) MCC-Marble Ceramic Ctr. v. Ceramica
Nuova D’Agostino, S.p.A., 29 June 1998, CISG-Online 342 (Pace), noting that Art. 8(1) “requires a court
to consider … evidence of the parties’ subjective intent” and that Art. 8(3) “is a clear instruction to
admit and consider parol evidence regarding the negotiations to the extent they reveal the parties’
subjective intent.” Also quoting MCC- Marble Ceramic case, in U.S. District Court, N.D., California
(U.S.) Supermicro Computer, Inc. v. Digitechnic, S.A., et al., 30 January 2001, CISG-Online 612 (Pace),
the tribunal decided that the CISG requires a “mirror-image” approach to contract negotiations that
allows the court to inquire into the subjective intent of the parties.
24 See Cour de justice de Genève (Switzerland) 12 May 2006, CISG-Online 1726 (Pace), where it was
decided that the subjective intent must be exteriorized in a fashion that could be recognized by the
addressee of the manifestation and LG Hamburg (Germany), 26 September 1990, CISG-Online 21 (Pace).
25 See opinion of Judge Jerome Frank, Ricketts v Pennsylvania R. Co., 2 Cir. 1946, 153 F.2 d 757, 760–
762, 164 A. L. R. 387.

26 Art. 4: “This Convention governs only the formation of the contract of sale and the rights and
obligations of the seller and the buyer arising from such a contract. In particular, except as otherwise
expressly provided in this Convention, it is not concerned with: (a) the validity of the contract or of any
of its provisions or of any usage; …”
27 Also Zeller, Determining the Contractual Intent of Parties under CISG and Common Law–A
Comparative Analysis, 4 European Journal of Law Reform (2000) 629 (635).

28 See this implicit in the decision of the BG St. Gallen, (Switzerland) 3 July 2007 (http://www.unilex.-
info/case.cfm?pid=1&do=case&id=306&step=FullText).
29 See U. N. Doc A/CONF.97/18.
30 Any previous negotiations as well as the subsequent conduct of the parties may show what they
understood in their respective declarations of intent. See HG Aargau (Switzerland), 5 February 2008,
CISG-Online 1740 (Pace), and Handelsgericht des Kantons Aargau (Switzerland) 26 November 2008,
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“indication of intention.”31 An offer will be valid when it is “definite”32 and clearly
indicates the intention of the offeror to be bound by his offer. From this point of view
and for determining the conclusion of a contract, the Commentary regards it as the
product of the sum of two unilateral acts, its offer and corresponding acceptance, both
being declarations of intention of each issuer.33
As some tribunals have recognized, the interpreter may perform a substantial inquiry 11
into the parties’ subjective intent through Art. 8, contrary to the stance commonly seen
in U.S. courts.34 The CISG requires a judge to evaluate the evidence that will prove
whether the recipient party of a statement was aware or unaware of the subjective intent
of the other party, which has delivered the statement in question. This requirement is
contrary to the parol evidence rule known in the common law.35 The parol evidence
rule provides that a written instrument intended by the parties thereto as the final
manifestation of their mutual understanding cannot be challenged by past or contem-
porary evidence contradicting it or modifying its content.36 The parol evidence rule it is
not applicable to CISG contracts,37 as it is deduced from the content of Art. 11 accepting
any evidence, even witnesses, for proving a contract. In a treaty such as the CISG, with
the primary goal of obtaining uniformity and harmonizing different global under-
standings of the most important contract, it was very unlikely to include a rule that
has lost supporters even in its own legal family.38
To make a “statement” means to utter an expression of will by any method fitted 12
for exteriorizing such manifestation. A statement is very different from a negative
activity such as, mere silence or inaction.39 A statement will include any representation
of fact, whether made in words or otherwise necessary, given to the other party. This
is consistent with translations in other official languages of the CISG. For example,
“statements” have been translated as “indications” in French and as “declaraciones” in
Spanish, both official versions requiring exteriorization of the will of the party, as an
active and passive demonstration of will. In an Italian case,40 the paragraph was used
to recognize the “distinguishable will” of one party for including general conditions in
a contract.41
31 Art. 12: “Any provision of article 11, article 29 or Part II of this Convention that allows a contract of
sale or its modification or termination by agreement or any offer, acceptance or other indication of
intention to be made in any form other than in writing does not apply where any party has his place of
business in a Contracting State which has made a declaration under article 96 of this Convention. The
parties may not derogate from or vary the effect of this article.”
32 See Art. 14.1: “… A proposal is sufficiently definite if it indicates the goods and expressly or
implicitly fixes or makes provision for determining the quantity and the price.”
33 See Art. 24.
34 MCC-Marble Ceramic Center, Inc. v Ceramica Nuova d’Agostino, S. p.A, 144 F.3 d 1384 (11th Cir.
1998) reversed. In another American case, Guang Dong Light Headgear Factory Co., Ltd. v ACI
International, Inc., 2007 U. S. Dist. LEXIS 76 844 (D.C. Kan. 2007) a tribunal affirmed that “… the plain
language of the CISG requires the Court to evaluate a party’s subjective intent, so long as the other party
was aware of that intent.”
35 See infra note 67.
36 For similar definitions see Farnsworth, Contracts 4th ed. (2004) para 7.3 and Corbin, Corbin On
Contracts (1952) p. 534.

37 See CISG-AC Opinion no 3, and Zuppi, “The Parol Evidence Rule. A comparative study of the
Common Law, the Civil Law Tradition and Lex Mercatoria” 35 Ga. J. Int’l & Comp. L. 2, 233 (2007). See
further this subject in II.3.
38 See Zuppi ibid, p. 265.
39 See Art. 18(1).
40 Tribunale di Rovereto (Italy), Takap B. V. v Europlay S. r. l., 21 November 2007, CISG-Online 1590
(Pace).
41 Idem in Italian “la volontà riconoscibile” or the recognizable will. In Arbitral Award, ICC 9187/1999,
June 1999 (Coke), CISG-Online 705 (Pace) it was decided that since the defendant did not prove that it
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13 The idea of “distinguishing the will of the issuer” obliges the interpreter to consider
exterior acts.42 Art. 8 will not only be used to help interpret the contractual terms of the
given contract, but also those statements issued during the negotiation of the contract as
well as those issued after the contract was concluded.43
14 Usually the interpreter tries to assess the “plain meaning” of any disputed term of a
statement between the parties.44 “Plain meaning” is the meaning attributed by a
common sense reading or understanding the words as saying what they say,45 but it is
not always possible to apply this rule. General words usually have several meanings and
thus are inherently ambiguous.46 Words are rarely used in isolation, but rather in
association with other words in the form of utterances. In Nix v Hedden,47 Justice Grey
discussed whether “tomatoes” considered as provisions, are to be classed as “vegetables”
or as “fruit,” within the meaning of the Tariff Act of 1883.48 As Cueto Rua explained in
length, it is impossible to find natural language words with such accuracy that no
uncertainty or obscurity could ever appear.49
15 b) The meaning of “intent”. Despite the literal meaning of the word “statement”, the
objective of Art. 8 is to set forth interpretation rules for determining the intent of the
parties. Silence or inactivity of one of the parties may constitute a clear indication of his
will when related to usages or practices developed by the parties. When the parties
develop the habit of only refusing changes on a revolving contract expressly, inactivity
or silence related to a request for an extension of time for performance would indicate
acceptance.50 This understanding should also be deduced from “the other conducts”
referred to in the first paragraph. The French text speaks of “indications et les autres
comportements” and the Spanish text of “las declaraciones y otros actos de una parte.”
Conducts, “comportements” and “actos” have in common a wide enough latitude to
include those relevant inactions, passive conducts or silence, which could be interpreted
as having a clear meaning. In Filanto v Chilewich51 it was admitted that the Italian seller
failed to respond promptly, which represented his acceptance for the court. The judge in
intended to enter into the contract as an “agent,” the Arbitral Tribunal could not assert that role “… if a
reasonable party in claimant’s position would have understood defendant’s statement as intent to be an
agent only (objective intent Art. 8.2 CISG). Given the wording of the contract, which clearly defined the
defendant as the seller and the fact that the defendant had signed the contract as the ‘seller’; claimant had
reasonably to understand and rationally to conclude that defendant was the seller.”
42 Neumayer/Ming, Convention de Vienne (1993), p. 111.
43 See decision of the Swiss Federal Tribunal, (Switzerland) 23 April 2013, CISG-Online 2482 (Pace),
using the rules of Art. 8 CISG to the interchange of statements and other manifestations of will between
the parties that the Tribunal understands substantially similar to the Swiss principle of trust (principe de
la confiance).
44 See Patterson, The Interpretation and Construction of Contracts, 64 Columbia Law Review (1964)
833 (838).
45 See Dickerson, The Interpretation and Application of Statutes (1975) p. 229.
46 See Cueto Rua, Judicial Methods of Interpretation of the Law (1981) p. 96.
47 149 U. S. 304 (1893).
48 Tariff Act of March 3, 1883, c. 121, imposing a duty on “vegetables in their natural state, or in salt or
brine, not specially enumerated or provided for in this act, ten per centum ad valorem,” and which the
plaintiffs contended came within the clause in the free list of the same act, “Fruits, green, ripe, or dried,
not specially enumerated or provided for in this act.” 22 Stat. 504, 519.
49 Cueto Rua, Judicial Methods of Interpretation of the Law (1981) p. 99.
50 Cámara Nacional de Apelaciones en lo Comercial [Appellate Court] (Argentina) Inta S. A. v MCS
Officina Meccanica S. p. A., 14 October 1993, CISG-Online 87 (Pace). By the same idea, the lack of
confirmation when the usage was to confirm by writing shows that no contract arises between the parties,
see French decision of Court of Appeal of Paris (France) Société H. H. … GmbH & Co. v SARL MG,
10 September 2003 (Pace).
51 US District Court, Southern District of New York (U.S.) Filanto v Chilewich International Corp.,
14 April 1992, CISG-Online 45 (Pace).
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this case decided that, in light of the extensive course of prior dealings between these
parties, Filanto was certainly under a duty to alert Chilewich in a timely fashion as to its
objections to the terms of the agreement.
Fridman52 understands the basic distinction between “statements” intended to be 16
terms in the contract and simple “inducements” by one party to the other to enter into
the contract as a question of fact. He refers to the British case of Bannerman v White53
where, during negotiations for the sale of hops, the seller answered the buyer that
sulphur had not been used in the treatment of the hops. The jury decided that this
statement bounds the seller and that the buyer could thus avoid the contract. Blackburn
J in Smith v Hughes presents the case of “apparent consensus.”54 In this case, the judge
applied a kind of estoppel finding that consent should be presumed when a reasonable
man would believe that, from the other party’s behaviour, he was assenting to the
proposed terms.55
When the will of the parties can be clearly understood, such agreement will prevail 17
even before the understanding of a reasonable person, as a consequence of the
“subjective test” established by paragraph 1. When the statement issued is clear and
the recipient could not have been unaware of the intent of the issuer, the international
contract should be protected and preserved.56 Those statements and actions should be
analysed in light of the parties’ common intent or, when there is no common intent, in
light of the objective, “reasonable person” standard.57 Some national jurisprudence
interpreting the extent of this text in Art. 8(1) has even generously included the
requirement to apply to a particular group of general conditions issued by the other
party.58 If the intention of one of the parties has been to incorporate standard terms to
the contract, they will be seen as part of the contract only when the other party was
aware of this or could not have been unaware.59
The domestic jurisprudence usually resolves conflicts of interpretation of the state- 18
ment by looking into the “meeting of the minds” of the parties.60 How should this be
52Fridman, The Law of Contract 5th ed. (2006) p. 439.

53(1861) 10 C. B. N. S. 844, 142 E. R. 685.
54 (1871) LR 6 QB 507, 607.
55 “If, whatever a man’s real intention may be, he so conducts himself that a reasonable man would
believe that he was assenting to the terms proposed by the other party, and that other party upon that
belief enters into the contract with him, the man thus conducting himself would be equally bound as if he
had intended to agree to the other party’s terms.”
56 See, for example, U.S. District Court, S.D., Michigan (U.S.) Shuttle Packaging Systems, L.L.C. v. Jacob
Tsonakis, INA S.A., et al., 17 December 2001, (http://www.unilex.info/case.cfm?pid=1&do=ca-

se&id=732&step=FullText). On the contrary, if the statement is unclear it will not be sufficient for
expressing the party’s will. See Swiss BGH (Germany), 2 April 2015, CISG-Online 2592 (Pace); or the
mere existence of the contract could not be evidenced, as it was decided in Primer Tribunal Colegiado en
Materia Civil del Primer Circuito (Mexico) Kolmar Petrochemicals Americas, Inc. v. Idesa Petroquimica
Sociedad Anonima de Capital Variable,,10 March 2005, CISG-Online 1004 (Pace); and in U.S. District
Court, District of Kansas (U.S.) Guang Dong Light Headgear Factory Co., Ltd., v. ACI International, Inc.,
28 September 2007 CISG-Online 1602 (Pace).
57 See U.S. District Court for the District of Colorado (U.S.) Alpha Prime Development Corporation v.
Holland Loader Company, LLC; and Steven Michael Svatek, 6 July 2010, CISG-Online 2111 (Pace).
58 See Tribunale di Rovereto (Italy) Takap B. V. v Europlay S. r. l., 21 November 2007, CISG-Online
1590 (Pace).
59 See BGH (Germany) (2001) VIII ZR 60/01, also BGH (Germany) on 27 November 2007, CISG-
Online 1617 (Pace); Gerechshof Den Haag (The Netherlands) 22 April 2014, CISG-Online 2515 (Pace);
Hof’s-Hertogenbosch (The Netherlands) 29 May 2007 (machine), CISG-Online 1550 (Pace);,and OLG
München (Germany) 14 January 2009, CISG-Online 2011 (Pace). See U.S. District Court, Western District
of Pennsylvania (U.S.) Roser Tecnologies v. Carl Schreiber GmbH, 10 September 2013, CISG-Online 2490
(Pace), denying the applicability of German law included in the general standard conditions of sales.
60 Corbin, Corbin On Contracts (1952) p. 157.
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resolved in international transactions? In the case of the CISG it is mandatory by

Art. 7(1) to have regard to the contract’s international character and to respect the need
to obtain a uniform application by all parties engaged. Art. 7(2) emphasizes the
application of the principles in which the CISG has been established as well as private
international law as a general principle if that is the applicable situation.
19 c) Objective and subjective intent. The discussion of subjective and objective
theories of intent in U.S. doctrine has a long history. Williston in 1919 explained that
the point of dispute for determining intent consists of either including the mental assent
of the parties as a requisite or just taking the statement by its meaning when it is clear
notwithstanding what the issuer of the statement had in mind.61
20 Lord Denning has held that the English language is not an instrument of “mathema-
tical precision;”62 words have several meanings even in a dictionary, which may turn
language vague or not accurate enough or ambiguous.63 Sometimes, the frame of
reference changes and what was deemed to be unambiguous becomes ambiguous.64
These propositions are applicable to any language and may vary to the different parties
of a contract. When the misunderstanding is related to a core element, the very
existence of the contract will be in question.
21 The Restatement of the Law of Contracts is very precise with respect to the meaning
of a manifestation of assent. There will be no juridical bond if the parties attach
materially different meanings to their manifestations.65
22 When the parties have discussed and agreed on a specific term of the contract, the
final agreement reached on that term should prevail if that term conflicts with another
term of the contract not specifically discussed between the parties.66 Therefore, if the
terms of the contract are clear, they are to be given their literal meaning, so parties
cannot later claim that their undeclared intentions should prevail.”67
61See Burton, Principles of Contract Law (1995) p. 16.

62Seaford Court Estates Ltd v Asher [1949] 2 KB 481.
63 Holmes, The Theory of Legal Interpretation, 12 Harvard Law Review (1899) 417.
64 Cueto Rua, Judicial Methods of Interpretation of the Law (1981) p. 482 with illustrations.
65 See Restatement of the Law Second Contracts (2 d) § 20.
“(1) There is no manifestation of mutual assent to an exchange if the parties attach materially different
meanings to their manifestations and
(a) neither party knows or has reason to know the meaning attached by the other; or
(b) each party knows or each party has reason to know the meaning attached by the other.
(2) The manifestations of the parties are operative in accordance with the meaning attached to them by
one of the parties if
(a) that party does not know of any different meaning attached by the other, and the other knows the
meaning attached by the first party; or
(b) that party has no reason to know of any different meaning attached by the other, and the other has
reason to know the meaning attached by the first party.”
66 When the parties have agreed the required conditions for resolution of the contract, the tribunal
should look within the agreed conditions and not in Art. 49 CISG. See Cour de justice de Genève
(Switzerland) 20 May 2011, CISG-Online 2429 (Pace) para. 5.2.1. See also Cour d’Appel de Grenoble,
Chambre Commerciale (France) Enterprise Alain Veyron v. Société E. Ambrosio, 26 April 1995, CISG-
Online 153 (Pace) applying Art. 8 for understanding that the offered price had been accepted; for
accepting discussed general conditions of sale, see Tribunal de commerce Nivelles (France) S.A. Gantry
v. Société de Droit Suisse, Research Consulting Marketing, 19 September 1995, CISG-Online 365 (Pace);
for determining the content of the price agreed, see ICC Court of Arbitration – Paris, N\ha 8324/1995
(http://www.unilex.info/case.cfm?pid=1&do=case&id=240&step=FullText).
67 See 2012 UNCITRAL Digest of case law on the United Nations Convention on the International Sale
of Goods, Digest of Article 8 case law, available at http://www.uncitral.org/pdf/english/clout/CISG-digest-

2012-e.pdf. See Audiencia Provincial de Navarra, sección 3\ha (Spain), Cerámica Tudelana S.A. v.
Wassmer Gruppe Spezialmachinen GmbH, 27 December 2007, CISG-Online 1798 (Pace) explaining
that if the terms of the contract are clear, they are to be given their literal meaning.
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2. The second paragraph: The reasonable understanding

When the interpretation of the intent of the issuer is not possible, the CISG will 23
consider what would be the understanding of a reasonable person placed in the
recipient’s shoes under the same circumstances surrounding the issued statement.68
The legal principle of a reasonable person connotes a pattern of behaviour, prudence
and responsibility, which define the standard of care of a person of the same kind
under the same circumstances.69 The requirement of reasonability is a leitmotif
repeated several times throughout the text of the CISG. Sometimes, the text only
allows for the application of a remedy unless the resulting inconvenience is unreason-
able.70 Other times the reference is to a reasonable reliance of one of the parties,71 or a
reasonable time,72 a reasonable price,73 reasonable measure,74 reasonable expenses75 or
even a reasonable excuse.76 However, the reference to a reasonable person of the same
kind is only used here in Art. 8 and in the case of fundamental breach in Art. 25 CISG.
The term “reasonable person” has been however criticized because it is a vague
concept.77
Although the principle is common within the civil law tradition, interpreters arriving 24
from the common law family have not properly understood this kind of elusive concept.
Lord Denning qualified it as a “doubtful proposition” to consider that “reasonable” is
something that “everyone knows”78 as suggested by Scrutton LJ in Reigate v Union
Manufacturing.79 In fact within this tradition, “reasonable” has been mostly understood
as a “relative” term proportionate to the circumstances of the case considered as a
whole. That which was seen as “reasonable” once could be viewed to the contrary after a
while.80 In the opinion of some courts however, the principle of good faith is included in
Art. 8.81
The requirement of looking into the reasonability of a person of “the same kind” 25
makes a clear reference to the understanding of the recipient. It does not matter
68 See Federal Circuit Court of Appeals (11th Circuit) (U.S.) Treibacher Industrie, A. G. v. Allegheny
Technologies, Inc., 12 September 2006, CISG-Online 1278 (Pace); Audiencia Provincial de Barcelona
(Spain), 28 April 2004, CISG-Online 931 (Pace); Supreme Court of the Slovak Republic (Slovak Republic)
30 April 2008 (Health care products), CISG-Online 1873 (Pace) and Kantonsgericht St. Gallen (Switzer-
land) 15 June 2010, CISG-Online 2159 (Pace).
69 See among other cases, Arbitral Award, Tribunal of International Commercial Arbitration at the
Russian Chamber of Commerce and Industry, 13 April 2006, CISG-Online 1944 (Pace); Obergericht des
Kantons Thurgau (Switzerland) 12 December 2006, CISG-Online 1566 (Pace) and Tribunale d’appello
Lugano, Cantone del Ticino (Italy), 29 October 2003, CISG-Online 912 (Pace).
70 See Arts 37, 48(1).
71 See Arts 16(2)(b), 46(2) and (3), 79(1).
72 See Arts 18(2), 33(c), 39(1), 43(1), 47(1), 48(2), 49(2)(a) and (b), 64(2)(b), 65, 72(2), 73(2), 75, 79(4)
and 88(1).
73 See Art. 76(2).
74 See Arts 77, 85, 86(1) and 88(2).
75 See Arts 88(2) and 3.
76 See Art. 44.
77 See Kakzorowska, Règles uniformes d’interpretation d’un contrat international, 68 Revue de Droit
International et Droit Comparé (1991), 294, p. 306.

78 Lord Denning, The Discipline of Law (1979) p. 36.
79 [1918] 1KB 592 at 605.
80 Glamorgan Coal Co. v South Wales Miners’ Federation [1903] 2 K. B. 545.
81 Arbitral Award, Arbitral Tribunal of the Chamber of Commerce, Hamburg (Germany), RIW (1996)
771–774. See also the Swiss Botschaft des Bundesrates betreffend das Wiener Übereinkommen über
Verträge über den internationalen Warenkauf vom 11 Januar 1989, BBI 1989 I (745) 767. Including good
faith among the elements that should be regarded according to Art. 8, see also HG Zürich (Switzerland)
30 November 1998, CISG-Online 415 (Pace).
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whether a person with the same skills as the issuer will understand the statement.82 The
statement in question should be understandable for any person of the same kind as its
recipient and, as a logical consequence, any doubt arising from it must be resolved
against the party who issued the ambiguity.83 How far can this reference to the
understanding of the reasonable recipient be expanded? Magnus84 uses this paragraph
for resolving a special situation of the so-called “battle of the forms.” In his opinion, the
mere reproduction of different standard terms from the ones sent in earlier commu-
nications would not be regarded as a modification of the contract since a reasonable
person would generally not consider such a communication as an offer to change the
existing contract.85 The same could be applicable to the use of the general conditions of
sale or Allgemeine Geschäftsbedingungen (AGB) as they are known in German law.
According to the interpretation made by some courts under Art. 8 CISG, the recipient
of a contract offer, which is supposed to be based on standard terms and conditions,
must have the possibility to become aware of them in a reasonable manner.86 Within
the scope of the Convention, the effective inclusion of standard terms and conditions
requires not only that the offeror’s intention that he wants to include his standard terms
and conditions into the contract be apparent to the recipient.87 In addition, the CISG
requires the user of standard terms and conditions to transmit the ext or make it
available in another way.88 An Italian tribunal decided that in order to make the
standard contract terms part of the contract, it has to be written either in the same
language idiom of the contract, or in the other part’s idiom or in an idiom that the other
party knows.89 A German tribunal90 applied Art. 8(2) CISG for construing the expres-
sion “frei Haus” or “frei Bestimmungsort” referred to delivery of goods including
transportation and insurance up to the destination. The tribunal understood with this,
the parties’ intention to accept the passing of risks at the buyer’s place of business,
different to Art. 31(a) CISG.
82 See OGH (Austria) 10 November 1994, CISG-Online 117 (Pace), applying this principle of Art. 8 for
determining whether an offer was definite enough.

83 For example, this method has been accepted to establishing whether a loss suffered should be
considered foreseeable under Art. 74 CISG. See OG (Austria) 14 January 2002, CISG-Online 643 (Pace).
84 Magnus, Incorporation of Standard Contract Terms Under the CISG, FS Kritzer (2008), p. 303 (325).
85 Ibid.
86 See BGH (Germany) (2001), BGHZ Vol. 149, 113, pp. 116 et seq. See also OLG München (Germany),
14 January 2009, CISG-Online 2011 (Pace); OLG Celle (Germany) 24 July 2009, CISG-Online 1906
(Pace).; Tribunale di Rovereto (Italy) Takap B. V. v Europlay S. r. l., 21 November 2007, CISG-Online
1590 (Pace), and in Tribunale di Rivoreto (Italy) 24 August 2006, CISG-Online 1374 (Pace); U.S. District
Court, District of Maryland (U.S.) CSS Antenna, Inc. v. Amphenol-Tuchel Electronics, GmbH, 8 February
2011, CISG-Online 2177 (Pace); LG Coburg (Germany), 12 December 2006, CISG-Online 1447 (Pace);
OLG Karlsruhe (Germany), 20 July 2004, CISG-Online 858 (Pace); OLG Düsseldorf (Germany), 21 April
2004, CISG-Online 915 (Pace); and Oberlandesgericht Düsseldorf (Germany), 25 July 2003 (rubber sealing
members (car acessories)) CISG-Online 919 (Pace).
87 See OLG München (Germany), 14 January 2009, CISG-Online 2011 (Pace); OLG Düsseldorf (Ger-
many), 30 January 2004, CISG-Online 821 (Pace); and Oberlandesgericht Düsseldorf (Germany) 25 July
2003 (rubber sealing members (car acessories)), CISG-Online 919 (Pace).
88 With references to the above quoted BGH case (which one?), see CISG AC Opinion no 13. See also
OLG Düsseldorf (Germany) 23 March 2011, CISG-Online 2218 (Pace); and LG Stuttgart (Germany),
15 October 2009, CISG-Online 2019 (Pace); LG Landhut (Germany) 12 June 2008, CISG-Online 1703
(Pace); and Tribunale di Rovereto (Italy) Takap B.V. v. Europlay S.r.l., 21 November 2007, CISG-Online
1590 (Pace).
89 See already quoted case Tribunale di Rovereto (Italy) Takap B.V. v. Europlay S.r.l., 21 November
2007, CISG-Online 1590 (Pace).

90 See OLG Karlsruhe (Germany), 20 November 1992, CISG-Online 54 (Pace). See also U.S. District
Court, S.D., New York (U.S.) Calzaturificio Claudia s.n.c. v. Olivieri Footwear Ltd. 6 April 1998, CISG-
Online 440 (Pace).
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Where a term is obscure or ambiguous, its meaning will be construed against the 26
party including it in the contract.91 This is the so called “contra proferentem” rule.92
However, where the term is obscure, it will be open to interpretation as to what it means
to “construe against” the author of the text.93
When the plaintiff failed to mitigate its own losses, a Brazilian tribunal criticized such 27
behaviour as having not acted as a reasonable businessman would have done in similar
circumstances as required under Art. 8(3) CISG.94
Art. 8(2) CISG has also been used to determine whether a seller had implicitly 28
waived, its right to argue that the buyer’s notice of lack of conformity in the goods
was not timely expressed.95
3. The third paragraph

Last paragraph of Art. 8 presents a list of examples of what should be understood as 29
the relevant circumstances for measuring the intent of the issuer or the understanding
of the reasonable recipient: prior negotiations between the parties,96 practices that have
been established between them,97 usages or any conduct subsequent to the contract.98
The list does not pretend to be exhaustive.99
This paragraph prevents a tribunal from the application of domestic rules that might 30
bar the court from “considering” any evidence that is relevant between the parties, and
is a clear direction to the court to admit and consider all other evidence related to the
negotiations, which could reveal the parties real intent.100 Accordingly, the reference
made by Art. 8(3) to the “subsequent conduct of the parties” authorizes the interpreter
91 Honnold, Uniform Law (2009), Art. 8 para. 107.7. A fresh case where this rule has been applied in
relation with the English expression “otherwise disposed of” has been the recent decision of Bundesger-
ichtshof (Germany) 28 May 2014 (Bowling alleys), CISG-Online 2513 (Pace). See Schröter, Rückkaufverp-
flictungen und ‘contra proferentem’-Regel unter dem UN-Kaufrecht, 5 IHR (2014) 173.
92 Included in PICC Art. 4.6. See the rule contra proferentem in relation with Art. 8 CISG in Schmidt-
Kessel, in Schlechtriem/Schwenzer, Commentary (year?) Art. 8, 111 p. 132 and in the decision of the
German BGH quoted above (which one? – 28 May 2014 or?).
93 Charters, Fitting the “Situation”: the CISG and the Regulated Market, Washington University Global
Studies Law Review (2005) 1 (10). See decision of the OG Stuttgart (Germany) 31 March 2008, CISG-
Online 1658 (Pace).
94 See Tribunal de Justiça Rio Grande do Sul (Brasil) Prakasa Indústria e Comércio de utilitades do lar
Ltda v. Mercomáquinas Insdústria Comércio e Representações Ltda, 20 May 2009, CISG-Online 2368
(Pace).
95 See the decision of the BGH (Germany), 25 November 1998, CISG-Online 353 (Pace); and HG
Zürich (Switzerland), 30 November 1998, CISG-Online 415 (Pace).

96 See Arbitral Award, ICC (11849/2003) (fashion products), (Pace).
97 See Oberlandesgericht Stuttgart (Germany), 31 March 2008 (Automobile), CISG-Online 1658 (Pace);
Oberster Gerichtshof (Austria), 31 August 2005 (Tantalum powder), CISG-Online 1093 (Pace); U.S.
District Court, Southern District of New York (U.S.) Hanwha Corporation v. Cedar Petrochemicals, Inc.,
18 January 2011, CISG-Online 2178 (Pace), and Tribunal Cantonal de Valais (Switzerland), 28 January
2009 (composite materials), CISG-Online 2025 (Pace).
98 See U.S. District Court, Eastern District of Pennsylvania (U.S.) ECEM European Chemical Marketing
B.V. v. The Purolite Company, 29 January 2010, CISG-Online 2090 (Pace); U.S. District Court, Southern
District of New York (U.S.), TeeVee Toons, Inc. (d/b/a TVT Records) & Steve Gottlieb, Inc. (d/b/a
Biobox) v. Gerhard Schubert GmbH, 23 August 2006 (Packaging System), CISG-Online 1272 (Pace);
Tribunal Supremo (Spain) Improgess GmbH v. Canary Islands Car., SL and Autos Cabrera Medina, SL,
17 January 2008, CISG-Online 1640 (Pace); and HG Aargau (Switzerland), 5 February 2008, CISG-Online
1740 (Pace).
99 See Farnsworth, in: Bianca/Bonell, Commentary (1987), Art. 8 para. 2.6; Honnold, Uniform Law
(1982), p. 171; Henschel, The Conformity of Goods in International Sales (2005) p. 104; López, in: Picazo/
León, La Compraventa Internacional de Mercaderı́as (1998), Art. 8, p. 125.
100 U.S. Circuit Court of Appeals (11th Circuit) (U.S.) MCC-Marble Ceramic Center, Inc. v Ceramica
Nuova D’Agostino S. p. A., 29 June 1998 (ceramic tiles), CISG-Online 342 (Pace).
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to look beyond the four corners of the contract and any merger clause. Some scholars,
however, understand that the parol evidence rule is merely a particular interpretation of
the “intent principle” of contract law.101 The common law principle of the parol
evidence rule102 cannot be applied in an international sale regulated by the CISG,103 as
the CISG clearly provides that a contract of sale may be proved by any means, including
witnesses.104
31 The reference to “usages” established between the parties should be completed with
Art. 9 binding the parties by any usage they have agreed on, expressly or impliedly.105
Schlechtriem recognizes usages which are local, national or from a particular group
within the concept of Art. 8(3), distinguishing them from the usages referred in
Art. 9.106 In his opinion, the “usages” mentioned in the third paragraph refer to the
special interpretation of explanations given between the parties.107 This is the reason
why concrete circumstances and usages are important in explaining the behaviour of the
recipient of a statement. However, beyond the binding aspect of a usage agreed on
between the parties as explained in Art. 9, Art. 8(3) emphasizes that when construing
the intent of the issuer or the recipient one should pay attention to the usages that the
parties may have developed between them. Under this understanding it does not matter
whether the usages have local, regional or particular character. Usages are as helpful as
any other tool found in Art. 8(3) and are available for looking past the apparent
meaning of the words or behaviour of the parties and determining their subjective
intent.108The proof of the existence of a given usage burdens the party who invoked it.109
32 The reference in Art. 8(3) to consider any “subsequent conduct” of the parties does
not mean that one of them, by subsequent conduct, may be able to change the content
of their agreement. It only means that the subsequent behaviour may be taken into
account when construing their intentions.110 In Filanto, the tribunal, quoting Art. 8(3),
considered previous relations between the parties in assessing whether a party’s conduct
101 Brand/Flechtner, Arbitration and the Contract Formation in International Trade: First Interpreta-
tions of the U. N. Sales Convention, Journal of Law and Commerce (1992/1993) 239 (251).
102 The parol evidence rule provides that a written instrument intended by the parties thereto as the
final manifestation of their mutual understanding cannot be challenged by past or contemporary evidence
contradicting it or modifying its content. See Farnsworth, Contracts 4th ed. (2004) para. 4.3.
103 See CISG-AC Opinion no 3. See US District Court, Southern District of New York (U.S.), Filanto v
Chilewich International Corp., 14 April 1992, CISG-Online 45 (Pace); and U.S. District Court, N.D.,
Illinois, Eastern Division (U.S.) Mitchell Aircraft Spares Inc. v. European Aircraft Service AB, 28 October
1998, CISG-Online 444 (Pace).
104 See Art. 11 CISG. See also Art. 1.2 PICC.
105 See this interplay between usages and Art. 9 CISG in OLG Köln (Germany), 2 July 2007, CISG-
Online 1811 (Pace); and Arbitral Award, Netherlands Arbitration Institute, 10 February 2005, CISG-
Online 1625 (Pace).
106 Schlechtriem, Internationales UN-Kaufrecht (2005), paras 51, 56.
107 Looking into circumstantial evidence and the selected words chosen by the parties for determining
their real will, see HG Aargau (Germany), 26 November 2008, CISG-Online 1739 (Pace).
108 So, for example, a Canadian Court in deciding that the place of payment was in the U.S. it looked
the pattern of payments between the parties in accordance with the rules of Art. 8(3) CISG. The evidence
indicated that over the course of dealings between the parties, payment had always been made in Quebec.
See Cour d’Appel de Quebec (Canada), 12 April 2011, CISG-Online 2278 (Pace).
109 See Kantonsgericht Zug (Switzerland), 2 December 2004, CISG-Online 1194 (Pace).
110 Huber/Mullis, The CISG (2007), p. 14. In this sense, see Handelsgericht Zürich (Switzerland),
25 June 2010, CISG-Online 2161 (Pace) that construed that Art. 8 CISG includes ulterior changes of the
content of the contract. In the case of Tribunal Supremo Sala de lo Civil Sección 1ra. (Spain), Amtraco
Commodity SL v. OLAN Int’l Ltd., 17 March 2011, CISG-Online 2521 (Pace), para. 30, in which the
Spanish Court used Art. 8 for determining that the prior relationships between seller and buyer were
sales. See also U.S. Circuit Court of Appeals (9th Circuit) (U.S.) Chateau des Charmes Wines Ltd. v. Sabaté
USA Inc., Sabaté S.A., 5 May 2003, CISG-Online 767 (Pace), rejecting the contention that an invoked
subsequent conduct created an agreement between the parties.
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constituted acceptance, and concluded that in light of the extensive course of prior
dealings between these parties, the plaintiff was certainly under a duty to alert Chilewich
in timely fashion.111
The common law tradition has developed the theory of “business efficacy” for dealing 33
with implied terms.112 Accordingly, implied terms used to resolve contractual gaps
should be interpreted in light of the efficacy of the contract, which is presumed to have
been the intent of the parties. Later, this theory was completed by Scrutton LJ in
Reigate v Union Manufacturing Co (Ramsbottom) Ltd with the so called “necessity test”
under which implied terms will only be interpreted into the contract if necessary for
giving efficacy.113 This method for gap filling is not in contradiction with the spirit of
the CISG. Under the CISG there is a clear position, praised by both doctrine and
jurisprudence, for favouring the continuation of the contract whenever possible (favor
negotii), having regard for the international character of the agreement and the
necessary expenses involved in it.114

No surprise should be expected when comparing the text of Art. 8 CISG with its 34
equivalent in other compilations of principles prepared for international trade. For
example, terms similar to those used in the first and second paragraphs of Art. 8 CISG
have been selected for the text of Art. 4.2 PICC.115 As with the CISG, the PICC also
refer to the relevant circumstances of the case to assist the interpreter in determining
the common intention of the parties, the most important of which are listed in Art. 4.3
PICC. Here, far more detail is given than from the text of Art. 8(3) CISG.116 Vettori
111 U.S. District Court, Southern District of New York (U.S.) Filanto, S. P. A. v Chilewich International
Corp., 14 April 1992, CISG-Online 45 (Pace). In a recent Spanish case Juzgado de Primera Instancia e
Instrucción N\ho 2 La Almunia de Don ~a Godina (Spain) SMR Automotive Systems Espan ~a v. Bühler
Motor GmbH, 28 November 2013, CISG-Online 2532 (Pace), it has been understood that the so called
“technical factor” is a usage within the automotive market and as such it shall be applicable to
international sale of goods independently that the document containing it has been signed by the parties
or not.
112 Traditionally The Moorcock (1889) 14 P.D, 64, Bowen L. J.: “In business transactions such as this,
what the law desires to effect by the implication is to give such business efficacy to the transaction as must
have been intended at all events by both parties who are business men; not to impose on one side all the
perils of the transaction, or to emancipate one side from all the chances of failure, but to make each party
promise in law as much, at all events, as it must have been in the contemplation of both parties that he
should be responsible for in respect of those perils or chances.”
113 [1918] 1 KB 592 at 605: “A term can only be implied if it is necessary in the business sense to give
efficacy to the contract; that is, if it is such a term that it can confidently be said that if at the time the
contract was being negotiated some one had said to the parties, ‘What will happen in such a case’, they
would both have replied, “Of course, so and so will happen; we did not trouble to say that; it is too clear”.
114 See BGH (Germany) 3 April 1996 (Cobalt sulphate), CISG-Online 135 (Pace).
115 “(1) The statements and other conduct of a party shall be interpreted according to that party’s
intention if the other party knew or could not have been unaware of that intention. (2) If the preceding
paragraph is not applicable, such statements and other conduct shall be interpreted according to the
meaning that a reasonable person of the same kind as the other party would give to it in the same
circumstances.”
116 “In applying Articles 4.1 and 4.2, regard shall be had to all the circumstances, including
(a) preliminary negotiations between the parties;

(b) practices which the parties have established between themselves;
(c) the conduct of the parties subsequent to the conclusion of the contract;
(d) the nature and purpose of the contract;
(e) the meaning commonly given to terms and expressions in the trade concerned;
(f) usages.”
Zuppi 159
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notes an interesting point in Art. II. – 8:102(2) DCFR that should be included within
the external circumstances to be regarded by the interpreter: “where an issue arises in
relation to a person, first, who is not a party to the contract (or an assignee) or second,
who, by law, has no better rights than such a party, but who has relied on the
contract’s apparent meaning, regard may be had to external circumstances only to the
extent that those circumstances were known to, or could reasonably be expected to
have been known to that party, subject to the general principle of good faith.”117
Art. 4.7 PICC states that where a contract is drawn up in two or more language
versions, which are equally authoritative, there is, in case of discrepancy between the
versions, a preference for the interpretation according to a version in which the
contract was originally drawn up.118
35 Bonell and Peleggi,119 comparing the PICC and the DCFR, point out that whereas the
PICC restrict the applicable usages to those “widely known to and regularly observed in
international trade by parties in the particular trade concerned,”120 under the DCFR the
parties are bound by any usage “which would be considered generally applicable by
persons in the same situation as the parties, except where the application of such usage
would be unreasonable.”121
36 An additional tool for interpreting the contract is offered in Art. 5.102 PECL.122 A
similar text, merely changing the order of two paragraphs, can be found at Art. II. –
8:102 DCFR.
37 Bonell and Peleggi123 point out another subtle difference between the PICC and the
DCFR concerning the application of the rule contra proferentem: under the PICC, if
contractual terms are unclear, there is a preference for the interpretation against one
party if that party has supplied those terms;124 under the DCFR, the rule applies to the
interpretation of both terms that are not individually negotiated and terms established
under the dominant influence of one party.125
38 The requirement of comparing the understanding of a reasonable person in Art. 8(2)
CISG is another point that deserves attention when comparing the texts. The PECL
establishes in Art. 1:302 a general criteria for determining reasonableness: “Under these
Principles reasonableness is to be judged by what persons acting in good faith and in the
117 Vettori, The Interpretation of Good Faith and According to Human Rights, Fundamental Freedoms
and Constitutional Laws in the Common Frame of Reference, Persona e Mercato (2009) available at
http://www.personaemercato.it/editoriale/DCFRgoodfaith/#more-206.
118 See LG Kassel (Germany), 15 February 1996, CISG-Online 191 (Pace) decided that if a party accepts
statements in a language different from the one used for the contract, the party is bound by such
statements.
119 Bonell/Peleggi, UNIDROIT Principles of International Commercial Contracts and Draft Common
Frame of Reference: a Synoptical Table, Uniform Law Review (2009) 437 (452).
120 Art. 1.9(2) PICC.
121 Art. II.-1:104(2) DCFR.
122 “In interpreting the contract, regard shall be had, in particular, to:
(a) the circumstances in which it was concluded, including the preliminary negotiations;
(b) the conduct of the parties, even subsequent to the conclusion of the contract;
(c) the nature and purpose of the contract;
(d) the interpretation which has already been given to similar clauses by the parties and the practices
they have established between themselves;
(e) the meaning commonly given to terms and expressions in the branch of activity concerned and the
interpretation similar clauses may already have received;
(f) usages; and
(g) good faith and fair dealing.”
123 Bonell/Peleggi, UNIDROIT Principles of International Commercial Contracts and Draft Common
Frame of Reference: a Synoptical Table, Uniform Law Review (2009) 437 (453).
124 Art. 4.6 PICC.
125 Art. II.-8:103 DCFR.
160 Zuppi
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same situation as the parties would consider to be reasonable. In particular, in assessing
what is reasonable the nature and purpose of the contract, the circumstances of the case,
and the usages and practices of the trades or professions involved should be taken into
account.” On the other hand, the definition provided by Annex J of the DCFR looks for
an objective verification.126
126 “Reasonable: What is “reasonable” is to be objectively ascertained, having regard to the nature and
purpose of what is being done, to the circumstances of the case and to any relevant usages and practices.”
Zuppi 161
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Article 9
(1) The parties are bound by any usage to which they have agreed and by any
practices which they have established between themselves.
(2) The parties are considered, unless otherwise agreed, to have impliedly made
applicable to their contract or its formation a usage of which the parties knew or
ought to have known and which in international trade is widely known to, and
regularly observed by, parties to contracts of the type involved in the particular trade
concerned.
Bibliography: Bainbridge, Trade Usages in International Sales of Goods: An Analysis of the 1964 and
1980 Sales Conventions, 24 Virginia Journal of International Law (1984) 619; Bout, Trade Usages:
Article 9 of the Convention on Contracts for the International Sale of Goods (1998); Coetzee, The role
and function of trade usages in modern international sales law, 20 Uniform Law Review (2015) 243;
Pamboukis, The Concept and Function of Usages in the United Nations Convention on International Sale
of Goods, 25 Journal of Law and Commerce (2005–2006) 107; Walker, Trade Usages and the CISG:
Defending the Appropriateness of Incorporating Custom into International Commercial Contracts, 24
Journal of Law and Commerce (2005) 263; CISG-AC Opinion no 3, Parol Evidence Rule, Plain Meaning
Rule, Contractual Merger Clause and the CISG, 23 October 2004. Rapporteur: Professor Richard Hyland,
Rutgers Law School, Camden, NJ, U.S., (at http://www.cisg-ac.org).
Outline
1. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
2. Art. 9 in the context of the CISG: Hierarchy of rules . . . . . . . . . . . . . . . . . . . . . . 4
3. Validity. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
1. Practices established between the parties: Art. 9(1) . . . . . . . . . . . . . . . . . . . . . . . . 8
a) Definition. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
b) Requirements. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
2. Agreed usages (Art. 9(1)) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
3. International usages of trade: Art. 9(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
b) Definition. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
c) Binding character of the usage. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
d) Regional or local usages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
e) Letters of confirmation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
4. Conflict between usages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
5. Procedural aspects/burden of proof . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
6. Extended application of Art. 9 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
7. CISG and other instruments as usages of trade . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36

1. Introduction
1 Art. 9(1) expressly acknowledges the recognition of international trade usages as one
of the most important sources for the regulation of the international sale of goods
contracts. At the same time Art. 9(2) considers the binding force of the practices
established between the parties and agreed usages. Art. 9 refers to three different
institutions in name, content and effect: practices established between the parties,

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agreed usages, and international usages of trade or customs. While, the practices and
agreed usages have a bilateral effect and are thus constrained to the habitual conduct of
the parties or the agreement of the parties concerned, the international usages of trade
have an erga omnes or general application as their existence is disconnected from a
concrete commercial operation. A common effect of all these usages is that they become
an integral part of the contract, usually during its formation but also in its perfor-
mance1, binding the contracting parties. The source of the obligation (and incorpora-
tion) is qualitatively different and includes: an expectation between the parties that has
been created (established practice), agreement between the parties (agreed usage) and
implied agreement (trade usage). The value of the practices and usages is normative as
they are considered to be sources of the contract by express or implied agreement.
Usages and practices (Art. 9) are important elements in determining the content of 2
the contract, usually during the process of the formation of contract. The essential
elements of the contract may well be determined by usages or, more generally, by the
practices established between the parties2.
They also serve another important function within the Convention, i. e. as an 3
interpretative criteria to the contract as considered in Art. 8(3)3.
2. Art. 9 in the context of the CISG: Hierarchy of rules

By virtue of the principle of autonomy of the parties (Art. 6 – also reflected in 4
Art. 9(1)) and because of the hierarchy that the Convention itself gives to international
trade usages (above the Convention but below the parties agreement), a hierarchy of
rules apply. Above all, the agreement of the parties (Arts 6 and 9(1): practices and
agreed usages) will displace the CISG4 except for Arts 12 and 965. Next in the hierarchy
importance is placed on the usages of trade of Art. 9(2), and at the bottom, the rules of
1 Also in agreement: Schmidt-Kessel, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 9 para. 3.
See also Art. 18(3) referring to the practices and usages in contract formation. Indirectly other provisions
refer to usages: Arts 32(2) and 35(2)(a). See for the latter provision: Oberster Gerichtshof (Austria)
13 April 2000 (machines), CISG-Online 576 (Pace).
2 See e. g., Fovárosi Biróság Budapest (Hungary) 24 March 1992 (unidentified goods), Adamfi Video
Production GmbH v Alkotók Studiósa Kisszövetkezet, CISG-Online 61 (Pace) (price of the contract
impliedly determined by the practices). The incorporation of standard terms in the offer might be derived
from the practices: Oberster Gerichtshof (Austria) 17 December 2003 (tantalum powder), (Pace), con-
firmed by Oberster Gerichtshof (Austria) 31 August 2005 (tantalum powder), CISG-Online 1093 (Pace);
and Oberlandesgericht Linz (Austria) 8 August 2005 (spacers for insulation glass), CISG-Online 1087
(Pace).
3 See comments to Art. 8 supra. Inter alia: Oberlandesgericht Hamburg (Germany) 5 October 1998
(electronic parts), CISG-Online 473 (Pace) and Arbitral Award, CIETAC, 17 October 1996 (tinplate)
(Pace).
4 Arbitral Award, Schiedsgericht der Börse für landwirtschaftliche Produkte in Wien, 10 December
1997 (barley), CISG-Online 351 (Pace) (agreed usages over CISG); Hof van Beroep Antwerpen (Belgium)
24 April 2006 (wood), GmbH Lothringer Gunther Grosshandelsgesellschaft für Bauelemente und Holz-
werkstoffe v NV Fepco International, CISG-Online 1258 (Pace): usages of trade over CISG. It is in
accordance with the legislative history where a proposal from former Czechoslovak was rejected to add to
Art. 9(2) that usages are applicable only to the extent that they are not in contradiction with the
Convention. See: Honnold, Documentary History (1989), pp. 394, 484, 661. Contrary and wrongfully:
Corte Suprema di Cassazione (Italy) 7 August 1998 (women block stockings), CISG-Online 538 (Pace)
considering that “the practice may simply be the consequence of a mere tolerance by the seller and, as
such, unable to establish a place of performance different from the legal one”.
5 According to Eörsi, General Provisions, in: International Sales: The United Nations Convention on
Contracts for the International Sale of Goods (1984), pp. 2–22, under ULIS, the usage prevailed over the
imperative provisions. It has to be noted that this seems to be undisputed in China (reservation state
under Arts 12 and 96) that non-written usages apply despite those imperative provisions. See e. g.:
Arbitral Award, CIETAC, 21 May 1999 (excavators), CISG-Online 1659 (Pace).

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the Convention6. As a consequence if a trade usage (Art. 9(2)) conflict with a practice
established between the parties (Art. 9(1)), the latter prevails7.
5 Although this hypothesis may be unlikely in practice, in the case of a conflict between
a practice and an agreed usage, the agreed usage would prevail over the practice since it
is presumed that the parties have derogated the practice by the express agreement on a
usage of trade8. Thus if a practice (Art. 9(1)) conflicts with an agreed usage of trade
(Art. 9(1)), the former prevails9.
3. Validity
6 Art. 4(a) excludes from the scope of the Convention issues in regard to the validity of
any usage, i. e., whether the usage is contrary to an imperative rule of the applicable law
to the contract10. The same applies to questions of whether the agreement to make the
usage binding is defective, such as if it was obtained through fraud, violence or abuse11.
By contrast the issue of mistake of one of the parties concerning the existence and
content of the trade usage is governed by the CISG12. Other issues are governed by the
applicable domestic law as determined by the conflict of laws rules, or by the law
applicable to the location where the specific usage takes place13. The concept of validity
is also to be found autonomously and internationally and thus the definition, the
binding force and the relationship of the usage with other provisions of the CISG are
governed by the Convention14.
7 Since, according to the majority view, the incorporation of standard terms into the
contract is not considered an issue of validity that would fall to domestic law, Art. 9 is
important in order to determine this issue15.
6 Among scholars, Schmidt-Kessel, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 9 paras 7, 15;
Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 199; Pamboukis, The Concept
and Function of Usages in the United Nations Convention on International Sale of Goods, 25 Journal of
Law and Commerce (Fall 2005/Spring 2006) 107 (109 et seq.) (Pace), but see p. 114 in regard to the trade
practices and CISG.
7 In case law: U.S. Court of Appeals (11th Circuit) (U.S.) 12 September 2006 (tantalum carbide),
Treibacher Industrie, A. G. v Allegheny Technologies, Inc., CISG-Online 1278 (Pace) considering the
interplay between Arts 8 and 9: “the parties’ usage of a term in their course of dealings controls that
term’s meaning in the face of a conflicting customary usage of the term”. Concurring Schmidt-Kessel, in:
Schlechtriem/Schwenzer, Commentary (2016), Art. 9 para. 11, pointing out that there is an abstract
concept to pinpoint the relationship between the articles.
8 In agreement: Pamboukis, The Concept and Function of Usages in the United Nations Convention on
International Sale of Goods, 25 Journal of Law and Commerce (Fall 2005/Spring 2006) 107 (115) (Pace).
See also Schmidt-Kessel, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 9 para. 11 considering that
it is an issue of the parties intent to be determined through interpretation. Contrary: Enderlein/Maskow,
International Sales Law (1992), p. 68. § 1–303(e) UCC (2001) considers the conflict and it states that
course of performance prevails over course of dealing and usage of trade; and that course of dealing
prevails over usage of trade.
9 Among scholars, Bout, Trade Usages: Article 9 of the Convention on Contracts for the International
Sale of Goods (1998), p. 1 (9) (Pace).

10 Bonell, in: Bianca/Bonell, Commentary (1987), Art. 9 para. 3.4.1 (Pace); Adame, El contrato de
compraventa internacional (1994) p. 83.

11 Bonell, in: Bianca/Bonell, Commentary (1987), Art. 9 para. 3.4.1 (Pace), who correctly points out that
defects in consent are only seen in regard to Art. 9(1) and not 9(2); Adame, El contrato de compraventa
internacional (1994) p. 83; Bout, Trade Usages: Article 9 of the Convention on Contracts for the
International Sale of Goods (1998), p. 1 (4) (Pace).
12 Schmidt-Kessel, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 9 para. 14.
13 E. g., as considered by Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 195,
in the case of seaports or stock exchanges usages.

15 See Arbitral Award (Interim), Netherlands Arbitration Institute, 10 February 2005 (meet), CISG-
Online 1625 (Pace); Gerechtshof’s Hertogenbosch (Netherlands) 24 April 1996 (yarn), E.H.T.M. Peters v

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1. Practices established between the parties: Art. 9(1)
a) Definition. “Practice” in the sense of Art. 9(1) can be defined as considered 8
actions or conduct established between the participants in a contract during a certain
time and number of contracts for the fulfilment of their respective obligations, that, due
to their repetition in time, are binding upon them and thus are incorporated into the
contract16.
It has also been considered that notions that are not expressly agreed to and which 9
arise from preliminary discussions, might amount to a practice in the sense of
Art. 9(1)17. However, practices established between the parties ought to be distinguished
from the negotiations. The negotiations might well serve to interpret the contract
(Art. 8(3)) but they are not to be considered as practices in the sense of Art. 9(1)18.
For the same reason, negotiations cannot amount to an implied usage19.
As considered by case law and scholars, there are several examples of practices 10
established between the parties. The practice can concern a prompt delivery of replace-
ment parts which renders delivery after a certain period a breach of contract. The
practice can also concern the conclusion of the contract and the inclusion of certain
terms such as to sign the faxed copy of the confirmation20; acceptance of an offer
without communicating it to the offeror (Art. 18(3)); acceptance of general conditions
Kulmbacher Spinnerei GmbH & Co. Produktions KG., CISG-Online 321 (Pace);Gerechtshof’s-Hertogen-
bosch (Netherlands) 29 May 2007 (machine), CISG-Online 1550 (Pace); Rechtbank Breda (Netherlands)
27 February 2008 (unidentified goods) (Pace). Contrary: Schmidt-Kessel, in: Schlechtriem/Schwenzer,
Commentary (2016), Art. 9 para. 5 who considers that validity refers to the validity of the terms
incorporated into the contract through usages.
16 It is similar to the “Course of dealing” of § 1–205 1) UCC that defines it as “a sequence of previous
conduct between the parties to a particular transaction which is fairly to be regarded as establishing a
common basis of understanding for interpreting their expressions and other conduct.” Although, CISG
scholars have considered the UCC definition as substantially coincident with Art. 9(1) second phrase
(Witz/Salger/Lorenz, Kommentar (2000), Art. 9 para. 16, that section of the UCC which indeed provides
for a useful definition within CISG, in its original drafting, referred more to interpretative practices
(Art. 8(3) CISG) than to normative practices (Art. 9(2)). Cf. Perales Viscasillas, La formación del contrato
de compraventa internacional de mercancı́as (1996), p. 85; and Flechtner, in: Flechtner/Brand/Walter,
Drafting Contracts (2007) 329 (337). Practices also include “course of performance” as defined in § 1–303
(a): a sequence of conduct between the parties to a particular transaction that exists if: (1) the agreement
of the parties with respect to the transaction involves repeated occasions for performance by a party and
(2) the other party, with knowledge of the nature of the performance and opportunity for objection to it,
accepts the performance or acquiesces in it without objection. Presently § 1–303 (d) UCC (2001)
considers the normative character of both course of dealing and course of performance.
17 Oberster Gerichtshof (Austria) 31 August 2005 (tantalum powder), CISG-Online 1093 (Pace); and
Oberster Gerichtshof (Austria) 6 February 1996 (propane gas), CISG-Online 224 (Pace) where the court
held that: “an intent pursued by a party during the first phase of negotiations can bind the parties under
Art 9(1) CISG as far as the other party knows this intent”. Criticisms to the case might be seen at Ferrari,
in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 196.
18 Contrary: Adame, El contrato de compraventa internacional (1994) p. 81, and Pendón, Disposiciones
generales, in: Morán Bovio (ed.), Comentarios a los Principios de UNIDROIT (2003), p. 60 (84), who
considers that practices would be normally established during the negotiation of the contract.
19 But see: Oberlandesgericht Graz (Austria) 7 March 2002 (animals), CISG-Online 669 (Pace): “The
intentions a party uttered during negotiations – even if not explicitly mentioned in the agreement – may
be considered as usages under Art. 9 CISG impliedly applicable to the contract, provided that the other
party knew or could not have been unaware of that condition (Art. 8(1) CISG)”.
20 Arbitral Award (Interim), Netherlands Arbitration Institute, 10 February 2005 (meet), CISG-Online
1625 (Pace).

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written in a different language to the order without protesting21; and the incorporation
of a warranty clause and the limitation of liability clauses22. Practice may also relate the
buyer’s payment obligation, such as the period of time to pay for the price23; the means
of payment24, such as by a Letter of Credit25; procedure of payment26; practice of
settlement of payments27; and discount for prompt payment28. Finally, practice can
relate to the delivery of the goods or its conformity, such as the period of time to deliver
the goods; the quality of the goods to be delivered; the place of delivery29; the use of
certain means of communications to order the goods; disregard of notice deadlines30;
and the delivery tolerances31.
11 b) Requirements. The predominant opinion as to the requirements for a practice
to be established is that the practice occurs with a “certain frequency and during
a certain period of time”32 or “an ongoing business relationship with several sales
21Oberster Gerichtshof (Austria) 31 August 2005 (tantalum powder), CISG-Online 1093 (Pace).
22Court of Appeal (Hovioikeus) of Turku (Finland) 12 April 2002 (forestry equipment), CISG-Online
660 (Pace).
23 See 2016 UNCITRAL, Digest of Case Law on the CISG, Art. 9 para. 6.
24 Tribunal Supremo (Spain) 28 January 2000 (jute), Internationale Jute Maatschappij BV v Marin
Palomares S.L., CISG-Online 503 (Pace). Also: Adame, El contrato de compraventa internacional (1994)
p. 80.
25 Therefore if the operation is made through the same advising bank, the buyer cannot rely on the
seller’s lack of information to that regard as an excuse for not issuing the L/C since there was a practice
established between the parties. See: Guangdong Higher People’s Court (China) 2005 (ferromanganese and
silicomanganese) (Pace).
26 The cost of the money transfer: Landgericht Bielefeld (Germany) 24 November 1998 (agency for
sanitary goods), CISG-Online 697 (Pace).

27 Which were made in the following manner: either the [buyer] or third parties (ultimate buyers) used
to wire various amounts to the account of the [seller] referring to neither the number of the contract nor
the name of the goods: Arbitral Award, Tribunal of International Commercial Arbitration at the Russian
Federation Chamber of Commerce and Industry, 17 January 2000 (unidentified goods) (Pace).
28 Oberster Gerichtshof (Austria) 31 August 2005 (tantalum powder), CISG-Online 1093 (Pace).
29 Regional Court in Zilina (Slovak Republic) 18 June 2007 (baked and confectionary goods), CISG-
Online 1951(Pace).
30 Oberster Gerichtshof (Austria) 31 August 2005 (tantalum powder), CISG-Online 1093 (Pace); also
Bonell, in: Bianca/Bonell, Commentary (1987), Art. 9 para. 2.1.1.

31 Oberster Gerichtshof (Austria) 31 August 2005 (tantalum powder), CISG-Online 1093 (Pace), citing
one of its previous decisions of 6 February 1996 (propane gas), CISG-Online 224 (Pace). In the later case
the court held that: “an intent pursued by a party during the first phase of negotiation can bind the
parties under Art 9(1) CISG as far as the other party knows this intent” (Abstract at Unilex). Criticism to
the case might be seen at Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 196.
See also: Arbitral Award (Interim), AAA, 23 October 2007 (frozen chicken parts), Macromex Srl. v
Globex International Inc., CISG-Online 1645 (Pace).
32 Oberster Gerichtshof (Austria) 31 August 2005 (tantalum powder), CISG-Online 1093 (Pace)
“which the parties can then assume in good faith will be observed again in a similar instance”;
Amtsgericht Duisburg (Germany) 13 April 2000 (pizza boxes), CISG-Online 659 (Pace), where the
tribunal held that Art. 9 requires a behaviour of the parties to be regularly observed and thus certain
duration and frequency in the commercial relationship considered; 2016 UNCITRAL, Digest of Case
Law on the CISG, Art. 9 para. 7 considering court decisions to this regard. Among scholars, the
following seems to be in agreement: Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond
(2003), p. 196; Schmidt-Kessel, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 9 para. 8; Bout,
Trade Usages: Article 9 of the Convention on Contracts for the International Sale of Goods (1998),
p. 1 (3) (Pace); and Pamboukis, The concept and Function of Usages in the United Nations
Convention on International Sale of Goods, 25 Journal of Law and Commerce (Fall 2005/Spring
2006) 107 (116–118) (Pace). Comment 2 to Art. 1.9 PICC–similar to Art. 9 CISG- points out that the
behaviour founded in a single previous operation would not be considered enough to raise the status
of a practice established between the parties. The same consideration might be considered in
interpreting CISG.

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contracts”33. In this sense, some decisions have considered that in order to consider a
practice established between the parties at least three or four previous dealings are
necessary34. Once the practice exists, it becomes automatically binding on the parties
despite silence in the written contract.
An established practice might be changed by an express or implied agreement 12
between the parties35, but not by an abrupt cancellation of the commercial relationship
derived from a long established practice between the parties36 since the binding force of
the practice also derives from the principle of estoppel or the prohibition of the venire
contra factum proprium37.
2. Agreed usages (Art. 9(1))

The term “agreed usages” may include different institutions that derive their binding 13
force from the agreement of the parties.
Firstly, agreed usages are particular agreements of the parties, express or implied, to 14
apply a particular usage to a specific transaction38. As an agreement between the parties,
the rules on contract formation apply (as does Art. 29 on modification and termination)
and the agreement can take place before or after the conclusion of the contract39. The
33 Zivilgericht Kanton Basel-Stadt (Switzerland) 3 December 1997 (Bulgarian white uria), F.SA v I. SRL,
CISG-Online 346 (Pace), pointing also out that “a previous relationship between two parties that is
limited to two simultaneously-executed contracts does not fulfil this requirement”.
34 Amtsgericht Duisburg (Germany) 13 April 2000 (pizza boxes), CISG-Online 659 (Pace);
and Zivilgericht Kanton Basel-Stadt (Switzerland) 3 December 1997 (Bulgarian white uria), F.SA v I.
SRL, CISG-Online 346 (Pace). Seems to support that at least two are enough: U.S. Federal District
Court of New York (U.S.) 6 April 1998 (shoes), Calzaturificio Claudia v Olivieri Footwear, CISG-
Online 440 (Pace). “it is questionable whether this one transaction is enough to establish a course of
dealing”.
35 See Arbitral Award, ICC 8817/1997 (food products), CISG-Online 776 (Pace), that considered in
regard to the modification of the periods of payment of an exclusive distributor contract that a practice
was established between the contracting parties (Art. 9(1)) and thus an intended modification of that
practice trying to diminish the time of payment required an offer to modify to be accepted by the other
party. However, according to Bout, Trade Usages: Article 9 of the Convention on Contracts for the
International Sale of Goods (1998), p. (Pace) 1 (5); and Pamboukis, The Concept and function of
Usages in the United Nations Convention on International Sale of Goods, 25 Journal of Law and
Commerce (Fall 2005/Spring 2006) 107 (113) (Pace) (UNCITRAL) only an express agreement is
possible.
36 Appellate Court Grenoble (France) 13 September 1995 (cheese), Société francaise de Factoring
international Factor France v Roger Caiato, CISG-Online 157 (Pace).

37 Witz/Salger/Lorenz, Kommentar (2000), Art. 9 para. 16. Also: Arbitral Award (Interim), Netherlands
Arbitration Institute, 10 February 2005 (meet), CISG-Online 1625 (Pace).

38 Arbitral Award CIETAC, 31 July 1997 (axle sleeves), CISG-Online 1072 (Pace) referring to the
inspection and compensation usage agreed by the parties. The usage means that the goods should be
handed over to the inspection agency agreed on by both parties within a certain period of time after the
goods arrive at the destination port. If there is a quality or quantity problem, the [Buyer] should demand
compensation from the [Seller] within a certain period of time. This is a common clause in international
sales contracts, and it is also a trade usage; Oberster Gerichtshof (Austria) 21 March 2000 (cellulose),
CISG-Online 645 (Pace). In agreement: Bout, Trade Usages: Article 9 of the Convention on Contracts for
the International Sale of Goods (1998), p. 1 (5) (Pace). Contrary: Bainbridge, Trade Usages in Interna-
tional Sales of Goods: An Analysis of the 1964 and 1980 Sales Conventions, 24 Virginia Journal of
International Law (1984) 619 (653) (Pace). An intermediate position at Pamboukis, The Concept and
function of Usages in the United Nations Convention on International Sale of Goods, 25 Journal of Law
and Commerce (Fall 2005/Spring 2006) 107 (112 seq.) (Pace), denying usages derived from the presumed
will of the parties.
39 Schmidt-Kessel, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 9 para. 7; Ferrari, in: Ferrari/
Flechtner/Brand, Draft Digest and Beyond (2003), p. 192.

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agreement may be on the application of usages of trade of the type described in

Art. 9(2), regional or local usages40, and usages of other trade sectors41.
15 Second, further included are contractual clauses emanating from certain “formulating
agencies”42 that compile and create, recognised business conduct which has been developed,
accepted and constantly practiced in the relevant trade and that has positively established
the modus operandi of the operators in international trade. The most well known examples
are Incoterms (2010) and UCP 600 (2007) (formerly UCP 500, 1993) from the ICC43, which
are also considered by some scholars and case law as usages of trade under Art. 9(2)44.
16 Thirdly, despite attempts to define the usages of trade, it has been argued that the
definition of usage is of no importance under Art. 9(1)45 since the agreement of the parties
applies whether the term agreed might be considered a usage or not. Although the
consequence of the agreement is as such, in this author’s view, the Convention refers
properly to the word “usages” to recognize the importance of certain codified usages or
rules in international trade. Thus, the agreement of the parties in regard to certain
contractual terms that are not usages, such as the agreement on the general conditions of
a specific trade or industry that do not achieve the status of a “usage”, is not an agreement
within Art. 9(1), but a mere contractual agreement (Art. 6).
3. International usages of trade: Art. 9(2)

17 a) General remarks. Art. 9(2) internationally codifies and expressly recognizes at
least part of the so-called lex mercatoria as the “law of merchants” and that it is the origin,
development and one of the most important features of international commercial law and
domestic commercial law46. Usages of trade were one of the most important sources of
commercial law in medieval times where the usage was international, entirely a creation of
the merchants, and solely applied by them. Although the international conception was
later abandoned, it is now emerging again due to the CISG. This recognition of the usages
of trade is also found in international commercial arbitration where the vast majority of
the arbitration laws as well as arbitration rules47 consider an obligation of the arbitrators in
all circumstances – whether or not there is applicable law and whether or not the
arbitration is ex aequo et bono – to consider the application of the usages of trade.
18 The recognition of usages of trade confers a dynamic interpretation of the Conven-
tion projecting ethical values48 and reducing the cost of negotiating the contract49.
40 See also 2016 UNCITRAL, Digest of Case Law on the CISG, Art. 9 para. 4; Oberster Gerichtshof
(Austria) 21 March 2000 (cellulose), CISG-Online 645 (Pace): considering that usages under Art. 9(1) “do
not need to be widely applied in international trade”. Among the scholars: Schmidt-Kessel, in: Schlech-
triem/Schwenzer, Commentary (2016), Art. 9 para. 6; Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest
and Beyond (2003), p. 194; Adame, El contrato de compraventa internacional (1994), p. 81; Illescas Ortiz/
Perales Viscasillas, Derecho Mercantil Internacional (2003), pp. 125 et seq.
41 Bonell, in: Bianca/Bonell, Commentary (1987), Art. 9 para. 2.1.2 (Pace).
42 For the use of the term: Schmitthoff, Commercial Law in a Changing Economic Climate (1981), p. 219.
43 Bonell, in: Bianca/Bonell, Commentary (1987), Art. 9 para. 3.5 (Pace). Also considering Incoterms:
Pamboukis, The Concept and function of Usages in the United Nations Convention on International Sale
of Goods, 25 Journal of Law and Commerce (Fall 2005/Spring 2006) 107 (112) (Pace).
44 See supra Art. 7 para. 23.
46 See e. g. Art. 2 Spanish CCo.
47 Art. 28.3 UNCITRAL Model Law on International Commercial Arbitration (1985); Art. 15 OHADA
Uniform Act on Arbitration; Art. 17.5 ICC Arbitration Rules, and Art. 33.3 of the UNCITRAL Arbitra-
tion Rules (1976).
48 Supra Art. 7.
49 Walker, Trade Usages and the CISG: Defending the Appropriateness of Incorporating Custom into
International Commercial Contracts, 24 Journal of Law and Commerce (2005) 263 (265 seq.) (Pace).

3B2 9.1.580; Page size: 160.00mm 240.00mm

The parties may agree, expressly or impliedly50, on the exclusion of the usage of trade 19
as recognized expressly by Art. 9(2). An agreement contrary to a well-established usage
might also be considered when a well-drafted merger clause exists in the contract, but
only if those usages and practices are specifically mentioned in the merger clause51or if a
clear reference is made to displace Art. 952.
b) Definition. Although the term “usage” is not defined in the Convention, and thus 20
it must be interpreted internationally and autonomously53, there are domestic defini-
tions and conditions for usages that might be considered to embody the same concepts
as the term “usage” within the Convention. Conduct generated by the societas merca-
torum in a particular sector of business or trade is widely known and regularly observed
by the participants54 as there is the conviction of their binding force or their present
practice (the so-called opinio juris seu neccessitatis)55. These requirements coincide with
the domestic conditions for usages of trade under many domestic law systems56. In this
regard, the old distinction between customs and usages of trade whereby the former had
binding character and the latter a mere contractual effect has been abandoned in many
national laws, international Conventions and the practice of international arbitration57.
The CISG uses the word usage in the widest possible sense making domestic 21
distinctions somehow irrelevant58. It encompasses different possible sources of the lex
mercatoria, including, from this author’s point of view, the distinction between codified
and uncodified “usages of trade” when the former fulfils the requirements of Art. 9(2).
Although within Art. 9(2) it may be that not all possible sources of the lex mercatoria59
50 Contrary: Oberlandesgericht Saarbrücken (Germany) 13 January 1993 (doors), CISG-Online 83
(Pace): “However, according to Art. 9(2) CISG, a usage is only applicable if the parties have not agreed
otherwise, and this ‘priority of contract’ (…) argues against setting aside the duty to examine the goods
and to give notice on the lack of conformity in Arts 38, 39 CISG by means of an – implicit – trade usage
to that effect in the present case”.
51 CISG-AC Opinion no 3, para. 4.7. See: Schmidt-Kessel, in: Schlechtriem/Schwenzer, Commentary
(2016), Art. 9 para. 15; Flechtner, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), pp. 337–
338.
52 An example of a merger clause excluding Art. 9: Flechtner, in: Flechtner/Brand/Walter, Drafting
Contracts (2007), p. 338.

53 For all: Bonell, in: Bianca/Bonell, Commentary (1987), Art. 9 para. 3.2 (Pace); Melis, in: Honsell,
Kommentar (1997), Art. 9 CISG para. 3; Schmidt-Kessel, in: Schlechtriem/Schwenzer, Commentary

(2016), Art. 9 para. 12; Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 193;
Bout, Trade Usages: Article 9 of the Convention on Contracts for the International Sale of Goods (1998),
p. 1 (3) (Pace); Pamboukis, The Concept and function of Usages in the United Nations Convention on
International Sale of Goods, 25 Journal of Law and Commerce (Fall 2005/Spring 2006) 107 (111) (Pace);
and Kröll/Hennecke, Kaufmännische Bestätigungsschreiben beim internationalen Warenskauf, RabelsZ
(2003) 448.
54 The CISG does not require that the custom be ancient, or long established, since usages need not be
long established (inveterata consuetudo): Honnold, Uniform Law (2009), para. 117; Schmidt-Kessel, in:
Schlechtriem/Schwenzer, Commentary (2016), Art. 9 para. 17. See comment 5 to (§ 1–303(d) UCC 2001):
“it is not required that a usage of trade be “ancient or immemorial”, “universal” or the like.”
55 The definition provided by § 1–205(2) UCC (§ 1–303(d) UCC 2001) of the usage of trade is valid to
be considered under the Convention: “A usage of trade is any practice or method of dealing having such
regularity of observance in a place, vocation or trade as to justify an expectation that it will be observed
with respect to the transaction in question.” Usages have both an interpretative and normative role: see
§ 1–303(d) UCC (2001).
56 See e. g.: Schlechtriem, Uniform Sales Law (1986), p. 40 (Pace).
57 López Rodrı́guez, Lex Mercatoria and Harmonization of Contract Law in the EU (2003), pp. 51–52.
58 In agreement: Bonell, in: Bianca/Bonell, Commentary (1987), Art. 9 para. 3(2) (Pace); and Bout,
Trade Usages: Article 9 of the Convention on Contracts for the International Sale of Goods (1998), p. 1
(3) (Pace).
59 Berger, The Creeping Codification of the Lex Mercatoria (1999), pp. 278–311 considered this term in
the widest possible sense.

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are included, nevertheless, what is included are the rules derived from international
commercial practice as well as international principles generally accepted60.
22 According to the majority view, usages “include all those actions or modes of
behaviour (including omissions) that are generally and regularly observed in the course
of business transactions in a specific area of trade or at a certain trade center”61.
23 In practice62, usages have been relied on in the context of the conclusion of the
contract (e. g. confirmation letter, or as to confirm an oral contract in an invoice
in the trade of cereals63) as well as in the context of defining the parties rights and
obligations such as: usages of wood “Tegernseer Gebräuche” 64; usage by which the
delay in delivery implies the duty of the seller to compensate the excess customs65; a
usage whereby the buyer should demand compensation from the seller within a
certain period of time if there is a quality or quantity problem66; in the trade of steel
plates there is a trade usage concerning checking of goods, by which the buyer has to
give the seller an opportunity to be present while checking the goods67; in the
automovile sector a trade usage is recognized in relation with the “technical factor”68;
in the hard metals industry, “consignment” meant that material would be shipped to
the customer, but would be stored separately and identified as property of the supplier
until actually used by the customer, and that the customer was under no obligation to
use any of a supplier’s consignment inventory, and the supplier remained free to
retrieve its product at any time69; and finally customs of fish merchants: a) where the
determination of the number of fish/kg of the different qualities and their prices
depends on the fishing obtained in each campaign (number of captured anchovies and
60 Cf. Perales Viscasillas, The Role of the UNIDROIT Principles and the PECL in the interpretation and
gap-filling of CISG, in: Janssen/Meyer (eds), Methodology of the CISG (2009).

61 As compiled by Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), cit., p. 194. Or
as considered by Bonell, in: Bianca/Bonell, Commentary (1987), Art. 9 para. 3.2 (Pace): “any practice or
line of conduct regularly observed within a particular trade sector or at a particular market place”, and the
definition in Art. 13.1 ULF: “any practice or method of dealing”. And “industry custom is a practice that
persons in such industry know and follow, or they ought to know and follow”: Arbitral Award, CIETAC
23 April 1995 (Australian raw wool), CISG-Online 1031 (Pace).
62 See also the individual cases identified by Schmidt-Kessel, in: Schlechtriem/Schwenzer, Commentary
(2016), Art. 9 para. 22.

63 In connection with the conclusion of the contract, the issuance of an invoice by an intermediary and
the absence of denunciation by either party upon receipt, is for them the assumption of a usage of trade
on the trade of cereal, by which the invoice proves the existence of the purchase agreement conclude over
the phone in accordance with the general principle of freedom of form (Art. 11 CISG: Tribunal Supremo
(Spain) 1 July 2013 (cereals), CISG-Online 2495 (Pace).
64 Oberster Gerichtshof (Austria) 21 March 2000 (cellulose), CISG-Online 645 (Pace). The usage obliges
the buyer to take the delivery and to give a written notice to the seller clearly specifying the lack of
conformity of the delivered wood within fourteen days after he was or would have been able to examine
the goods.
65 Arbitral Award, CIETAC, 20 February 1994 (cysteine) (Pace).
66 Award CIETAC CISG/1997/24, 31 July 1997 (axle sleeves), CISG-Online 1072 (Pace).
67 Appellate Court of Helsinki (Finland) 29 January 1998 (steel plates), CISG-Online 1302 (Pace).
68 Juzgado de Primera Instancia e Instrucción, No 2 de La Almunia de Don ~a Godina (Spain)
28 November 2013 (cheese), SMR Automotive Systems Spain v Bühler Motor GmbH, CISG-Online
2532 (Pace) and confirmed by Audiencia Provincial de Zaragoza (Spain) 27 May 2014 (electrical
actuators), SMR Automotive Systems Spain v Bühler Motor GmbH, CISG-Online 2529 (Pace): The
“technical factor “ is a formula for determining liability, which involves setting a percentage of blame on a
sampling of parts delivered by suppliers to the final recipient, to quantify the portion of guilt that has
each. This is done by the inability to collect thousands of pieces already installed in the final product.
69 U.S. Court of Appeals (11th Circuit) (U.S.) 12 September 2006 (tantalum carbide), Treibacher
Industrie, A. G. v Allegheny Technologies, Inc., CISG-Online 1278 (Pace). No discussion of the concept
of a contract of sale is noted on the decision and thus considering “consignment contracts” as contracts
for the sale of goods, although this kind of situation might be well considered differently under domestic
laws, even as a mixed contract of deposit and sale.

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size thereof70; b) where the trade is made using Latin designations for fish71. It might
be also noted that for tariff purposes in international trade the Latin names are used in
order to specifically designate some goods such as fish72.
c) Binding character of the usage. Based on the Secretariat Commentary73 and the 24
very wording of Art. 9(2) (to have impliedly made applicable) it might be considered
that there are only two figures embodied in Art. 9: practices and agreed usages, and thus
the latter also comprises of normative usages of trade that are applicable to the contract
as an implied agreement of the parties when the usage is widely known and regularly
observed in the particular trade. This approach means that a subjective perspective of
usages is adopted as the value of usages is achieved only if they are expressly or
impliedly integrated in the will of the parties during the process of formation of
contract. However, we consider -in accordance with the tripartite division and in
agreement with the legislative history of this provision74 and the previous texts, such
as Art. 9 ULIS where the distinction of the three institutions was clearer- that usages of
trade in Art. 9(2) are objective in character and thus ought to be considered as an
objective and normative rule and “source of the law”75 in international sale of goods
contracts76. The different positions of scholars are also seen in regard to the application
70 Audiencia Provincial de Asturias (Spain) 29 September 2010 (anchovies), Mattera Hermanos, S.A. v
Gonzales Barrio, S.L., CISG-Online 2313 (Pace).

71 Danish Maritime Commercial Court (Denmark) 31 January 2002 (fish), Dr. S. Sergueev Handelsa-
gentur v DAT-SCHAUB A/S, CISG-Online 679 (Pace). According to the Court “As a preliminary point,
it should be made clear that within both families “scumbrida” and “carangidae” several fish in Danish,
English and German are called “”makrel”, “mackerel” and “Makrele” or contain this word as part of their
names. The only way in which to precisely identify a species is to use its Latin name. According to the
statement by the Association of Danish Fish Processing Industries and Exporters and the evidence given
by Mr. Sørensen of [Seller], the court finds that the Latin names are used in dealings in fish. In his
evidence [Buyer] stated that the only previous contract for the sale of fish between the parties had been
based on the Latin name of the species concerned”.
72 See for example: GATT (http://tariffdata.wto.org) and DR-CAFTA (Dominican Republic-Central
America Free Trade Agreement).

73 See Secretariat Commentary on 1978 Draft, Art. 8 (now Art. 9) (A/CONF.97/5, in A/CONF.97/19,
para. 2). But see 2016 UNCITRAL, Digest of Case Law on the CISG, Art. 9 para. 1, making a triple
distinction.
74 See further details: Jokela, The Role of Usages in the Uniform Law on International Sales, 10
Scandinavian Studies in Law (1966) 81 (88 et seq.) (Pace).

75 In agreement: Bonell, in: Bianca/Bonell, Commentary (1987), Art. 9 paras 1.4.1, 2.2 and 2.3 (Pace);
Perales Viscasillas, La formación del contrato de compraventa internacional de mercancı́as (1996), pp. 79
et seq.; Illescas Ortiz/Perales Viscasillas, Derecho Mercantil Internacional (2003), pp. 125–126; Adame, El
contrato de compraventa internacional (1994) p. 82; Garro/Zuppi, Compravanta internacional (1990),
p. 61; Oviedo Albán, El sistema de fuentes del contrato de compraventa internacional de mercancı́as, in
Estudios de contratación internacional. Régimen uniforme e internacional privado (2004), pp. 244 et seq.;
Bout, Trade Usages: Article 9 of the Convention on Contracts for the International Sale of Goods (1998),
p. 1 (5) (Pace); Pamboukis, The Concept and function of Usages in the United Nations Convention on
International Sale of Goods, 25 Journal of Law and Commerce (Fall 2005/Spring 2006) 107 (108) (Pace);
Melis, in: Honsell, Kommentar (1997), Art. 9 paras 2 and 8; Witz/Salger/Lorenz, Kommentar (2000),
Art. 9 para. 7; López Rodrı́guez, Lex Mercatoria and Harmonization of Contract Law in the EU (2003),
pp. 54–55. Contrary: Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 201;
Schmidt-Kessel, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 9 paras 2, 13 and 18; Eörsi,
General Provisions, in: International Sales: The United Nations Convention on Contracts for the
International Sale of Goods (1984), pp. 2–23.
76 “The usages and practices of the parties or the industry are automatically incorporated into any
agreement governed by the Convention, unless expressly excluded by the parties. CISG Art. 9”. U.S.
District Court, Southern District of New York (U.S.) 10 May 2002 (chemicals), Geneva Pharmaceuticals
Tech. Corp. v Barr Labs. Inc., CISG-Online 653 (Pace). The statement is in agreement with the objective
and normative character of Art. 9(2). However, the decision has been criticised: inter alia: Walker, Trade
Usages and the CISG: Defending the Appropriateness of Incorporating Custom into International

3B2 9.1.580; Page size: 160.00mm 240.00mm
of certain rules of the Convention to usages. For example, if a normative character were
adopted, Art. 7(1) applies to the interpretation of usages77, while a contractual character
– implied knowledge of the usage – implies the application of Art. 878.
25 The objective character of the usage of trade in Art. 9(2) is shown in the drafting of
the rule itself: “the parties knew or ought to have known”. A legal presumption of
knowledge of the usage confers its objective feature and thus its direct application
independent from the effective knowledge by commercial operators, laying the pro-
tection of such expectation in the promotion of economy efficency79. The implied
application of the usage to the contract, is distortive and complicates the understanding
of the question of the real meaning of the usage of trade in Art. 9(2) and seems to
degrade it to a mere tacit contractual practice80, diminishing the efficacy of the
international customs or usages of trade. This condition was introduced as a compro-
mise, since the normative character of the usages of trade was not universally recog-
nized at the time of the negotiation of the Vienna Convention–particularly, former
USSR accepted only their contractual effect. At the same time, a fear that unknown
usages of trade were being imposed on weaker parties or parties belonging to less
industrialized countries was behind the compromise81. The development is well seen by
comparing the drafting of Art. 9 ULIS and Art. 9 CISG. Still, under the CISG, a party
not even knowing a usage of trade can be bound by it if that party ought to have known
of it82.
Commercial Contracts, 24 Journal of Law and Commerce (2005) 263 (272 seq.) (Pace). Also: Rechtbank
van Koophandel Tongeren (Belgium) 25 January 2005 (steel), Scafom International BV & Orion Metal
BVBA v Exma CPI SA, CISG-Online 1106 (Pace): “while Art. 9 lifts practices and trade usages to a source
of contractual obligations that is just as important as the clauses that the parties have explicitly agreed
on”; Helsinki Court of Appeals (Finland) 26 October 2000 (plastic grass carpets), CISG-Online 1078
(Pace): “According to international trade usage, a contractual relationship concerning imports brings
about duties to the parties, even if the details had not been agreed on”; Arbitral Award, CIETAC CISG/
1995/07, 23 April 1995 (Australian raw wool), CISG-Online 1031 (Pace).
77 Marı́n Fuentes, Compraventa internacional de mercancı́as (2006) p. 61.
79 Coetzee, p. 250, but p. 262 considering under CISG the presumption of an implied agreement of the
parties.
80 Alcover Garau, La transmisión del riesgo en la compraventa mercantil: Derecho espan ~ol e inter-
nacional (1991), pp. 128–131; and Bainbridge, Trade Usages in International Sales of Goods: An Analysis
of the 1964 and 1980 Sales Conventions, 24 Virginia Journal of International Law (1984) 619 (638 seq.)
(Pace).
81 The discussion was raised several times: see Honnold, Documentary History (1989), pp. 21, 236, 243;
Eörsi, General Provisions, in: International Sales: The United Nations Convention on Contracts for the
International Sale of Goods (1984), pp. 2–20 and 2–25 seq., referring to parties that did not have well-
established legal services or information; Date-Bah, The Convention on the International Sale of Goods
from the Perspective of the Developing Countries, in: La Vendita Internazionale (1981), p. 27; Maskow,
The Convention on the International Sale of Goods from the Perspective of the Socialist Countries, in: la
Vendita Internazionale (1981), pp. 58 seq., who points out that for a usage to be widely known, it has to
be widely accepted for countries with different economic system; Réczei, The Rules of the Convention
Relating to its Field of Application and to its interpretation. Problems of Unification of International Sales
Law, Working papers submitted to the Colloquium of the International Association of Legal Science,
Potsdam, August 1979 (1980), p. 84; Kastley, Unification and Community: A Rhetorical Analysis of the
United Nations Sales Convention, 8 Northwestern Journal of International Law and Business (1988) 574
(607 seq.) (Pace).
82 Contrary Eörsi, General Provisions, in: International Sales: The United Nations Convention on
Contracts for the International Sale of Goods (1984), pp. 2–22; Schmidt-Kessel, in: Schlechtriem/Schwen-
zer, Commentary (2016), Art. 9 para. 20; and Bout, Trade Usages: Article 9 of the Convention on
Contracts for the International Sale of Goods (1998), p. 1 (6) (Pace) considering that exceptionally usage
under Art. 9(2) would not be applicable in the case of a producer that by necessity has to make a foreign
purchase just once.

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The harshness of the rule has been mitigated by some scholars by providing several 26
extreme examples in which this legal presumption might be rebutted either by the
application of the principle of reasonableness, as a means to protect parties from poor
industrialized and less developed regions and with lack of experience in international
operations83, or by applying the good faith principle84. Also, some courts have mis-
understood the scope of the application of Art. 9(2) trying to restrict its binding force
and have considered that the usage can only bind the parties if “either have their place
of business within the area of these usages, or which continuously do business in this
area for a considerable period of time”85. However, Art. 9(2) does not depend upon the
parties subjective intent, their place of business or the fact that the party conducts
business regularly in the specific area where the usage applies, but to the objective fact
that the usage is widely known and regularly observed by traders86.
d) Regional or local usages. Art. 9(2) does not require a universal application, which 27
of course is also within the provision, but regular observation of the usage in the
framework of international commercial operations in a particular trade. Furthermore,
local87 or regional88 usages, as well as purely commercial or legal usages, might also be
included within the provision since it refers to usages widely known and observed by
parties to contracts involved in a particular trade. This means that it will be necessary to
distinguish industry, parties and place89 and a sufficient relation with international trade
as well as sufficient awareness and observance by international traders90. Finally, in
exceptional cases, a local usage of trade might be binding on the party that regularly
does business in the place where the usage applies. Therefore, although under Art. 9(2)
any usage must or ought to be known to the parties, and must be widely known in the
83 See: Audit, Vente Internationale (1990), pp. 45 et seq.; and Comment 5 Art. 1.9 PICC. However,
China’s proposal trying to add the word “reasonable” before “usage” was rejected: Honnold, Documen-
tary History (1989), pp. 483 seq., 661.
84 Bonell, in: Bianca/Bonell, Commentary (1987), Art. 9 para. 3.4.2 (Pace); Kastley, Unification and
Community: A Rhetorical Analysis of the United Nations Sales Convention, 8 Northwestern Journal of
International Law and Business (1988) 574 (597 seq.) (Pace), considering that a usage perpetuating
domination by the powerful is not incorporated into the contracts under Art. 9(2). It has also been
considered that something that contradicts the principle of good faith cannot be considered to be a usage
of trade: Oberlandesgericht Köln (Germany) 21 December 2005 (unidentified goods), CISG-Online 1201
(Pace). Among scholars: Bout, Trade Usages: Article 9 of the Convention on Contracts for the Interna-
tional Sale of Goods (1998), p. 1 (3 seq.) (Pace).
85 Oberster Gerichtshof (Austria) 21 March 2000 (cellulose), CISG-Online 645 (Pace).
86 Oberster Gerichtshof (Austria) 21 March 2000 (cellulose), CISG-Online 645 (Pace) according to
which Art. 9(2) CISG’s requirements are satisfied when the usages “are recognized by the majority of
persons doing business in the same field”.
87 Schmidt-Kessel, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 9 para. 19. Comment to
Art. 1:105 PECL (similar to Art. 9(2) CISG) clearly establishes that it applies also to local usages or
usages particular to a certain trade sector. But see denying that local usages might play a role within CISG:
Adame, El contrato de compraventa internacional (1994) p. 82; and Enrich/Malet, La Convención de las
Naciones Unidas sobre los contratos de compraventa internacional de mercaderı́as, Revista Jurı́dica de
Catalun ~a (1991) 133 (140 seq.).
88 The Secretariat Commentary on 1978 Draft (A/CONF.97/5, at A/CONF.97/19, pfo.3, p. 20) seems
also to admit regional usages. The scholars are also in agreement: Goldstajn, Usages of Trade and other
autonomous rules of international trade according to the UN (1980) Sales Convention, in: Volken/
Sarcevic (eds), International Sale of Goods (1986), p. 55 (74 seq.) (Pace); Honnold, Uniform Law (2009),
para. 120.1; Bonell, in: Bianca/Bonell, Commentary (1987), Art. 9 para. 2.2.3 (Pace); Witz/Salger/Lorenz,
Kommentar (2000), Art. 9 para. 9; Schmidt-Kessel, in: Schlechtriem/Schwenzer, Commentary (2016),
Art. 9 para. 19; Bout, Trade Usages: Article 9 of the Convention on Contracts for the International Sale
of Goods (1998), p. 1 (6) (Pace).
90 Schmidt-Kessel, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 9 para. 19. Coetzee, pp. 261–
262.

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international trade and regularly observed, it is also possible that, in certain circum-
stances, a local usage may be applicable to the contract. This is particularly true in cases
with respect to usage applied within local commodity exchanges, fairs and warehouses,
provided that such usage is regularly observed also with respect to businesses involving
foreign dealers91. Hence the requirements for a local usage to be binding are stricter
than those considered generally under Art. 9(2).
28 e) Letters of confirmation. An example of a regional legal usage subject to an
interesting body of case law is the letters of confirmation, i. e., a written confirmation
that is within a reasonable time92 sent either after an oral conclusion of the contract, or
after an oral modification. Therefore, the parties, through the letter of confirmation,
intend to confirm in writing the oral conclusion or modification of the contract93, but
some modifications are introduced.
29 Although some scholars consider that the issue of letters of confirmation is a gap
within CISG that should be filled by applying domestic law (Art. 7(2) CISG94, or by
applying Art. 2.1.12 PICC as they reflect the general principles on which the CISG is
based95, in this author’s opinion letters of confirmation are governed by CISG. This
position is confirmed by the legislative history of the CISG96. CISG governs that issue
either directly or by resorting to the general principles within CISG (Art. 7(2))97 and
their use can be considered normal practice between businessmen. To this extent, it has
also been considered that oral orders confirmed by invoices with sales terms is
commonplace, i. e., a usage of trade under Art. 9(2)98. The rules on contract formation99
and the general provisions of the CISG apply to resolve the issue of the modifications
91 See Oberlandesgericht Graz (Austria) 9 November 1995 (marble slabs), CISG-Online 308 (Pace),
citing Prof. Bonell. The same consideration is found in the scholarly writings see: Bonell, in: Bianca/
Bonell, Commentary (1987), Art. 9 para. 2.2.3 (Pace) and comment 4 to Art. 1.9 PICC drafted by Prof.
Bonell. In agreement: Huber/Mullis, The CISG (2007), p. 19. Contrary: Schmidt-Kessel, in: Schlechtriem/
Schwenzer, Commentary (2016), Art. 9 para. 19 considering that it goes too far and usages should only be
considered under Arts 8.3 and 9(1).
92 Comment 2 to Art. 2.1.12 PICC.
93 Inter alia: Bezirksgericht Sissach (Switzerland) 5 November 1998 (summer cloth collection), CISG-
Online 1466 (Pace).

94 Stern, Erklärungen im UNCITRAL-Kaufrecht (1990), para. 116. In case law: Arrondissementsrecht-
bank Zutphen (Netherlands) 29 May 1997 (cuttings), Handelskwekerij G. Aartsen BV v G. Suykens,

95 Garro, The Gap-Filling Role of the UNIDROIT Principles in International Sales Law: Some
Comments on the Interplay between the Principles and the CISG, 69 Tulane Law Review (1995) 1149
(1168).
96 A/CN.9/142, UNICTRAL YB (1978), para. 228.
97 The majority of the scholars consider that the letters of confirmation are a matter governed by the
Convention: Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Intro to Arts 14–24 para. 4;
Schmidt-Kessel, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 9 para. 23; Perales Viscasillas,
Tratamiento jurı́dico de las cartas de confirmación en la Convención de Viena de 1980 sobre Compra-
venta Internacional de Mercaderı́as, Revista Jurı́dica del Perú, octubre-diciembre (1997) 241 (241 et seq.);
Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 202; Schlechtriem/Witz, Conven-
tion de Vienne sur les Contrats de Vente Internationale de Marchandises (2008), para. 103; Noussias, Die
Zugangsbedürftigkeit von Mitteilungen nach den Einheitlichen Haager Kaufgesetzen und nach dem UN-
Kaufgesetz (1982), pp. 121 seq.; and Ludwig, Der Vertragsschluss nach UN-Kaufrecht im Spannungsver-
hältnis von Common Law und Civil Law: dargestellt auf der Grundlage der Rechtsordnungen Englands
und Deutschlands, in: Studien zum vegleichenden und internationalen Recht-Comparative and Interna-
tional Law Studies, Band 24 (1994), pp. 88 et seq.; Kröll/Hennecke, Kaufmännische Bestätigungsschreiben
beim internationalen Warenskauf, RabelsZ (2003) 448.
98 U.S. Federal District Court of the State of Washington (U.S.) 13 April 2006 (raspberry roots), Barbara
Berry, S. A. de C. V. v Ken M. Spooner Farms, Inc., CISG-Online 1354 (Pace).

99 See infra comments to Arts 14–24, and particularly important the value given to the silence or
inaction of the addressee of the letter of confirmation. Provisions on writings in confirmation might be

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introduced in letters of confirmation and particularly whether the silence of the
addressee of the letter that amends or supplements a previous orally concluded contract
amounts to an acceptance of those modifications. Here, national courts have found that
a duty to object exists by application of the good faith principle100 and that a practice or
usage between the parties101 will exist so as to confer to the silence of the addressee
constitutive effect102.
With respect to usage of trade, national courts usually refer to the usage of German, 30
Swiss and Austrian commercial letters of confirmation103 whereby, between business-
men, silence or inaction of the addressee of a commercial letter of confirmation
(Kaufmännisches Bestätigungsschreiben) which contains modifications of a previous
oral contract are deemed to be an acceptance. As it is clear from the case law, usage
only applies if the conditions of Art. 9(2) are met and particularly when both parties
belong to a legal system in which that trade usage is recognized104; a position that is
found at Arts 2.1.12 PICC, 2:210 PECL and II.-4:210 DCFR, applying the rules on contract formation,
particularly counteroffers if a material alteration is included.
100 See expressly: Bezirksgericht Sissach (Switzerland) 5 November 1998 (summer cloth collection),
CISG-Online 1466 (Pace): In a contract of sale of textiles between a buyer (Switzerland) and a seller
(Germany), the court considered that the oral modification of the contract -a payment agreement
regarding the outstanding claims- that was followed by a letter that was accepted by the seller’s silence
an application of the good faith principle. Impliedly: Hof van Beroep Gent (Belgium) 15 May 2002 (design
of pagers), N.V. A.R. v N.V. I., CISG-Online 746 (Pace). See also for the acceptance of an offer by silence
during the formation of the contract: U.S. District Court for the Southern District of New York (U.S.)
14 April 1992 (footware), Filanto v Chilewich, CISG-Online 45 (Pace).
101 See considering silence or inaction as an acceptance when supported by a usage as in the case of
letters of confirmation: Esser, Commercial Letters of Confirmation in International Trade: Austrian,

French, German and Swiss Law and Uniform Law under the 1980 Sales Convention, Georgia Journal of
International and Comparative Law (1988) 427 (450 et seq.) (Pace); Neumayer/Ming, Convention de
Vienne (1993), p. 169; Noussias, Die Zugangsbedürftigkeit von Mitteilungen nach den Einheitlichen
Haager Kaufgesetzen und nach dem UN-Kaufgesetz (1982), pp. 110 et seq.; Enderlein/Maskow, Interna-
tional Sales Law (1992), p. 93; Herber/Czerwenka, Kommentar (1991), para. 17, p. 107; Ludwig, Der
Vertragsschluss nach UN-Kaufrecht im Spannungsverhältnis von Common Law und Civil Law: darges-
tellt auf der Grundlage der Rechtsordnungen Englands und Deutschlands, in: Studien zum vegleichenden
und internationalen Recht-Comparative and International Law Studies, Band 24 (1994), pp. 356 et seq.
102 For a discussion on the constitutive versus declarative effect, see: Kröll/Hennecke, Kaufmännische
Bestätigungsschreiben beim internationalen Warenskauf, RabelsZ (2003) 448 .

103 It also exists in other countries as listed by Schmidt-Kessel, in: Schlechtriem/Schwenzer, Commen-
tary (2016), Art. 9 para. 25, who also expresses his doubts about the existence of such a usage in some
countries, such as Austria, France, and Italy. But see: Schlechtriem, in: Schlechtriem/Schwenzer, Com-
mentary (2005), Art. 4 para. 4, considering that it is a usage in Austria, as well as in Germany and
Switzerland. In agreement with the later position: Kröll/Hennecke, Kaufmännische Bestätigungsschreiben
beim internationalen Warenskauf, RabelsZ (2003) 448, but problematic in France, only known in the U.S.
in certain circumstances, and impossible to recognize in the UK. The position in Spain, according to legal
scholars, is that silence of the addressee of the letter of confirmation will amount to an acceptance if so
derived from the good faith principles, practices or usages of trade: see Perales Viscasillas, Tratamiento
jurı́dico de las cartas de confirmación en la Convención de Viena de 1980 sobre Compraventa
Internacional de Mercaderı́as, Revista Jurı́dica del Perú, octubre-diciembre (1997) 241 (note 8) (Pace). A
comparative study at: Esser, Commercial Letters of Confirmation in International Trade: Austrian,
International and Comparative Law (1988) 427 (429 et seq.) (Pace); and Coetzee, pp. 254–260.
104 Zivilgericht Basel-Stadt (Switzerland) 21 December 1992 (fibre), W.T.GmbH v P.AG, CISG-Online
55 (Pace), where the seller was from Austria and the buyer from Switzerland. The court considered the
value of the commercial letters of confirmation under Art. 9. It recognized that both in Austria and
Switzerland the silence to a letter of confirmation means acceptance and that this is considered to be a
usage (Art. 9(2)). Furthermore, the court held that a practice established between the parties was
considered to exist (Art. 9 (1)). See also: Oberlandesgericht Frankfurt am Main (Germany) 5 July 1995
(chocolate products), CISG-Online 258 (Pace), considering that in the case at hand no usage of trade
existed because it was only known in the buyer’s country (Germany) but not in the seller’s country
(France). However, the Court considered the letter of confirmation as evidence and applying other means

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confirmed by the majority of scholars105. However, this line of reasoning is sometimes

qualified when the modifications relate to forum selection clauses at the back of invoices
that might be considered, in certain situations, to require express assent106. Another
qualification exists in situations where invoices cannot play the role of a “letter of
confirmation” during the formation of the contract since they might belong to its
performance107. Only a case-by-case analysis is possible since invoices may be used by
the parties during the formation of the contract108 or its modification as a habitual
practice or usage in the trade109.
31 The letters of confirmation must be made in writing (letter sent by post, fax or email
will suffice). It might exceptionally be made orally,110 but in this situation evidence of its
content is needed, for example, if the confirmation is made orally but recorded.
4. Conflict between usages

32 If several usages under Art. 9(2) apply and contradict each other, it has been correctly
suggested that those usages most closely related to the contractual relationship will be
applied111 as opposed to a mutual exclusion of those usages112. If a conflict exists
of evidence held in favour of the seller. Oberlandesgericht Köln (Germany) 22 February 1994 (wood),
CISG-Online 127 (Pace) in a contract of sale of wood between a seller (Nigeria) and a buyer (Germany),
the court did not consider the contract modified by a confirmation letter, and therefore the court
expressly stated that: “there is no room for a reference to the German Conflict of Laws provisions
regarding the conclusion of a contract by silence as an acceptance of a commercial letter of confirmation”.
See also 2016 UNCITRAL, Digest of Case Law on the CISG, Art. 9 para 17. The same conclusion before in
the case law on ULF in Germany: Oberlandesgericht Hamm (Germany) 15 November 1979 (2 U 78/79);
Oberlandesgericht Hamburg (Germany) 9 July 1980 (5 U 122/80); Landesgericht Karlsruhe (Germany)
23 October 1981 (7 O 530/80); and Landesgericht Marburg (Germany) 22 April 1982 (4 O 22/82);
Bundesgerichtshof (Germany) 26 March 1992 (windows and doors). Scholars are also in agreement; e. g.:
Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 4 para. 4. But see: Oberlandesgericht
Saarbrücken (Germany) 14 February 2001 (windows and doors), CISG-Online 610 (Pace): in a contract
of sale of windows and doors between an Italian seller and a German buyer. The buyer sent two letters
of confirmation establishing a special discount of 14 %. The court considered that according to the
application of a commercial trade usage, silence to a letter of confirmation means acceptance.
105 Esser, Commercial Letters of Confirmation in International Trade: Austrian, French, German and
Swiss Law and Uniform Law under the 1980 Sales Convention, Georgia Journal of International and
Comparative Law (1988) 427 (453) (Pace); Schlechtriem, Uniform Sales Law (1986), pp. 56 seq. (Pace);
Ludwig, Der Vertragsschluss nach UN-Kaufrecht im Spannungsverhältnis von Common Law und Civil
Law: dargestellt auf der Grundlage der Rechtsordnungen Englands und Deutschlands, in: Studien zum
vegleichenden und internationalen Recht-Comparative and International Law Studies, Band 24 (1994),
pp. 357 seq.; Müller/Otto, Allgemeine Geschäftsbedingungen im internationalen Wirtschaftsverkehr
(1994), p. 37; Illescas Ortiz/Perales Viscasillas, Derecho Mercantil Internacional (2003), p. 169; and Kröll/
Hennecke, Kaufmännische Bestätigungsschreiben beim internationalen Warenskauf, RabelsZ (2003) 448.
106 U.S. Circuit Court of Appeals (9th Circuit) (U.S.) 5 May 2003 (wine corks), Chateau des Charmes
Wines Ltd, v Sabaté USA, Sabaté S. A., CISG-Online 767 (Pace); Cour d’Appel Paris (France) 13 Decem-
ber 1995 (outer wrappings of packets of biscuits), Société Isea industrie SPA et al. v SA Lu et al., CISG-
Online 312 (Pace).
107 Zivilgericht Kanton Basel-Stadt (Switzerland) 3 December 1997 (Bulgarian white uria), F.SA v I.
SRL, CISG-Online 346 (Pace).

108 Cámara Nacional en lo Comercial (Argentina) 14 October 1993 (machinery), Inta. S.A. v MCS
Officina Meccania S.P.A., CISG-Online 87 (Pace); Landesgericht Aachen (Germany) 14 May 1993
(electronic ear device), CISG-Online 86 (Pace); and Oberlandesgericht Stuttgart (Germany) 28 February
2000 (floor tiles), CISG-Online 583 (Pace).
109 See Comment 3 to Art. 2.1.12 PICC.
110 Contrary: Schlechtriem/Schmidt-Kessel, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 11
para. 7.
112 Bonell, in: Bianca/Bonell, Commentary (1987), Art. 9 para. 2.2.3 (Pace) stating that in that situation
the issue has to be resolved either according to the relevant provisions of the Convention or, in the

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between an applicable local usage and an international one, the former prevails since the
requirements for its application are stricter and more in line with the particular trade
between the parties113. As an additional criterion it is observed that “different practices
within the same industry and same locality negate sufficient observance of the trade
usage” with the inapplication of Art. 9(2) unless a clear predominance is seen114.
5. Procedural aspects/burden of proof

The burden of proof is an issue dealt with by the CISG (Art. 7(2) and expressly in 33
Art. 79) and thus the evidence of the usage or practice is governed by the CISG and it is
not an issue of validity115. Several courts have considered that it is the party alleging the
existence of practices established between them, an agreed usage or usages of trade
(Art. 9), who bears the burden of proof and thus the principle of actore incumbit
probatio applies116. The territorial, temporal, personal and factual sphere of application
of the usage have to be established117. However, if the usage is notorious, the court
might allege its existence ex officio, even more so if the usage is codified118. This solution
is in accordance with the majority of the legal systems119.
Evidence about usages is considered a question of fact120 to be determined by the 34
court or arbitral tribunal using all possible means121, usually through expert witnesses
absence thereof, according to the gap-filling principles of Art. 7. Following this author: Pamboukis, The
Concept and Function of Usages in the United Nations Convention on International Sale of Goods, 25
Journal of Law and Commerce (Fall 2005/Spring 2006) 107 (122) (Pace).
113 Contrary Pamboukis, The Concept and function of Usages in the United Nations Convention on
International Sale of Goods, 25 Journal of Law and Commerce (Fall 2005/Spring 2006) 107 (123–124)
(Pace) who alleges that a priority and a relevance rules apply favouring the application of international
usages of trade.
115 But see: Espinosa, Compraventa Internacional (2003), p. 244.
116 Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 205; Schmidt-Kessel, in:
Schlechtriem/Schwenzer, Commentary (2016), Art. 9 para. 21; Huber/Mullis, The CISG (2007), p. 18;
Pamboukis, The Concept and Function of Usages in the United Nations Convention on International Sale
of Goods, 25 Journal of Law and Commerce (Fall 2005/Spring 2006) 107 (118 seq.) (Pace). Amtsgericht
Duisburg (Germany) 13 April 2000 (pizza boxes), CISG-Online 659 (Pace); Bundesgericht (Switzerland)
13 November 2003 (used textile cleaning machine), CISG-Online 840 (Pace), considering also the
proximity to the evidence as a principle to consider when allocating the burden of proof; similarly:
Appelationshof Bern (Switzerland) 11 February 2004 (cables), CISG-Online 1191 (Pace); in case of an
unclear letter of confirmation, the burden of proof cannot be reversed by assuming the correctness of the
letter’s content: Obergericht des Kantons des Basel Landschaft (Switzerland) 5 October 1999 (clothes),
CISG-Online 492 (Pace). Contrary, Bonell, in: Bianca/Bonell, Commentary (1987), Art. 9 para. 3.3 (Pace)
considering that the procedural law of the forum governs; and Bezirksgericht der Saane (Zivilgericht)
(Switzerland) 20 February 1997 (spirits), U. GmbH v D. and Ch. AG, CISG-Online 426 (Pace).
117 Oberlandesgericht Saarbrücken (Germany) 13 January 1993 (doors), CISG-Online 83 (Pace).
118 Coetzee, pp. 246–247.
119 Bonell, in: Bianca/Bonell, Commentary (1987), Art. 9 para. 3.3 (Pace); Bout, Trade Usages: Article 9
of the Convention on Contracts for the International Sale of Goods (1998), p. 1 (8) (Pace).
120 Schmidt-Kessel, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 9 para. 21; Schlechtriem/
Witz, Convention de Vienne sur les Contrats de Vente Internationale de Marchandises (2008),
para. 104; Huber/Mullis, The CISG (2007), p. 18. In case law: Oberster Gerichtshof (Austria) 15 October
1998 (wood), CISG-Online 380 (Pace); Oberster Gerichtshof (Austria) 21 March 2000 (cellulose), CISG-
Online 645 (Pace); Oberster Gerichtshof (Austria) 31 August 2005 (tantalum powder), CISG-Online 1093
(Pace); Oberster Gerichtshof (Austria) 27 February 2003 (frozen fish), CISG-Online 794 (Pace). UCC § 1–
303(c) (2001), but if the trade usage is embodied in a trade code, the interpretation is a question of law.
121 Oberster Gerichtshof (Austria) 27 February 2003 (frozen fish), CISG-Online 794 (Pace). See Coetzee,
p. 246, considering that arbitrators might easily prove the existence of a usage as compared with national
judges.

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offered by chambers of commerce or by trade organizations122. Art. 7(1) applies to the

interpretation of usages.
6. Extended application of Art. 9

35 Some authors as well as case law have held that Art. 9 also applies to issues in
principle outside the scope of application of the Convention, i. e., to issues not governed
by the CISG but that are part of the contract, such as venue or arbitration clauses123.
This position is justified on several grounds: the interpretation and determination of the
content of the contract as a whole, and the fact that Art. 9(3) refers to several issues
outside the scope of the CISG124. Although the extent to which arbitration clauses are
governed by the CISG125 is contentious, this author agrees with the commented position
in the sense that Art. 9 might be applied to issues of the contract outside the scope of
the CISG. To this regard, Art. 9 is the model to several other legal instruments
confirming its value as a rule generally applied in commercial contracts. Furthermore,
other provisions of the CISG extend their application outside the Convention, and
finally an extended application of Art. 9 is seen in domestic case law that relies on the
CISG as an aid in the interpretation of domestic concepts126.
7. CISG and other instruments as usages of trade

36 Apart from the role that the CISG attributes to both the practices established between
the parties and trade usage (Art. 9), some decisions have considered the Convention or
certain of its provisions as evidence of existing trade usages127, rules and usages of
122 See: Oberlandesgericht Dresden (Germany) 9 July 1998 (textiles), CISG-Online 559 (Pace), in regard
to a contract of sale between a German and a Turkish party considered that in order to prove whether an
international usage of trade exists whereby the silence of the addressee of a letter of confirmation
amounts to an acceptance, the buyer has to prove it. In the case at hand the buyer has neither explained
such an alleged trade usage in detail, nor proven it (as might have been done through evidence given by
the International Chamber of Commerce or similar body). Among the scholars: Bout, Trade Usages:
Article 9 of the Convention on Contracts for the International Sale of Goods (1998), p. 1 (8) (Pace).
123 Schmidt-Kessel, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 9 para. 26; European Court of
Justice (as it then was – now CJEU) (EU), 20 February 1997 (a contract for time charter of a vessel) (Pace)
in regard to the interpretation of Art. 17 of the Convention on Jurisdiction and the Enforcement of
Judgments in Civil and Commercial Matters 1968, and the binding effect of a statement of jurisdiction set
out in a commercial letter of confirmation, relying on Art. 9(2) CISG: “the ECJ determined that, in
international trade according to Art. 17(1),(2)(c) Brussels Convention, “an agreement on jurisdiction can
also be made in such a way that the contractual party does not react to a commercial letter of
confirmation set to it by the other party, which contains a pre-printed reference to the jurisdiction, or
repeatedly pays invoices containing such a reference without objection” (ibid, para. 25)”. Similarly:
European Court of Justice (as it then was – now CJEU) (EU), 16 March 1999 (unidentified goods)
(Pace); and Zivilgericht Kanton Basel-Stadt (Switzerland) 3 December 1997 (Bulgarian white uria), F.SA v
I. SRL, CISG-Online 346 (Pace). The same solution can be found in the Council (Brussels) Regulation
(EC) 44/2001, 22 December 2000 on Jurisdiction and the Recognition and Enforcement of Judgments in
Civil Law and Commercial Matters that supersedes the Brussels Convention (Art. 23).
124 Schmidt-Kessel, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 9 para. 26 and Art. 8 para. 5,
who also considers the fact that Art. 9 is incorporated into EU Law.
125 Cf. infra Art. 11 paras 12–14.
126 Cf. supra Art. 7.
127 Arbitral Award, ICC 5713/1996 (Pace); Arbitral Award, ICC 6149/1996 (clothing) (Pace); Arbitral
Award, ICC 8502/1996 (rice), CISG-Online 1295 (Pace), considering also the PICC. See also considering
that both CISG and PICC are a proof of the practices admitted in international trade: Arbitral Award,
ICC 8502/1996 (rice), CISG-Online 1295 (Pace); Arbitral Award, International Chamber of Commerce
and Industry of the Russian Federation, 5 June 1997 (unidentified goods), CISG-Online 1247 (Pace);
Arbitral Award, CIETAC, 25 June 1997 (art paper) (Pace) CISG as international trade custom; and
Arbitral Award, ICC 9333/1998 (services), CISG-Online 1308 (Pace). In agreement: Audit, The Vienna

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international trade128, international customs129, admitted practices under international
trade law130, or as general principles of international commercial practice131. Despite
these general references in the case law that seem to implicate a complete identity
between the lex mercatoria or the usages of trade and the CISG, there is a partial
application of some of the rules of the CISG to a given case as some of them are
understood to reflect usages of trade. The same consideration applies to the PICC and
PECL when they have been considered as a reflection of international trade usages.
When the PICC/PECL reflect usages of trade in the sense of Arts 8(3) and 9(2)132 or
when a judge or arbitrator considers that in the interpretation and gap-filing of the
CISG regard is to be had to international usages of trade or to the lex mercatoria133, the
PICC and PECL may play a significant role within the CISG134. In case of conflict, PICC
should be preferred over PECL.
Another interesting issue is whether Incoterms, should be considered usages of trade 37
under Art. 9(2), i. e., whenever one of the parties uses the three letter trade term but
with no reference to Incoterms.
First, there is an important interplay between the CISG and international commer- 38
cial terms in regard to delivery, passing of risk and payment. Even where the parties
have not expressly agreed on an application of the Incoterms to a used three letter
acronym, courts have considered that the interpretation of that agreed term should
rely on the terms codified by the ICC Incoterms and the CISG (Art. 8(3))135. In this
Sales Convention and the Lex Mercatoria, in: Carbonneau (ed.), Lex Mercatoria and Arbitration (1998),
p. 173 (174) (Pace) considering the CISG as and expression of international mercantile customs.
128 Arbitral Award, ICC 6281/1989 (steel bars) (Pace); and Arbitral Award, ICC 8453/1995 (machine
for medical use), CISG-Online 1275 (Pace). See Illescas Ortiz/Perales Viscasillas, Derecho Mercantil
Internacional (2003), pp. 111–113.
129 Tribunal de Justiça do Rio Grande do Sul (Brasil) 14 February 2017 (frozen chicken legs),
(cisgspanish.com); and Tribunal de Justiça do Rio Grande do Sul (Brasil) 30 March 2017 (electric motors)
(cisgspanish.com), justifying this application of the CISG in the light of public international law due to
the worldwide consistency and regularity of its application. The Court also applied PICC as lex
mercatoria.
130 Arbitral Award, ICC 8502/1996 (rice), CISG-Online 1295 (Pace) referring both to CISG and PICC.
131 Arbitral Award, ICC 7331/1994 (cowhides), CISG-Online 106 (Pace).
132 See Arbitral Award, International Chamber of Commerce and Industry of the Russian Federation,
5 June 1997 (unidentified goods), CISG-Online 1247 (Pace), in a transaction in which CISG was
applicable, basing their decision on the PICC Preamble, the Tribunal resorted to Art. 7.4.13(2) PICC,
but it also held that recourse to the PICC was justified as well on the basis of Art. 9(2) CISG. The
application of PICC as usages of trade (Art. 9) is considered among others by Huber/Mullis, The CISG
(2007), pp. 20 and 36 on a case-by-case basis. The PICC are generally considered a usage of trade:
Pamboukis, The Concept and function of Usages in the United Nations Convention on International Sale
of Goods, 25 Journal of Law and Commerce (Fall 2005/Spring 2006) 107 (129 seq.) (Pace).
133 Ramberg, International Commercial Transactions (1997), p. 20: “Gap-filling of international com-
mercial contracts may be achieved by the application of the so-called lex mercatoria or, in other words,
the law merchant”, and considering at the time of his writing that it was premature to regard the PICC
and PECL as generally accepted lex mercatoria; Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and
Beyond (2003), p. 204; and Similarly: Schmidt-Kessel, in: Schlechtriem/Schwenzer, Commentary (2016),
Art. 9, para 27 in regard to Incoterms, UCP 600 and PICC and also pointing out that they are
interpretation material to be considered under Art. 8(3) CISG.
134 See Perales Viscasillas, The Role of the UNIDROIT Principles and the PECL in the interpretation
and gap-filling of CISG, in: Janssen/Meyer (eds), Methodology of the CISG (2009).
135 See Perales Viscasillas, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 259. Further:
Juzgado de Primera Instancia en lo Comercial No. 26 (Argentina) 2 July 2003 (credit) (Pace) (www.cisg-
spanish.com): FOB agreed in the contract interpreted in conformity with Incoterms and Art. 9 CISG;
Bezirksgericht der Saane (Zivilgericht) (Switzerland) 20 February 1997 (spanish), U. GmbH v D. and Ch.
AG, CISG-Online 426 (CLOUT 261) interpreting “CIF Moscow” in accordance with Incoterms (1990);
High Arbitration Court (or Presidium of Supreme Arbitration Court) of the Russian Federation (Russia)
25 December 1996 (medical goods) (Pace); Tribunal cantonal Valais (Switzerland) 28 January 2009

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regard, Art. 8(2) will be useful136, and with similar effect Arts 9(3) ULIS and 13(2)
ULF137. Second, the use of those terms does not entirely displace the CISG rules on the
passing of the risk, as it is only a partial exclusion of the CISG (Art. 6). Third,
generally speaking, reference in the contract to a term codified by the ICC should be
made to Art. 9(1) (agreed usage) and not to Art. 9(2) (normative usages, i. e. usages
that have the force of law), unless it can be proved that the agreed term fulfils the
requirements of Art. 9(2). This might be the case in regard to the most frequently used
terms: CIF and FOB clauses138 unles the parties have adopted a different under-
standing through a practice139. As a consequence, the fact that certain trade terms are
codified does not mean that they are to be considered usages of trade, but may become
usages140.
(fiberglass composite materials), CISG-Online 2025 (Pace), relying also on Art. 9(1) CISG. Also: Principle
No. IV.4.6 (Central at http://www.tldb.net). But see: Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and
Beyond (2003), p. 203. A minority view considers that trade terms are excluded from the Convention
itself (Eörsi, General Provisions, in: International Sales: The United Nations Convention on Contracts for
the International Sale of Goods (1984), pp. 2–25).
136 Bonell, in: Bianca/Bonell, Commentary (1987), Art. 9 para. 3.5 (Pace) resorts to Art. 8(2) to interpret
the commercial terms included in the contract; and Schlechtriem, Uniform Sales Law (1986), p. 42 (Pace).
137 “Where expressions, provisions or forms of contract commonly used in commercial practice are
employed, they shall be interpreted according to the meaning usually given to them in the trade
concerned”. It was considered that it was necessary to have this provision since there is a difference
between the usages covered by Art. 9 and the interpretation of trade terms such as FOB and CIF in
respect of which several interpretations exist. However a contrary view was expressed in the sense that
there was no need to keep it since it was already covered by Art. 9 or by Art. 8. See Honnold,
Documentary History (1989), pp. 324, 489, 661.
138 U.S. District Court for the Southern District of New York (U.S.) 26 March 2002 (magnetic resonance
imaging system (“MRI”)), St. Paul Guardian Insurance Co., et al. v Neuromed Medical System & Support,
et al, CISG-Online 615 (Pace); and critic to the decision: Ferrari/Flechtner/Brand, Draft Digest and
Beyond (2003), p. 203; and Bridge, The International Sale of Goods. Law and Practice 2007, para. 11.50.
See also: U.S. Federal District Court of Texas (U.S.) 7 February 2006 (explosive boosters), China North
Chemical Industries Corporation v Beston Chemical Corporation, CISG-Online 1177 (Pace); Bankruptcy
Court for the Eastern District of Pennsylvania (U.S.) 18 June 2014 (unidentified goods) (decision affirmed
by the U.S. District Court for the Eastern District of Pennsylvania, United States, 19 January 2016 (2016
WL 215229)) 511 B.R. 738 (CLOUT 1639); Juzgado Nacional de Primera Instancia (Argentina) 20 May
1991 (unidentified goods) (Pace); Juzgado de Primera Instancia en lo Comercial (Argentina) 6 October
1994 (looms) (Pace); Tribunal cantonal Valais (Switzerland) 28 January 2009 (fiberglass composite
materials) (Pace); Federal District Court [New York] (U.S.) 28 September 2011 (liquid phenol), Cedar
Petrochemicals inc. v Dongbu Hannong Chemical Ltd., CISG-Online 2338 (Pace).
Considering that Incoterms are usages of trade in the sense of Art. 9(2) Pamboukis, The Concept and
function of Usages in the United Nations Convention on International Sale of Goods, 25 Journal of Law
and Commerce (Fall 2005/Spring 2006) 107 (127 seq.) (Pace). Also generally referring to Incoterms
(1990): Arbitral Award, CIETAC, 25 June 1997 (art paper) (Pace), or to Incoterms (2000) but unclear as
to whether interpretative usages (Art. 8(3)) but not normative usage (Art. 9(2)) is considered: Arbitral
Award, Tribunal of International Commercial Arbitrationat the Russian Federation Chamber of Com-
merce and Industry, 13 April 2006 (unidentified goods), CISG-Online 1944 (Pace).
140 Bonell, in: Bianca/Bonell, Commentary (1987), Art. 9 para. 3.2 (Pace), referring to “the conscious
creation of usages”. See also: Piltz, Internationales Kaufrecht (2008), paras 2–197; and Witz/Salger/Lorenz,
Kommentar (2000), Art. 9 paras 14 and 19. See considering that those cases overstate the authority of the
Incoterms definitions under the Convention: Honnold, Uniform Law (2009) para. 118.

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Art. 9 CISG reflects general principles of international commercial contracts as well 39
as domestic commercial contracts. Art. 9 has been reflected in the PICC as well as in
other international instruments141.
Art. 1.9 PICC follows to a great extent Art. 9 CISG142 but has sensibly improved on 40
the drafting of Art. 9(2) CISG. This improvement consists of the total recognition of the
international usage. This recognition is due, first, to the suppression of the reference
that the parties knew or ought to have known of that usage, and, secondly, to the
suppression of the reference that it is presumed that the application of the international
usage is derived from a tacit incorporation of it into the contract. Accordingly, unlike
Art. 9(2) CISG where the recognition of international usage is obscured by its tacit
application, the PICC are clearer when recognizing international usage without any
further conditions143. PECL and DCFR depart from the PICC: “The parties are bound
by a usage which would be considered generally applicable by persons in the same
situation as the parties” (Art. 1.105(2) PICC and Art. II.-1:104 (2) DCFR). The
departure is logical considering the different scope of application and thus the PECL
have simply “de-commercialized” the trade usages in CISG and PECL144. Finally, the
PICC prevent the application of the international usage when it is not reasonable145.
141 Paragraph 1 of Art. 1.9 PICC, Art. 1.105 (1) PECL and Art. II.-1:104 (1) DCFR are identical to
Art. 9(1) CISG. See also: Principle of the Lex Mercatoria I.3 (Central at www.tldb.net) almost identical to
Art. 9(2) CISG. Follows Art. 9 CISG: Art. 207 OHADA Uniform Act Relating to General Commercial
Law (commercial sale, 1 January 1998); Art. 23.1(c); Council Regulation (EC) 44/2001 of 22 December
2000; and Art. 11(2) and 3 of The United Nations Convention on the Assignment of Receivables in
International Trade (2005).
142 For a comparison of PICC/PECL with the CISG see Oviedo Albán, Usages and Practices: Editorial
Remarks on the manner in which the UNIDROIT Principles may be used to interpret or supplement
CISG Art. 9, in: Felemegas (ed.), An International Approach to the Interpretation of the United Nations
Convention on Contracts for the International Sale of Goods (1980) as Uniform Sales Law (2007) p. 51
(51 seq.) (Pace); and Carlsen, Usages and Practices: Editorial Remarks on the manner in which the PECL
may be used to interpret or supplement CISG Art. 9, in: Felemegas (ed.), An International Approach to
(1980) as Uniform Sales Law (2007), p. 277 (277 seq.).
143 Bonell, Restatement (2005), p. 99.
144 Cf. Berger, The Creeping Codification of the Lex Mercatoria (1999), p. 205.
145 Art. 1.105 (2) PECL and Art. II.-1:104 (1) DCFR. See also: Bonell, Restatement (2005), pp. 306–307.

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Article 10
For the purposes of this Convention:
(a) if a party has more than one place of business, the place of business is that
which has the closest relationship to the contract and its performance, having
regard to the circumstances known to or contemplated by the parties at any
time before or at the conclusion of the contract;
(b) if a party does not have a place of business, reference is to be made to his
habitual residence.
Bibliography. Butler, Place of business: Comparison between the provisions of CISG Article 10 and the
counterpart provisions of UNIDROIT Principles Article 1.10, in: Felemegas (ed.), An International
Approach to the Interpretation of the United Nations Convention on Contracts for the International
Sale of Goods (1980) as Uniform Sales Law (2007); Schlechtriem & Schwenzer Commentary on the UN
Convention on the International Sale of Goods (CISG) (OUP 2016).
Outline
1. Autonomous versus domestic meaning of “place of business” . . . . . . . . . . . . 9
2. Essential elements of the term “place of business” . . . . . . . . . . . . . . . . . . . . . . . . . 13
a) Permanence or stability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
b) Ability to conduct business autonomously or independently . . . . . . . . . . 17
3. Place of business that has the “closest relationship to the contract and its
performance” . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
4. Crucial factors for the determination of “the place of business that has
the closest to the contract relationship” . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
5. “Having regard to the circumstances known to or contemplated by the
parties at any time before or at the conclusion of the contract” . . . . . . . . . . 38
6. Art. 10(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40

1 It is not unusual for commercial corporations to maintain and operate through
various places of business situated in different places or different states. When this
happens, Art. 10 will apply to determine which one of the several places of business will
be relevant for the purposes of the Convention. In that sense, Art. 10 is an ancillary
provision, used in order to ensure the proper application of other provisions in the
CISG, which can only apply on the basis of a single place of business.
2 Art. 10 has not attracted extensive scholarly writing. It has not often been cited in court
decisions or arbitral awards either. Nevertheless, the provision is of important relevance to
the international character and scope of application of the Convention.1 Indeed, Art. 1
provides that for the Convention to apply the parties must have their places of business in
different states. Thus, Art. 10 is particularly important when at least one of the several
places of business of a party is situated either in the same state as the place of business of
the other party or even in a non-Contracting State.2 In such cases, Art. 10 may well
1 See Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 26.
2 Kritzer/Vanto/Vanto/Eiselen, International Contract Manual, Vol. 4, No. 3 paras 85–144.
182 Brekoulakis
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determine that the relevant places of business of both parties are situated in the same state
(or in non-Contracting States), in which case the Convention would not apply.
Art. 10 also has relevance to other CISG provisions: 3
– To Art. 20(2) in order to ascertain the relevant place of business of the offeror, which 4
is crucial to determine the extension of a fixed period of time for the acceptance of
the offer.
– To Art. 24 in order to ascertain the relevant place of business of the addressee, which 5
is the crucial place where an offer and declaration of acceptance must reach him.
– To Arts 94 and 96 in order to determine whether one or more Contracting State(s) may 6
declare that the Convention or Parts of it will not apply in specific circumstances.
– To a number of articles referring to important contractual duties of the parties. More 7
specifically, for Art. 31(3) in order to ascertain the place of delivery of the goods;
Art. 42(1)(b) in order to ascertain the law under which we will determine whether the
seller has delivered goods free from rights or claims of a third party; Art. 57 in order
to ascertain the place where the buyer must pay the price to the seller.3
Art. 10 comprises two paragraphs; however, the gravity of the provision is found in 8
paragraph (a), which lays down the applicable legal rule, i. e. when a party is associated
with more than one possible place, the one that should be taken into account for the
purposes of the CISG is the one “which has the closest relationship to the contract and
its performance”. The same legal rule is implicitly repeated in paragraph (b), the only
difference being that the “place of business” is substituted by “habitual residence” as the
crucial point of reference for a party. Thus, in essence paragraph (b) is a legal variation
or alternative of the legal rule set out in paragraph (a).
1. Autonomous versus domestic meaning of “place of business”

Despite the fact that it is mentioned in several CISG provisions, the term “place of 9
business” is not given a definition in the Convention.4 Naturally, thus, a question arises
as to which standards should apply to determine the “place of business” for the
purposes of Art. 10(a) and the Convention more generally. Specifically, a question arises
as to whether the term “place of business” should be defined by reference to domestic
law or should be given an autonomous interpretation by reference to Art. 7?
The prevailing view seems to be that for the purposes of the Convention5 the term 10
“place of business” should be given an autonomous meaning in accordance with the
international character of the Convention.6
3 The term place of business is also mentioned in Art. 69, but here it seems that it is not necessary to
determine the relevant place of business under Art. 10, see Secretariat Commentary on 1978 Draft, Art. 9
(now Art. 10) para. 5; see also Kritzer/Vanto/Vanto/Eiselen,Kritzer/Vanto/Vanto/Eiselen, International
Contract Manual, Vol. 4, No. 3 paras 85–51.
4 Ferrari notes that the CISG does not include a definition of the term “place of business” due to the
lack of meaning with general acceptance, or at least acceptance to the delegates to the Vienna Diplomatic
Conference. Thus the meaning will be usually defined on a case-by-case basis: see Ferrari, in: Ferrari/
Flechtner/Brand, Draft Digest and Beyond (2003), p. 26.
5 By contrast, for purposes that go beyond the Convention – say for example to determine the place of
business for establishing jurisdiction or for tax purposes – the term “place of business” will be determined
by reference to domestic law Schwenzer/Hachem, in: Schlechtriem/Schwenzer, Commentary (2016),
footnote 8.
6 Schwenzer/Hachem, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 10 para. 2; also Kritzer/
Vanto/Vanto/Eiselen, in Kritzer/Vanto/Vanto/Eiselen, International Contract Manual, Vol. 4, No. 3 paras,

85–53. See also Kantonsgericht Wallis (Switzerland) 23 May 2006, CISG-Online 1532 (Pace) para. 3: “The
Brekoulakis 183
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11 Indeed, the prevailing view must be accepted as the right one, considering in
particular the impact of the term “place of business” on the scope of application of the
Convention by virtue of Arts 1 and 10.7 Allowing national courts to interpret the term
by reference to divergent domestic standards would undermine uniformity and predict-
ability in the application of the Convention.
12 For example, a seller conducts business through branches in states A and B, whereas
the buyer only operates in state A. If domestic standards applied to determine whether
the seller’s braches in states A and B qualify as “place of business” for the purposes of
the Convention, there could be no uniform or in abstracto predictable answer as to
whether the Convention would apply to the contract. Indeed, it could well be that in
accordance with the standards of state X both states A and B would qualify as “place of
business”, in which case Art. 10 would apply, leading most likely to the application of
the Convention.8 However, it could also be that in accordance with the standards of
state Y only state A would qualify as “place of business”, in which case Art. 10 and,
necessarily, the Convention would be inapplicable.9
2. Essential elements of the term “place of business”

13 Adopting an autonomous interpretation of the term “place of business” requires us to
identify the essential elements of its meaning.10 A review of the relevant case law and
scholarly writing reveals that there are two requirements for a company’s branch to
qualify as a “place of business” under the Convention: first, permanence or stability;
second, ability to conduct business autonomously or independently.
14 a) Permanence or stability11. A stable business connection must exist between a
corporation and a particular state. The issue of stability of a “place of business” was
discussed in detail in the preparation of the Convention. In particular, it was feared that
the term “place of business” was unduly wide, and that it might include a temporary
place, used by a travelling agent to negotiate and conclude a contract.12 Accordingly, it
was suggested that the word “permanent” be added before the term “place of business”,
in order to narrow down its meaning. In the end, it was rightly concluded that there was
notion of ‘établissement’ is not defined by the CISG, but a uniform legal interpretation has developed: it is
sufficient if an organisation of certain constancy and determined commercial activity exists, which can be
distinguished from the market stands or store-rooms for goods.”
7 Schlechtriem, in the 2005 edition of Schlechtriem/Schwenzer, Commentary (2005), Art. 10 para. 4
even mentioned that “the courts exhibit a tendency to find the relevant places of business in different
states in order to apply the Convention”. This is not to argue though that courts will hesitate to apply
Art. 10(1) in a way that would exclude the application of the Convention: see for example the case in
Superior Court of Massachusetts (U.S.) 28 February 2005, Vision Systems, Inc. v EMC Corporation, CISG-
Online 1005 (Pace) (discussed infra 4).
8 It was additionally held that State B was the place of business which has the closest relationship to the
specific contract and its performance.

9 In this case, the “place of business” of both the seller and the buyer would be in the same state A.
10 Although, it should be noted that whether the requirements of the definition are met will have to be
assessed on a case-by-case analysis. See Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond
(2003), p. 26.
11 See Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 27; Schwenzer/Hachem,
in: Schlechtriem/Schwenzer, Commentary (2016), Art. 10 para. 2. Cf. the Kantonsgericht Wallis (Switzer-
land) 19 August 2003, CISG-Online 895 (Pace) para. 3: “The concept of ‘establishment’ is not defined by
the Convention but a uniform judicial interpretation clarifies this: It suffices that there exists an
organization of certain continuance and having certain stands in trade fairs or depots for goods.”
12 See Records 1980 United Nations Conference on Contracts for the International Sale of Goods,
Analysis of Comments and Proposals: (Comment by ICC), Honnold, Documentary History (1989),
p. 394. See also Honnold, Uniform Law (1999), para. 124.
184 Brekoulakis
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no need to alter the wording of Art. 10(a) (as is now found in the Convention), as
temporary sojourns would never qualify as a “place of business” in the first place.13 As
was noted, the terms “établissement” and “establecimiento” used in French and Spanish
respectively (also official languages of the Convention) would not extend to a temporary
place of business.
Thus, it is generally accepted14 that a hotel room or an exhibition centre or any other 15
transitory place used by a corporation to conduct business in view of a particular
contract would not qualify, at least for the purposes of the Convention, as a “place of
business.”15 This must also be accepted even when a party uses the same place every
year (or for a series of years), albeit for a short period of time; for example, a party that
has the same place in an annual exhibition centre and has even secured this place for
some years in the future. In this case, the place might be described as periodical (at
most), but not as permanent. The same applies for the location of a company’s server
for contracts concluded via the Internet.16
Indeed, the correct meaning of the term – at least for the purposes of the Convention – 16
becomes clear when the term is read together with the phrase “which has the closest
relationship to the contract and its performance” found in Art. 10(a). The reference to the
“performance” of the contract, in particular, indicates that the term “place of business”
refers to a place of permanent and regular business.17
b) Ability to conduct business autonomously or independently18. The important 17
question for this requirement is whether the branch has the “business set up” required
to largely effect transactions with third parties autonomously of the company’s central
place of administration or the other branches of the company. This will normally
require the branch to have a corporate status of its own. Thus, it was held that a
business liaison office of a German company, which was registered at the trade registry
of Créteil (France) did “not have a corporate status of its own,” as it was “simply a
commercial office set up in France by the German-regulated company Fujitsu and
therefore it did not qualify as a “place of business.”19
While the necessary degree of autonomy will depend on the factual circumstances, it 18
can safely be argued that complete autonomy will not normally be required. Indeed, a
branch or an establishment of a corporation must retain a certain amount of business
links with that corporation so that it is considered part of its business operation. For
13 As was noted the terms “établissement” and “establecimiento” used in French and Spanish respec-
tively, which are also official languages of the Convention, would not extend to a “temporary place”.
14 See Honnold, Uniform Law (1999), para. 124; and Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest
and Beyond (2003), p. 27.

15 See also Kantonsgericht Wallis (Switzerland) 23 May 2006, CISG-Online 1532 (Pace) para. 3: “The
notion of ‘établissement’ is not defined by the CISG, but a uniform legal interpretation has developed: it is
sufficient if an organisation of certain constancy and determined commercial activity exists, which can be
distinguished form the market stands or store-rooms for goods.”
16 Schlechtriem/Schwenzer, Commentary (2016), Art. 10 para. 2.
17 Cf. Honnold, Uniform Law (1999), para. 124, who also arrives at the same conclusion by reference to
the use of the term “place of business” in the context of Arts 24, 31(c), 42(b) and 69(2).
18 See Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 26. Cf. also Oberlandes-
gericht Graz (Austria) 29 July 2004, CISG-Online (Pace) 1627 para. 1: “the term place of business must be
broadly interpreted but does not constitute a technical legal tem. It refers to any place from which
participation in commercial transactions with third parties takes place with a certain autonomy. It is not
necessary to have the epicentre of commercial activity or the seat of the business management at that
place.”
19 Cour de Cassation (France) 4 January 1995, CISG-Online 138 (Pace). See also Oberlandesgericht Graz
(Austria) 29 July 2004, CISG-Online 1627 (Pace) para. 1 “The ‘place of business’ merely requires to
execute a minimum of actual functions within the business of the company concerned. Only mere ancillary
functions will not qualify to establish a place of business.” (emphasis added).
Brekoulakis 185
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example, a branch would qualify as a place of business under Art. 10(a) when it has the
business ability to negotiate and then perform a contract with a third party, even if the
contract would first require approval by the central place of business. It should be kept
in mind that the Convention in Art. 10(a) has consciously not opted for the criterion of
the “central administration”. Thus, even peripheral branches, which retain an opera-
tional autonomy, will qualify as “place of business”.
19 On the other hand, the fact that there must be a business relationship between a
branch and a corporation does not mean that the branch has to be part of a specific
group of companies or corporations. No parent-subsidiary relationship is required
between the branch and the corporation. Even legal entities that are not part of a group
of companies can qualify as a “place of business” of a corporation.20
20 The converse also applies: the fact that two companies have a parent-subsidiary
affiliation does not necessarily mean that the subsidiary would not qualify as a place of
business under Art. 10(a) due to lack of “autonomy or independence”. Indeed, courts
have held that different companies of the same group would establish different “places
of business” of a single party under Art. 10(a).21
21 This view is in line with the “group of companies” theory, rather than the principle of
“separate legal personality” and it is in fact closer to commercial reality. What seems to
be crucial here is not whether two or more branches belong to a single entity, in strict
legal terms, but whether two or more branches (or a branch and a principal) have such
close business and operational links that they can reasonably be taken as belonging to a
single group entity. Commercial reality is important here; not formalities concerning
the legal personality of the subsidiary. Thus, if one company operates through a branch
in a different place, this place can be taken into account under Art. 10(a) if the two
requirements above are met, and irrespective of whether the “branch” has a separate
legal personality or not.22
22 An issue arises as to whether a person or a company, acting as an agent of another
company based in a different place, may qualify as a “place of business” of the second
company. It seems that the answer here would be negative: a person or a company
acting as a (disclosed) agent of another legal entity acts in the name and on behalf of the
principal, and thus it could not meet the requirement of independence and autonomous
business activity. This was the approach taken by German courts,23 in a case where
the buyer had his place of business in Germany and the seller had his place of business
in Italy, but the contract was negotiated on seller’s behalf by another company in
20 Indeed, courts have accepted that two companies that had no parent-subsidiary relationship and that
were based in different places qualified as different “places of business” under Art. 10; see Rechtbank van
Koophandel, Hasselt (Belgium) 2 June 1999, CISG-Online 762 (Pace) and Bezirksgericht der Saane
(Switzerland) 20 February 1997, CISG-Online 426 (Pace).
21 This was the case in Federal District Court of California (U.S.) 2 November 2005, McDowell Valley
Vineyards, Inc. v Sabaté USA Inc. et al., CISG-Online 1416 (Pace), where it was held that the U.S.
subsidiary of the French Sabaté company did qualify as a “place of business” under Art. 10. Similarly,
Superior Court of Massachusetts (U.S.) 28 February 2005, Vision Systems, Inc. v EMC Corporation, CISG-
Online 1005 (Pace).
22 The same approach is taken under the European Council Reg. 44/2001 “On Jurisdiction and the
Recognition and Enforcement of Judgments in Civil and Commercial Matters” for jurisdictional
purposes. Here, also commercial reality is the crucial factor. Thus, the Court of Justice of the EU
(European Court of Justice, as it then was) has held that for the purposes of Reg. 44/2001 Art. 5(5) a
company with separate legal personality would qualify as a “branch or agency” of another company
legally established in a different country; see for example C-218/86 SAR Schotte v Parfums Rothschild
[1987] ECR 819 (ECLI:EU:C:1987:536); C-439/93 Lloyd’s Register of Shipping v Soc Campenon Bernard
[1995] ECR I-961 (ECLI:EU:C:1995:104).
23 See the decision of Oberlandesgericht Köln (Germany) 13 November 2000, CISG-Online 657 (Pace).
186 Brekoulakis
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Germany.24 It was held that the person who negotiated with the buyer was the seller’s
commercial agent rather than an independent merchant. Therefore, it could not qualify
as the manager of a German place of business of the seller.25
3. Place of business that has the “closest relationship to the contract

and its performance”
The aim of Art. 10(a) is to ascertain the relevant place of business out of the several 23
business places of a party in view of a particular contract. The determination of the
specific place of business of a corporation, by reference to Art. 10(a), will not have other
legal repercussions for that corporation. For example, it cannot be used to determine the
nationality of a corporation with business places in several states. It will only be an one-
off determination of a place of business that is relevant to the specific contract, and in
view of the factual circumstances of the negotiation and the performance of the specific
contract. It might well be that a different place of business of the same corporation will
be designated with regard to a different contract.
Exactly because the purpose of the provision is to designate a place of business for a 24
contract, the criterion adopted by Art. 10(a) is the “closest relationship to the contract
and its performance”.26 This is despite the fact that the original view of the drafters was
to adopt the criterion of the “principal place of business.”27
Thus, the current provision is contract oriented rather than party oriented: the 25
particulars of the contract at hand should be taken into account rather than the
operational centre of the corporation that is party to the contract.
One could argue that the criterion of the “central place of business” would be 26
preferable to the ‘closest relationship’ criterion in order to enhance predictability, as
corporations typically have a single central place of business, which is easy to ascertain.
However, it would be artificial to determine whether the Convention would be 27
applicable to a contract on the basis of a business place that had a limited, or no role
at all, in the negotiation and the performance of the specific contract even if that place
was the central place of business of the corporation. By contrast, the criterion of “the
closest to the contract” place of business allows the Convention to follow commercial
reality, and apply only to contracts that have actually been concluded and performed in
different places. Thus, in view of the international character of the Convention the
approach adopted by Art. 10(a) must be considered the right one.
24 Note, though, that Italy seemed to be the most relevant place of business, anyway, as the buyer
directed all correspondence after the negotiation and conclusion of the contract directly to the seller in
Italy, and the defective goods were transported back to Italy.
25 However, see the U.S. District Court of California, San Jose Division (U.S.) 27 July 2001, Asante
Techs., Inc. v PMC-Sierra, Inc., CISG-Online 616 (Pace), where a U.S. company was acting as a
nonexclusive distributor of the seller that had its central place of business in Canada. The buyer argued
that the distributor acted as a U.S. agent of the seller, so that the US should be held as the relevant “place
of business” for the purposes of the particular contract. The court rejected the assertion of the buyer
noting that the U.S. company was merely a distributor of the goods manufactured by the seller rather
than an agent, and thus the U.S. could not be established as a seller’s place of business. However, this
reasoning might create the misleading impression that if the distributor were acting as a U.S. agent of the
seller, the U.S. could be considered as a place of business of the seller.
26 The same criterion is used in Art. 1.11 PICC.
27 It seems that the original view of the drafters of the CISG was to adopt the criterion of the “principal
place of business” where the following provision was suggested: “where a party has places of business in
more than one State, his place of business shall be his principal place of business…” see UNICTRAL YB
(1971), p. 52; see also Rajski, in: Bianca/Bonell, Commentary (1987), pp. 116–117; cf. Records 1980
United Nations Conference on Contracts for the International Sale of Goods, Analysis of Comments and
Proposals: (Comment by ICC), Honnold, Documentary History (1989), p. 394.
Brekoulakis 187
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28 Yet, this is not a solution without problems. In particular, an issue arises with the
twin references in Art. 10(a) to both the contract and its performance as pertinent
factors to determine the relevant place of business. The question in particular is which
one of the above factors will prevail to determine the relevant place of business if the
contract is concluded in one place and performed in another.
29 Here, one should first examine whether the parties have specifically agreed on a
particular place of business or whether there is an established practice or usage binding
upon the parties.28
30 If no such arrangement or established practice or usage exists between the parties, the
wording of Art. 10(a) (“which has the closest relationship to the contract and its
performance” emphasis added) would suggest that preference should be given to the
place of the performance over the place of the conclusion of the contract.29 Indeed, the
provision singles “performance” out of other possible relevant factors related to a
contract, such as negotiation, conclusion, termination.30
31 However, if the place of performance of the contract was not known to either party at
the time when the contract was concluded, the place of conclusion of the contract will
be the relevant place, instead of the place of performance. The latter will have to be
disqualified because of the wording of the provision itself: “having regard to the
circumstances known to or contemplated by the parties at any time before or at the
conclusion of the contract”. The place where the contract has been concluded will
always be known to the parties.31
4. Crucial factors for the determination of “the place of business that

has the closest to the contract relationship”
32 Different factors may be crucial for courts and tribunals to determine which is “the
place of business that has the closest (relationship?) to the contract relationship”.
33 Some courts have given particular emphasis on the place where the contract
representations came from. This was the criterion applied by the U.S. courts in Asante
Techs Inc. v PMC-Sierra Inc.32 In this case, the buyer was based in California (U.S.),
whereas the seller had his corporate headquarters, marketing office, public relations
department, principal warehouse, and most of his design and engineering functions in
Canada. The seller’s products were sold in California through an authorized, non-
exclusive distributor of the seller’s products in North America. In the particular
transaction, four out of the five purchase orders were submitted to the seller through
the Californian distributor whereas only one purchase order was directly submitted to
28Schwenzer/Fountoulakis, International Sales Law (2007), Art. 10 p. 106.

29Same Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 31; this is also
supported by the Official Comments to the UNIDROIT Principles, 2004 edition which in 1.11 set out
the same provision as CISG Art. 10(1), available at 1.11.2 http://www.unilex.info/dynasite.cfm?ds-
sid=2377&dsmid=13 637.
30 Cf. Schlechtriem/Schwenzer, Commentary (2016), Art. 10 para. 6, who adopt the view favouring the
place of business which has the most power to exert influence upon the contractual relationship,
acknowledging that this place will often coincide with the principal place of business. This view may be
difficult to reconcile with the letter and legislative history of Art. 10 expressly rejecting the principal place
of business for the purposes of the provision (see para. 24 above).
31 See Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 30; same, Butler, Place of
business: Comparison between the provisions of CISG Article 10 and the counterpart provisions of
UNIDROIT Principles Article 1.10, in: Felemegas (ed.), An International Approach to the Interpretation
of the United Nations Convention on Contracts for the International Sale of Goods (1980) as Uniform
Sales Law (2007), p. 61.
32 U.S. District Court of California, San Jose Division (U.S.) 27 July 2001, Asante Techs., Inc. v PMC-
Sierra, Inc., CISG-Online 616 (Pace).
188 Brekoulakis
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the seller in Canada. Nevertheless, the court put emphasis on the representations
regarding contractual technical specifications, which eventually were not satisfied by
the delivered goods. The court noted that these representations, the breach of which
constituted the buyer’s claim, came from Canada and therefore it concluded that the
seller’s place of business with the closest relationship to the contract and its perfor-
mance was Canada, which lead to the application of the CISG.33
In other instances, courts have put more emphasis on the place where the price 34
quotations came from, especially when this was the same place where the purchase
orders were submitted, even if the delivered goods were developed and manufactured at
a different place.
For example, in Vision Systems, Inc. v EMC Corporation,34 the buyer, whose place of 35
business was in Massachusetts (U.S.), negotiated the contract with a representative from a
U.S. subsidiary of a multinational company. The buyer also discussed technical details with
an engineer at the U.S. subsidiary and he finally sent purchase orders to the U.S.
subsidiary. An Australian subsidiary of the multinational company carried out all the
research, development and manufacture of the units sold. It was held that the relevant
place of business for the purposes of CISG was the U.S. In particular, the court found that
the “centre of gravity of circumstances” was Massachusetts, as first, it was the U.S.
subsidiary that made the price quotations; second, the quotations referred to delivery
FOB Massachusetts; and third, all the buyer’s orders were submitted to the U.S. subsidiary.
Other factors may also come into play when courts and tribunals determine the 36
relevant place of business under Art. 10(a). For example, in the Isocab France v
E. C. B. S.35 case, the Belgian courts relied on the language of the contract to ascertain
the relevant place of business. The buyer had two places of business, one in the U.S. and
another in Belgium, and the court held that it was the Belgian establishment that had
the closest relationship to the contract since the invoice was addressed to it, in Dutch
(one of the official Belgian languages).
In the final award of the National and International Arbitration Chamber of Milan, 37
28 September 2001,36 the seller had two places of business, one in Moscow and one in
Nicosia. The tribunal applied Art. 10(a) and held that the Moscow was the relevant place
of business, as the contract was signed in Russia, all the correspondence between the buyer
and the seller came by and from the Moscow office and the goods were shipped from
Russia and loaded aboard Russian ships. By contrast, Nicosia (Cyprus), which was the
place of seller’s incorporation, was essentially an accounting and payment centre only.
5. “Having regard to the circumstances known to or contemplated by

the parties at any time before or at the conclusion of the contract”
Only those factors, which both parties were aware of at any time before or at the 38
conclusion of the contract, can be taken into account for the determination of the
33 The same criterion was relied upon in Federal District Court of California (U.S.) 2 November 2005,
McDowell Valley Vineyards, Inc. v Sabaté USA Inc. et al., CISG-Online 1416 (Pace). Here, the buyer had its
place of business in the U.S., whereas seller had two different places of business: one in California (U.S.) and
another in France. The court referred to the Asante case, noting that the key criterion to determine the
relevant place of business was “where did the representations about the product came from”. In the
particular case the court found that the representations came largely if not entirely from the California
company, since all the seller’s advertising literature and letters proposing the sale of the product were printed
on a letterhead of the U.S. branch of the seller, stating a California address and telephone number.
34 Superior Court of Massachusetts (U.SA.) 28 February 2005, CISG-Online 1005 (Pace).
35 Rechtbank van Koophandel, Hasselt (Belgium) 02 June 1999, CISG-Online 762 (Pace).
36 Arbitral Award, Chamber of National and International Arbitration of Milan, 28 September 2001,
Brekoulakis 189
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relevant place of business. The purpose of this requirement is to exclude unilateral

knowledge of one party regarding matters of its internal organisation, which the other
party could never have knowledge of. Thus, for example, if one party, in accordance
with the internal allocation of power within its organisation, maintains a place of
business with an important role on the performance of the contract, this place will be
irrelevant under Art. 10(a), unless the importance of this place was apparent to the
other party before or at the conclusion of the contract.37
39 Also, the above reference to “the circumstances known to or contemplated by the
parties at any time before or at the conclusion of the contract” may apply to disqualify
places used by an agent of an undisclosed principal. Thus, the place of business of the
undisclosed principal will normally not be taken into account under Art. 10, as this will
not be known to the other party before or at the conclusion of the contract.38
6. Art. 10(b)
40 In case a party has no place of business, its habitual residence will be taken into
account. Although it is unlikely that commercial parties to international sales transac-
tions have no place of business, Art. 10(b) was included to avoid a void in the
application of the Convention in the rare case where a party lacks a place of business.39
41 The term “habitual residence” is not defined in the Convention. Again here, as with
the term “place of business” above, the prevailing view is that “habitual residence” must
be given an autonomous interpretation in accordance with Art. 7(1). As the term is
often used in domestic legislation, we would need to avoid discrepancy by excluding
domestic standards to apply to define habitual residence.40
42 What constitutes habitual residence will have to be determined in a case-by-case
basis, taking in view the particular factual circumstances. However, it is accepted that,
whereas intention would not always be relevant, residence must be for a certain period
of time,41 if not for a long period of time.42

43 The PICC and PECL contain an identical provision to that of Art. 10(a). In
particular, Art. 1.11 PICC and Art. 2.106(2) PECL provide, inter alia, that “where a
party has more than one place of business the relevant ‘place of business’ is that which
has the closest relationship to the contract and its performance, having regard to the
circumstances known to or contemplated by the parties at any time before or at the
conclusion of the contract”. In addition, Art. 2.106(3) PECL contains an identical
provision to that of Art. 10(b) providing that “[i]f a party does not have a place of
business his habitual residence is to be treated as his place of business.”
37 Schwenzer/Hachem, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 10 para. 9; cf. also Secre-
tariat Commentary on 1978 Draft, Art. 9 (now Art. 10) para. 8, which refers to the example of a head
office located in another state, which supervises the making of the contract.
38 Cf. Honnold, Honnold, Uniform Law (1999), para. 41; however, Schlechtriem, in: Schlechtriem/
Schwenzer, Commentary (2016), Art. 10 para. 4, argues that it does not matter whether a disclosed or
an undisclosed agent exists, as the business place of an agent acting for one of the parties would usually
not constitute an independent place of business of that party, as it is the party itself that normally has the
closest relationship to the contract and its performance.
39 Honnold, Uniform Law (1999), para. 125; courts have only exceptionally referred to Art. 10(b); see
for example, Landgericht Hamburg (Germany) 26 September 1990, CISG-Online 21 (Pace).

190 Brekoulakis
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Article 11
A contract of sale need not be concluded in or evidenced by writing and is not
subject to any other requirement as to form. It may be proved by any means,
including witnesses.
Bibliography: Flechtner, Addressing Parol Evidence Issues in Contracts Governed by the CISG, in:
Flechtner/Brand/Walter, Drafting Contracts (2007), p. 329; Schlechtriem, Opting out of Merger and
Form Clauses Under the CISG – Second thoughts on TeeVee Toons, Inc. & Steve Gottlieb, Inc. v
Gerhard Schubert GmbH, FS Kritzer (2008), p. 416; Walker, Agreeing to disagree: Can We Just Have
Words? CISG Art. 11 and The Model Law Writing Requirement, 25 Journal of Law and Commerce
(2005–2006) 163; CISG-AC, Opinion no 1, Electronic Communications under CISG, 15 August 2003.
Rapporteur: Professor Christina Ramberg, Gothenburg, Sweden (at http://www.cisg-ac.org); CISG-AC
Opinion no 3, Parol Evidence Rule, Plain Meaning Rule, Contractual Merger Clause and the CISG,
23 October 2004. Rapporteur: Professor Richard Hyland, Rutgers Law School, Camden, NJ, U.S. (at
http://www.cisg-ac.org).
Outline
1. Freedom of form . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
a) Meaning of the provision . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
b) Form and agreements outside the CISG. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
2. Freedom of evidence. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
a) Meaning of the provision . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
b) Means of evidence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
c) Evaluation of the evidence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
3. Agreement of the parties requiring writing or evidence in writing . . . . . . . . 19
4. Electronic form and evidence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

Contracts subject to the CISG are governed by a general principle of informality 1
that has been widely recognized by scholars and case law1. Art. 11 displaces any
domestic requirements as to form2 irrespective of whether it constitutes a requirement
for the validity of the contract (forma ad valorem) or merely a means of prescribed
evidence (forma ad probationem), relevant primarily in cases where the existence
of the contract is challenged. Thus, the principle of informality as enshrined in Art. 11
refers to freedom of form and freedom of evidence and recognizes the normal be-
haviour of businesspersons when contracting for the sale of goods in international
settings. The principle of informality, within the general provisions of the Convention,
1 Rajski, in: Bianca/Bonell, Commentary (1987), Art. 11 para. 2.1 (Pace) referring to the principle of
consensualism; Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 208. Similar
provisions are found in Arts 15 ULIS and 3 ULF. Rechtbank van Koophandel Tongeren (Belgium)
25 January 2005 (steel), Scafom International BV & Orion Metal BVBA v Exma CPI, S.A., CISG-Online
1106 (Pace); and Arbitral Award, Compromex (Mexico) 4 May 1993 (garlic), José Luis Morales y/o Son
Export, S.A. de C.V v Nez Marketing de Los Angeles California, E.U.A., CISG-Online 75 (Pace).
2 Inter alia: U.S. Federal District Court of New York (U.S.) 8 August 2000 (shoes), Fercus v Mario
Palazzo et al., CISG-Online 588 (Pace).

3B2 9.1.580; Page size: 160.00mm 240.00mm
applies throughout the whole contractual process, i. e. in the formation, performance,

modification and termination of the contract3.
2 An international sale of goods contract can be concluded or modified orally, by the
conduct of the parties or even by the silence of the offeree (Art. 18(3))4. Thus, on the
application of general standard terms and conditions no requirement as to form applies
to the agreement5.
3 Form and evidence of the contract are issues closely interrelated but they are not
coincidental. Although there is no definition of ‘form’ under the CISG, scholars have
put forth an autonomous and broad definition6, namely, the means through which
declarations of intent ought to be exteriorized to reach full validity and efficiency7.
Evidence, on the other hand, is a means to prove the existence of declarations of
intent.
4 The concept of from within Art. 11 is broad enough as to encompass and thus to
displace special requirements of consent such as consideration or causa.
5 Art. 11 has a very important limitation through an Art. 96 reservation in conjunction
with Art. 128 to satisfy states that require written form or written evidence of the
contract. An Art. 96 reservation applies strictly to the declarations in Part II relating to
the formation of the contract (Arts 14–24) and to the modification and termination of
the contract by agreement (Art. 29). The reservation does not apply to any other notice
or communication under Part III of the Convention to which the general principle of
informality applies9.
6 Finally, although not expressly provided for, the principle of informality also applies
to other declarations within the Convention (Art. 7(2))10.
3 Also in agreement: Schmidt-Kessel, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 11
para. 10: Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 207; Witz/Salger/
Lorenz, Kommentar (2000), Art. 11 para. 4. In case law: Oberster Gerichtshof (Austria) 29 June 1999
(plates), CISG-Online 483 (Pace): The avoidance of a sales contract under the CISG is, in principle, not
subject to formal requirements. Thus, avoidance could also be done orally, or as here, over the
telephone, as well as impliedly. Contrary: Butler, Formal Requirements: Editorial Remarks on the
manner in which Art. 2:201(2) of the PECL may be used to interpret or supplement Art. 11 of the
CISG, in: Felemegas (ed.), An International Approach to the Interpretation of the United Nations
Convention on Contracts for the International Sale of Goods (1980) as Uniform Sales Law (2007),
p. 286 (286) (Pace).
4 Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), pp. 207–208; Perales Viscasillas,
La formación del contrato de compraventa internacional de mercancı́as (1996), pp. 512 et seq. For the
modification of the contract by silence together with various other elements such as the previous
behaviour of the parties: Audiencia Provincial de Palencia (Spain) 9 September 2014 (coffee), Krüger
GmbH & Co.KG v Soluble Products, Inc., CISG-Online 2577 (Pace).
5 Arrondissementsrechtsbank Arnhem (Netherlands) 17 March 2004 (soil for plan), CISG-Online 946
(Pace); and Arrondissementsrechtsbank Arnhem (Netherlands) 17 January 2007 (compensators), Hibro

Compensatoren B.V. v Trelleborg Industri Aktiebolag, CISG-Online 1455 and 1476 (Pace).
7 Perales Viscasillas, La formación del contrato de compraventa internacional de mercancı́as (1996),
p. 102; and Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 210.
8 Cf. infra comments to Arts 12 and 96. As considered by the Secretariat Commentary on 1978 Draft,
Art. 10 (now Art. 11) para. 3, the form requirements is a question of public policy.
9 Witz/Salger/Lorenz, Kommentar (2000), Art. 12 para. 11; Melis, in: Honsell, Kommentar (1997),
Art. 12 para. 2; Coca Payeras, in: Dı́ez-Picazo, Comentario (1998), Art. 12 p. 157; Andersen, General
Principles of the CISG-Generally Impenetrable?, FS Kritzer (2008), p. 13 (32). But see: Rajski, in: Bianca/
Bonell, Commentary (1987), Art. 12 para. 2.2 (Pace); for a detailed discussion see infra Art. 96.
10 Schmidt-Kessel, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 11 paras 6 and 11.

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1. Freedom of form
a) Meaning of the provision. The principle of freedom of form is well recognized in 7
civil law systems11 yet it is less known in common law systems and former socialist
countries. Although, some common law systems have relaxed the need of writing for the
enforceability of sale of goods contracts (statute of frauds)12, they still require con-
sideration for the contract conclusion or its modification.
The CISG does not require any particular form or any special requirements for the 8
conclusion or validity of the contract, thus the statute of frauds13, consideration
(common law systems)14, causa (civil law systems) and any other formal requirements
are irrelevant. To this regard, the Convention does not require a signature15 for the
conclusion of the contract or any other requirement for its validity; a notion contrary to
some domestic legal systems that do require certain contracts be signed, registered or
authenticated by a notary16. For the same reason, special form requirements due to
certain control exchange rules or due to the intervention of the state as a contracting
party are displaced by the Convention17. However, some authors, following the legisla-
tive history of the Convention, have concluded that the contract is not enforceable
against the party which concluded the non-written contract”18.
Simply, Art. 11 allows the offer (Art. 14) and the acceptance (Art. 18) as well as the 9
conclusion of the contract (Arts 18(2) and 23) to be made in any form, including
acceptance by conduct, silence or inaction of the offeree (Arts 18(1) and 18(3)).
11See e. g.: Arts 51 Spanish CCo and 1278 Spanish CC.

12In Great Britain, the Law Reform (Enforcement of Contracts) Act abolished in 1954 the Statute of
Frauds that since 1677 required written form for a number of contracts, including the sale of goods. § 2-
201 UCC, requires written form for the enforceability of the contract. It has to be noted that U.S. did not
make the reservation under Art. 96. See Farnsworth, The Convention on the International Sale of Goods
from the Perspective of the Common Law Countries, in: La Vendita Internazionale (1981), pp. 5 et seq.;
and Comoglio, Libertà di forma el libertà di prova nella compravendita internazionale di merci, Rivista
Trimestrale di Dirtito Processuale e Civile (1990) 785 (786 et seq.).
13 Honnold, Uniform Law (2009), para. 126; Schlechtriem/Witz, Convention de Vienne sur les Contrats
de Vente Internationale de Marchandises (2008), para. 107; Huber/Mullis, The CISG (2007), pp. 37 seq.;
Piltz, Internationales Kaufrecht (2008), paras 2–129.
14 Honnold, Documentary History (1989), p. 379; Schmidt-Kessel, in: Schlechtriem/Schwenzer, Com-
mentary (2016), Art. 11 para. 12; Schlechtriem/Witz, Convention de Vienne sur les Contrats de Vente
Internationale de Marchandises (2008), para. 107; Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and
Beyond (2003), p. 211; Huber/Mullis, The CISG (2007), pp. 37 seq.; Piltz, Internationales Kaufrecht
(2008), paras 3–132. See also: Drobnig, Substantive Validity, 40 American Journal of Comparative Law
635 (635 et seq.) (Pace); Nicholas, The Vienna Convention on International Sales Law, 105 LQR 201 (214
et seq.) (Pace).
15 Handelsgericht des Kantons St. Gallen (Switzerland) 5 December 1995 (computer hardware devices),
CISG-Online 245 (Pace); Appellate Court Grenoble (France) 28 November 2002 (machinery), CISG-
Online 787 (Pace); Oberlandesgericht München (Germany) 8 March 1995 (nickel-copper cathods), CISG-
Online 145 (Pace); Arbitral Award, Compromex (Mexico) 30 November 1998 (sweets), CISG-Online 504
(Pace); and Harju County Court, Tartu mnt Court House (Estonia) 23 February 2009 (wood), Saratoga
Forest Products Inc. v AS UM Components, CISG-Online 2644 (Pace).
16 See Honnold, Documentary History (1989), p. 259.
17 Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 211. Contrary: Secretariat
Commentary on 1978 Draft, Art. 10 (now Art. 11) para. 2.

18 Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 211. Honnold, Uniform Law
(2009), para. 127 considers that Art. 11 does not interfere with the imposition of sanctions for evasion or
violation of a regulatory program; Art. 11 merely removes any impediment to enforcement between the
parties based on any domestic “requirements as to form”.

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Modification and termination of the contract (Art. 29) are similarly governed by the
same principle of freedom of form by the same rules (though with minor adjustments)
as seen with the formation of the agreement19. In addition, any notices or communica-
tions under Part III are governed by this same principle.
10 Form, as considered in the CISG, has its own autonomous and uniform meaning;
thus, even if the issue of form is a matter of validity, Art. 11 prevails20. The Convention
will, for example, override form requirements even in situations where they are
intended to protect the consumers21 or small businesses. An example of this is the
incorporation of EU directives into domestic law. These directives are displaced by the
CISG22 and thus EU directives are not within the scope of Art. 9023.
11 b) Form and agreements outside the CISG. Some scholars argue that the principle of
freedom of form applies exclusively to issues dealt with in the CISG and therefore it is
up to the applicable domestic law to determine the form requirements of agreements
outside the CISG. This has been considered in relation, for example, with competition
clauses24, or issues related to the consent of the principal to the transaction concluded
by his agent25.
12 The most controversial issue among scholars is whether the form of arbitration
agreements included in the contract of sale – which is normally the case – is an issue
governed by the CISG26. One view is that under the principle of separability, and
because of the CISG’s field of application, the Convention does not govern arbitration
19 Cf. Perales Viscasillas, Modification and Termination of the Contract (Art. 29 CISG), 25 Journal of
Law and Commerce, 167 (169 seq.) (Pace) (Uncitral).

22 E. g.: Art. 11 (Placing of the order) of the EU Directive 2000/31/EC of 8 June 2000 on certain legal
aspects of information society services, in particular electronic commerce, in the Internal Market
(Directive on Electronic Commerce), EC Official Journal, L 178, 17 July 2000, p. 1, breaks the rules of
offer/acceptance and modification of CISG, which does not provide for a mandatory confirmation. Thus,
the CISG deals specifically with the matter of contract formation and modification and therefore the
domestic law is displaced. See: Illescas Ortiz/Perales Viscasillas, Derecho Mercantil Internacional (2003),
p. 166. See for a more general discussion: Schmidt-Kessel, in: Schlechtriem/Schwenzer, Commentary
(2016), Art. 11 para. 18, reaching similar conclusion.
23 Schlechtriem/Schwenzer/Hachem, in: Schlechtriem/Schwenzer, Commentary (2010), Art. 90 paras 1
et seq. See also Mohs, in: Schlechtriem/Schwenzer, Commentary (2010), Art. 58 para. 22, in relation with
the EU Directive 2000/35 on late payment. Both authors agree (as does this author) that the directives are
not within Art. 90 CISG, and on a minimum interference of the directives within the CISG. See also
Magnus, The CISG’s Impact on European Legislation, in: Ferrari, The 1980 Uniform Sales Law (2003),
p. 129 (131), also considering the prevalence of CISG. In general terms Prof. Ferrari points out that the
directives are not international agreements in the sense of Art. 90 CISG: Ferrari, in: Schlechtriem/
Schwenzer, Kommentar (German ed. 2004), Art. 90 para. 3; and id., Universal and Regional Sales Law:
Can they coexist?, Uniform Law Review (2003) 177 (181 seq.); Piltz, Internationales Kaufrecht (2008),
paras 2–176 ; Perales Viscasillas, Late Payment Directive 2000/35 and the CISG, 19 Pace International
Law Review 125 (127 et seq.).
24 Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 208. But see: U.S. Federal
District Court of Michigan (U.S.) 17 December 2001 (thermoforming line equipment for manufacture of
plastic gardening pots together with the technology), Shuttle Packaging Systems v Tsonakis et al., CISG-
Online 773 (Pace).
26 Even if considered outside the CISG, an extended application of Art. 11 would be possible as it
happens with Art. 9 (supra Art. 9 para. 26) or with Art. 7(1) in regard to the good faith principle that it is
considered when examining the validity of jurisdiction clauses contained in general conditions under the
Council Regulation (EC) 44/2001 (Audiencia Provincial de Navarra (Spain) 27 December 2007 (machine
for repair of bricks) (Pace) (www.cisgspanish.com)) or under Art. II 1958 New York Convention
(Audiencia Provincial de Navarra (Spain) 22 September 2003 (motors for production of electricity)
(Pace) (www.cisgspanish.com)).

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agreements27 or jurisdiction clauses28. The majority view, however, is that while the
form of arbitration agreements is generally outside the scope of the CISG and primarily
governed by the 1958 New York Convention on the Recognition and Enforcement of
Foreign Arbitral Awards (Art. II), the formation of the arbitration agreement might be
analysed under CISG (Arts 14–24)29.
It is this author’s view, for several reasons30, both the form and formation of an 13
arbitration agreement might well be considered under the CISG rules31. First, arbitra-
tion agreements are dealt with by the CISG in regard to the formation of the contract
(Art. 19(3)) and the avoidance of the contract (Art. 81(1)). Secondly, modern trends in
international commercial laws consider that arbitration agreements are not subject to
special requirements as to form and formation, and thus an agreement to arbitrate is
achieved through the same means as the formation of a sale of goods contract32. Thus, it
is suggested that special requirements for formal validity are not necessary and that
Commerce 39 (43 seq.) (Pace) (UNCITRAL), although see p. 46 in fine; Schmidt-Kessel, in: Schlech-
triem/Schwenzer, Commentary (2016), Art. 11 para. 9. See: Landesgericht Duisburg (Germany) 17 April
1996 (textiles), CISG-Online 186 (Pace); Bundesgericht (Switzerland) 11 July 2000 (construction materi-
als), Dörken-Gutta Pol.; Ewald Dörken AG v Gutta-Werke AG, CISG-Online 627 (Pace); and Handels-
gericht Zürich (Switzerland) 26 April 1995 (second hand metallic hangar), Marques Roque Joachim v
S.a.r.l. Holding Manin Rivière, CISG-Online 154 (Pace).
28 Bundesgericht (Switzerland) 11 July 2000 (construction materials), Dörken-Gutta Pol. ; Ewald
Dörken AG v Gutta-Werke AG, CISG-Online 627 (Pace); Cámara Nacional de Apelaciones en lo

Comercial (Argentina) 14 October 1993 (machinery), Inta. S.A. v MCS Officina Meccania S.P.A., CISG-
Online 87 (Pace) on the basis of Art. 4, but considering that some of its provisions might be used when
the jurisdiction clause is within the contract of sale.
29 Koch, The CISG as the Law Applicable to Arbitration Agreement?, FS Kritzer (2008), p. 267 (280 et
seq.); Mistelis, CISG and Arbitration, in: Janssen/Meyer (eds), CISG Methodology (2009), p. 394 con-
sidering that the CISG can never apply to formal validity of the arbitration agreements but can apply
sometimes, but not very likely, to substantive validity. Also Art. 9 ought to be considered, see supra Art. 9
para. 35. Arts 14–24 and 8 are generally considered when dealing with arbitration clauses contained in
general terms and conditions where CISG is decisive, inter alia: Arrondissementsrechtsbank Arnhem
(Netherlands) 17 January 2007 (compensators), Hibro Compensatoren B.V. v Trelleborg Industri Aktie-
bolag, CISG-Online 1455 and 1476 (Pace). Under Council (Brussels) (EC) Regulation 44/2001 of
22 December 2000 on jurisdiction and the recognition and enforcement of judgments in civil law and
commercial m atters, Art. 23 considers the validity of forum selection clauses that are in writing or
evidenced in writing, or in a form that accords the practice established between the parties. Therefore, to
the extent possible, Art. 11 might be considered.
30 See Perales Viscasillas/Ramos Mun ~oz, CISG and Arbitration, in: Festschrifft für Ingeborg Schwenzer
zum 60. Geburtstag (2011), Band II. pp. 1355–1374. For a mere recent status in doctrinal discussion in
both arbitration and CISG: Flecke-Giammarco/Grimm, CISG and Arbitration Agreements: A Janus-Faced
Practice and How to Cope with It, 25 Journal of Arbitration Studies (2015), pp. 33–58; and Kroll,
Arbitration and the CISG, in: Schwenzer/Atamer/Butler, Current Issues in the CISG and Arbitration
(2013), pp. 59–86.
31 Walker, Agreeing to disagree: Can We Just Have Words? CISG Art. 11 and The Model Law Writing
Requirement, 25 Journal of Law and Commerce 153 (156 seq.) (Pace) (Uncitral); Perales Viscasillas, La
formación del contrato de compraventa internacional de mercancı́as (1996), pp. 671 et seq. In case law,
see: U.S. District Court, Southern District of New York (U.S.) 14 April 1992 (footware), Filanto v
Chilewich, CISG-Online 45 (Pace). U.S. Federal Appellate Court (U.S.) 5 May 2003 (wine corks), Chateau
des Charmes Wines Ltd. v Sabaté USA, Sabaté S. A., CISG-Online 767 (Pace); Ontario Superior Court of
Justice (Canada) 28 October 2005 (wine corks), Chateau des Charmes Wines Ltd v Sabaté USA, Inc. et al.,
CISG-Online 1139 (Pace); U.S. Federal District Court of Delaware (U.S.) 9 May 2008 (soy lecithin), Solae,
LLC v Hershey Canada, Inc. (Pace).
32 See new Art. 7 UNCITRAL Model Law on International Commercial Arbitration (2006) (both
Option I and II) and Recommendation of UNCITRAL of 7 July 2006 regarding the interpretation of
Art. II(2) and Art. VII(1) of the Convention on the Recognition and Enforcement of Foreign Arbitral
Awards (New York, 1958). See: Perales Viscasillas, Forma escrita del convenio arbitral: Nuevas disposi-
ciones de la CNUDMI/UNCITRAL, 197 Derecho de los Negocios, 5 (7 et seq.).

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arbitration agreements in a sale of goods contract should be concluded by the same

means as the conclusion of the contract in which it is inserted. This position confirms
the expectation of businesspersons when dealing internationally. It also means that it is
no longer the problem of validity of the agreement but rather an issue of its evidence.
Art. 90 CISG is not an obstacle33 when considering Art. VII NYC and thus Art. 11 CISG
– a substantive provision – could be considered as the more favourable provision
(MFP)34.
14 In conclusion, in this author’s opinion, Art. 11 might play a role in relation to
agreements outside the CISG if they are included within the sale of goods contract
governed by the CISG. Art. 11 expressly recognizes an important principle in interna-
tional commercial transactions and thus it is apt to an extended application. This is
conceivable for any of the general principles embodied within the Convention35.
2. Freedom of evidence
15 The principle of freedom of evidence applies to both judicial and arbitral proceed-
ings36. Whether the issues of evidence are considered substantive or procedural under
domestic law is of no importance37 since the CISG displaces domestic law in this
regard. Particularly, the CISG displaces, at least in part, those domestic rules that in
addition to substantive law form requirements often impose further evidentiary
restrictions as to what can be pleaded, which evidence is admissible and how evidence
has to be weighed (freedom of form, after all, makes no sense if informal contracts
cannot be enforced).
16 a) Meaning of the provision. The principle of informality also applies to evidentiary
means and thus the Convention provides freedom to the parties to present evidence as
to the existence of the contract38. A sale of goods contract need not be evidenced by
writing, and it may be proven by any means, including witnesses (Art. 11). Thus,
domestic evidentiary rules (e. g., if the contract is higher than a certain amount39)
requiring that a sale of goods contract must proved by certain means, such as in
writing40, or that exclude oral testimony (parole evidence rule)41, are displaced by the
33 But see: Waincymer, The CISG and International Commercial Arbitration: Promoting a Compli-
mentary relationship Between Substance and Procedure, FS Kritzer (2008), p. 582 (588).
34 Walker, Agreeing to disagree: Can We Just Have Words? CISG Art. 11 and The Model Law Writing
Requirement, 25 Journal of Law and Commerce 153 (163 seq.) (Pace) (Uncitral).
36 Comoglio, Libertà di forma el libertà di prova nella compravendita internazionale di merci, Rivista
Trimestrale di Dirtito Processuale e Civile (1990) 785 (789); and Rajski, in: Bianca/Bonell, Commentary
(1987), Art. 11 para. 2.3 (Pace).
37 Schlechtriem/Witz, Convention de Vienne sur les Contrats de Vente Internationale de Marchandises
(2008), para. 108. Honnold, Uniform Law (2009), para. 126 considers that modern common law scholars
consider it as a substantive issue. As a procedural matter is considered by: Vázquez Lepinette, La
Compraventa internacional de mercaderı́as Una visión jurisprudencial (2000), no I. VI.3.
38 All means of proof possible: Rechtbank van Koophandel, Kortrij (Belgium) 4 April 2001 (shoes)
(Pace); U.S. Federal District Court of New York (U.S.) 6 April 1998, Calzaturificio Claudia v Olivieri
Footwear, CISG-Online 440 (Pace); U.S. Federal District Court of New York (U.S.) 10 May 2002
(chemicals), Geneva Pharmaceuticals Tech. Corp. v Barr Labs. Inc., CISG-Online 653 (Pace).
39 A list of domestic systems stipulating conditions of written form is provided by: Piltz, Internationales
Kaufrecht. Das UN-Kaufrecht in praxisorientierter Darstellung (2008) Internationales Kaufrecht (2008),

paras 3–130: U.S., Russia Federation, Argentina, Spain, France, and Italy. It is considered an issue of
evidence and not a matter of the form of the contract.
40 See § 2–201 UCC.
41 § 2–202 UCC. In agreement: CISG-AC Opinion no 3, para. 1.2; Inter alia: U.S. Federal District Court
of New York (U.S.) 6 April 1998 (shoes), Calzaturificio Claudia v Olivieri Footwear, CISG-Online 440
(Pace), and see comments to Art. 8 supra.

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Convention42. In fact, during the legislative history, several attempts were made to limit
evidence requirements. First, an attempt was made to delete evidence by writing, but
this was kept on the ground that in common law systems it would be problematic since
some systems provide for the recognition of oral contracts but not their enforceability
unless in writing43. Second, an attempt was made to limit witness evidence, but this was
rejected as it was seen as contrary to the principle of free appreciation of evidence by the
judge44. In this regard, judges may maintain their own rules of evidence giving more
weight to documentary evidence45, or to the contrary to consider that the CISG allows
“all relevant information into evidence even if it contradicts the written documenta-
tion”46. The principle of freedom of evidence in Art. 11 is also confirmed by Art. 8(3)
that acceptsa full range of evidentiary means to interpret the statements and declara-
tions of the parties, and thus to determine the agreement of the parties.
b) Means of evidence. A liberal interpretation of Art. 11 allows for different means 17
of evidence to be considered, such as electronic data and or oral witnesses, as
mentioned specifically by the provision. Also, evidence as to the conclusion of the
contract and its terms might well be obtained not only through evidence of the offer
and acceptance, but also by the contractual documents that the parties might have
exchanged prior to the conclusion of the contract, documents exchanged through the
negotiation, or after its conclusion, such as letters of confirmation47 or invoices48.
Therefore, although international sale of goods contracts might be concluded orally or
notice might be sent orally, it is advisable for the parties to keep a record of it, for
42 Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), pp. 211–212; Piltz, Internatio-
nales Kaufrecht (2008), paras 3–130; Coca Payeras, in: Dı́ez-Picazo, Comentario (1998), Art. 11 pp. 151–
152; Witz/Salger/Lorenz, Kommentar (2000), Art. 11 para. 8. Also: Obergericht Zürich (Switzerland)
6 February 2009, (Graffiti protection coating case) (Pace) considering that: “Under Art. 11 CISG, a
relevant oral agreement can be proved by any means, including witnesses. By its refusal to conduct the
taking of [relating] evidence, the lower court violated the right to a court hearing and the right to present
evidence”.
43 Honnold, Documentary History (1989), p. 367.
44 A proposal made by Canada. See: Honnold, Documentary History (1989), pp. 491, 662; Rajski, in:
Bianca/Bonell, Commentary (1987), Art. 11 para. 1.3 (Pace). For cases where witness testimony was
relevant: Oberlandesgericht München (Germany) 8 March 1995 (nickel-copper cathods), CISG-Online
145 (Pace); Oberlandesgericht Rostock (Germany) 27 October 2003 (trucks), CISG-Online 921 (Pace);
Appelationshof Bern (Switzerland) 11 February 2004 (cables), CISG-Online 1191 (Pace).
45 Rechtbank van Koophandel, Hasselt (Belgium) 22 May 2002 (packaging for vegetables), R.B.V. N.V. v
J.V. B.V., CISG-Online 703 (Pace).

46 U.S. Federal District Court of New York (U.S.) 6 April 1998 (shoes), Calzaturificio Claudia v Olivieri
Footwear, CISG-Online 440 (Pace); Federal District Court of New York (U.S.) 23 August 2006 (packaging
system), TeeVee Tunes, Inc. et al v Gerhard Schubert GmbH, CISG-Online 1276 (Pace).
47 Oberlandesgericht Frankfurt am Main (Germany) 5 July 1995 (chocolate products), CISG-Online
258 (Pace); and Oberlandesgericht Köln (Germany) 22 February 1994 (wood), CISG-Online 127 (Pace),
after rejecting the German usage on Kaufmännisches Bestätigungsschreiben: “Nevertheless, the impor-
tance of the commercial letter of confirmation as evidence for the formation of the contract remains
unaffected”. Contrary: Esser, Commercial Letters of Confirmation in International Trade: Austrian,
International and Comparative Law (1988) 427 (459) (Pace), considering that is a procedural issue to be
left to the lex fori.
48 Compromex (Mexico) 4 May 1993 (garlic), José Luis Morales y/o Son Export, S.A. de C.V v Nez
Marketing de Los Angeles California, E.U.A., CISG-Online 75 (Pace) has considered that the existence of
an international sale of goods contract between a Mexican seller and a U.S. buyer of 24 tons of garlic is
evidenced by the invoice issued by the seller as well as by the carriage documents that point out to
the buyer as the final addressee. See also: Rechtbank van Koophandel Kortrij (Belgium) 4 April 2001
(unidentified goods) (Pace); Juzgado Cuarto de lo Civil de Tijuana, Baja California (México) 3 September
2010 (metals), (www.cisgspanish.com); and Tribunal de Justiça do Rio Grande do Sul (Brasil) 14 February
2017 (frozen chicken legs), (cisgspanish.com), relying both in Art. 11 CISG and art. 1.2 PICC.

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example, by recording the conversation or by sending a letter of confirmation.

Otherwise, the evidence of the existence of the contract or any other subsequent
requirement might be difficult to prove49. However, it is not impossible if the
circumstances of the case demonstrate that oral communications form part of a
practice or proof of a reasonable behaviour of businesspersons50.
18 c) Evaluation of the evidence. The weight to be given to the evidence is a matter to
be left to the judge or arbitrator and thus the probative value of the evidence is to be
assessed in accordance with the procedural laws or rules of law51. This would usually be
the case under the principle of freedom of appreciation of the evidence by the judge or
the arbitrator, who would generally consider the evidence on a case-by-case basis. If
procedural rules impose limitations on the judges according to domestic rules of
evidence, they should be disregarded on the application of Art. 1152. However, as with
any other evidence, the discretionof the judge or arbitrator applies and thus the
evidence might be excluded anyway.
3. Agreement of the parties requiring writing or evidence in writing

19 Parties might well expressly or impliedly agree on the exclusion or derogation of the
principle of informality under Art. 11, requiring the need of writing for contract
conclusion, modification or for any other notice due during the performance of the
contract or requiring the signature of the contract for the contract conclusion (Art. 6)53.
Such an agreement is subject to domestic validity requirements that might prohibit such
agreements54, particularly if we consider the exclusion or limitation of the evidence
when certain aspects of the evidence might be considered a procedural issue and thus
outside the scope of the Convention.
20 In accordance with the general principle of informality, an agreement of the parties
with respect to writing is considered to be a rebutted presumption of the evidentiary
character of the writing requirement, unless a clear indication to the contrary, i. e., that
49 E. g. in regard to Art. 39 there is abundant case law declaring the buyer’s loss of the remedies for the
lack of conformity of the goods due to the lack of evidence in regard to the communication to be sent in a
reasonable time under Art. 39 and its content: Landesgericht Frankfurt am Main (Germany) 13 July 1994
(shoes), CISG-Online 118 (Pace), confirmed by Oberlandesgericht Frankfurt am Main (Germany) 23 May
1995 (shoes), CISG-Online 185 (Pace); Amtsgericht Kehl (Germany) 6 October 1995 (fashion goods)
(Pace); Landesgericht Kassel (Germany) 22 June 1995 (clothes), CISG-Online 370 (Pace); Amtsgericht
Kehl (Germany) 6 October 1995 (knitwear), CISG-Online 162 (Pace); and Landesgericht Stuttgart
(Germany) 31 August 1989 (shoes), CISG-Online 11 (Pace). Other situations include the buyer’s
obligation under FOB terms to notify the delivery terms and thus when done by phone and with no
further evidence constitutes a fundamental breach of the Contract: CIETAC Arbitration proceeding
(China) 9 January 2008 (metallic silicon), CISG-Online 2056 (Pace).
50 Appelationshof Bern (Switzerland) 11 February 2004, CISG-Online 1191 (Pace).
51 Schmidt-Kessel, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 11 para. 14. Landesgericht
Memmingen (Germany) 1 December 1993 (granite stones), CISG-Online 73 (Pace); Ferrari, in: Ferrari/
Flechtner/Brand, Draft Digest and Beyond (2003), p. 212; Bundesgericht (Switzerland) 5 April 2005
(triethylen tetramin (“TETA”)), CISG-Online 1012 (Pace).
52 Somehow contrary: Schmidt-Kessel, in: Schlechtriem/Schwenzer, Commentary (2010), Art. 11
para. 13, making a distinction not adopted within Art. 11 according to which the evidence is either a
condition of validity in which case Art. 11 applies or mere means of proof where procedural rules of the
lex fori applies.
53 An example of the latter where parties agreed for the need of a contract signed for its conclusion
and thus by not complying with this requirement the Court concluded that the contract was not
concluded between the parties: Tallinn Circuit Court (Estonia) 5 March 2010 (peat), CISG-Online 2642
(Pace).

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the writing be a condition of validity of the contract55. The consequence of a party’s
failure to comply with an agreement as to form is governed by domestic law56.
According to the general rules applied to the burden of proof, the burden is on the 21
party asserting the existence of an agreement to comply with a specific form57.
The parties might also agree on requiring evidence in writing, i. e., an agreement that 22
oral evidence of the contract is to be excluded.
Agreements contrary to the general principles established in Art. 11 might be 23
achieved by a well-drafted merger clause or by a “No Oral Modification Clause”
(NOM Clause) whereby the former excludes all prior oral negotiations in order to
interpret or supplement the contract58, while the latter excludes oral agreements for the
modification of the contract (Art. 29).
4. Electronic form and evidence

The flexible statement of Art. 11 makes it possible to include computer messages 24
among the means of form and proof, i. e. the exchange of declarations of intent by EDI
(Electronic Data Interchange) or by electronic mail (email). In addition, any proof that
the contract has been concluded by those means is admissible59.

Principles of freedom of form and proof under Art. 11 have been adopted almost 25
literally by other instruments of uniform international commercial law, confirming that
this principle is not just a rule specific to the CISG, but rather that it is considered to be
a general principle of international business transactions60.
The following provisions follow Art. 11 CISG without deviation: Art. 1.2 PICC, 26
Art. 2:101(2) PECL, Art. II.-1:107 DCFR; Art. 9(1) of the UN Convention on the Use
55 Somehow a different position at Schlechtriem/Witz, Convention de Vienne sur les Contrats de Vente
Internationale de Marchandises (2008), para. 110, considering that the meaning of the agreement is to be
seen at the light of Art. 8.
57 Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), pp. 214–215; Schmidt-Kessel,
in: Schlechtriem/Schwenzer, Commentary (2016), Art. 11 para. 18. Kantonsgericht Freiburg (Switzerland)
11 October 2004 (triethylen tetramin (“TETA”)), CISG-Online 964 (Pace).
58 See Flechtner, Addressing Parol Evidence Issues in Contracts Governed by the CISG, in: Flechtner/
Brand/Walter, Drafting Contracts (2007), p. 329 (333 seq.) giving an example of a merger clause by which
Art. 11 is displaced, but pointing out that the reference to Art. 11 is not necessary since a merger clause
does not create a formality requirement or a form-of-evidence requirement. There are limitations as
considered by Federal District Court of New York (U.S.) 23 August 2006 (packaging system), TeeVee
Tunes, Inc. et al v Gerhard Schubert GmbH, CISG-Online 1276 (Pace) relying on CISG-AC Opinion no
3. See Schlechtriem, Opting out of Merger and Form Clauses Under the CISG–Second thoughts on
TeeVee Toons, Inc. & Steve Gottlieb, Inc. v Gerhard Schubert GmbH, FS Kritzer (2008), p. 416 (416 et
seq.); and Meyer, Die privatautonome Abbedingung der vorvertraglichen Abreden–Integrationsklauseln
im internationalen Wirtschaftsverkehr, RabelsZ (2008) 562 (596 et seq.).
59 CISG-AC, Opinion no 1, para. 11.1. The Opinion states that: “A contract may be concluded or
evidenced by electronic communications”. See also infra comments to Art. 13 para. 6.

60 It is considered a general principle of the lex mercatoria. See: Principle no IV.3.1- Principle of
Informality: “Contractual declarations are valid even when they are not evidenced in writing unless
mandatory rules of any applicable domestic law provide otherwise” (Central at http://www.tldb.net). Also
in terms of formal validty of choice of law agreements, see Art. 5 of The Hague Principles on choice of
law in international commercial contracts (approved on 19 March 2015): “A choice of law is not subject to
any requirement as to form unless otherwise agreed by the parties”; a rule that is a substantive rule of
private international law and not a conflict of law rule in itself (see comment 5.3).

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of Electronic Communications in International Contracts (2005), and Art. 208 OHADA

Uniform Act Relating to General Commercial Law61.
27 Both principles (freedom of form and proof) can be excluded or modified by the
parties; a possibility that Art. 1.5 PICC recognizes. As opposed to the CISG that has an
important limitation to this freedom of form and proof (Art. 96), the PICC do not
consider it necessary to satisfy the written form requirements of some states, since the
users of the PICC are not states but operators in international commercial trade.
61 Commercial sale (1 January 1998).

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Article 12
Any provision of Article 11, Article 29 or Part II of this Convention that allows a
contract of sale or its modification or termination by agreement or any offer,
acceptance or other indication of intention to be made in any form other than in
writing does not apply where any party has his place of business in a Contracting
State which has made a declaration under Article 96 of this Convention. The parties
may not derogate from or vary the effect of this Article.
Bibliography: Schroeter,The Cross-Border Freedom of Form Principle under Reservation: The Role of
Articles 12 and 96 CISG in Theory and Practice, 33 Journal of Law and Commerce (2014), 81–118;
Wang/Andersen, The Chinese Art. 96 Reservation against Oral Contracts Under the CISG–Time to
Withdraw?, 8 Vindobona Journal of International Commercial Law and Arbitration (2004) 145; CISG-
AC Opinion no 15, Reservations under Articles 95 and 96 CISG, 21 and 22 October 2013. Rapporteur:
Professor Doctor Ulrich G. Schroeter, University of Mannheim, Germany (at http://www.cisg-ac.org)
Outline
1. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1. Scope of Art. 12 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2. Art. 96 reservation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

1. Introduction
The principle of informality in Art. 11 has a very important limitation through an 1
Art. 96 reservation in conjunction with Art. 121. Art. 12 is the only provision of the
CISG that is mandatory and thus not subject to the contrary agreement of the parties or
by the application of a usage of trade (Art. 12 last sentence) as it creates an obligation of
public international law character2. A reminder of this mandatory character is also
found in Art. 6. The purpose of an Art. 96 reservation is to give the states an
opportunity to preserve their domestic requirements of writing, not only with respect
to the form of the contract–and other related communications – but also to its evidence.
2. Drafting history
Art. 12 was introduced in the 1978 CISG Project3 due to pressures made by Eastern 2
countries, especially the former USSR, whose domestic laws consider the written form
1 Argentina, Armenia, Belarus, Chile, Paraguay, Russian Federation,Vietnam and Ukraine have made
Art. 96 reservation. Upon approving the Convention, the People’s Republic of China declared that it did
not consider itself bound by Art. 11, nor the provisions in the Convention relating to the content of
Art. 11. Art. 96 is the provision within Part IV with the higher number of states making a reservation.
Estonia, Latvia, Lithuania and Hungary withdrew the reservation. For a comprehensive study on this area,
see: Schroeter, The Cross-Border Freedom of Form Principle under Reservation: The Role of Articles 12
and 96 CISG in Theory and Practice, 33 Journal of Law and Commerce (2014) 89–94.
2 Sarcevic, The CISG and regional unification, in: Ferrari, The 1980 Uniform Sales Law (2003), p. 3 (6).
3 There were several attempts before that tried to amend Art. 11 as proposed by former USSR to include
the written form of the contract if so required by at least one of the countries whereof the parties of the

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of the contract as a question of validity, due to the state’s rigid control of international
business transactions, particularly for the international sale of goods4. In fact, a great
number of the states that have made the Art. 96 reservation have done so to respond to
that concern5. There are several states that have made an Art. 96 reservation presumably
due to their own domestic evidentiary requirements, such as Argentina6 and Chile7.
There are, however, some states with similar form or evidentiary requirements that have
decided not to make the reservation probably due to the desire of achieving a higher
degree of uniformity within the Convention, e. g. U.S. and Spain8. Finally, some states
no longer have these domestic requirements due to major changes in their legislation9.
Also The CISG Advisory Council recommends that: a) States which newly acceed to the
Convention do so without making any declarations under Arts 92–96 CISG; and b)
Contracting States that have made one or more declarations under Articles 92–96 CISG
consider withdrawing them in accordance with Article 97(4) CISG10.

1. Scope of Art. 12
3 Art. 12 (also Art. 96) prevents the principle of freedom of form and evidence to
apply. Once within the scope of Arts 12 and 96, any provision on the formation
(i. e., offer, acceptance, counteroffer, withdrawal11, revocation, late acceptance), mod-
ification and termination of the contract that allows indications of intention to be
made in any form other than in writing, do not apply. Other formality requirements
contract have their place of business: Honnold, Documentary History (1989), pp. 53, 63. The question
remained unsettled during the years in which the projects were discussed: Honnold, Documentary History
(1989), pp. 236, 245. Finally in 1977, Art. 11 was amended to include a similar provision to Art. 12 and also
a proposed provision for Art. 96 reservation: Honnold, Documentary History (1989), p. 326.
4 See Art. 162.3 Russian Federation CC (1994); Maskow, The Convention on the International Sale of
Goods from the perspective of the Socialist Countries, in: La Vendita Internazionale (1981), p. 39 (42
seq.). Arbitral Award, Tribunal of International Commercial Arbitration at the Russian Federation
Chamber of Commerce and Industry, 9 June 2004 (unidentified goods), CISG-Online 1239 (Pace)
referring to Art. 11 stated that: “This provision of the Vienna Convention of 1980 takes into considera-
tion peremptory norms of Russian civil legislation (Art. 162 of Russian Civil Code), according to which
non-observance of simple written form of an external economic agreement entails its nullity”.
5 Feltham, The United Nations Convention on contracts for the international sales of goods, Journal
of Business Law (1981) 346 (346 et seq.); and Rajski, in: Bianca/Bonell, Commentary (1987), Art. 11
para. 2.1 (Pace).
6 Art. 209 CCo of Argentina (1890) requiring a principle of written evidence to contracts of more than
a certain amount. Since it does not require written form, some authors doubt about the reservation:
Garro, The U. N. Sales Convention in the Americas: Recent Developments, 17 Journal of Law and
Commerce 219 (229) (Pace).
7 See Grob Duhalde, La reserva de Chile a la Convención de Viena de 1980, Revista de Derecho de la
Pontificia Universidad Católica de Valparaı́so, 2011, pp. 37–67.

8 § 2–201 UCC and Art. 51 Spanish CCo.
9 For China, see: Wang/Andersen, The Chinese Art. 96 Reservation against Oral Contracts Under the
CISG–Time to Withdraw?, 8 Vindobona Journal of International Commercial Law and Arbitration 145
(145 et seq.) (Pace); and Schroeter, Backbone or Backyard of the Convention? The CISG’s Final
Provisions, FS Kritzer (2008), p. 425 (436 seq.).
10 CISG-AC Declaration No 2 Use of Reservations under the CISG. Rapporteur: Professor Dr. Ulrich G.
Schroeter, University of Mannheim, Germany. Adopted by the CISG-AC following its 18th meeting, in
Beijing, China, on 21 October 2013.
11 Contrary: Schmidt-Kessel, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 12 para. 6. How-
ever, Art. 12 expressly refers to other indication of intention under Part II, thus covering also withdrawal
of the offer. In agreement considering any communication of Part II is covered: Rajski, in: Bianca/Bonell,
Commentary (1987), Art. 12 para. 2.2 (Pace); Ziegel, Comments to Art. 12, Report to the Uniform Law
Conference of Canada on Convention on Contracts for the International Sale of Goods (1981) (Pace).

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fall outside the scope of Art. 12, such as formalities relating to the registration of the
contract12, sealed documents, authentication by a notary13 and any other notice or
communication under Part III of the Convention14.
Art. 12, taken literally, prevents the formation of contract to be made through 4
different means, such as an oral offer which is accepted in writing or vice versa, or the
situation described in Art. 29(2) second sentence. However, it is possible that different
means may be used to make a declaration of intent, which can be made through writing,
silence, inaction or conduct15.
2. Art. 96 reservation
The close interplay between Arts 12 and 96 obligates one to investigate the effect of 5
the state’s reservation under the latter provision16. Art. 96 allows states, whose legisla-
tion requires sale of goods contracts to be concluded in or evidenced17 by writing, to
make a reservation. Art. 96’s writing considerations are assessed autonomously under
Art. 1318. Therefore, when, due to an Art. 96 reservation, the writing requirements of
domestic law applies, these writing requirements will be assessed by Art. 13.
The effect of the provision is not to invalidate contracts concluded or evidenced in 6
any form other than in writing19, but rather to disapply of the provisions of the
Convention that allow an oral form (Arts 11, 29 and Part II).
12 Honnold, Uniform Law (1999), para. 129, considering that resort is to be had to the conflict of law
rules of the lex fori. But see, Honnold, Uniform Law (2009), para. 129, considering again the position in
the first edition of the book.
13 Schmidt-Kessel, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 12 para. 5. Schroeter, The
cross-border, pp. 96–97. They are covered by Art. 11 which displaces those requirements.
14 Contrary: Rajski, in: Bianca/Bonell, Commentary (1987), Art. 13 para. 3.1 (Pace), in relation with the
declaration of avoidance; Id., Art. 12, para. 2.2.

15 Inter alia: Enderlein/Maskow, International Sales Law (1992), p. 83 and pp. 92 et seq.; Patti, Silenzio,
Inerzia e compartamento concludente nella Convenzione di Vienna sui contratti di vendita internazionale
di beni mobile, Rivista del Diritto Commerciale e del Diritto generale della obligazione (1991) 135 (146);
Perales Viscasillas, La formación del contrato de compraventa internacional de mercancı́as (1996), p. 113.
With doubts: Enderlein/Maskow/Strohbach, Internationales Kaufrecht (1991), p. 97. Contrary: Stern,
Erklärungen im UNCITRAL-Kaufrecht, in: Wiener Rechtswissenschaftliche Studien (1990), para. 134;
Schlechtriem, Uniform Sales Law- The UN-Convention on Contracts for the International Sale of Goods
(1986), pp. 44 et seq., and pp. 62 seq.; Hillman, Art. 29(2) of the United Nations Convention on Contracts
for the International Sale of Goods: A New Effort at Clarifying the Legal Effect of “No Oral Modification”
Clauses, 21 Cornell International Law Journal 449 (460 seq.), and probably: Heuzé, La Vente Internatio-
nale de marchandises. Droit Uniforme (1992), pp. 145 seq.
16 Cf. Comments to Art. 96 by Prof. Herre.
17 Therefore if the domestic legislation provides no form for the contract conclusion but yet for its
evidence, the state might resort to the reservation. This is the case of Argentina, Chile and Paraguay.
18 Schwenzer/Fountoulakis, International Sales Law (2007), p. 118; Schmidt-Kessel, in: Schlechtriem/
Schwenzer, Commentary (2016), Art. 13 para. 5–7. Considering that is to be determined by the applicable
Law: Rajski, in: Bianca/Bonell, Commentary (1987), Art. 12 para. 2.3 (Pace), but see, id., Art. 13, para. 3.1
justifying on the basis of a uniform application of the CISG an extended application of Art. 13 to
domestic law as determined by the rules of private international law; Eiselen, Electronic Commerce and
the UN Convention on Contracts for the International Sale of Goods, 6 EDI Law Review (1999) 21 (36)
(Pace). It seems to be also the position of Mazzotta, Notes on the United Nations Convention on the Use
of Electronic Communications in International Contracts and Its Effects on the United Nations Conven-
tion on Contracts for the International Sale of Goods, 33 Rutgers Computer and Technology Law Journal
(2007) 251 (271) (Pace) when he considers that resort to electronic communications is barred when a
reservation on Arts 12 and 96 have been made.
19 Contrary: Arbitral Award, CIETAC, 6 September 1996 (engines), CISG-Online 1146 (Pace); U.S.
Federal District Court of New Jersey (U.S.) 7 October 2008, Forestal Guarani, S. A. v Daros International,
Inc. (Pace); and U.S. Federal District Court of Florida (U.S.) 19 May 2008 (polyester dyed fabric), Zhejiang
Shaoxing Yongli Printing and Dyeing Co., Ltd v Microflock Textile Group Corporation (Pace).

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7 As to the application of the reservation20, some case law and academics (minority view)
argue that the contract should be in writing if at least one of the parties has its place of
business in the reservation state21; a position that seems to be supported by the language
of Arts 12 and 96: “any party has his place of business in a Contracting State”.
8 However, this author is of the opinion that this sentence opens the door to the
applicability of Arts 12 and 96 and thus the non-application of Arts 11, 29 and Part II.
In this situation, since these provisions of the CISG do not apply, the applicable law in the
contract or the rules of private international law of the forum (or to the system applied by
the arbitrators to find the applicable law) would decide the issue (majority view).
9 However, there is disagreement among the supporters of the majority view as to the
further application of CISG in a situation described under b).
10 a) It is clear that if the court or the arbitrator is directed to a reservation state, its non-
uniform domestic rules would be applied. It has to be reminded that the reservation
applies to countries whose domestic legislation requires writing for the conclusion, or
evidence of, a contract and thus it might be possible under the domestic law of the
reservation state that the writing requirement only refers to the evidence of the contract.
Thus, under domestic law an oral contract might be considered valid, but would require
some evidence of its existence in writing, e. g., through an invoice22.
20 See an extended discussion: CISG-AC Opinion no 15. The Opinion conforms the majority view and
so clarifies that: “Where any party to a sales contract has its place of business in a Contracting State which
has made a declaration under Article 96, 6.1 no Contracting State is under any obligation under public
international law to apply any provision of Article 11, Article 29 or Part II of the Convention that allows a
contract of sale or its modification or termination by agreement or any offer, acceptance or other
indication of intention to be made in any form other than in writing (Article 12): 6.2 the forum’s rules of
private international law determine which law governs the requirements as to form applicable to such
sales contract and the manner in which it may be evidenced”.
21 Arbitral Award, Tribunal of International Commercial Arbitration at the Russian Federation Chamber
of Commerce and Industry, 16 February 1998 (goods), CISG-Online 1303 (Pace); Arbitral Award, Tribunal
of International Commercial Arbitration at the Russian Federation Chamber of Commerce and Industry,
25 March 1997 (onions), CISG-Online 1224 (Pace); Arbitral Award, Tribunal of International Commercial
Arbitration at the Russian Federation Chamber of Commerce and Industry (Russian Federation) 30 June
2009 (unidentified goods), CISG-Online 2614 (Pace); Rechtbank van Koophandel Hasselt (Netherlands)
2 May 1995 (frozen rasberries), Vital Berry Marketing NV v Dira-Frost NV, CISG-Online 371 (Pace)
(Unilex); Arrondissementsrechtbank Rotterdam (Netherlands) 12 July 2001 (lemons, mandarins and or-
anges), Hispafruit BV v Amuyen S.A., CISG-Online 968 (Pace); U.S. Federal District Court of New Jersey
(U.S.) 7 October 2008 (lumber products), Forestal Guarani, S. A. v Daros International, Inc. (Pace); and U.S.
Federal District Court of Florida (U.S.) 19 May 2008 (polyester dyed fabric), Zhejiang Shaoxing Yongli
Printing and Dyeing Co., Ltd v Microflock Textile Group Corporation (Pace). Impliedly this seems to be the
position of the Chinese Arbitral Awards under CIETAC, e. g.: Arbitral Award, CIETAC, 15 December 1997
(hot-rolled coils), CISG-Online 1204 (Pace). Among scholars: Eörsi, General Provisions, in: International
Sales: The United Nations Convention on Contracts for the International Sale of Goods (1984), pp. 2–32;
Adame, El contrato de compraventa internacional (1994), p. 22; Garro/Zuppi, Compraventa internacional
(1990), pp. 69 seq.; Garro, The U. N. Sales Convention in the Americas: Recent Developments, 17 Journal of
Law and Commerce 219 (226) (Pace), pointing out that the contract to be valid ought to be in writing;
Torsello, The CISG’S impact on Legislators: The Drafting of International Contract Law Conventions, in:
Ferrari, The 1980 Uniform Sales Law (2003), pp. 251 et seq., considering Arts 12 and 96 as a sort of
“supermandatory rules”; Hussonmorel, La Compraventa Internacional de Mercaderı́as (2004), p. 40; Piltz,
Internationales Kaufrecht (2008), para. 2–132; Zuppi, The Parol Evidence Rule, International Electronic
Documents and the United Nations Convention on Contracts for the International Sale of Goods (CISG),
FS Kritzer (2008), p. 640 (643). This position, however, is rejected by the legislative history, see: Ferrari,
CISG and Private International Law, in: Ferrari, The 1980 Uniform Sales Law (2003), p. 19 (54).
22 Arbitral Award, Compromex, 29 April 1996 (canned fruit), Conservas la Costena S.A. de C.V. v
Lanis San Luis S.A. & Agroindustrial Santa Adela S.A., CISG-Online 350 (Pace) considering an
international sale of goods contract between an Argentinean seller (reservation state) and a Mexican
buyer. The Commission considered that the essential matters of the contract were in writing and that to
demand that the contract itself be in writing is against the general principles of the Convention.

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b) If a non-reservation state is designated, the CISG (Art. 11) applies since the 11
reservation under Art. 96 binds the reservation state but not the non-reservation state,
and thus it is the CISG that is the applicable law to determine the issue23 and not the
domestic rules of the non-reservation state24, which would have the negative effect to
bring into play domestic form requirements of certain states that have internationally
and intentionally decided to abandon them25. Thus, due to the terminology: “any party
has his place of business in a Contracting State” in Arts 12 and 96, one must consider,
as the first step, whether one of the parties have their place of business in a reservation
state, and next, whether the conflict of laws provisions of that state point to the law of
another reservation state.
23 In agreement: Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), pp. 213 seq.;
Schmidt-Kessel, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 12 para. 3; Schwenzer/Hachem, in:

Schlechtriem/Schwenzer, Commentary (2016), Art. 96 para. 3; Schroeter, The cross-border, pp. 103–108;
id, Backbone, p. 425; Witz/Salger/Lorenz, Kommentar (2000), Art. 12 para. 12; Melis, in: Honsell,
Kommentar (1997), Art. 12 para. 4; Schlechtriem/Witz, Convention de Vienne sur les Contrats de Vente
Internationale de Marchandises (2008), para. 109; Huber/Mullis, The CISG (2007), p. 38; Bernstein/
Lookofsky, Understanding the CISG (2003), paras 2–14; Piltz, Internationales Kaufrecht (2008), para. 2–
132; Schroeter, Backbone or Backyard of the Convention? The CISG’s Final Provisions, FS Kritzer (2008),
p. 425 (443). Also case law: Arrondissementsrechtbank Rotterdam (Netherlands) 12 July 2001 (lemons,
mandarins and oranges), Hispafruit BV v Amuyen S.A., CISG-Online 968 (Pace); Gerechtshof Leeuvarden
(Netherlands) 5 June 1996 (vodka), CISG-Online 325 (Pace) (Unilex) followed by Hooge Raad (Nether-
lands) 7 November 1997 (vodka), J.T. Schuermans v Boomsma Distilleerderij/Wijnkoperij BV, CISG-
Online 551 (Pace); Fovárosi_Biróság_Budapest (Hungary) 24 March 1992 (unidentified goods), Adamfi
Video Production GmbH v Alkotók Studiósa Kisszövetkezet, CISG-Online 61 (Pace) (Unilex). Contrary:
Honnold, Uniform Law (2009), para. 129, although considering that rules on formality may be affected by
conduct demonstrating that a contract had been made (estoppel); and considering the application of
Art. 8 CISG: Ishida, Reservation of the Freedom-of-Form (FOF) Provisions by Articles 12 & 96 of the
CISG- Let Us Do without Article 11: We Have 8-, 58 Himeji Law Review, 1 (2016), 1–27.
24 See i.e., among the latest cases: U.S. Court of Appeals, Third Circuit (U.S.) 16 April 2010 (lumber
products), Forestal Guarani S. A., v Daros International, Inc., (Pace), which has an interesting dissenting
opinion, in an oral contract of sale between an Argentina seller and a U.S. buyer, the Court held that: “We
conclude that where, as here, one party’s country of incorporation has made a declaration while the
other’s has not, a court must first decide, based on the forum state’s choice-of-law rules, which forum’s
law applies, and then apply the law of the forum designated by the choice-of-law analysis”. The Court
rejected the District Court conclusion that Argentina’s declaration imposed a writing requirement and
that the absence of a written contract in this case precluded the plaintiff’s claim. To this regard the Court
considered the issue in the light of Art. 7(2) as a gap within the Convention and so concluded that the
CISG does not “expressly settle” the question whether a breach-of-contract claim is sustainable in the
absence of a written contract. Further, “given that neither the CISG nor its founding principles explicitly
or implicitly settle the question, Article 7(2)’s reference to “the rules of private international law” is
triggered. In other words, we have to consider the choice-of-law rules of the forum state, in this case New
Jersey, to determine whether New Jersey or Argentine form requirements govern”.
25 As in the case of U.S. where domestically the Statute of Frauds applies (§ 2–201 UCC). See
considering that domestic law would be applicable: Brand/Flechtner, Arbitration and Contract Formation
in International Trade: First Interpretations of the U. N. Sales Convention, 12 Journal of Law and
Commerce (1993) 239 (240 et seq.); Butler, Formal Requirements: Editorial Remarks on the manner in
which Art. 2:201(2) of the PECL may be used to interpret or supplement Art. 11 of the CISG, in:
Contracts for the International Sale of Goods (1980) as Uniform Sales Law (2007), p. 286 (287 note 7)
(Pace); Herre, Article 96, para 8 (in this commentary). The same pattern but with a different solution is
found in the case Fovárosi Biróság Budapest (Hungary) 24 March 1992 (unidentified goods), Adamfi
Video Production GmbH v Alkotók Studiósa Kisszövetkezet, CISG-Online 61 (Pace) (Unilex), where the
contract was a Hungarian (reservation state) and a German party. The Tribunal resorted to the applicable
law–German Law- and considered that under domestic rules–in that instance: Art. 147.1 BGB 1869- the
contract does not need to comply with any special form requirements; and Fovárosi Biróság Budapest
(Hungary) 21 May 1996 (goods), CISG-Online 252 (Pace), in a contract of sale between a Hungarian and
a Swedish, the Court applied Swedish domestic rules and considered the contract was concluded as the
domestic written requirements were fulfilled.

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12 By the very nature of the Arts 12 and 96 CISG there are no comparable rules in soft
law instruments such as PICC.
13 Other international Conventions prepared by UNCITRAL and UNIDROIT do not
have similar provisions to Arts 12 and 96 CISG, except for Art. 27 of the 1983 Unidroit
Convention on Agency in the International Sale of Goods26.
26 See Herre, Article 96, para 9 (in this Commentary).

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Article 13
“Writing” includes telegram and telex.
Bibliography: Eiselen, Electronic Commerce and the UN Convention on Contracts for the International
Sale of Goods, 6 EDI Law Review (1999) 36; Schroeter, Interpretation of “writing”: Comparison between
provisions of CISG (Art. 13) and counterpart provisions of the Principles of European Contract Law, in:
Contracts for the International Sale of Goods (1980) as Uniform Sales Law (2007); CISG-AC, Opinion no
1, Electronic Communications under CISG, 15 August 2003. Rapporteur: Professor Christina Ramberg,
Gothenburg, Sweden (at http://www.cisg-ac.org).
Outline
1. Scope of Art. 13 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2. Expansive interpretation of Art. 13: fax and electronic means . . . . . . . . . . . . . 6
3. Interpretation of Art. 13 in light of other international uniform law
instruments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

Art. 13 is an interpretative provision which purports to include certain means of 1
communications, namely telegrams and telex, within the meaning of writing. A broad
interpretation of Art. 13 implies that fax and modern electronic means of communica-
tion should be included within the provision. This interpretation is in line with modern
trends in international uniform law instruments, domestic law, and business practice
and with a media-neutral approach within CISG1 that encompasses cross-border sales
in the 21st century.2
Art. 13 applies to those provisions within the CISG that refer to writing, as well as 2
when a writing requirement is derived from an agreement between the parties. The
concept of writing is also important in situations where the Convention provides for
different legal regimes depending on whether the communication is either written or
oral. Art. 18(2) is an example of this situation as it imposes on the addressee of an oral
offer a diligent duty of communicating the acceptance. In this regard, the concept of
oral communications should include radio, telephone and electronic communications
that provide for oral instantaneous communications3.
1For the latter: Schmidt-Kessel, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 11 para. 6.
2Butler, Electronic Commerce within the framework of the United Nations Convention on Contracts
for the International Sale of Goods, in: Schwenzer/Atamer/Butler, Current Issues in the CISG and
Arbitration (2013), p. 121.
3 Cour de Justice Genève (Switzerland) 13 September 2002 (printed goods), CISG Online 722
(Pace): “The notion of an oral offer, before being in principle accepted immediately, includes conversa-
tions face-to-face, by telephone or any other technical or electronic means of communication allowing
immediate oral contact, but not statements captured in a material medium such as, notably a fax”. It is
also the situation considered by Art. 20 which refers to instantaneous means of communication.

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1. Scope of Art. 13
3 Art. 13 was introduced at the last stage of the legislative history of the Convention4.
4 It is clear from the wording of Art. 13 that it does not provide for a definition of
writing, but rather that it should be viewed as an interpretative rule5 that has a
substantive role.
5 Art. 13 not only applies to provisions within CISG that refer to writing, such as Arts
12, 21(2), 29 and 96, but also applies to situations in which the writing requirement is
derived from an agreement between the parties (Art. 6)6, from a practice established
between the parties or from a usage of trade7. What is meant to the parties “by writing”
is to be understood under Art. 8 as well as within the scope of writing under Art. 138
and the principle laid down in Art. 11. Furthermore, if the parties agree that any
declaration must be signed, Art. 11 and not Art. 13 is derogated9.
2. Expansive interpretation of Art. 13: fax and electronic means

6 Art. 13 refers only to telex and telegrams in a non-exhaustive way reflecting the
commercial practice in 1980. In present day, neither of them are a frequent means of
communication, and have been displaced by fax and electronic means such as email.
The need to tailor the CISG to the special needs of these modern means implies that it is
uncontroversial among scholars and case law that modern means of communication –
especially electronic means – that were not contemplated within Art. 13 ought to be
included (Art. 7(2))10. This conclusion is achieved on the basis of both the informality
4 Schmidt-Kessel, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 13 para. 1, considers that
Art. 13 was introduced ex novo during the Diplomatic Conference in April 1980 thanks to a proposal of
the former Federal Republic of Germany. See: Honnold, Documentary History (1989), pp. 490, 662. But
the proposal was raised earlier: See: Honnold, Documentary History (1989), p. 326.
5 Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 209; Coca Payeras, in: Dı́ez-
Picazo, Comentario (1998), Art. 13, p. 159.

6 Rajski, in: Bianca/Bonell, Commentary (1987), Art. 13, para. 3.1 (Pace); Ferrari, in: Ferrari/Flechtner/
Brand, Draft Digest and Beyond (2003), p. 210; Schmidt-Kessel, in: Schlechtriem/Schwenzer, Commentary
(2010), Art. 13 para. 2.
7 Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 210; Schlechtriem/Schmidt-
Kessel, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 13 para. 2.

8 Similarly: Schmidt-Kessel, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 13 para. 2; id.,
Art. 11 para. 17, but considering that the intention of the parties might be considered under domestic law.
9 Contrary: Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 13 para. 2; and
Schmidt-Kessel, in: Schlechtriem/Schwenzer, Commentary (2010), Art. 13 para. 4.

10 CISG-AC, Opinion no 1, Arts 11 and 13. Also fax: Judicial Division of the Supreme Arbitration Court
of the Russian Federation (Russian Federation) 26 February 2009 (wheat), Agro-Holding, LLC v VALARS,
S.A., CISG-Online 2523 (Pace). Among scholars; Honnold, Uniform Law (1999), para. 130, referring to
fax and EDI; Nicoll, E. D. I. Evidence and the Vienna Convention, 52 Journal of Business Law (1995) 21
(31); Ferrari, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 209; Ludwig, Der Vertragss-
chluss nach UN-Kaufrecht im Spannungsverhältnis von Common Law und Civil Law: dargestellt auf der
Grundlage der Rechtsordnungen Englands und Deutschlands (1994), p. 350; Eiselen, Electronic Com-
merce and the UN Convention on Contracts for the International Sale of Goods, 6 EDI Law Review
(1999) 21 (36) (Pace) (fax, email and EDI); Piltz, Internationales Kaufrecht (2008), paras 3–129 (fax, SMS,
EDI, email); Mazzotta, Notes on the United Nations Convention on the Use of Electronic Communica-
tions in International Contracts and Its Effects on the United Nations Convention on Contracts for the
International Sale of Goods, 33 Rutgers Computer and Technology Law Journal (2007) 251 (271) (Pace);
Zuppi, The Parol Evidence Rule, International Electronic Documents and the United Nations Convention
on Contracts for the International Sale of Goods (CISG), FS Kritzer (2008), p. 640 (645). However,

3B2 9.1.580; Page size: 160.00mm 240.00mm

principle in Art. 1111, and an expansive interpretation or an interpretation by analogy12
of Art. 13. Particularly, case law shows that modern means within the CISG are
considered without further discussion13, just as a fact of commercial life.
Some scholars qualify the consideration of fax and electronic means as writing under 7
Art. 13 to the fact that the message can be printed14. In this author’s opinion, no such
requirement is needed. The fact that fax and electronic means are writing within the
CISG derives from an interpretation by analogy of Art. 13. This provision includes
within its scope a means of communication – telegram and telex – between distant
places by which the process of communication involves a segment that it is not in
written form. The same process is seen when using a fax where the initial and the final
stage of the process are in writing, but not the intermediate one.
The application by analogy of Art. 13 to modern electronic means (EDI, email and 8
the Internet) is more difficult, because there may be no writing stage involved. However,
even if no message is printed, electronic communications might be considered as
writing if they are functionally equivalent to writing, i. e., establish the content and
identification of the author15. The fact that telex and telegrams are included within the
provision implies that a general principle might be considered under Art. 1316: a
concept of writing17 that goes far beyond the traditional consideration of writing as a
Gabriel, Contracts for the Sale of Goods: A Comparison of Domestic and International Law (2004), p. 65,
seems to consider that the writing requirement should be analysed under domestic law.
11 E. g.: CISG-AC, Opinion no 1, para. 11.1; Secretariat Commentary on 1978 Draft, Art. 10 (now
Art. 11) para. 2.

12 Perales Viscasillas, La formación del contrato de compraventa internacional de mercancı́as (1996),
pp. 106 et seq (fax and EDI); Schlechtriem/Witz, Convention de Vienne sur les Contrats de Vente
Internationale de Marchandises (2008), para. 111; Garro/Zuppi, Compraventa internacional (1990), p. 69
(fax); Hussonmorel, La Compraventa Internacional de Mercaderı́as (2004), p. 41 (fax and email); Coetzee,
Securing the Future of Electronic Sales in the Context of International Sales, 11 Vindobona Journal of
International Commercial Law & Arbitration (1/2007) 11–24.
13 See e. g.: Court of Cassation (Egypt) 11 April 2006 (marble) (Pace) considering that within Art. 13
fax, email and other electronic means of communication are included; Hof’s-Gravenhage (Netherlands)
23 April 2003 (wheat flour), CISG Online 903 (Pace) a contract concluded by fax; Juzgado de Primera
Instancia, No 3 de Badalona (Spain), 22 May 2006 (Bermuda shorts), CISG Online 1391 (Pace)
(www.cisgspanish.com) where the contract was concluded through the exchange of emails; Primer
Tribunal Colegiado en Materia Civil del Primer Circuit,. Amparo Directo Civil (Mexico) 10 March 2005
(chemical product), Kolmar Petrochemicals Américas, Inc. v Idesa Petroquı́mica Sociedad Anónima de
Capital Variable, CISG Online 1004 (Pace) in regard to negotiations through email; Oberlandesgericht
Düsseldorf (Germany) 21 April 2004 (car phones), CISG Online 915 (Pace) where all the communications
including the formation of the contract where done through email.
14 Schmidt-Kessel, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 13 para. 5; Schlechtriem/Witz,
Convention de Vienne sur les Contrats de Vente Internationale de Marchandises (2008), para. 111;
Huber/Mullis, The CISG (2007), p. 39; Witz/Salger/Lorenz, Kommentar (2000), Art. 13 para. 2.
15 Rajski, in: Bianca/Bonell, Commentary (1987), Art. 13 para. 2.2 (Pace), referring to telegram and
telex; CISG-AC, Opinion no 1, para. 13.1, considering that electronic communication should fulfil the
same functions as the paper: to save (retrieve) the message and to understand (perceive) it. Contrary,
Schroeter, Interpretation of “writing”: Comparison between provisions of CISG (Art. 13) and counterpart
provisions of the Principles of European Contract Law, in: Felemegas (ed.), An International Approach to
(1980) as Uniform Sales Law (2007), p. 265 (269) (Pace), considering that these requirements derived
from domestic laws and not from CISG. The principle of functional equivalent is well established in other
UNCITRAL texts, mainly the 2005 Convention on the use of electronic communications in international
contracts (Art. 9) and the Model Law on Electronic Commerce (1996) (Arts 6–8).
16 Contrary stating that no general principle can be inferred from Art. 13: Schroeter, Interpretation of
“writing”: Comparison between provisions of CISG (Art. 13) and counterpart provisions of the Principles
of European Contract Law, in: Felemegas (ed.), An International Approach to the Interpretation of the
United Nations Convention on Contracts for the International Sale of Goods (1980) as Uniform Sales
Law (2007), p. 265 (269) (Pace).
17 See: Explanatory Note on the 1996 Model Law on Electronic Commerce, para. 15.

3B2 9.1.580; Page size: 160.00mm 240.00mm
paper document. Thus, writing under Art. 13 includes any means of communication
that provides the content of the information and that is capable of being reproduced in
a tangible or perceivable form18: printed, recorded or stored on a computer or disk.
Thus, if the electronic message is recorded on a computer or disk, or the fax is
transmitted through the computer and stored or printed, it will fulfil the writing
requirement19. The same applies to contracting via the Internet, e. g. on a website or
through an automated message system. It is the possibility to make the electronic data
tangible – whether by paper or not – that ought to be considered when interpreting
Art. 13.
3. Interpretation of Art. 13 in light of other international uniform law

instruments
9 The extended scope of Art. 13 to modern means of communication is also achieved
by a dynamic interpretation of Art. 13 in light of other international uniform instru-
ments, such as the 1996 Model Law on Electronic Commerce, Art. 1.10 PICC20 and
Art. 1:301(6) PECL21, or by resorting to CISG-AC Opinion no 122. There is, however,
only one exception when considering these instruments: the PECL consider “any means
of communication capable of providing a readable record of the statement on both
sides”. However, in this author’s opinion, in order to meet the requirements of Art. 13,
it is sufficient to provide only one record23. The question is then to assess the evidence
presented, and a judge or arbitral tribunal might consider that the record presented only
by one side is not enough as such.
10 The 2005 UN Convention on the Use of Electronic Communications in International
Contracts might be used to fill the gap of Art. 13 in two different circumstances. First,
18 CISG-AC, Opinion no 1: “The term “writing” in CISG also includes any electronic communication
retrievable in perceivable form”.

19 In agreement: Perales Viscasillas, La formación del contrato de compraventa internacional de
mercancı́as (1996), pp. 106 et seq.; Illescas Ortiz/Perales Viscasillas, Derecho Mercantil Internacional
(2003), pp. 133 et seq.; Schroeter, Interpretation of “writing”: Comparison between provisions of CISG
(Art. 13) and counterpart provisions of the Principles of European Contract Law, in: Felemegas (ed.), An
International Sale of Goods (1980) as Uniform Sales Law (2007), p. 265 (270) (Pace).
20 Charters, Growth of the CISG with Changing Contract Technology: “Writing” in Light of the
UNIDROIT Principles and CISG-AC Advisory Council Opinion no 1, in: Felemegas (ed.), An Interna-
tional Approach to the Interpretation of the United Nations Convention on Contracts for the Interna-
tional Sale of Goods (1980) as Uniform Sales Law (2007), pp. 68 seq. (Pace).
21 See considering that Art. 1:301(6) PECL is an aid in the interpretation of Art. 13: Schroeter,
Interpretation of “writing”: Comparison between provisions of CISG (Art. 13) and counterpart provisions
of the Principles of European Contract Law, in: Felemegas (ed.), An International Approach to the
Interpretation of the United Nations Convention on Contracts for the International Sale of Goods (1980)
as Uniform Sales Law (2007), p. 265 (269 seq.) (Pace).
22 CISG-AC Opinion no 1 has been considered as the applicable interpretation of the CISG with regard
to electronic communications: Hahnkamper, Acceptance of an offer in light of electronic communica-

tions, 25 Journal of Law and Commerce 147 (148) (Pace) (Uncitral); and Charters, Growth of the CISG
with Changing Contract Technology: “Writing” in Light of the UNIDROIT Principles and CISG-AC
Advisory Council Opinion no 1, in: Felemegas (ed.), An International Approach to the Interpretation of
the United Nations Convention on Contracts for the International Sale of Goods (1980) as Uniform Sales
Law (2007), pp. 73 seq. (Pace).
23 Contrary Schroeter, Interpretation of “writing”: Comparison between provisions of CISG (Art. 13)
and counterpart provisions of the Principles of European Contract Law, in: Felemegas (ed.), An
International Sale of Goods (1980) as Uniform Sales Law (2007), p. 265 (273) (Pace), as he relies on
PECL, and thus he concludes that a declaration made through a website form does not provide a readable
record of the statement on both sides.

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by a direct application of Art. 20 of the 2005 Convention that considers the situation in
which, if a state has ratified the 2005 Convention and the CISG, the 2005 Convention
applies to the provisions of the CISG related to electronic communications24. As such,
Arts 11, 13 and 14 are “replaced” by Arts 9(1),(2) and 11 of the 2005 Convention.
Second, even if there is no ratification of the 2005 Convention or even if it has not yet
entered into force, the possibility to resort to this instrument to interpret or supplement
Art. 13 is not to be rejected since Art. 7(2) CISG allows, from a dynamic perspective,
resort to other international texts25; an approach based on the goals of uniform and
international interpretation of the CISG (Art. 7(1)) which are shared by the 2005
Convention26. Furthermore, impliedly, the intended purpose of UNCITRAL when
considering the interplay between the 2005 Convention and other international con-
ventions was to create a “recommendation”27, whereby the interpretation of such
conventions – including the CISG – should be made in light of electronic communica-
tions as conceived by the 2005 Convention28. In conclusion, Art. 9(2) of the 2005
Convention ought to be considered in relation to the CISG: writing under Art. 13
includes any electronic communication “if the information contained therein is acces-
sible so as to be usable for subsequent reference”29.

The meaning of writing within Art. 1330 has been taken as a model for many other 11
international and regional legal texts justifying the interplay between uniform law
instruments31. Most of them have been drafted in more recent times therefore taking
into account the new developments in modern means of communication32. We can
24 More details at Eiselen, Integration of the UN electronic communications Convention and the
United Nations Convention on Contracts for the International Sale of Goods in: Schwenzer/Atamer/
Butler, Current Issues in the CISG and Arbitration (2013), pp. 145–165.
25 Similarly: Meyer, Constructive Interpretation- Applying the CISG in the 21st Century, in: Janssen/
Meyer (eds), CISG Methodology (2009), p. 338.

26 The Preamble of the CISG emphasizes the goal of creating uniform rules with the purpose of
removing obstacles that might be derived from existing international trade instruments. See also
comments to supra Art. 7 para. 39.
27 It is true, however, that Art. 20 is not meant to provide an authentic interpretation of the CISG: see
Explanatory Note by the UNCITRAL Secretariat on the 2005 UN Convention on the Use of Electronic
Communications in International Contracts, para. 289.
28 Electronic communication as equivalent to writing is now the term used in the more recent
instrument prepared by UNCITRAL: e. g., Art. 3 UN Convention on the contracts for the international
carriage of goods wholly or partly by sea (2008 Rotterdam Rules).
29 The same approach is found in Art. 6.1 Model Law on Electronic Commerce (1996). The Guide to
enactment of the Model Law, para. 50 considers that Art. 6 focuses on the information being reproduced
and read and that “accessible” means that the information is readable and interpretable. See also
Explanatory Note to the 2005 UN Convention on the Use of Electronic Communications in International
Contracts, para. 146.
30 The model for Art. 13 CISG was Art. 1.3(g) UNCITRAL Prescription Limitation Convention (1974).
31 Art. 13 has been used in regard to the interpretation of an arbitration agreement concluded by
exchange of telex: Arbitral Award, Tribunal of International Commercial Arbitration at the Russian
Federation Chamber of Commerce and Industry, 28 April 1995 (unidentified goods), (Pace). But see
denying the application by analogy of Art. 13: Oberster Gerichtshof (Austria) 2 July 1993 (domestic lease),
CISG Online 527 (Pace) (Unilex) in a case involving a domestic lease contract made by telefax; Oberster
Gerichtshof (Austria) 26 April 1997 (unidentified goods), (Unilex) in relation with a CMR Transport
Contract: “Eine analoge Anwendung von Art 13 UN-Kaufrecht scheide nach der zitierten oberstgerich-
tlichen Entscheidung aus, weil Ausnahmebestimmungen nicht analogiefähig seien”.
32 OHADA Uniform Act Relating to General Commercial Law (Commercial sale: Art. 209, 1 January
1998): including telefax. Art. 7 UNCITRAL Model Law on International Commercial Arbitration (as
amended in 2006).

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even refer to instruments of a new generation where attention is paid to the functional
concept of writing without the need of enumerating them. For example, the concept of
writing in the PICC “means any mode of communication that preserves a record of the
information contained therein and is capable of being reproduced in tangible form”33.
The comment on this article enumerates the means of communication included within
writing as not only a telegram and a telex (in clear allusion to Art. 13 CISG), but also
any other mode of communication that preserves a record and can be reproduced in a
tangible form. This provision certainly improves Art. 13.
33 See Art. 1(4) UNIDROIT Convention on International Factoring (1988).
Art. I.-1:105 DCFR refers to the meaning of writing as “a statement is “in writing” if it is in textual form,
on paper or another durable medium and in directly legible characters. Then defines textual form,
durable medium and electronic means (Art. I.-105(2)(3) and Art. I.-1:106(5) DCFR).

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PART II
Formation of the Contract
Introduction to Articles 14–24
Outline
I. Sphere of application and possibility of reservation according to Article 92. 1
1. Possibility of Reservation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
2. Temporal sphere of application. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
II. Scope of application . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
1. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
2. Standard Contract Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
3. Other modes of contract conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
4. Commercial letter of confirmation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
III. Exclusion of Part II . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
I. Sphere of application and possibility of reservation according

to Article 92
1. Possibility of Reservation
The (dispositive)1 provisions on “Formation of the Contract” are found in Part II of 1
the CISG. They were combined, at a very late stage in the drafting process, with
provisions concerning the rights and obligations of the parties (Part III) to form a
consolidated text.2 This combination made certain parallel provisions (such as those
regarding the sphere of application) superfluous, though the provisions were necessary
vis-à-vis the ULIS and the ULF.3 The provisions of Part II of the CISG can be traced
back to the rules found in ULF.4 Despite the consolidation into one single text, the
independence of the various sets of rules relating to “Formation of the Contract” and
“Sale of Goods” still shines through.5 Pursuant to Art. 92, it is possible for a Contracting
State to “declare at the time of signature, ratification, acceptance, approval or accession
that it will not be bound by Part II of this Convention or that it will not be bound by
Part III of this Convention.”6 The Scandinavian Contracting States, namely Denmark,
Finland, Norway and Sweden, which pushed for the possibility of declaring this
reservation,7 all have declared a reservation according to Art. 92, pursuant to which
1
Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Intro. to Art. 14 CISG para. 47.
2
For an overview of the history of these rules, see, e. g., Ludwig, Der Vertragsabschluß nach UN-
Kaufrecht im Spannungsverhältnis von Common Law und Civil Law, dargestellt auf der Grundlage der
Rechtsordnungen Englands und Deutschlands (1994), pp. 287 et seq.
3 See UNCITRAL YB (1978), p. 13 paras 15 et seq.
4 See, among others, Schlechtriem, Einheitliches UN-Kaufrecht (1981), p. 34.
5 For this statement, see Magnus, in: Staudinger Kommentar (2013), Intro. to Art. 14 para. 1.
6 See Adame Goddard, El Contrato de Compraventa Internacional (1994) p. 92.
7 See Brunner/Hutzli, Kommentar (2014), Art. 92para. 1; Ferrari, Vendita internazionale di beni mobili.
Artt. 14–24. Formazione del contratto (2006) p. 4; Herber/Czerwenka, Kommentar (1991), Art. 92 para. 1;
Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Intro. to Art. 14 CISG para. 2; Jametti
Greiner, Der Vertragsabschluss, in: Hoyer/Posch (eds), Das Einheitliche Wiener Kaufrecht (Vienna), p. 43
(45); Schroeter, Reservations and the CISG: The Borderland of Uniform International Sales Law and the
Treaty-Law after Thirty-Five Years, 41 Brook. J. Int’l L. (2015) 203 (224).
Ferrari 213
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Introduction to Articles 14–24 2 Part II. Formation of the Contract
they would not be bound by Part II of the Convention.8 By now, all of the Scandinavian
countries have withdrawn their reservation.9
2 This declaration constitutes a real reservation.10 However, unlike other reservations
that can be declared under the CISG,11 this reservation affects whether a given country12
has overall Contracting State status and therefore has also to be taken into account by
Contracting non-reservatory States.13 This is made clear by the text of para. 2, which
explains the effects of the reservation at hand. Accordingly, a state cannot be considered
a Contracting State with respect to the Part of the Convention to which the reservation
relates.14 As a consequence, if a party has its place of business in a Contracting State that
has declared an Art. 92 reservation, the CISG can never be applicable in toto by virtue of
Art. 1(1)(a).15 In effect, only that part of the CISG in force in both states where the
contracting parties have their places of business can be applicable under Art. 1(1)(a).
Nevertheless, this does not foreclose the application of the provisions of the Part in
respect of which the reservation has been declared.16 Rather, the application of that Part
depends on whether the rules of private international law of the forum state refer to the
law of a Contracting State that did not declare a reservation.17 In that case, the Part to
which the declaration relates can be applicable by virtue of Art. 1(1)(b),18 provided, of
8 Lookofsky, Alive and Well in Scandinavia: CISG Part II, 18 Journal of Law and Commerce (1999) 289
(289 et seq.).
9 Brunner/Hutzli, Kommentar (2014), Art. 92 para. 2; Schroeter, in: Schlechtriem/Schwenzer, Commen-
tary (2016), Intro to Arts 14–24 para. 78.

10 See Ferrari, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2008), Art. 92 para. 2; in:
Schwenzer/Hachem, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 92 para. 1.

11 See, e. g., Art. 95 and Art. 96.
12 Compare Ferrari, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2008), Art. 1 para. 65.
13 Piltz, Internationales Kaufrecht (2008), para. 3-3.
14 Achilles, Kommentar (2000) Art. 92 para. 1; Herber/Czerwenka, Kommentar (1991), Art. 92 para. 3;
Magnus, in: Staudinger Kommentar (2013), Art. 92 para. 5; Sannini, L’applicazione della Convenzione di
Vienna sulla vendita internazionale negli Stati Uniti (2006) p. 69; Schwenzer/Hachem, in: Schlechtriem/
15 See also Ferrari, Vendita internazionale di beni mobili. Artt. 14–24. Formazione del contratto (2006)
p. 5; Siehr, in: Honsell, Kommentar (1997), Art. 1 paras 22 et seq.; Lookofsky, Alive and Well in
Scandinavia: CISG Part II, 18 Journal of Law and Commerce (1999) 289 (292); Ferrari, in: Schlech-
triem/Schwenzer, Kommentar (German ed. 2008), Art. 92 para. 3; incorrect: Oberlandesgericht Naumburg
(Germany) 27 April 1999, CISG-Online 512: application of the CISG by virtue of Art. 1(1)(a), even
though one of the parties had its place of business in a country that had declared an Art. 92 reservation;
incorrect also Oberlandesgericht Frankfurt (Germany) 4 March 1994, CISG-Online 110; for critical
remarks see Fogt, Rechtzeitige Rüge und Vertragsaufhebung bei Waren mit raschem Wertverlust nach
UN-Kaufrecht, ZeuP (2002) 580 (587 note 22).
16 See also Herber/Czerwenka, Kommentar (1991), Art. 92 para. 3; Lookofsky, Alive and Well in
Scandinavia: CISG Part II, 18 Journal of Law and Commerce (1999) 289 (294 et seq.).
17 Brunner/Hutzli, Kommentar (2014), Art. 92 para. 3; Enderlein/Maskow/Strohbach, Internationales
Kaufrecht (1991), Art. 92 para. 6; Ferrari, La vendita internazionale. Applicabilità ed applicazioni della
Convenzione delle Nazioni Unite sui contratti di vendita internazionale di beni mobili (2nd ed., 2006)
pp. 79 et seq.; Flechtner, The Several Texts of the CISG in a Decentralized System: Observations on
Translations, Reservations and other Challenges to the Uniformity Principle in Article 7(1), 17 Journal of
Law and Commerce (1998) 187 (193 et seq.); Garro/Zuppi, Compraventa internacional de mercaderı́as
(2012), p. 96; Jametti Greiner, Der Vertragsabschluss, in: Hoyer/Posch (eds), Das Einheitliche Wiener
Kaufrecht (Vienna), p. 43 (45); Piltz, Internationales Kaufrecht (2008), para. 3-3; Lüderitz/Fenge, in:
Soergel, Kommentar zum BGB. Schuldrechtliche Nebengesetze (2000), Intro. to Art. 14 para. 1; Schroeter,
in: Schlechtriem/Schwenzer, Commentary (2016), Intro to Arts 14–24 para. 79.
18 See Brunner/Hutzli, Kommentar (2014), Art. 92 para. 3; Gruber, in: MünchKommBGB (2016), Intro.
to Art. 14 para. 15; Rudolph, Kommentar (1996), Art. 92 para. 2; Ferrari, in: Schlechtriem/Schwenzer,
Kommentar (German ed. 2008), Art. 1 para. 69; Saenger, in: Bamberger/Roth, Kommentar zum Bürger-
lichen Gesetzbuch (2012), Intro. to Art. 14 para. 2; Schlechtriem, in: Schlechtriem/Schwenzer, Commen-
tary (2005), Intro. to Art. 14 para. 10; Witz/Salger/Lorenz, Kommentar (2016), Intro. to Art. 14 para. 1.
214 Ferrari
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Part II. Formation of the Contract 3–4 Introduction to Articles 14–24

course, that all other requirements are met.19 This is true even in those instances where
the court deciding the dispute is located in a Contracting State that has declared an
Art. 92 reservation.20 This has been confirmed in case law.21
2. Temporal sphere of application

Art. 100(1) defines the temporal sphere of application of Part II. According to that 3
provision, the rules of Part II apply only when the proposal for concluding the contract
is made on, or after the date when the CISG enters into force (with respect to the
Contracting States referred to in subparagraph (1)(a) or the Contracting State referred
to in subparagraph (1)(b) of Art. 1). Thus, for Part II to apply, it is not sufficient that
the contract has been concluded after the coming into force of the CISG in the
mentioned states.22 Rather, the time the offer is made is decisive.23
II. Scope of application
1. Introduction
The provisions of Part II, which govern all contractual agreements covered by the 4
CISG, including an agreement to terminate, modify, or supplement an already existing
contract,24 only govern the external agreement, as pointed out by commentators25 and
courts alike.26 In this respect “the CISG follows the conventional mechanism of offer
19 In case law, see US District Court, Northern District of Illinois, Eastern Division (U.S.), Mitchell
Aircraft Spares Inc. v European Aircraft Service AB, 27 October 1998, CISG-Online 444; Fovárosi Biróság
Budapest (Hungary) 21 May 1996, CISG-Online 252; Oberlandesgericht Rostock (Germany) 27 July 1995,
CISG-Online 209; Arbitral Award, ICC 7585/92, (Pace); unclear Oberlandesgericht München (Germany)
8 March 1995, CISG-Online 145.
20 See also Herber/Czerwenka, Kommentar (1991), Art. 92 para. 3; Lookofsky, Loose Ends and Contorts
in International Sales: Problems in the Harmonization of Private Law Rules, 39 American Journal of
Comparative Law (1991) 403 (403).
21 Østre Landsret (Denmark) 23 April 1998, CISG-Online 486.
22 For this conclusion, see also Evans, in: Bianca/Bonell, Commentary (1987), Art. 100 para. 2.2; Ferrari,
Vendita internazionale di beni mobili. Artt. 14–24. Formazione del contratto (2006) p. 7; Piltz, Internatio-
nales Kaufrecht (2008), para. 2–108; Magnus, in: Staudinger Kommentar (2013), Art. 100 para. 5.
23 See Czerwenka, Rechtsanwendungsprobleme im internationalen Kaufrecht. Das Kollisionsrecht bei
grenzüberschreitenden Kaufverträgen und der Anwendungsbereich der internationalen Kaufrechtsüber-

einkommen (1988) p. 155; Ferrari, Vendita internazionale di beni mobili. Artt. 14–24. Formazione del
contratto (2006) p. 9; Karollus, UN-Kaufrecht (1991) p. 36; Ferrari, in: Schlechtriem/Schwenzer, Kom-
mentar (German ed. 2008), Art. 100 para. 2; in case law, see U. S. District Court, Southern District of
Florida (U.S.), 22 November 2002, Impuls v Psion-Teklogix, CISG-Online 783 (Pace).
24 Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Intro. to Art. 14 CISG para. 49;
Piltz, Internationales Kaufrecht (2008), para. 3-1; Rehbinder, Vertragsschluss nach UN-Kaufrecht im
Vergleich zu EAG und BGB, in: Schlechtriem (ed.), Einheitliches Kaufrecht und nationales Obligatio-
nenrecht (1987), p. 149 (153).
25 Bydlinski, Das allgemeine Vertragsrecht, in: Doralt (ed.), Das UNCITRAL-Kaufrecht im Vergleich
zum österreichischen Recht (1985), p. 57 (60); Ferrari, Vendita internazionale di beni mobili. Artt. 14–24.
Formazione del contratto (2nd ed., 2006) p. 10; Herber/Czerwenka, Kommentar (1991), Intro. to Art. 14
para. 6; Gruber, in: MünchKommBGB (2016), Intro. to Art. 14 para. 1; Piltz, Internationales Kaufrecht
(2008), para. 3-2; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Intro. to Art. 14 para. 1;
Schlechtriem/Schroeter, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2008), Intro. to Arts 14–24
para. 1; Magnus, in: Staudinger Kommentar (2013), Intro. to Art. 14 para. 2; Stoffel, Formation du
contrat, in: Wiener Übereinkommen von 1980 über den internationalen Warenkauf (1985), p. 55 (56);
Wiltz/Salger/Lorenz, Kommentar (2016) Intro to Art. 14 para. 6.
26 See Cour d’Appel Liège (Belgium) 28 April 2003, CISG-Online 944; Oberster Gerichtshof (Austria)
22 October 2001, CISG-Online 614; Oberster Gerichtshof (Austria) 6 February 1996, CISG-Online 224;
Zivilgericht Basel-Stadt (Switzerland) 21 December 1992, CISG-Online 55.
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and corresponding acceptance.”27 Except for form requirements,28 validity requirements

are not governed by the CISG,29 and must therefore be determined according to the
applicable domestic law – identified case by case on the basis of the rules of private
international law of the forum.30 Thus, it is unsurprising that both commentators and
courts suggest that domestic law is applicable to some issues, relevant for determining
whether a valid contract formation occurred. This is true, for instance, as regards the
legal capacity of a person31 and/or capacity to contract,32 as well as questions concerning
defects of intent, such as duress, fraud and mistake33 (except for issues relating to
mistake as to the quality of goods and to mistake as to the other party’s capacity to
perform or one party’s solvency, which are all governed by the CISG34), and questions
concerning the power of representation in the case of a contract concluded by an
agent.35 The same is true for questions concerning the effect of a violation of a statutory
prohibition, domestic law is also applicable to those questions.36
2. Standard Contract Terms

5 The question of whether standard contract terms are incorporated into a contract is
also subject to the rules found in Part II of the CISG.37 Consequently, these rules
27 Landgericht Zwickau (Germany) 19 March 1999, CISG-Online 519; in legal writing see Jametti
Greiner, Der Vertragsabschluss, in: Hoyer/Posch (eds), Das Einheitliche Wiener Kaufrecht (Vienna), p. 43
(45); Magnus, in: Staudinger Kommentar (2013), Intro. to Art. 14 para. 2; Piltz, Neue Entwicklungen im
UN-Kaufrecht, NJW (1996) 2768 (2770); Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005),
Intro. to Art. 14 para. 2; Schlechtriem/Schroeter, Internationales UN-Kaufrecht (2013) para. 240; Witz/
Salger/Lorenz, Kommentar (2016), Intro. to Art. 14 para. 4.
28 See Ferrari, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2008), Art. 4 para. 13.
29 Brunner/Pfisterer/Köster Kommentar (2014), Intro. to Art. 14 para. 2; Garro/Zuppi, Compraventa
internacional de mercaderı́as (2012), p. 115; Heuzé, La formation du contrat selon la CVIM: quelques
difficultés, Revue de droit des affaires internationales (2001) 277 (277); Gruber, in: MünchKommBGB
(2016), Intro. to Art. 14 para. 8; Magnus, in: Staudinger Kommentar (2013), Intro. to Art. 14 para. 3;
Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Intro. to Art. 14 CISG para. 3.
zum österreichischen Recht (1985). pp. 57 (pp. 84 et seq.); Ferrari, Vendita internazionale di beni mobili.
Artt. 14–24. Formazione del contratto (2006) p. 11; Schlechtriem, in: Schlechtriem/Schwenzer, Commen-
tary (2005), Intro. to Art. 14 para. 1; Schlechtriem/Schroeter, in: Schlechtriem/Schwenzer, Kommentar
(German ed. 2008), Intro. to Arts 14–24 para. 2.
31 Rudolph, Kommentar (1996), Art. 4 para. 5; Witz/Salger/Lorenz, Kommentar (2016), Intro. to Art. 14
para. 6.
32 Magnus, in: Staudinger Kommentar (2013), Intro. to Art. 14 para. 3.
33 Gruber, in: MünchKommBGB (2016), Intro. to Art. 14 para. 8; Piltz, Internationales Kaufrecht
(2008), para. 3- 2; Lüderitz/Fenge, in: Soergel, Kommentar zum BGB. Schuldrechtliche Nebengesetze
(2000), Intro. to Art. 14 para. 4.
34 See Ferrari, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2008), Art. 4 para. 24.
35 See Siehr, in: Honsell, Kommentar (1997), Art. 4 para. 7; Gruber, in: MünchKommBGB (2016),
Intro. to Art. 14 para. 8; Ferrari, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2008), Art. 4
para. 34; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Intro. to Art. 14 para. 1; Witz/
Salger/Lorenz, Kommentar (2016), Intro. to Art. 14 para. 7.
36 Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Intro. to Art. 14 para. 1; Magnus, in:
Staudinger Kommentar (2013), Intro. to Art. 14 para. 3.

37 Brunner/Pfisterer/Köster, Kommentar (2014), Intro. to Art. 14 para. 2; Ferrari/Torsello, International
Sales Law – CISG (2015), p. 131; Gruber, in: MünchKommBGB (2016), Intro. to Art. 14 para. 6;
Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Intro. to Art. 14 CISG para. 21;
Schlechtriem/Schroeter, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2008), Intro. to Arts 14–
24 para. 4; Schwenzer/Hachem, CISG – Success and Pittfalls, 57 American Journal of Comparative Law
(2009) 457 (473); Stoffel, Formation du contrat, in: Wiener Übereinkommen von 1980 über den
internationalen Warenkauf (1985), p. 55 (71); Witz/Salger/Lorenz, Kommentar (2016), Intro. to Art. 14
para. 10; in case law, see Rechtbank Midden-Nederland (Netherlands) 20 January 2016, CISG-Online
2685; Rechtbank Rotterdam (Netherlands) 2 December 2015, CISG-Online 2683; LG Fulda (Germany)
216 Ferrari
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Part II. Formation of the Contract 6 Introduction to Articles 14–24

likewise govern38 the question of the battle of forms as a specific provision on the battle
of forms is lacking, unlike for instance under the UNIDROIT Principles39 which contain
a provision (Art. 2.1.22) that deals with the issue on the basis of the “knock-out-rule”.40
In contrast, domestic law is applicable to the question of whether standard contract
terms that have been incorporated into a contract are valid,41 provided that this issue is
not to be decided, as it is for instance under Italian law,42 on the sole basis of form
requirements being met.43 This is due to the fact that Art. 4(a) excludes certain validity
issues, such as the validity of contract terms, from the CISG’s scope of application.44
However, if for the purpose of deciding whether a contract term is valid the applicable
domestic law requires one to evaluate the contents of a contract term in light of whether
it meets certain standards (such as reasonableness), the evaluation must take into
account the CISG’s standards (on reasonableness).45
By virtue of Art. 4(a), domestic law also determines the scope of rights granted to 6
particular groups of persons, such as consumers, to which the CISG may exceptionally
apply – allowing them to dissolve a contract already concluded (rights of withdrawal or
droits de repentir46 as well as cool-off periods).47 This has been justified by commenta-
tors on the grounds that these rights and cool-off periods serve a function that parallels
that of protecting persons with limited capacities.48
29 September 2015, CISG-Online 2716; LG Stade (Germany) 19 February 2015, CISG-Online 2669; LG
Neubrandenburg (Germany) 3 August 2005, CISG-Online 1190; Hoge Raad (Netherlands) 28 January
2005, CISG-Online 1002; OLG Düsseldorf (Germany) 21 April 2004, CISG-Online 915; Oberster Gericht-
shof (Austria) 17 December 2003, CISG-Online 828; Bundesgerichtshof (Germany) 31 October 2001,
CISG-Online 617; OLG Zweibrücken (Germany) 31 March 1998, CISG-Online 481.
38 Magnus, in: Staudinger Kommentar (2013), Intro. to Art. 14 para. 2.
39 See also Art. II-4:209 DCFR and Art. 2:209 PECL, both of which deal with the battle of forms issue
on the basis of the knock-out rule.

40 See Fejös, Battle of the Forms Under the CISG, 11 Vindobona Journal of International Commercial
Law and Arbitration (2007) 113 (126 et seq.); Monti, A Comment on “An Ex-Ante View of the Battle of
the Forms: Inducing Parties to Draft Reasonable Terms” by Omri Ben Shahar, International Review of
Law and Economics (2005) 371 (276 note 20); Naudé, in: Vogenauer/Kleinheitserkamp (eds), Commen-
tary on the Unidroit Principles (2009), Art. 2.1.22. paras 1 and 3 et seq.; Wildner, Art. 19 CISG: The
German Approach to the Battle of the Forms in International Contract Law: The Decision of the Federal
Supreme Court of Germany of 9 January 2002, 20 Pace International Law Review (2008) 1 (10 et seq.).
41 Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Intro. to Art. 14 CISG para. 25;
Schlechtriem/Schroeter, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2008), Intro. to Arts 14–24
para. 3.
42 See Article 1341 of the Italian Civil code; for a more detailed analysis of the issue at hand, see Ferrari,
Vendita internazionale di beni mobili. Artt. 1–13. Ambito di applicazione. Disposizioni generali (1994)
p. 216.
43 See Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Intro. to Art. 14 para. 1; contra
see Witz/Salger/Lorenz, Kommentar (2016), Intro. to Art. 14 para. 11.

44 Meeusen, Totstandkoming van de Overeenkomst, in: van Houtte/Erauw/Wautelt (eds), Het Weens
Koopverdrag (1997), p. 71 (89).

45 See also Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 14 para. 12; Piltz, Internationales
Kaufrecht (2008), para. 2-153; Ferrari, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2008),
Art. 4 para. 20.
46 Gruber, in: MünchKommBGB (2016), Intro. to Art. 14 para. 10; Mankowski, in: Ferrari et al.,
Internationales Vertragsrecht (2012), Intro. to Art. 14 CISG para. 4.

47 Schlechtriem/Schroeter, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2008), Intro. to Arts
14–24 para. 8; Witz/Salger/Lorenz, Kommentar (2016), Intro. to Art. 14 para. 7.

48 Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Intro. to Art. 14 para. 1.
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3. Other modes of contract conclusion

7 It is well established49 that the provisions of Part II are based on the traditional
scheme of contract conclusion through offer and acceptance.50 This fact – and the fact
that during the drafting process proposals aimed at the introduction of provisions
which state that a contract is to be considered concluded, even in cases where it is not
possible to clearly identify an offer and a corresponding acceptance, have been with-
drawn51 – has induced some commentators to suggest that agreements reached by
means other than through offer and acceptance (such as agreements reached in point-
by-point negotiations or lengthy exchange of correspondence) are not governed by the
CISG.52 According to the prevailing opinion in both legal writing53 and case law54,
however, “other forms of getting to an agreement [are] not excluded [by the CISG].”55
Hence, parties “can get to a contract even if offer and acceptance are not clearly
distinguishable.”56 The issue – which requirements have to be met in order for a
contract to be concluded – is therefore not a matter of domestic law,57 but one governed
by the CISG,58 more specifically, one to be solved by resorting to the general principles
49 See supra the text accompanying note 27.

zum österreichischen Recht (1985) p. 57 (60); Eörsi, Formation of Contract, in: Wiener Übereinkommen
von 1980 über den internationalen Warenkauf (1985), p. 43 (44); Ferrari/Torsello, International Sales Law
– CISG (2015), p. 131; Heuzé, La formation du contrat selon la CVIM: quelques difficultés, Revue de droit
des affaires internationales (2001) 277 (278); Gruber, in: MünchKommBGB (2016), Intro. to Art. 14
para. 1; Lüderitz/Fenge, in: Soergel, Kommentar zum BGB. Schuldrechtliche Nebengesetze (2000), Intro.
to Art. 14 para. 1; Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Intro. to Art. 14
CISG para. 6; Piltz, Internationales Kaufrecht (2008), para. 3-11; Schlechtriem, in: Schlechtriem/Schwen-
zer, Commentary (2005), Intro. to Art. 14 para. 2; Schlechtriem/Schroeter, in: Schlechtriem/Schwenzer,
Kommentar (German ed. 2008), Intro. to Arts 14–24 para. 15.
51 UNCITRAL YB (1978), p. 38 f.
52 U. Huber, Der UNCITRAL-Entwurf eines Übereinkommens über internationale Warenkaufverträge,
43 RabelsZ (1979) 413 (447).

53 Brunner/Pfisterer/Köster, Kommentar (2014), Intro. to Art. 14 paras 1 and 5; Mankowski, in:
Ferrari et al., Internationales Vertragsrecht (2012), Intro. to Art. 14 CISG para. 6; Schwenzer/Mohs,
Old Habits Die Hard: Traditional Contract Formation in a Modern World, IHR (2006) 239 (239);
Schlechtriem/Schroeter, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2008), Intro. to Arts 14–
24 para. 23.
54 See Bonell, Vertragsverhandlungen und culpa in contrahendo nach dem Wiener Kaufrechtsüber-
einkommen, RIW (1990) 693 (695 et seq.); Brunner, Kommentar (2004), Intro. to Art. 14 paras 1 and 4;
Bydlinski, Das allgemeine Vertragsrecht, in: Doralt (ed.), Das UNCITRAL-Kaufrecht im Vergleich zum
österreichischen Recht (1985), p. 57 (61); Ferrari, Vendita internazionale di beni mobili. Artt. 14–24.
Formazione del contratto (2006) pp. 12 et seq.; Herber/Czerwenka, Kommentar (1991), Intro. to Art. 14
para. 16; Karollus, UN-Kaufrecht (1991) pp. 54 et seq.; Ludwig, Der Vertragsabschluß nach UN-
Kaufrecht im Spannungsverhältnis von Common Law und Civil Law, dargestellt auf der Grundlage
der Rechtsordnungen Englands und Deutschlands (1994), pp. 294 et seq.; Schlechtriem, in: Schlech-
triem/Schwenzer, Commentary (2005), Intro. to Art. 14 para. 5; Magnus, in: Staudinger Kommentar
(2013), Intro. to Art. 14 para. 5; Wey, Der Vertragsabschluss beim Internationalen Warenkauf nach
UNCITRAL und schweizerischen Recht (1984) para. 239; Witz/Salger/Lorenz, Kommentar (2016),
Intro. to Art. 14 para. 5.
55 Oberlandesgericht München (German) 8 March 1995, CISG-Online 145.
56 Hof Beroep Gent (Belgium) 15 May 2002, CISG-Online 746.
57 See also Herber/Czerwenka, Kommentar (1991), Into. to Art. 14 para. 16.
58 Brunner/Pfisterer/Köster, Kommentar (2014), Intro. to Art. 14 para. 5; Witz/Salger/Lorenz, Kom-
mentar (2016), Intro. to Art. 14 para. 5.
218 Ferrari
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Part II. Formation of the Contract 8–9 Introduction to Articles 14–24

upon which Part II of the CISG is based. Accordingly, it is generally sufficient59 that the
parties have come to an agreement with regard to the essentialia negotii.60
4. Commercial letter of confirmation

The issue of whether the failure to object to a commercial letter of confirmation also 8
constitutes an issue of contract formation.61 Does this mean that the issue is governed
by the CISG, even though no specific CISG provision is dedicated to the issue, unlike,
for instance, under the PICC which contained a provision (Art. 2.1.12) that specifically
deals with the issue? Because Part II deals exhaustively with the issue of contract
formation,62 it is unlikely that domestic standards developed in different national legal
systems (such as in Germany) are relevant. Since, however, there are instances in which
usages prevail over the (default) rules of the CISG (and, therefore, over the provisions of
Part II as well),63 domestic rules concerning the failure to object to a commercial letter
of confirmation may be relevant, provided that these rules have become usages in the
sense of Art. 9,64 as also stated in case law.65
Rules on the failure to object to a commercial letter of confirmation certainly 9
constitute usages in an autonomous sense of CISG.66 But this alone is insufficient to
bind the parties under Art. 9(2), and it is insufficient that these rules apply at the place
of business of the addressee of the commercial letter of confirmation.67 Rather, both
59 For a reference to form requirements that have – exceptionally – to be met, see Ferrari, Form und
UN-Kaufrecht, IHR (2004) 1 et seq.; Ferrari, Writing requirements: Articles 11–13, in: Ferrari/Flechtner/
Brand, Draft Digest and Beyond (2003), pp. 206 et seq.
60 Brunner/Pfisterer/Köster, Kommentar (2014), Intro. to Art. 14 para. 5; Ferrari/Torsello, International
Sales Law – CISG (2015), p. 131; Karollus, UN-Kaufrecht. Eine systematische Darstellung für Studium
und Praxis (1991), pp. 54 et seq.; Perales Viscasillas, La formacion del contrato de compraventa
internacional de mercaderias (1996) p. 389 et seq.; Schlechtriem, in: Schlechtriem/Schwenzer, Commen-
tary (2005), Intro. to Art. 14 para. 5; Magnus, in: Staudinger Kommentar (2013), Intro. to Art. 14 para. 5.
61 Lüderitz/Fenge, in: Soergel, Kommentar zum BGB. Schuldrechtliche Nebengesetze (2000), Intro. to
Art. 14 para. 118.

62 Jametti Greiner, Der Vertragsabschluss, in: Hoyer/Posch (eds), Das Einheitliche Wiener Kaufrecht
(Vienna), p. 43 (46); Piltz, Internationales Kaufrecht (2008), para. 3-2; Stoffel, Formation du contrat, in:
Wiener Übereinkommen von 1980 über den internationalen Warenkauf (1985), pp. 55 (67 et seq.);
Schlechtriem/Schroeter, Internationales UN-Kaufrecht (2013) para. 242; Schlechtriem/Schroeter, in:
Schlechtriem/Schwenzer, Kommentar (German ed. 2008), Intro. to Arts 14–24 para. 1; see also Bydlinski,
Das allgemeine Vertragsrecht, in: Doralt (ed.), Das UNCITRAL-Kaufrecht im Vergleich zum österrei-
chischen Recht (1985), p. 57 (61); but see Gruber, in: MünchKommBGB (2016), Intro. to Art. 14 para. 2.
63 For a comment on the impact of usages on the CISG, see Ferrari, Trade Usage and Practices
Established between the Parties under the CISG, International Business Law Journal (2003) 571 et seq.
64 See Brunner/Pfisterer/Köster, Kommentar (2014), Intro. to Art. 14 para. 7; Esser, Die letzte Glocke zum
Geleit? – Kaufmännische Bestätigungsschreiben im Internationalen Handel: Deutsches, Französisches,

Österreichisches und Schweizerisches Recht und Einheitliches Recht unter der Kaufrechtskonvention von
1980, Zeitschrift für Rechtsvergleichung (1988) 167 (186); Ferrari, Vendita internazionale di beni mobili.
Artt. 14–24. Formazione del contratto (2006) p. 13; Ferrari/Torsello, International Sales Law – CISG (2015),
p. 133; Herber/Czerwenka, Kommentar (1991), Intro. to Art. 14 para. 18; Gruber, in: MünchKommBGB
(2016), Intro. to Art. 14 para. 4; Piltz, Internationales Kaufrecht (2008), para. 2-127; Schlechtriem, in:
Schlechtriem/Schwenzer, Commentary (2005), Intro. to Art. 14 para. 4; Magnus, in: Staudinger Kommentar
(2013), Intro. to Art. 14 para. 6; Witz/Salger/Lorenz, Kommentar (2016), Art. 9 para. 10.
65 ZG Kanton Basel-Stadt (Switzerland) 21 December 1992, CISG-Online 55 (Pace).
66 For this conclusion see, e. g., Esser, Die letzte Glocke zum Geleit? – Kaufmännische Bestätigungss-
chreiben im Internationalen Handel: Deutsches, Französisches, Österreichisches und Schweizerisches

Recht und Einheitliches Recht unter der Kaufrechtskonvention von 1980, Zeitschrift für Rechtsvergle-
ichung (1988) 167 (188 et seq.); Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Intro.
to Art. 14 CISG para. 9; Piltz, Internationales Kaufrecht (1993), § 2 para. 178.
67 Accord Herber/Czerwenka, Kommentar (1991), Art. 9 para. 12; contra Ebenroth, Internationale
Vertragsgestaltung im Spannungsverhältnis zwischen ABGB, IPR-Gesetz und UN-Kaufrecht, österrei-

chische Juristische Blätter (1986) 681 (688).
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Introduction to Articles 14–24 10–11 Part II. Formation of the Contract
contractual parties must have their places of business in an area which subscribes to that
particular usage68 (or must maintain commercial operations in that area on a regular
basis), the usage must be one that is widely known in international trade, and regularly
observed by parties to contracts of the type involved in the particular trade concerned.69
This has been acknowledged at least by those courts70 that do not exclude a priori the
possibility that the rules (concerning the failure to object to a commercial letter of
confirmation) are a usage in terms of the CISG.71
III. Exclusion of Part II

10 Since the provisions found in Part II are, like most – though not all72 – other
provisions of the CISG, by nature dispositive,73 the parties can (explicitly or implicitly)
exclude them or derogate from them.74 An agreement of the parties is required for this
purpose.75 This agreement will often arise out of a preliminary agreement or a frame-
work contract;76 this generally poses no serious issues, as the same considerations and
requirements apply as to agreements excluding the CISG’s applicability in general.77
11 The question of the law applicable to the formation of contracts is problematic if the
offeror attempts to exclude the CISG unilaterally, by inserting a clause to that effect into
the offer.78 Some commentators suggest that, in this case, the applicable law to the
formation is that determined by the offeror or, absent such a determination, the law
applicable by virtue of the objective connecting factors of the private international law
rules of the forum.79 This view cannot be shared.80 The question of whether a statement
by the party taking the initiative towards the conclusion of the contract constitutes an
68See Herber/Czerwenka, Kommentar (1991), Intro. to Art. 14 para. 18.

69See Achilles, Kommentar (2000), Art. 9 para. 4; Holl/Kessler, Selbstgeschaffenes Recht der Wirtschaft und
Einheitsrecht – Stellung der Handesbräuche und Gepflogenheiten im Wiener UN-Kaufrecht, RIW (1995)
457 (459); Neumayer/Ming, Convention de Vienne (1993), Art. 9 para. 4; Schlechtriem, Internationales UN-
Kaufrecht, Art. 9 para. 62; Lüderitz/Fenge, in: Soergel, Kommentar zum BGB. Schuldrechtliche Nebengesetze
(2000), Intro. to Art. 14 para. 7; Magnus, in: Staudinger Kommentar (2013), Art. 9 para. 27.
70 See Oberlandesgericht Frankfurt (Germany) 5 July 1995, CISG-Online 258.
71 For a court stating that the rules on the failure to object to a commercial letter of confirmation do
not at all apply under the CISG, see Landgericht Frankfurt (Germany) 6 July 1994, CISG-Online 257.
72 Ferrari, Exclusion et inclusion de la CVIM, Revue de droit des affaires internationales (2001) 401 (402).
73 Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Intro. to Art. 14 CISG para. 47.
74 Bonell, La formazione del contratto di compravendita, in: La vendita internazionale. La convenzione
di Vienna dell’11 aprile 1980 (1981), p. 113 (117); Herber/Czerwenka, Kommentar (1991), Intro. to
Art. 14 para. 3; Meeusen, Totstandkoming van de Overeenkomst, in: van Houtte/Erauw/Wautelt (eds),
Het Weens Koopverdrag (1997), p. 71 (71).
75 Ferrari, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2008), Art. 6 para. 12.
76 For this statement, see Herber/Czerwenka, Kommentar (1991), Intro. to Art. 14 para. 4; compare also
Bonell, La formazione del contratto di compravendita, in: La vendita internazionale. La convenzione di

Vienna dell’11 aprile 1980 (1981) p. 113 (118 et seq.).
77 For papers on the exclusion of the CISG, see, most recently, Ferrari, Remarks on the UNCITRAL
Digest’s Comments on Article 6 CISG, 25 Journal of Law and Commerce (2005) 13 et seq.; Ferrari, Zum
vertraglichen Ausschluss des UN-Kaufrechts, ZEuP (2002) 737 et seq.
78 For the following remarks, see also Ferrari, La vendita internazionale. Applicabilità ed applicazioni
della Convenzione delle Nazioni Unite sui contratti di vendita internazionale di beni mobili (2nd ed.,
2006) p. 233.
79 Brunner/Manner/Schmitt, Kommentar (2014), Art. 6 para. 6; Ferrari Mankowski, in: Ferrari et al.,
Internationales Vertragsrecht (2012), Intro. to Art. 14 CISG para. 47; Siehr, in: Honsell, Kommentar
(1997), Art. 6 para. 4; Piltz, Internationales Kaufrecht (2008), para. 2-112; Rehbinder, Vertragsschluss
nach UN-Kaufrecht im Vergleich zu EAG und BGB, in: Schlechtriem (ed.), Einheitliches Kaufrecht und
nationales Obligationenrecht (1987), p. 149 (151).
80 For this conclusion, see also Karollus, Der Anwendungsbereich des UN-Kaufrechts im Überblick,
Juritstische Schulung (1993) 378 (381); Magnus, in: Staudinger Kommentar (2013), Art. 6 paras 11 et seq.
220 Ferrari
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Part II. Formation of the Contract 11 Introduction to Articles 14–24

offer must be decided on the basis of Part II of the CISG, just as much as the question of
whether a reply by the offeree constitutes an acceptance.81 If the latter issues a statement
mirroring the offer, an agreement as to the CISG’s exclusion is reached. If the offeree
does not agree to the CISG’s exclusion, by virtue of Art. 19 no such agreement is
reached and the CISG applies.82 The same is true if it is the acceptor who wants to
exclude the CISG, as the acceptor’s reply containing an exclusion clause not contained
in the offer would necessarily be a reply which materially alters the terms of the offer
and would, by virtue of Art. 19(2), constitute a counter-offer which would not lead to
the exclusion of the CISG.
81 Accord Bonell, La formazione del contratto di compravendita, in: La vendita internazionale. La
convenzione di Vienna dell’11 aprile 1980 (1981), p. 113 (118); Czerwenka, Rechtsanwendungsprobleme
im internationalen Kaufrecht. Das Kollisionsrecht bei grenzüberschreitenden Kaufverträgen und der
Anwendungsbereich der internationalen Kaufrechtsübereinkommen (1988) p. 169.
Ferrari 221
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Article 14
(1) A proposal for concluding a contract addressed to one or more specific persons
constitutes an offer if it is sufficiently definite and indicates the intention of the
offeror to be bound in case of acceptance. A proposal is sufficiently definite if it
indicates the goods and expressly or implicitly fixes or makes provision for determin-
ing the quantity and the price.
(2) A proposal other than one addressed to one or more specific persons is to be
considered merely as an invitation to make offers, unless the contrary is clearly
indicated by the person making the proposal.
Bibliography: Adami, Les contrats “open price” dans la Convention des Nations Unies sur les contrats
de vente international de marchandises, Revue de droit des affaires itnernationales (1989) 103;
Blandhol, A Pragmatic Approach to Contract Formation, in: Lookofsky/Andersen (eds), The CISG
Convention and Domestic Contract Law (2014), p. 55; Bonell, La formazione del contratto di
compravendita, in: La vendita internazionale. La convenzione di Vienna dell’11 aprile 1980 (1981);
Eörsi, Formation of contract, in: Wiener Übereinkommen von 1980 über den internationalen Ware-
nkauf (1985), p. 43; Ferrari, Vendita internazionale di beni mobili. Artt. 14–24. Formazione del
contratto (2006); Ferrari, A Comparative Overview of Offer and Acceptance Inter Absentes, 10 Boston
University International Law Journal (1992) 171; Fortier, Le prix dans la Convention de Vienne sur la
vente internationale de marchandises: les articles 14 et 55, Journal du droit international (1990) 381;
Huber/Kröll, Deutsche Rechtsprechung zum UN-Kaufrecht in den Jahren 2001/2002, IPRax (2003) 309;
Janssen, Die Einbeziehung von allgemeinen Geschäftsbedingungen in internationale Kaufverträge und
die Bedeutung der UNIDROIT- und der Lando-Principles, IHR (2004) 194; Jenkins, Contract Resur-
rected! Contract Formation: Common Law- UCC- CISG, 40 N.C. J. Int’l L. & Com. Reg. (2015) 245;
Kahn, La Convention de Vienne du 11 avril 1980 sur les contrats de vente internationale de
marchandises, Revue internationale de droit comparé (1981) 951; Kleineman, The New Nordic
Approach to CISG Part II: Pragtism Wins the Day?, in: Lookofsky/Andersen (eds), The CISG
Convention and Domestic Contract Law (2014), p. 21; Leete, Contract Formation under the United
Nations Convention on Contracts for the International Sale of Goods and the Uniform Commercial
Code: Pitfalls for the Unwary, 6 Temple International and Comparative Law Journal (1992) 193;
Ludwig, Der Vertragsabschluß nach UN-Kaufrecht im Spannungsverhältnis von Common Law und
Civil Law, dargestellt auf der Grundlage der Rechtsordnungen Englands und Deutschlands (1994);
Perales Viscasillas, La formación del contrato de compraventa internacional de mercaderı́as (1996);
Roth/Kunz, Zur Bestimmbarkeit des Preises im UN-Kaufrecht, RIW (1997) 17; Schultz, Rolling
Contract Formation under the UN Convention on Contracts for the International Sale of Goods, 35
Cornell International Law Journal (2001) 263; Sono, Formation of International Contracts under the
Vienna Convention: A Shift above the Comparative Law, in: Sarcevic/Volken (eds), International Sale
of Goods (1986), p. 111; van Alstine, Consensus, Dissensus, and Contractual Obligation Through the
Prism of Uniform International Sales Law, 37 Virginia Journal of International Law (1996) 1; Wey, Der
Vertragsabschluss beim Internationalen Warenkauf nach UNCITRAL und schweizerischen Recht
(1984).
Outline
1. Proposal addressed to specific persons; invitation to make an offer . . . . . . 7
2. Intention to be bound . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
3. The specificity requirement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
a) Preface . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
b) Indication of the goods. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
c) Indication of the quantity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
d) Indication of the purchase price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
222 Ferrari
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Part II. Formation of the Contract 1–2 Article 14

4. The requirement of indication of the purchase price and price
determination absent such indication . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
5. Offer containing a clause excluding Part II . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
6. Incorporation of standard contract terms. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38

This dispositive1 provision, which can be traced back, at least in part, to Art. 4(1) 1
ULF,2 provides that for a proposal to be considered an offer under the CISG, it must be
addressed to one or more specific persons, must indicate an intent to be bound, and
must exhibit a level of definiteness3 that leads to the contract conclusion where it is
accepted by its addressee.4 For a proposal to be considered an offer, it is not necessary
that the offeror use the word “offer” or words similar,5 nor must the offeror comply
with other formalities.6 The party relying upon a valid offer has to prove the existence of
the requirements for a proposal to constitute an offer.7
The question of whether a proposal meets the aforementioned requirements is subject 2
to Art. 8.8 In light of this provision, where the offeree did not know or could not have
1 Dornis, in: Honsell, Kommentar (2010), Art. 14 para. 37; Ferrari, Vendita internazionale di beni
mobili. Artt. 14–24. Formazione del contratto (2006) p. 17; Gruber, in: MünchKommBGB (2016), Art. 14
para. 16; since, however, the intention to be bound is essential to the existence of an offer, that element is
not left to party autonomy; see, Ferrari, in: MünchKommHGB (2013), Art. 14 para. 1; Brunner/Pfisterer/
Köster, Kommentar (2014), Art. 14 para. 4; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary
(2005), Art. 14 para. 12.
2 For details as to some innovations of the CISG, see Mankowski, in: Ferrari et al., Internationales

3 Compare Brunner/Pfisterer/Köster, Kommentar (2014), Art. 14 para. 1; Dornis, in: Honsell, Kom-
mentar (2010), Art. 14 para. 3; Meeusen, Totstandkoming van de Overeenkomst, in: van Houtte/Erauw/
Wautelet (eds), Het Weens Koopverdrag (1997), p. 71 (72); Perales Viscasillas, La formación del
contrato de compraventa internacional de mercaderı́as (1996) pp. 269 et seq.; Schultz, Rolling Contract
Formation under the UN Convention on Contracts for the International Sale of Goods, 35 Cornell
International Law Journal (2001) 263 (271); Witz/Salger/Lorenz, Kommentar (2016), Art. 14 para. 1; in
case law, see Bezirksgericht St. Gallen (Switzerland) 3 July 1997, CISG-Online 336; Oberster Gerichtshof
(Austria) 10 November 1994, CISG-Online 117; compare, however, US District Court for the Southern
District of New York (U.S.), Geneva Pharmaceuticals Technology Corp. v Barr Laboratories Inc.,
10 May 2002, CISG-Online 653, not requiring that a proposal be addressed to specific persons to be
considered an offer.
4 For this statement, see also Rechtbank Koophandel Tongeren (Belgium) 25 January 2005, CISG-Online
1106; Kantonsgericht Zug (Switzerland) 2 December 2004, CISG-Online 1194; Rechtbank Koophandel
Oudenaarde (Belgium) 10 July 2001, CISG-Online 1785; Oberster Gerichtshof (Austria) 6 February 1996,
CISG-Online 224; Oberster Gerichtshof (Austria) 10 November 1994, CISG-Online 117.
5 For this statement, see also Dornis, in: Honsell, Kommentar (2010), Art. 14 para. 6; Ferrari, in:
MünchKommHGB (2013), Art. 14 para. 1; Gruber, in: MünchKommBGB (2016), Art. 14 para. 6; Perales
Viscasillas, La formación del contrato de compraventa internacional de mercaderı́as (1996) p. 271; Piltz
NJW (1996), 2768 (2770); Schroeter, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2013), Art. 14
para. 2; Schroeter, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 14 para. 2.
6 Brunner/Pfisterer/Köster, Kommentar (2014), Art. 14 para. 1; Piltz, Internationales Kaufrecht (2008)
para. 3-15.
7 Dornis, in: Honsell, Kommentar (2010), Art. 14 para. 38; Gruber, in: MünchKommBGB (2016),
Art. 14 para. 38; Hepting/Müller, in: Baumgärtel/Laumen (eds), Handbuch der Beweislast im Privatrecht
(2009), Art. 14 CISG para. 1; Jung, Die Beweislastverteilung im UN-Kaufrecht (1996) p. 5858; Magnus, in:
Staudinger Kommentar (2013), Art. 14 para. 45; Mankowski, in: Ferrari et al., Internationales Vertrags-
recht (2012), Art. 14 CISG para. 34; Saenger, in: Bamberger/Roth (eds), Kommentar zum Bürgerlichen
Gesetzbuch (2012), Art. 14 para. 8.
8 Vgl. Amato, Recent Developments: CISG. U. N. Convention on Contracts for the International Sale of
Goods – The Open Price Term and Uniform Application: an Early Interpretation by the Hungarian
Courts, 13 Journal of Law and Commerce (1993) 1 (6); Audit, Vente Internationale (1990), p. 57; Saenger,
Ferrari 223
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Article 14 3 Part II. Formation of the Contract
been unaware of the offeror’s intent,9 the proposal is to be interpreted “according to the
offeror’s intent that was recognizable to the addressee.”10 “In doing so, pursuant to
Article 8 CISG due consideration is to be given to the negotiations, any practices which
the parties have established between themselves, usages and any subsequent conduct of
the parties.”11 Where a proposal remains ambiguous despite an interpretation in light of
Art. 8, no acceptable offer exists.12 If the proposal is composed in a language unknown
to the addressee or in a language that a reasonable person of the same kind as the
addressee would not know, the proposal cannot be considered an offer,13 provided that
a different result cannot be reached on the grounds of practices established between the
parties, any usage that is binding upon the parties on the basis of Art. 9, or from an
agreement they have reached (on the occasion, for instance, of a framework agree-
ment).14
3 It is worth noting that the offer – a declaration of will15 – not only has to meet all
Art. 14 requirements, but also any validity requirements of the applicable law,
determined on the basis of the private international law of the forum, such as
requirements concerning legal capacity, the absence of certain kinds of mistake,
duress, etc.16
in: Bamberger/Roth (eds), Kommentar zum Bürgerlichen Gesetzbuch (2012), Art. 14 para. 2; Brunner/
Pfisterer/Köster, Kommentar (2014), Art. 14 para. 1; Ferrari, Vendita internazionale di beni mobili. Artt.
14–24. Formazione del contratto (2006) p. 18; Neumayer/Ming, Convention de Vienne (1993), Art. 14
para. 5; Ludwig, Der Vertragsabschluß nach UN-Kaufrecht im Spannungsverhältnis von Common Law
und Civil Law, dargestellt auf der Grundlage der Rechtsordnungen Englands und Deutschlands (1994)
pp. 297 et seq.; Lüderitz/Fenge, in: Soergel (ed), Kommentar zum BGB. Schuldrechtliche Nebengesetze
(2000), Art. 14 paras 3 and 7; Stern, Erklärungen im UNCITRAL-Kaufrecht (1990) pp. 16 et seq.; van
Alstine, Consensus, Dissensus, and Contractual Obligation Through the Prism of Uniform International
Sales Law, 37 Virginia Journal of International Law (1996) 1 (17).
9 See Handelsgericht St. Gallen (Switzerland) 5 December 1995, CISG-Online 245.
10 Oberster Gerichtshof (Austria) 6 February 1996, CISG-Online 224; see also Oberlandesgericht Frank-
furt (Germany) 30 August 2000, CISG-Online 594; Oberster Gerichtshof (Austria) 9 March 2000, CISG-
Online 573; Landgericht Zwickau (Germany) 19 March 1999, CISG-Online 519; Oberster Gerichtshof
(Austria) 20 March 1997, CISG-Online 269; Handelsgericht St. Gallen (Switzerland) 5 December 1995,
CISG-Online 245; Oberster Gerichtshof (Austria) 10 November 1994, CISG-Online 117; in legal writing
see Herber/Czerwenka Kommentar (1991), Art. 14 para. 10.
11 Oberster Gerichtshof (Austria) 6 February 1996, CISG-Online 224; also compare Oberlandesgericht
Graz (Austria) 7 March 2002, CISG-Online 669; Oberster Gerichtshof (Austria) 10 November 1994, CISG-
Online 117; in legal writing Meeusen, Totstandkoming van de Overeenkomst, in: van Houtte/Erauw/
Wautelet (eds), Het Weens Koopverdrag (1997), p. 71 (74); J. Pierre/V. Pierre, A Comparison of the Rules
on Formation of Sales Contracts Under the Louisiana Civil Code and the United Nations Convention on
Contracts for the International Sale of Goods: What Buyers and Sellers Should Know, 20 Southern
University Law Review (1993) 189 (190 et seq.).
12 See Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 14 para. 4.
13 For a similar statement, see Piltz, Internationales Kaufrecht (2008) para. 3-18.
14 Piltz, Internationales Kaufrecht (2008) para. 3-18.
15 Compare Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 165; Schroeter, in: Schlechtriem/
Schwenzer, Kommentar (German ed. 2013), Art. 14 para. 1.

16 In accord Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 168 et seq.; Dornis, in: Honsell,
Kommentar (2010), Art. 14 paras. 2 and 4; Garro/Zuppi, Compraventa internacional de mercaderı́as

(2012), p. 115; Ludwig, Der Vertragsabschluß nach UN-Kaufrecht im Spannungsverhältnis von Common
Law und Civil Law, dargestellt auf der Grundlage der Rechtsordnungen Englands und Deutschlands
(1994) p. 295; Saenger, in: Bamberger/Roth (eds), Kommentar zum Bürgerlichen Gesetzbuch (2012),
Art. 14 para. 2; Schroeter, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2013), Art. 14 para. 1;
Gruber, in: MünchKommBGB (2016), Art. 14 para. 4; Schlechtriem, in: Schlechtriem/Schwenzer, Com-
mentary (2005), Art. 14 para. 1; Schroeter, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 14
para. 1; Witz/Salger/Lorenz, Kommentar (2016), Art. 14 para. 18.
224 Ferrari
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In principle,17 form requirements do not have to be fulfilled18 in order for a proposal 4
to be able to be considered an offer under the CISG.19 Thus, oral declarations, as well as
silence and implied conduct, such as the handing over of goods,20 may amount to an
offer21 (provided the requirements as regards content are fulfilled). The choice of the
communication medium (telephone, telex, facsimile, email,22 etc.) is also subject to the
offeror’s discretion.23 The offeror can indicate in its offer that the acceptance has to take
a particular form. An offer providing that silence will be treated as acceptance is,
however, not binding upon the offeree.24
In the absence of any one of the three aforementioned requirements (or where their 5
existence is to be considered irrelevant pursuant to Art. 8), a proposal can only
constitute an invitation to make an offer.25 The same is true also if preliminary
negotiations or practices established between the parties require that the proposal
include additional elements in order to be able to be considered an offer.26 Where
such elements are lacking, a proposal cannot constitute an offer.27
The party asserting that a proposal constitutes an offer bears the burden of proving 6
that all the aforementioned requirements are met.28

1. Proposal addressed to specific persons; invitation to make an offer
The question of whether a proposal addressed to an indefinite group of persons 7
(whether natural or legal)29 constitutes an offer was not answered by the ULF,30 this
engendered much controversy.31 The question is now explicitly addressed in Art. 14.
17But see Arts 12 and 96.

18In case law, see Oberster Gerichtshof (Austria) 9 March 2000, CISG-Online 573; Bezirksgericht
St. Gallen (Switzerland) 3 July 1997, CISG-Online 336; Oberster Gerichtshof (Austria) 6 February 1996,
CISG-Online 224.
19 In legal writing see Adame Goddard, El Contrato de Compraventa Internacional (1994) p. 93; Bonell,
La formazione del contratto di compravendita, in: La vendita internazionale. La convenzione di Vienna

dell’11 aprile 1980 (1981) pp. 113 (121 et seq.); Dornis, in: Honsell, Kommentar (2010), Art. 14 para. 5;
Neumayer/Ming, Convention de Vienne (1993), Art. 14 para. 5; Piltz, Internationales Kaufrecht (2008)
para. 3-15; Magnus, in: Staudinger Kommentar (2013), Art. 14 para. 11.
20 In accord Enderlein/Maskow/Strohbach, Internationales Kaufrecht (1991), Art. 14 para. 2; Ludwig,
Der Vertragsabschluß nach UN-Kaufrecht im Spannungsverhältnis von Common Law und Civil Law,
dargestellt auf der Grundlage der Rechtsordnungen Englands und Deutschlands (1994) p. 296 note 38;
Reinhart, Kommentar (1991) Art. 14 para. 3; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary
(2005), Art. 14 para. 3.
21 Piltz, Internationales Kaufrecht (2008) para. 3-15.
22 See Ferrari, in: MünchKommHGB (2013), Art. 14 para. 4.
23 See Dornis, in: Honsell, Kommentar (2010), Art. 14 para. 5; Schnyder/Straub, in: Honsell, Kommen-
tar (1997), Art. 14 para. 14.

24 For this statement, see also Herber/Czerwenka, Kommentar (1991), Art. 14 para. 14.
25 Oberster Gerichtshof (Austria) 20 March 1997, CISG-Online 269.
26 Schroeter, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2013), Art. 14 para. 5; Schroeter, in:

27 Compare Eörsi, in: Bianca/Bonell, Commentary (1987), Art. 14 para. 2.2.2; Schlechtriem, in: Schlech-

28 See, for instance, Hepting/Müller, in: Baumgärtel/Laumen (eds), Handbuch der Beweislast im
Privatrecht (2009), Art. 14 CISG para. 1; Jung, Die Beweislastverteilung im UN-Kaufrecht (1996) p. 58.
29 Schroeter, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2013), Art. 14 para. 4.
di Vienna dell’11 aprile 1980 (1981) p. 113 (125).

31 In this respect, see von Caemmerer, Die Haager Konferenz über die internationale Vereinheitlichung
des Kaufrechts vom 2. bis 25 April 1964, RabelsZ 29 (1965) 101 (118 et seq.).
Ferrari 225
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From Art. 14(1) it seems to result that only a proposal addressed to one or more specific
persons constitutes an offer. This is not true.32 For example, a proposal addressed to a
broader group of persons can also constitute an offer, if the party making the proposal
clearly indicates that this should be so;33 it is not necessary, however, that that party
does so explicitly.34 Irrespective of the size of the group of persons to which the offer is
addressed, only a person within this group is entitled to accept the offer.35
8 A proposal is considered to be addressed to a group of specific persons not only
where it addresses each member by name,36 but also where the party making the
proposal has a clear idea of the persons addressed.37 This is why, for instance, sending a
prospectus,38 a catalogue,39 or a price list40 does not amount to making an offer.41 The
same is true with respect to advertisements in newspapers,42 on the radio or on
television, as well as statements addressed to an indefinite group of persons via the
Internet,43 for instance by sending out a high number of emails.44 The opposite is true,
32 Also compare Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 169; Ferrari, Vendita internazio-
nale di beni mobili. Artt. 14–24. Formazione del contratto (2006) pp. 23 et seq.
33 Vessichelli Nuove leggi civ. comm. 1989, 51 (52).
34 Contra Perales Viscasillas, La formación del contrato de compraventa internacional de mercaderı́as
(1996) pp. 286 et seq.

35 See Oberster Gerichtshof (Austria) 18 June 1997, CISG-Online 292; contra in legal writing Perales
Viscasillas, La formación del contrato de compraventa internacional de mercaderı́as (1996) p. 290.

36 This, however, seems to be the view held by Piltz, Internationales Kaufrecht (2008) para. 3-19.
37 Compare Dornis, in: Honsell, Kommentar (2010), Art. 14 para. 8; Ferrari, Vendita internazionale di
beni mobili. Artt. 14–24. Formazione del contratto (2006) p. 24; Ferrari/Torsello, International Sales Law
– CISG (2015) p. 135; Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 14 CISG
para. 9; Wey, Der Vertragsabschluss beim Internationalen Warenkauf nach UNCITRAL und schweizer-
ischen Recht (1984) paras 733 et seq.; for a partially different view, see Perales Viscasillas, La formación
del contrato de compraventa internacional de mercaderı́as (1996) p. 290.
38 Garro/Zuppi, Compraventa internacional de mercaderı́as (2012), p. 116; Schroeter, in: Schlechtriem/

39 Adame Goddard, El Contrato de Compraventa Internacional (1994) p. 94; Eörsi, Formation of contract,
in: Wiener Übereinkommen von 1980 über den internationalen Warenkauf (1985), p. 43 (45); Garro/Zuppi,
Compraventa internacional de mercaderı́as (2012), p. 116; Schultz, Rolling Contract Formation under the
UN Convention on Contracts for the International Sale of Goods, 35 Cornell International Law Journal
(2001) 263 (272); Sono, Formation of International Contracts under the Vienna Convention: A Shift above
the Comparative Law, in: Sarcevic/Volken (eds), International Sale of Goods (1986), p. 111 (119); also
compare Handelsgericht Zurich (Switzerland) 22 December 2005, CISG-Online 1195.
40 Schroeter, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 14 para. 32.
41 See Dornis, in: Honsell, Kommentar (2010), Art. 14 para. 10; Enderlein/Maskow/Strohbach, Inter-
nationales Kaufrecht (1991), Art. 14 para. 4; Ferrari/Torsello, International Sales Law – CISG (2015)
p. 135; Herber/Czerwenka, Kommentar (1991), Art. 14 para. 3; Honnold/Flechtner, Uniform Law (2009),
para. 136; Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 14 CISG para. 10;
Neumayer/Ming, Convention de Vienne (1993), Art. 14 paras 2 and 12; Perales Viscasillas, La formación
del contrato de compraventa internacional de mercaderı́as (1996) p. 289; Wey, Der Vertragsabschluss
beim Internationalen Warenkauf nach UNCITRAL und schweizerischen Recht (1984) para. 732; contra
see Ludwig, Der Vertragsabschluß nach UN-Kaufrecht im Spannungsverhältnis von Common Law und
Civil Law, dargestellt auf der Grundlage der Rechtsordnungen Englands und Deutschlands (1994)
pp. 300 et seq.; Audit, Vente Internationale (1990), p. 58; see, however, Dı́ez-Picazo, in: Dı́ez-Picazo,
Comentario (1998), p. 170, holding that the dispatch of a proposal to many persons constitutes an
invitatio ad offerendum, even though a proposal may have been addressed to each single person only.
42 See Farnsworth, Formation of Contract, in: Galston/Smit (eds), International Sales (1984), pp. 3–01
(3–03 and 3–06); Magnus, in: Staudinger Kommentar (2013), Art. 14 para. 13; Piltz, Internationales
Kaufrecht (2008) para. 3-19.
43 See Ferrari, Vendita internazionale di beni mobili. Artt. 14–24. Formazione del contratto (2006)
p. 25; Ferrari/Torsello, International Sales Law – CISG (2015) p. 135; Schlechtriem, in: Schlechtriem/
Schwenzer, Commentary (2005), Art. 14 para. 15; Magnus, in: Staudinger Kommentar (2013), Art. 14
para. 37.
44 Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 14 CISG para. 12; contra
Ludwig, Der Vertragsabschluß nach UN-Kaufrecht im Spannungsverhältnis von Common Law und Civil
226 Ferrari
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as mentioned above, if the party making the proposal clearly indicates that he wants the
declaration to be considered as an offer – i. e., if he manifests his intention to be bound
unambiguously.45 This is the case, for instance, where the proposal contains a deadline
for acceptance or a promise to deliver for a period of time at a particularly favourable
price,46 or where the proposal contains a “while stocks last” clause,47 or any clause that
makes it clear that the availability of goods is limited.48 The existence of the intent to be
bound must also be assumed, at least according to the Secretariat’s Commentary,49
where the proposal contains the following wording: “This advertisement constitutes an
offer” and “These goods will be sold to the first person who presents cash or an
appropriate banker’s account.”
Because a proposal addressed to an indefinite group of persons does not generally 9
constitute an offer, but a mere invitation to make an offer,50 the party asserting that
such a proposal constitutes an offer bears the burden of proving that the party making
the proposal had the intention to be bound by the proposal.51
It is worth pointing out that a proposal addressed to an indefinite group of persons, 10
which exceptionally does not constitute a mere invitation to make an offer, must also
comply52 with the specificity requirements set forth in Art. 14.53
2. Intention to be bound
A proposal constitutes an offer upon the condition that the party making the 11
proposal is willing to be bound in case of an acceptance of the proposal.54 In other
words, the offer has to “embody an authorization for the addressee to conclude a
Law, dargestellt auf der Grundlage der Rechtsordnungen Englands und Deutschlands (1994) pp. 300
et seq.
45 Adame Goddard, El Contrato de Compraventa Internacional (1994) p. 97; Ferrari/Torsello, Interna-
tional Sales Law – CISG (2015) p. 135.

47 Compare Audit, Vente Internationale (1990), p. 58; Dornis, in: Honsell, Kommentar (2010), Art. 14
para. 10; Enderlein/Maskow/Strohbach, Internationales Kaufrecht (1991), Art. 14 para. 13; Ferrari, Ven-
dita internazionale di beni mobili. Artt. 14–24. Formazione del contratto (2006) p. 25; Ferrari/Torsello,
International Sales Law – CISG (2015) p. 135; Magnus, in: Staudinger Kommentar (2013), Art. 14
para. 14; Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 14 CISG para. 13;
Meeusen, Totstandkoming van de Overeenkomst, in: van Houtte/Erauw/Wautelet (eds), Het Weens
Koopverdrag (1997), p. 71 (73); Piltz, Internationales Kaufrecht (2008) para. 3-21; see, however, Gruber,
in: MünchKommBGB (2016), Art. 14 para. 12: mere invitatio ad offerendum.
48 See Adame Goddard, El Contrato de Compraventa Internacional (1994) p. 97; Audit, Vente Inter-
nationale (1990), p. 58; Ferrari/Torsello, International Sales Law – CISG (2015) p. 135; Schnyder/Straub,
in: Honsell, Kommentar (1997), Art. 14 para. 18; Neumayer/Ming, Convention de Vienne (1993), Art. 14
para. 13; contra see Magnus, in: Staudinger Kommentar (2013), Art. 14 para. 14.
49 See Official Records (1981), p. 21.
51 Hepting/Müller, in Baumgärtel/Laumen (eds), Handbuch der Beweislast im Privatrecht (2009),
Art. 14 CISG para. 6; Ferrari, Vendita internazionale di beni mobili. Artt. 14–24. Formazione del contra-
tto (2006) p. 26.
52 In accord Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 169; Meeusen, Totstandkoming van de
Overeenkomst, in: van Houtte/Erauw/Wautelet (eds), Het Weens Koopverdrag (1997), p. 71 (73); Perales
Viscasillas, La formación del contrato de compraventa internacional de mercaderı́as (1996) p. 286;
Magnus, in: Staudinger Kommentar (2013), Art. 14 para. 39; Vessichelli Nuove leggi civ. comm. 1989, 51
(52).
53 Schroeter, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2013), Art. 14 para. 31; Schroeter,
in: Schlechtriem/Schwenzer, Commentary (2016), Art. 14 para. 33.

54 See Rechtbank Koophandel Tongeren (Belgium) 25 January 2005, CISG-Online 1785; Oberster
Gerichtshof (Austria) 18 June 1997, CISG-Online 292 in legal writing, see Gillette/Walt, The UN
Convention on Contracts for the International Sale of Goods (2016) p. 87–88; Gruber, in: Münch-
KommBGB (2016), Art. 14 para. 5; Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012),
Ferrari 227
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Article 14 12–13 Part II. Formation of the Contract
contract through an acceptance that mirrors the proposal and without further need for
action on the part of the party making the proposal: The party making the proposal
manifests its intention to conclude for the sale of goods.”55 This intention to conclude
a contract, which exists also where the contract is to be concluded subject to a
condition,56 has to be distinguished from the intention to be bound by a revocable
offer;57 the intention to be bound addressed in Art. 14 only refers to the former.58
12 Whether the intention to be bound exists is generally to be assessed on a case-by-case
basis59 on the basis of Art. 8.60 Sill, some assumptions can be made. Thus, for instance, it
is possible to assume that the more a proposal complies with the specificity requirement
set forth in Art. 14 (concerning the addressees of the proposal, the goods, quantity and
price) the more probable it is that the intention to be bound exists.61
13 Art. 14(2) itself establishes the rule that intent to be bound generally does not exist
where the proposal is addressed to an indefinite group of persons.62 In that case, it is
assumed that the party making the proposal, unlike in the case of a proposal addressed
to a specific person, cannot evaluate the consequences.63 Therefore Art. 14(2), pursuant
to which a proposal ad incertas personas is to be considered merely as an invitation to
make an offer, is quite justifiable.
Art. 14 CISG para. 3; Schlechtriem/Schroeter, Internationales UN-Kaufrecht (2013) para. 243; Schroeter,
55 Wey, Der Vertragsabschluss beim Internationalen Warenkauf nach UNCITRAL und schweizerischen
Recht (1984) para. 722; see also Dornis, in: Honsell, Kommentar (2010), Art. 14 para. 25; Schroeter, in:
56 See Enderlein/Maskow/Strohbach, Internationales Kaufrecht (1991), Art. 14 para. 5.
57 Dornis, in: Honsell, Kommentar (2010), Art. 14 para. 25; Eörsi, Formation of contract, in: Wiener
Übereinkommen von 1980 über den internationalen Warenkauf (1985), p. 43 (47); Herber/Czerwenka,
Kommentar (1991), Art. 14 para. 7; Jametti Greiner, Der Vertragsabschluss, in: Hoyer/Posch (eds), Das
Einheitliche Wiener Kaufrecht (1992), p. 43 (48 note 20); Magnus, in: Staudinger Kommentar (2013),
Art. 14 para. 12; Vessichelli Nuove leggi civ. comm. 1989, p. 51 (52); Schroeter, in: Schlechtriem/
58 See Enderlein/Maskow/Strohbach, Internationales Kaufrecht (1991), Art. 14 para. 6; Ferrari, Vendita
internazionale di beni mobili. Artt. 14–24. Formazione del contratto (2006) p. 27; Herber/Czerwenka,
Kommentar (1991), Art. 14 para. 8; Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 14 para. 42;
Gruber, in: MünchKommBGB (2016), Art. 14 para. 5; Neumayer/Ming, Convention de Vienne (1993),
Art. 14 para. 3; Piltz, Internationales Kaufrecht (2008) para. 3-30; Perales Viscasillas, La formación del
contrato de compraventa internacional de mercaderı́as (1996) p. 270 note 4; Lüderitz/Fenge, in: Soergel,
Kommentar zum BGB. Schuldrechtliche Nebengesetze (2000), Art. 14 para. 7; Magnus, in: Staudinger
Kommentar (2013), Art. 14 para. 12; Stern, Erklärungen im UNCITRAL-Kaufrecht (1990) pp. 18 et seq.
59 Ferrari/Torsello, International Sales Law – CISG (2015) p. 136; Schultz, Rolling Contract Formation
under the UN Convention on Contracts for the International Sale of Goods, 35 Cornell International Law
Journal (2001) 263 (271); in recent case law, see Bundesgerichtshof (Germany) 25 March 2015, CISG-
Online 2588.
60 Gillette/Walt, The UN Convention on Contracts for the International Sale of Goods (2016) p. 88.
61 In accord Ferrari/Torsello, International Sales Law – CISG (2015) p. 136; Gruber, in: Münch-
KommBGB (2016), Art. 14 para. 7; Kahn, La Convention de Vienne du 11 avril 1980 sur les contrats de
vente internationale de marchandises, Revue internationale de droit comparé (1981) 951 (964); Piltz,
Internationales Kaufrecht (2008) para. 3-33; in case law, see Bundesgerichtshof (Germany) 25 March 2015,
CISG-Online 2588.
62 Ferrari/Torsello, International Sales Law – CISG (2015) p. 136; Gillette/Walt, The UN Convention on
Contracts for the International Sale of Goods (2016) p. 88.

63 See Adame Goddard, El Contrato de Compraventa Internacional (1994) p. 93; Stern, Erklärungen im
UNCITRAL-Kaufrecht (1990) p. 18; Eörsi, Formation of contract, in: Wiener Übereinkommen von 1980
über den internationalen Warenkauf (1985), p. 43 (47); Gillette/Walt, The UN Convention on Contracts
for the International Sale of Goods (2016) p. 88; for comparative remarks, see Ferrari, A Comparative
Overview of Offer and Acceptance Inter Absentes, 10 Boston University International Law Journal (1992)
171 (185 et seq.).
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However, a proposal addressed to one or more specific persons can fail to manifest an 14
intention to be bound. It is to be assumed, for instance, that such intent is lacking where
the proposal contains expressions such as “without obligation,”64 “non-binding,”65 or
other expressions to the same effect,66 even though under certain circumstances one
may get to the opposite result.67 A proposal containing the reservation “subject to
contract” lacks the necessary intention to be bound.68 A letter of intent, which normally
contains all the other elements referred to in Art. 14 and is usually addressed to a
specific person, generally lacks the intention to be bound.69 The same is true for a
“memorandum of understanding.”70
It must be assumed that the intention to be bound exists where goods are being sent 15
to a party with indication of the purchase price,71 regardless of whether the relevant
domestic law qualifies this differently – as does English Law, for instance.72 Where,
however, various alternatives are submitted, it can be assumed that no intention to be
bound exists.73
In addition, both commentators74 and courts75 have agreed that an intention to be 16
bound exists where a person submits an order for goods subject to no reservations or
conditions.
64 Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 14 CISG para. 4; Schroeter,
in: Schlechtriem/Schwenzer, Kommentar (German ed. 2013), Art. 14 para. 25; Schroeter, in: Schlechtriem/
65 See Enderlein/Maskow/Strohbach, Internationales Kaufrecht (1991) Art. 14 para. 5; Ferrari/Torsello,
International Sales Law – CISG (2015) p. 137; Gruber, in: MünchKommBGB (2016), Art. 14 para. 8; Piltz,
Internationales Kaufrecht (2008) para. 3-31; in case law, see Kantonsgericht Zug (Switzerland) 2 Decem-
ber 2004, CISG-Online 1194.
p. 28; Herber/Czerwenka, Kommentar (1991), Art. 14 para. 9; Schnyder/Straub, in: Honsell, Kommentar
(1997), Art. 14 para. 48; Neumayer/Ming, Convention de Vienne (1993), Art. 14 para. 3; Perales Visca-
sillas, La formación del contrato de compraventa internacional de mercaderı́as (1996) pp. 278 et seq.;
Schroeter, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 14 para. 27.
67 See Brunner/Pfisterer/Köster, Kommentar (2014), Art. 14 para. 5; Lüderitz/Fenge, in: Soergel, Kom-
mentar zum BGB. Schuldrechtliche Nebengesetze (2000), Art. 14 para. 8; Magnus, in: Staudinger Kom-
mentar (2013), Art. 14 para. 14.
68 See Bonell, Vertragsverhandlungen und culpa in contrahendo nach dem Wiener Kauf-rechtsüber-
einkommen, RIW (1990) 693 (697); Ferrari/Torsello, International Sales Law – CISG (2015) p. 137; Witz/
Salger/Lorenz, Kommentar (2016), Art. 14 para. 23.
69 Compare Bonell, Vertragsverhandlungen und culpa in contrahendo nach dem Wiener Kaufrechtsü-
bereinkommen, RIW (1990) 693 (696 et seq.); Dornis, in: Honsell, Kommentar (2010), Art. 14 para. 30;
Gruber, in: MünchKommBGB (2016), Art. 14 para. 9; Ludwig, Der Vertragsabschluß nach UN-Kaufrecht
im Spannungsverhältnis von Common Law und Civil Law, dargestellt auf der Grundlage der Rechtsord-
nungen Englands und Deutschlands (1994) p. 299; Schnyder/Straub, in: Honsell, Kommentar (1997),
Art. 14 para. 49; see also Magnus, in: Staudinger Kommentar (2013), Art. 14 para. 15, stating that this is
an issue of interpretation; also compare Brunner/Pfisterer/Köster, Kommentar (2014), Art. 14 para. 6;
Schroeter, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2013), Art. 14 para. 26; Schroeter, in:
70 See also Dornis, in: Honsell, Kommentar (2010), Art. 14 para. 30; Ferrari/Torsello, International Sales
Law – CISG (2015) p. 137; Witz/Salger/Lorenz, Kommentar (2016), Art. 14 para. 24.
72 Compare Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 14 para. 13; see also
Art. 6 a of the Swiss Code of obligations.

73 See Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 14 para. 46.
74 Compare Meeusen, Totstandkoming van de Overeenkomst, in: van Houtte/Erauw/Wautelet (eds),
Het Weens Koopverdrag (1997), p. 71 (77); Witz/Salger/Lorenz, Kommentar (2016), Art. 14 para. 22.
75 See Handelsgericht St. Gallen (Switzerland) 5 December 1995, CISG-Online 245.
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3. The specificity requirement

17 a) Preface. In order for a proposal to constitute an offer under the CISG (as in most
legal systems),76 it has to be definite in such a manner that the sole acceptance of the
proposal leads to the conclusion of the contract77 or that “in case of acceptance it can be
made the basis for a decision.”78 This “absolute validity requirement,”79 which can be
only partly traced back to the ULF,80 is met pursuant to Art. 14(1) if the goods are
indicated and if the quantity and the price are expressly or implicitly fixed, or if
provision is made for their determination.81 Consequently, a contract is concluded if a
proposal meeting these requirements is accepted, irrespective of whether the parties
reached an agreement on additional issues,82 since what is crucial is “that the parties
have agreed to the essential minimum content the parties wanted to agree to.”83
18 Where one of the aforementioned essential elements84 is lacking (or if these elements
are invalid according to Art. 4(a)),85 or where they exist but cannot be understood86 by
“a reasonable person of the same kind […] in the same circumstances” as the addressee
of the proposal,87 the proposal does not constitute an acceptable offer,88 and therefore
its acceptance cannot lead to the conclusion of the contract.89
19 If it results from an agreement of the parties (e. g. a framework agreement),90 the
practices established between them, the usages (as referred to in Art. 9)91 or the
76 See Ferrari, A Comparative Overview of Offer and Acceptance Inter Absentes, 10 Boston University
International Law Journal (1992) 171 (185 et seq.).

77 Compare Dornis, in: Honsell, Kommentar (2010), Art. 14 para. 12; Eörsi, in: Bianca/Bonell, Com-
mentary (1987), Art. 14 para. 2.2.2; Ferrari/Torsello, International Sales Law – CISG (2015) p. 135–136;
Garro/Zuppi, Compraventa internacional de mercaderı́as (2012), p. 117; Mankowski, in: Ferrari et al.,
Internationales Vertragsrecht (2012), Art. 14 CISG para. 14; Schlechtriem, in: Schlechtriem/Schwenzer,
Commentary (2005), Art. 14 para. 2; Schroeter, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 14
para. 2; van Alstine, Consensus, Dissensus, and Contractual Obligation Through the Prism of Uniform
International Sales Law, 37 Virginia Journal of International Law (1996) 1 (16); see also Oberster
Gerichtshof (Austria) 6 February 1996, CISG-Online 224.
78 In case law, see Oberlandesgericht Frankfurt (Germany) 4 March 1994, CISG-Online 110; in legal
writing, see Magnus, in: Staudinger Kommentar (2013), Art. 14 para. 16; Schroeter, in: Schlechtriem/
79 Witz/Salger/Lorenz, Kommentar (2016), Art. 14 para. 27; for this conclusion, see also Gruber, in:
MünchKommBGB (2016), Art. 14 para. 13.

80 For a reference to the differences, see Witz/Salger/Lorenz, Kommentar (2016), Art. 14 para. 3.
81 See Ferrari/Torsello, International Sales Law – CISG (2015) p. 136; Mankowski, in: Ferrari et al.,
Internationales Vertragsrecht (2012), Art. 14 CISG para. 14; Schlechtriem/Schroeter, Internationales UN-
Kaufrecht (2013) para. 244.
82 Ferrari/Torsello, International Sales Law – CISG (2015) p. 136.
83 Landgericht München (Germany) 8 February 1995, CISG-Online 203.
84 See Jametti Greiner, Der Vertragsabschluss, in: Hoyer/Posch (eds), Das Einheitliche Wiener Kau-
frecht (1992) p. 43 (48).

86 See also Schroeter, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2013), Art. 14 para. 10;

87 See Art. 8(2).
88 Also compare Dornis, in: Honsell, Kommentar (2010), Art. 14 para. 12; Garro/Zuppi, Compraventa
internacional de mercaderı́as (2012), p. 116 et seq.; Gruber, in: MünchKommBGB (2016), Art. 14 para. 13;
Magnus, in: Staudinger Kommentar (2013), Art. 14 para. 18; Mankowski, in: Ferrari et al., Internationales
Vertragsrecht (2012), Art. 14 CISG para. 23; Schroeter, in: Schlechtriem/Schwenzer, Kommentar (German
ed. 2013), Art. 14 para. 6.
89 See in case law in respect of the lack of the essentialia, Handelsgericht St. Gallen (Switzerland)

230 Ferrari
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proposal itself that the proposal has to contain additional elements in order to be
considered an offer, an “acceptance” relating solely to the aforementioned essential
elements will not lead to the conclusion of the contract.92 From this one can easily
derive that “Art. 14(1), last sentence, does not lay down mandatory minimum or
maximum requirements.”93
Except in the cases mentioned in the preceding paragraph,94 the offer does not have 20
to contain other elements, since other details relevant to the contract and its perfor-
mance are settled by the CISG itself95 (such as the time of delivery or payment, place of
delivery or payment, quality of the goods, packaging, etc.) – or from the elements to be
taken into account by virtue of Art. 9.96
b) Indication of the goods. Art. 14(1) second sentence requires that the goods must 21
be indicated, but without specifically addressing whether the indication has to be made
explicitly or whether it can also occur implicitly – as is possible with both the
determination of price and of quantity. This question has been answered by commen-
tators97 and courts98 affirmatively; the indication of goods can take any form and
therefore can be made tacitly.99 There is a “tacit” indication where there is an indication
of elements that permit the identification of the goods (or the particular quantity and
price).100
92 Compare Brunner/Pfisterer/Köster, Kommentar (2014), Art. 14 para. 7; Dı́ez-Picazo, in: Dı́ez-Picazo,
Comentario (1998), p. 168; Eörsi, in: Bianca/Bonell, Commentary (1987), Art. 14 para. 2.2.2; Ferrari/
Torsello, International Sales Law – CISG (2015) p. 138–139; Ludwig, Der Vertragsabschluß nach UN-
Rechtsordnungen Englands und Deutschlands (1994) p. 296; Gruber, in: MünchKommBGB (2016),
Art. 14 paras 14 et seq.; Perales Viscasillas, La formación del contrato de compraventa internacional de
mercaderı́as (1996) p. 275; Piltz, Internationales Kaufrecht (2008) para. 3-34.
93 Lüderitz/Fenge, in: Soergel, Kommentar zum BGB. Schuldrechtliche Nebengesetze (2000), Art. 14
para. 6.
95 See also Dornis, in: Honsell, Kommentar (2010), Art. 14 para. 13; Herber/Czerwenka, Kommentar
(1991), Art. 14 para. 7; Magnus, in: Staudinger Kommentar (2013), Art. 14 para. 16; Schnyder/Straub, in:
Honsell, Kommentar (1997), Art. 14 para. 25; Perales Viscasillas, La formación del contrato de compra-
venta internacional de mercaderı́as (1996) p. 277; Rudolph, Kommentar (1996), Art. 14 para. 4; Schlech-
triem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 14 para. 2; Schroeter, in: Schlechtriem/
96 Ferrari, in: MünchKommHGB (2013), Art. 14 para. 20; Perales Viscasillas, La formación del contrato
de compraventa internacional de mercaderı́as (1996) 275.

97 See Brunner/Pfisterer/Köster, Kommentar (2014), Art. 14 para. 11 and more specifically at note 622;
Dornis, in: Honsell, Kommentar (2010), Art. 14 para. 20; Mankowski, in: Ferrari et al., Internationales
Vertragsrecht (2012), Art. 14 CISG para. 45; Meeusen, Totstandkoming van de Overeenkomst, in: van
Houtte/Erauw/Wautelet (eds), Het Weens Koopverdrag (1997), p. 71 (74); Gruber, in: MünchKommBGB
(2016), Art. 14 para. 18; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 14 paras 3
and 5; Magnus, in: Staudinger Kommentar (2013), Art. 14 para. 20.
98 See Oberster Gerichtshof (Austria) 10 November 1994, CISG-Online 117.
p. 32; Ludwig, Der Vertragsabschluß nach UN-Kaufrecht im Spannungsverhältnis von Common Law und
Civil Law, dargestellt auf der Grundlage der Rechtsordnungen Englands und Deutschlands (1994) p. 297;
Magnus, in: Staudinger Kommentar (2013), Art. 14 para. 20; Mankowski, in: Ferrari et al., Internationales
Vertragsrecht (2012), Art. 14 CISG para. 46; Witz/Salger/Lorenz, Kommentar (2016), Art. 14 para. 30;
contra, without any justification, Vessichelli, Nuove leggi civ. comm. 1989, 51 (51).
100 See Oberster Gerichtshof (Austria) 10 November 1994, CISG-Online 117; in legal writing see
Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 14 para. 3.
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22 Furthermore, goods do not necessarily have to be indicated individually;101 an

indication of the type of goods is sufficient.102 However, as noted by both commenta-
tors103 and courts,104 ambivalent indications are insufficient.
23 It is worth pointing out that the specificity requirement is not lacking just because
some characteristics of the goods (relating, for instance, to their, dimension, etc.) are not
indicated in the proposal.105 This conclusion can be derived from Art. 65,106 which deals
with the seller’s rights in case the buyer fails to specify some features of the purchased
goods (either on the date agreed upon or within a reasonable time after receipt of a
request from the seller). The specification of those features can be left to the offeror, the
offeree, or even a third party.107 In the last case, however, one has to take into account
domestic rules concerning the validity of a clause which leaves the indication of the
goods to a third party, since the validity of that clause – as well as other contract clauses
– is generally not governed by the CISG.108
24 c) Indication of the quantity. The explicit or implicit109 determination (by the offeror
or by a person other than the offeror)110 of the quantity of the goods or the possibility of
its determination is a prerequisite for a proposal to be able to be considered an offer
under the CISG.111 According to the Secretariat’s Commentary,112 this requirement is
fulfilled if the entire inventory or the entire production is offered113 or if reference is
made to “all my requirements.”114 In this author’s opinion, it must be doubted whether
these formulations meet the specificity requirement set forth in Art. 14(1).115

mentar (2010), Art. 14 para. 20; Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012),
Art. 14 CISG para. 45; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 14 para. 3;
103 Compare, among others, Dornis, in: Honsell, Kommentar (2010), Art. 14 para. 20; Mankowski, in:
Ferrari et al., Internationales Vertragsrecht (2012), Art. 14 CISG para. 45; Witz/Salger/Lorenz, Kommen-
tar (2016), Art. 14 para. 32.
104 See Oberster Gerichtshof (Austria) 20 March 1997, CISG-Online 269.
105 See also Honnold/Flechtner, Uniform Law (2009), para. 137.2; Magnus, in: Staudinger Kommentar
(2013), Art. 14 para. 19.

107 Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 14 CISG para. 49; Saenger,
Pfisterer/Köster, Kommentar (2014), Art. 14 para. 9; Herber/Czerwenka, Kommentar (1991), Art. 14
108 See Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 14 para. 7; Magnus, in:
Staudinger Kommentar (2013), Art. 14 para. 19.

109 Bundesgericht (Switzerland) 5 April 2005, CISG-Online 1012; Kantonsgericht Zug (Switzerland)
2 December 2004, CISG-Online 1194; Hof Gent (Belgium) 8 November 2004, CISG-Online 982; Oberster
Gerichtshof (Austria) 10 November 1994, CISG-Online 117.
110 Herber/Czerwenka, Kommentar (1991), Art. 14 para. 5; Magnus, in: Staudinger Kommentar (2013),
Art. 14 para. 22; Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 14 CISG para. 52.
111 Compare Perales Viscasillas, La formación del contrato de compraventa internacional de mercader-
ı́as (1996) p. 304.

113 See also Enderlein/Maskow/Strohbach, Internationales Kaufrecht (1991), Art. 14 para. 9; Mankowski,
in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 14 CISG para. 50; Witz/Salger/Lorenz,
114 See Brunner/Pfisterer/Köster, Kommentar (2014), Art. 14 para. 12; Perales Viscasillas, La formación
del contrato de compraventa internacional de mercaderı́as (1996) pp. 306 et seq.; Magnus, in: Staudinger
115 Expressing some doubts Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 14 para. 27; contra
see Gillette/Walt, The UN Convention on Contracts for the International Sale of Goods (2016) p. 87;
Leete, Contract Formation under the United Nations Convention on Contracts for the International Sale
232 Ferrari
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The question of whether a proposal that determines the quantity of goods only in an 25
approximate manner constitutes a proposal depends, according to the Austrian Su-
preme Court,116 on whether this kind of determination complies with usages of the
particular trade concerned.117
Whether a reference to “a larger quantity” complies with the specificity require- 26
ment118 is doubtful, and should arguably be answered in the negative because “a larger
quantity” is emblematic of an indeterminate and also indeterminable quantity.119
Quantity can be determined by reference to an amount as a whole (e. g., 2,500 kg),120 27
but determination can also result from the indication of specific measuring units,121 as
well as from reference to more closely identified needs for a specific purpose.122
d) Indication of the purchase price. Art. 14(1) second sentence requires that in order 28
for a proposal to constitute an offer, the proposal must indicate the price either
explicitly or implicitly,123 or that the proposal allows for price determination124 (con-
tingently by a third party,125 to be indicated, however, with sufficient precision126).
Absent the indication of elements that may lead to the determination of the purchase
price – elements which have to be proven by the party that claims that it is possible to
determine the purchase price127 – the proposal does not constitute an offer under
Art. 14(1).128 The same is true if the proposal indicates the price for only a fragment of
the goods even though the offeror intends to buy all the goods.129 But where the parties
of Goods and the Uniform Commercial Code: Pitfalls for the Unwary, 6 Temple International and
Comparative Law Journal (1992) 193 (201).
116 Oberster Gerichtshof (Austria) 6 February 1996, CISG-Online 224.
117 See also Magnus, in: Staudinger Kommentar (2013), Art. 14 para. 21.
118 In case law see Oberster Gerichtshof (Austria) 10 November 1994, CISG-Online 117.
119 Ferrari, Vendita internazionale di beni mobili. Artt. 14–24. Formazione del contratto (2006) p. 34;
Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 14 CISG para. 53; Roth/Kunz, Zur
Bestimmbarkeit des Preises im UN-Kaufrecht, RIW (1997) 17 (20).
120 Dornis, in: Honsell, Kommentar (2010), Art. 14 para. 21.
121 See Adame Goddard, El Contrato de Compraventa Internacional (1994) p. 95; Schnyder/Straub, in:
Honsell, Kommentar (1997), Art. 14 para. 37.

122 Enderlein/Maskow/Strohbach, Internationales Kaufrecht (1991), Art. 14 para. 9; Neumayer/Ming,
Convention de Vienne (1993), Art. 14 para. 7.

123 For an express reference in case law to the possibility of implicitly indicating the price, see
Bundesgericht (Switzerland) 5 April 2005, CISG-Online 1012; Kantonsgericht Zug (Switzerland) 2 Decem-
ber 2004, CISG-Online 1194; Oberster Gerichtshof (Austria) 10 November 1994, CISG-Online 117.
124 If the offer leaving the determination of the price to a third party is accepted, it must be assumed
that the contract is concluded, subject to a condition, however. Thus, where the third party does not fix
the price, the contract cannot have any effects. It cannot be assumed, as some commentators do (see
Witz/Salger/Lorenz, Kommentar (2016), Art. 14 para. 51) that the party implicitly intended for the court
to fix the price. Also, resort to Art. 55 is not possible (for commentators who do not seem to exclude this
possiblity, see Witz/Salger/Lorenz, Kommentar (2016), Art. 14 para. 51).
125 See Enderlein/Maskow/Strohbach, Internationales Kaufrecht (1991), Art. 14 para. 12; Ferrari, Ven-
dita internazionale di beni mobili. Artt. 14–24. Formazione del contratto (2006) p. 35; Neumayer/Ming,
Convention de Vienne (1993), Art. 14 para. 8; Perales Viscasillas, La formación del contrato de compra-
venta internacional de mercaderı́as (1996) pp. 351 et seq.; Lüderitz/Fenge, in: Soergel, Kommentar zum
BGB. Schuldrechtliche Nebengesetze (2000), Art. 14 para. 4; Vessichelli Nuove leggi civ. comm. 1989, 51
(51).
126 Compare Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 14 CISG para. 41;

127 Bundesgericht (Switzerland) 5 April 2005, CISG-Online 1012.
128 Leete, Contract Formation under the United Nations Convention on Contracts for the International
Sale of Goods and the Uniform Commercial Code: Pitfalls for the Unwary, 6 Temple International and
Comparative Law Journal (1992) 193 (199 et seq.).
129 See Witz/Salger/Lorenz, Kommentar (2016), Art. 14 para. 35; in case law see Oberlandesgericht
Frankfurt (Germany) 4 March 1994, CISG-Online 110; Legfelsóbb Birósag (Hungary) 25 September
1992, CISG-Online 63.
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agree that a proposal should constitute an offer despite the lack of a price determination
(which is possible given the autonomy they enjoy under Art. 6130), reference should be
made to Art. 55 for the determination of the purchase price.131
29 For the purpose of an implicit indication of the purchase price, reference to price lists,132
catalogue prices, market prices, etc., is sufficient.133 It is, however, not necessary that these
prices be fixed at the time when the proposal is made. Therefore, a proposal that refers to a
market price at a particular time can also constitute an offer,134 – a view held by both
commentators135 and courts.136 The mere unilateral reference to a future price determina-
tion by one party generally does not comply with the price determination requirement.137
30 The Austrian Supreme Court has held that the indication of a price range linked to
the quality of the goods is sufficient vis-à-vis the price determination requirement.138
The indication of a price range is, however, problematic for the exact determination of
the purchase price.139 One commentator has suggested the application of the arithmetic
mean of the range of prices.140 In this author’s opinion one should instead resort to the
principle of good faith, as well as the principles laid down in Art. 55 to determine the
purchase price.141
31 Where indication of preferred currency is lacking, it has been suggested that, absent a
different indication in the proposal, the currency used at the seller’s place of business
should be used.142 In this author’s opinion, this is untenable; a proposal that lacks an

131 See Landgericht Neubrandenburg (Germany) 3 August 2005, CISG-Online 1190.
132 In case law see Oberlandesgericht Rostock (Germany) 10 October 2001, CISG-Online 671.
133 See Adame Goddard, El Contrato de Compraventa Internacional (1994) p. 95; Brunner/Pfisterer/
Köster, Kommentar (2014), Art. 14 para. 13; Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 167;
Leete, Contract Formation under the United Nations Convention on Contracts for the International Sale
Comparative Law Journal (1992) 193 (200); Gruber, in: MünchKommBGB (2016), Art. 14 para. 19;
Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 14 CISG para. 35; Neumayer/
Ming, Convention de Vienne (1993), Art. 14 para. 8; Nicholas, The Vienna Convention on International
Sales Law, Law Quarterly Review 105 (1989) 201 (214); Perales Viscasillas, La formación del contrato de
compraventa internacional de mercaderı́as (1996) p. 350; Magnus, in: Staudinger Kommentar (2013),
Art. 14 para. 23; Witz/Salger/Lorenz, Kommentar (2016), Art. 14 para. 52; in case law see Landgericht
Neubrandenburg (Germany) 3 August 2005, CISG-Online 1190.
134 Official Records (1981), p. 21.
135 Compare Dornis, in: Honsell, Kommentar (2010), Art. 14 para. 18; Gruber, in: MünchKommBGB
(2016), Art. 14 para. 19; Lüderitz/Fenge, in: Soergel, Kommentar zum BGB. Schuldrechtliche Nebenge-
setze (2000), Art. 14 para. 4; Witz/Wolter, Die ersten Entscheidungen französischer Gerichte zum
Einheitlichen Kaufrecht, RIW (1995) 810 (810).
136 See Cour d’Appel Paris (France) 22 April 1992, CISG-Online 222; more recently, see Canadian
International Trade Tribunal (Canada), Cherry Stix Ltd. v President of the Canada Borders Services
Agency, 6 October 2005, CISG-Online 1140: “A contract may be unenforceable if essential terms are
omitted. These include such things as price and quantity. However, these terms need not be conclusively
settled if the agreement provides a manner for fixing them later.” For a statement that is even more
explicit, see Landgericht Neubrandenburg (Germany) 3 August 2005, CISG-Online 1190.
137 In accord Witz/Salger/Lorenz, Kommentar (2016), Art. 14 para. 45; see also Schnyder/Straub, in:
Honsell, Kommentar (1997), Art. 14 para. 32; contra, see Achilles, Kommentar (2000) Art. 14 para. 5;
138 Oberster Gerichtshof (Austria) 10 November 1994, CISG-Online 117.
139 For a criticism of the decision referred to in the text, see, e. g., Dornis, in: Honsell, Kommentar
(2010), Art. 14 para. 18.

140 Magnus, Unbestimmter Preis und UN-Kaufrecht, IPRax (1996) 145 (148).
141 See also Roth/Kunz, Zur Bestimmbarkeit des Preises im UN-Kaufrecht, RIW (1997) 17 (20).
142 See Brunner/Pfisterer/Köster, Kommentar (2014), Art. 14 para. 13, and more specifically at note 633;
Magnus, Währungsfragen im Einheitlichen Kaufrecht. Zugleich ein Beitrag zu seiner Lückenfüllung und
Auslegung, RabelsZ 1989, 116 (129); Magnus, in: Staudinger Kommentar (2013), Art. 14 para. 25.
234 Ferrari
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Part II. Formation of the Contract 32 Article 14

indication on currency does not constitute an acceptable offer (unless the currency can
be determined by interpretation).143
4. The requirement of indication of the purchase price and price

determination absent such indication
Where the purchase price is neither determined nor determinable, the proposal 32
does not constitute an offer, which is easily derived from Art. 14(1). The relationship
between this provision and Art. 55, which determines the purchase price where a
contract has been validly concluded but does not expressly or implicitly fix or make
provision for determining the price, is rather uncertain.144 In regard to this issue,
which has already been identified as a problem area at the Vienna Diplomatic
Conference,145 some commentators suggest that Art. 55 should always be applicable
where the price is not indicated in the proposal,146 which, however, would mean that
the price determination requirement set forth in Art. 14(1) would have no importance
whatsoever.147 Other commentators advocate – sometimes very aggressively148 – that
Art. 14 should always prevail over Art. 55,149 while other commentators hold the
143 Also compare Dornis, in: Honsell, Kommentar (2010), Art. 14 para. 22; Enderlein/Maskow/Stroh-
bach, Internationales Kaufrecht (1991), Art. 14 para. 10; Ferrari, Vendita internazionale di beni mobili.
Artt. 14–24. Formazione del contratto (2006) p. 37; Mankowski, in: Ferrari et al., Internationales
Vertragsrecht (2012), Art. 14 CISG para. 44; Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 14
para. 38; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 14 para. 3; Dı́ez-Picazo, in:
Dı́ez-Picazo, Comentario (1998), p. 166.
144 For an overview of the state of the discussion, see Adami, Les contrats “open price” dans la
Convention des Nations Unies sur les contrats de vente international de marchandises, Revue de droit des
affaires itnernationales (1989) 103 et seq.; Bucher, Preisvereinbarung als Voraussetzung der Vertragsgül-
tigkeit beim Kauf. Zum angeblichen Widerspruch zwischen Art. 14 und Art. 55 des “Wiener Kaufrechts”,
in: Bucher (ed), Wiener Kaufrecht (1991), pp. 53 et seq.; Fortier, Le prix dans la Convention de Vienne
sur la vente internationale de marchandises: les articles 14 et 55, Journal du droit international (1990) 381
et seq.; Gillette/Walt, The UN Convention on Contracts for the International Sale of Goods (2016) p. 105
et seq.; Roth/Kunz, Zur Bestimmbarkeit des Preises im UN-Kaufrecht, RIW (1997) 17 et seq.; in case law
see Kantonsgericht Freiburg (Switzerland) 11 October 2004, CISG-Online 964.
146 Compare Adame Goddard, El Contrato de Compraventa Internacional (1994) p. 96; Adami, Les
contrats “open price” dans la Convention des Nations Unies sur les contrats de vente international de
marchandises, Revue de droit des affaires internationales (1989) 103 (110 et seq.); Eörsi, in: Bianca/Bonell,
Commentary (1987), Art. 55 paras 2.2.2. et seq.; Corbisier, Rev. int. dr. comp. (1988) 767 828; Dı́ez-Picazo,
in: Dı́ez-Picazo, Comentario (1998), p. 168; Fortier, Le prix dans la Convention de Vienne sur la vente
internationale de marchandises: les articles 14 et 55, Journal du droit international (1990) 381 (389);
Garro, Reconciliation of Legal Traditions in the U. N. Convention on Contracts for the International Sale
of Goods, 23 International Lawyer (1989) 443 (464); Honnold/Flechtner, Uniform Law (2009),
paras 137.4 et seq.; Joseph, Contract Formation under the United Nations Convention on Contracts for
the International Sale of Goods and the Uniform Commercial Code, 3 Dickinson Journal of International
Law (1984) 107 (122); Karollus, UN-Kaufrecht (1989) p. 76; Mankowski, in: Ferrari et al., Internationales
Vertragsrecht (2012), Art. 14 CISG paras 32 et seq.; Sono, Formation of International Contracts under the
Vienna Convention: A Shift Above Comparative Law, in: Sarcevic/Volken (eds), International Sale of
Goods (1986), pp. 111 (120 et seq.); Stern, Erklärungen im UNCITRAL-Kaufrecht (1990) p. 17; Stoffel,
Formation du contrat, in: Wiener Übereinkommen von 1980 über den internationalen Warenkauf (1985),
p. 55 (63).
147 For a reference to this consequence, see also Schlechtriem, in: Schlechtriem/Schwenzer, Commentary
(2005), Art. 14 para. 10.

148 See Heuzé, Vente Internationale (2005), para. 169 et seq.
149 Herber/Czerwenka, Kommentar (1991), Art. 14 para. 6; Gruber, in: MünchKommBGB (2016),
Art. 14 para. 24; Hager, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 55 para. 5: Magnus, in:
Staudinger Kommentar (2013), Art. 14 paras 32 et seq.; Thieffry, Sale of Goods Between French and US
Merchants: Choice of Law Considerations Under the United Nations Convention on Contracts for the
International Sale of Goods, 22 International Lawyer (1988) 1017 (1030); Witz/Salger/Lorenz, Kommentar
(2016), Art. 14 para. 11.
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view150 that the issue constitutes a gap151 that must be filled on the basis of the
applicable law.152
33 In this author’s opinion, the solution to the problem of the relationship between the
two provisions, which in practice does not appear to cause too many problems,153
requires one to realize that the two provisions govern different situations.154 In effect,
Art. 55 does not require that the contract be validly concluded via the traditional offer
and acceptance mechanism.155 Thus, where a contract has not been concluded via that
traditional mechanism,156 the purchase price has to be determined directly via Art. 55.157
This is regardless of domestic provisions that provide for the invalidity of contracts
concluded without the indication of the purchase price,158 since the validity exception in
Art. 4(a) allows for recourse to domestic law only insofar as the CISG itself does not
deal with an issue, which, in the case at hand it does, given that the CISG governs the
formation of contract exclusively.159
34 Furthermore, Art. 55 applies without any doubt where Part II of the CISG is not
applicable as a consequence of a reservation made pursuant to Art. 92.160
35 Art. 55 applies even in cases where the contract is concluded through offer and
acceptance, but the application of Art. 14(1) has been excluded by the parties161 (an
150 Expressly rejecting the view mentioned in the text, see Mankowski, in: Ferrari et al., Internationales
Vertragsrecht (2012), Art. 14 CISG para. 27; Schroeter, in: Schlechtriem/Schwenzer, Kommentar (German
ed. 2013), Art. 14 para. 22.
151 Compare Ferrari, in: MünchKommHGB (2013), Art. 17 para. 43.
152 See Cottino, Posizione del compratore, in: La vendita internazionale. La convenzione di Vienna dell’11
aprile 1980 (1981) pp. 147 (152 et seq.); Ebenroth, Internationale Vertragsgestaltung im Spannungsverhält-
nis zwischen ABGB, IPR-Gesetz und UN-Kaufrecht, österreichische Juristische Blätter (1986) 681 (685);
Kahn, La Convention de Vienne du 11 avril 1980 sur les contrats de vente internationale de marchandises,
Revue internationale de droit comparé (1981) 951 (980 et seq.); Meeusen, Totstandkoming van de Over-
eenkomst, in: van Houtte/Erauw/Wautelet (eds), Het Weens Koopverdrag (1997), pp. 71 (76 et seq.);
Samson, Étude comparative de certaines dispositions de la Convention de Vienne de 1980 et des règles du
droit québécois en la matière, in: Perret/Lacasse (eds), Actues du colloque sur la vente internationale (1989),
pp. 105 (110 et seq.); Smart, Formation of Contracts in Louisiana under the United Nations Convention for
the International Sale of Goods, 53 Louisiana Law Review (1993) 1339 (1354).
153 Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 14 CISG para. 31.
154 See also Brunner/Pfisterer/Köster, Kommentar (2014), Art. 14 para. 14; Ferrari, Vendita internazio-
nale di beni mobili. Artt. 14–24. Formazione del contratto (2006) p. 40; Magnus, in: Staudinger
Kommentar (2013), Art. 14 para. 32; see also Schroeter, in: Schlechtriem/Schwenzer, Commentary
(2016), Art. 14 para. 22; for a criticism of the position advocated in the text, see Gillette/Walt, The UN
Convention on Contracts for the International Sale of Goods (2016) pp. 108–109.
155 See Roth/Kunz, Zur Bestimmbarkeit des Preises im UN-Kaufrecht, RIW (1997) 17 (19); in case law
see Oberlandesgericht München (Germany) 8 March 1995, CISG-Online 145.

156 For a reference to other modes of contract conclusion, see Schlechtriem, in: Schlechtriem/Schwenzer,
Commentary (2005), Introduction to Art. 14 para. 2.

157 Brunner/Pfisterer/Köster, Kommentar (2014), Art. 14 para. 17; Dornis, in: Honsell, Kommentar
(2010), Art. 14 para. 23; Magnus, in: Staudinger Kommentar (2013), Art. 14 para. 33; contra, see Gruber,
in: MünchKommBGB (2016), Art. 14 para. 24.
158 See Piltz, Internationales Kaufrecht (2008) para. 3-29; contra see Bonell, La formazione del contratto
di compravendita, in: La vendita internazionale. La convenzione di Vienna dell’11 aprile 1980 (1981),
p. 113 (127); Botschaft betreffend das Wiener Übereinkommen über Verträge über den internationalen
Warenkauf (1989) p. 772.
(2016), Art. 14 para. 26; Magnus, in: Staudinger Kommentar (2013), Art. 14 para. 35; Perales Viscasillas,
La formación del contrato de compraventa internacional de mercaderı́as (1996) p. 357; Schlechtriem, in:
Schlechtriem/Schwenzer, Commentary (2005), Art. 14 para. 11; Schroeter, in: Schlechtriem/Schwenzer,
Kommentar (German ed. 2013), Art. 14 para. 20; Schroeter, in: Schlechtriem/Schwenzer, Commentary
(2016), Art. 14 para. 22.
161 Dornis, in: Honsell, Kommentar (2010), Art. 14 para. 23; Schlechtriem/Schroeter, Internationales
UN-Kaufrecht (2013) para. 248; in case law, see OLG Neubrandenurg (Germany) 3 August 2005, CISG-
236 Ferrari
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exclusion that can also occur implicitly)162 or where Art. 14(1) is inapplicable.163 In
these instances as well, recourse is to be had to Art. 55 to determine purchase price,164
irrespective of whether domestic provisions allow for the conclusion of a contract
without the determination of the purchase price,165 since Art. 55 prevails over the
applicable domestic law.
Even in cases where the offeror deliberately leaves the purchase price open and the 36
addressee accepts the proposal – by starting performance, for instance – a contract is
concluded, thus making recourse to Art. 55 necessary to determine the purchase
price.166 This is a view shared by courts.167 Where, however, the proposal lacks a
determination of the purchase price and does not make provision for determining it,
and an interpretation pursuant to Art. 8 leads to the conclusion that the person making
the proposal did not want to submit an offer susceptible of acceptance, no contract is
concluded, thus making resort to Art. 55 unnecessary.168
5. Offer containing a clause excluding Part II

The question of which law is applicable with regard to the conclusion of a contract 37
for the international sale of goods seems particularly problematic in cases where the
offeror wants to unilaterally exclude the CISG by inserting a clause to that effect into
the offer.169 Some commentators believe that this issue should be dealt with by
consulting the law indicated as the applicable one by the offeror or, in the absence of
such an indication, on the basis of the law to be determined by means of the objective
connecting factors of the rules of private international law of the forum.170 This view is
not tenable.171 The question of whether the declaration of the person initiating the
Online 1190; for a reference to the dispositive nature of Art. 14(1) second sentence, see Schnyder/Straub,
in: Honsell, Kommentar (1997), Art. 14 para. 70; Gruber, in: MünchKommBGB (2016), Art. 14 para. 23;
Perales Viscasillas, La formación del contrato de compraventa internacional de mercaderı́as (1996) p. 355;
Piltz, Internationales Kaufrecht (2008) para. 3-27; Rudolph, Kommentar (1996), Introduction to Art. 14
para. 7.
162 Gruber, in: MünchKommBGB (2016), Art. 14 para. 17; see also, however, Witz/Salger/Lorenz,
Kommentar (2016), Art. 14 para. 13; Piltz, Internationales Kaufrecht (2008) para. 3-28.
163 Compare Oberlandesgericht Rostock (Germany) 27 July 1995, CISG-Online 209; Oberlandesgericht
München (Germany) 8 March 1995, CISG-Online 145.

164 Compare Rudolph, Kommentar (1996), Art. 14 para. 5.
165 See also Fortier, Le prix dans la Convention de Vienne sur la vente internationale de marchandises:
les articles 14 et 55, Journal du droit international (1990) 381 (389); contra see Heuzé, La formation du
contrat selon la CVIM: quelques difficultés, Revue de droit des affaires internationales (2001) 277 (291);
Neumayer/Ming, Convention de Vienne (1993), Art. 14 para. 11; Magnus, in: Staudinger Kommentar
(2013), Art. 14 para. 35.
166 Brunner/Pfisterer/Köster, Kommentar (2014), Art. 14 para. 16; Ferrari, Vendita internazionale di
beni mobili. Artt. 14–24. Formazione del contratto (2006) pp. 41 et seq.; Herber/Czerwenka, Kommentar
(1991), Art. 14 para. 6; Magnus, in: Staudinger Kommentar (2013), Art. 14 para. 33; in case law see
Handelsgericht des Kantons Aargau (Switzerland), 26 September 1997, CISG-Online 329.
167 Compare Landgericht Neubrandenburg (Germany) 3 August 2005, CISG-Online 1190; Bezirksger-
icht St. Gallen (Switzerland), 3 July 1997, CISG-Online 336.

168 Compare Arbitral Award, International Arbitral Tribunal of the Russian Chamber of Commerce,
3 March 1995, CISG-Online 204.

169 For the following, see also Ferrari, La vendita internazionale. Applicabilità ed applicazioni della
Convenzione delle Nazioni Unite sui contratti di vendita internazionale di beni mobili (2006) pp. 233 et seq.
170 Siehr, in: Honsell, Kommentar (1997), Art. 6 para. 4; Rehbinder, Vertragsschluss nach UN-Kau-
frecht im Vergleich zu EAG und BGB, in: Schlechtriem (ed), Einheitliches Kaufrecht und nationals
Obligationenrecht 1987), p. 149 (151).
171 See also Karollus, Der Anwendungsbereich des UN-Kaufrechts im Überblick, Juristische Schulung
(1993) 378 (381); Magnus, in: Staudinger Kommentar (2013), Art. 6 paras 11 et seq.
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conclusion of a contract constitutes an offer has to be answered on the basis of the

provisions of Part II of the CISG. The same is true with regard to the question of whether a
declaration of the party accepting the offer constitutes an acceptance for the purposes of
the CISG.172 An agreement to exclude the CISG is clearly at hand where the acceptance
mirrors the offer containing the exclusion clause; if the acceptance departs from the offer
insofar as the offeree does not agree to the CISG’s exclusion, Art. 19 leads to the
conclusion that no agreement as to the CISG’s exclusion has been reached.173 The same
is true where it is the acceptor and not the offeror who wants to exclude the CISG. Since
the addition of an exclusion clause on the part of the acceptor would clearly constitute a
“material” modification of the offer under Art. 19(2), the statement by the acceptor cannot
be considered an “acceptance”, but constitutes a counteroffer instead.
6. Incorporation of standard contract terms

38 The offeror will generally attempt to have his standard contract terms govern the
contract. As regards the incorporation of standard contract terms, according to both
commentators174 and courts,175 the “CISG does not postulate special requirements. The
rules needed therefore have to be derived from Arts 14 et seq. CISG that govern the
process of contract formation.”176 Recourse to domestic law or to non-binding rules,
such as the UNIDROIT Principles, is neither necessary nor appropriate,177 as also
expressly stated by a German court in 2015.178
172 See also Czerwenka, Rechtsanwendungsprobleme im internationalen Kaufrecht. Das Kollisionsrecht
bei grenzüberschreitenden Kaufverträgen und der Anwendungsbereich der internationalen Kaufrechtsü-

bereinkommen (1988) p. 169.
174 Compare Ferrari, Vendita internazionale di beni mobili. Artt. 14–24. Formazione del contratto
(2006) p. 44; Gruber, in: MünchKommBGB (2016), Introduction to Art. 14 para. 6; Herber/Czerwenka,
Kommentar (1991), Art. 14 para. 11; Janssen, Nach welchem Recht richtet sich die Einbeziehung von
Allgemeinen Geschäftsbedingungen in den Niederlanden?, IHR (2005) 155 (156 et seq.); Janssen, Die
Einbeziehung von allgemeinen Geschäftsbedingungen in internationale Kaufverträge und die Bedeutung
der UNIDROIT- und der Lando-Principles, IHR (2004) 194 (197); Magnus, in: Staudinger Kommentar
(2013), Art. 14 para. 40; Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 14 CISG
para. 22; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 14 para. 16; Schlechtriem/
Schroeter, Internationales UN-Kaufrecht (2013) para. 250; Schnyder/Straub, in: Honsell, Kommentar
(1997), Art. 14 para. 55; Schroeter, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2013), Art. 14
175 See Rechtbank Midden-Nederland (Netherlands) 20 January 2016, CISG-Online 2685; Rechtbank
Rotterdam (Netherlands) 2 December 2015, CISG-Online 2683; Hof s’Hertogenbosch (Netherlands)

29 September 2015, CISG-Online 2655; Landgericht Fulda (Germany) 29 September 2015, CISG-Online
2716; LG Stade (Germany) 19 February 2015, CISG-Online 2669; OLG Naumburg (Germany) 13 Febru-
ary 2013, CISG-Online 2455; Oberster Gerichtshof (Austria) 31 August 2005, CISG-Online 1093; Land-
gericht Neubrandenburg (Germany) 3 August 2005, CISG-Online 1190; Oberlandesgericht Innsbruck
(Austria) 1 February 2005, CISG-Online 1130; Hoge Raad (the Netherlands) 28 January 2005, CISG-
Online 1002; Oberlandesgericht Karlsruhe (Germany) 20 July 2004, CISG-Online 858; Oberlandesgericht
Düsseldorf (Germany) 21 April 2004, CISG-Online 915; Landgericht Trier (Germany) 8 January 2004,
CISG-Online 910; Oberster Gerichtshof (Austria) 17 December 2003, CISG-Online 828.
176 Oberster Gerichtshof (Austria) 6 February 1996, CISG-Online 224; see also Rechtbank Rotterdam
(Netherlands) 2 December 2015, CISG-Online 2683; contra see Landgericht Duisburg (Germany) 17 April
177 See, however, Hofs’Hertogenbosch (the Netherlands) 16 October 2002, CISG-Online 816; for a com-
ment on this decision, see Janssen, Die Einbeziehung von allgemeinen Geschäftsbedingungen in internatio-
nale Kaufverträge und die Bedeutung der UNIDROIT- und der Lando-Principles, IHR (2004) 194 et seq.
178 Landgericht Fulda (Germany) 29 September 2015, CISG-Online 2716.
238 Ferrari
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To determine whether standard contract terms are part of the offer,179 special regard 39
must be given to Art. 8, as often suggested by both commentators180 and courts181.
Hence, where the addressee knew or could not have been unaware of the fact (Art. 8(1))
that it was the offeror’s intent that the standard contract terms be part of the offer, those
terms have to be considered an integral part of the offer.182 Even absent the aforemen-
tioned requirements, the standard contract terms must be considered an integral part of
the offer if “a reasonable person of the same kind” as the addressee “in the same
circumstances” (Art. 8(2)) would have understood that the terms were supposed to be
part of the offer.183 Pursuant to Art. 8(3), in determining “the understanding a reason-
able person [of the same kind as the addressee] would have had, due consideration is to
be given to all relevant circumstances of the case including the negotiations, any
practices which the parties have established between themselves, usages and any
subsequent conduct of the parties.”184 Thus, “for an effective incorporation it is required
that the addressee can gain knowledge of the standard contract terms in a reasonable
manner.”185 “An effective incorporation of standard contract terms therefore requires
above all that the addressee of the offer could become aware of offeror’s intent to
incorporate his standard contract terms into the contract. Furthermore, the uniform
sales law requires […] from the user of standard contract terms that he send their text
to the addressee or make them available in another way.”186
179 For a very detailed discussion of the issue, see, among others, Hennemann, AGB-Kontrolle im UN-
Kaufrecht aus deutscher und französischer Sicht (2001); Teklote, Die Einheitlichen Kaufgesetze und das
deutsche AGB-Gesetz: Probleme bei Verwendung allgemeiner Geschäftsbedingungen im CISG und im
EKG/EAG (1994).
180 Compare Dornis, in: Honsell, Kommentar (2010), Inro. Art. 14 para. 6; Ferrari/Torsello, Interna-
tional Sales Law – CISG (2015) p. 137; Gruber, in: MünchKommBGB (2016), Art. 14 para. 28; Lüderitz/
Fenge, in: Soergel, Kommentar zum BGB. Schuldrechtliche Nebengesetze (2000), Art. 14 para. 10;
Magnus, in: Staudinger Kommentar (2013), Art. 14 para. 41; Schroeter, in: Schlechtriem/Schwenzer,
Commentary (2016), Art. 14 para. 40.
181 See Rechtbank Midden-Nederland (Netherlands) 20 January 2016, CISG-Online 2685; Rechtbank
Rotterdam (Netherlands) 2 December 2015, CISG-Online 2683; Landgericht Fulda (Germany) 29 Sep-
tember 2015, CISG-Online 2716; OLG Naumburg (Germany) 13 February 2013, CISG-Online 2455;
Oberster Gerichtshof (Austria) 31 August 2005, CISG-Online 1093; Oberster Gerichtshof (Austria) 8 Au-
gust 2005, CISG-Online 1087; Landgericht Neubrandenburg (Germany) 3 August 2005, CISG-Online
1190; Oberlandesgericht Innsbruck (Austria) 1 February 2005, CISG-Online 1130; Oberlandesgericht
Düsseldorf (Germany) 21 April 2004, CISG-Online 915; Bundesgerichtshof (Germany) 31 October 2001,
CISG-Online 617; Oberster Gerichtshof (Austria) 6 February 1996, CISG-Online 224; Tribunal de
commerce de Nivelles (Belgium) 19 September 1995, CISG-Online 366.
182 Bundesgerichtshof (Germany) 31 October 2001, CISG-Online 617.
184 Oberster Gerichtshof (Austria) 6 February 1996, CISG-Online 224; for more recent decisions stating
the same, see Landgericht Fulda (Germany) 29 September 2015, CISG-Online 2716; Oberster Gerichtshof
(Austria) 8 August 2005, CISG-Online 1087; Landgericht Neubrandenburg (Germany) 3 August 2005,
CISG-Online 1190.
185 Magnus, in: Staudinger Kommentar (2013), Art. 14 para. 41; also compare Dornis, in: Honsell,
Kommentar (2010), Vor Art. 14 para. 7; Garro/Zuppi, Compraventa internacional de mercaderı́as (2012),
p. 120; Lüderitz/Fenge, in: Soergel, Kommentar zum BGB. Schuldrechtliche Nebengesetze (2000), Art. 14
para. 10; Witz/Salger/Lorenz, Kommentar (2016), Introduction to Art. 14 para. 12; in case law see Land-
gericht Fulda (Germany) 29 September 2015, CISG-Online 2716; U.S. District Court, Western District of
Pennsylvania (U.S.), Roser Technologies, Inc. v. Carl Schreiber GmbH, 10 September 2013, CISG-Online
2490; OLG Naumburg (Germany) 13 February 2013, CISG-Online 2455; Landgericht Neubrandenburg
(Germany) 3 August 2005, CISG-Online 1190.
186 Bundesgerichtshof (Germany) 31 October 2001, CISG-Online 617; see also Rechtbank Midden-
Nederland (Netherlands) 20 January 2016, CISG-Online 2685; Rechtbank Rotterdam (Netherlands)

2 December 2015, CISG-Online 2683; Oberlandesgericht Düsseldorf (Germany) 21 April 2004, CISG-
Online 915; Oberster Gerichtshof (Austria) 6 February 1996, CISG-Online 224; in legal writing see
Hennemann, AGB-Kontrolle im UN-Kaufrecht aus deutscher und französischer Sicht (2001) pp. 72 et
Ferrari 239
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40 “By virtue of the differences between the legal systems and usages many differences
exist between standard contract terms; this is why the contractual partner of the user of
standard contract terms oftentimes will not be able to predict the particular contents of
the terms he agreed to; moreover, a control as regards the contents of the standard
contract terms according to domestic law (Article 4(2)(a) CISG) is not provided for
everywhere. For the user of the standard terms it is easily possible to attach the terms –
which are regularly advantageous to him – to the offer. It would violate both the
principle of good faith in international trade (Article 7(1) CISG) and the general duty of
the parties to corporate and to inform each other [as to issues relevant to the their
contract] if one were to impose an obligation on the contractual partner of the user of
the standard contract terms to inquire as to the contents of the terms that have not been
transmitted, and, thus, impose upon that party the risks and disadvantages of unknown
standard contract terms drafted by the opposing party. As regards the fact that standard
contract terms referred to in commercial transactions or in transactions between
businesses become part of the contract under German non-uniform law even if the
opposing party is not aware of them, but could have become aware of them by using
reasonable efforts – for instance, by requesting them from the user […], this is
irrelevant in international commerce, with the consequence that, pursuant to the
principle of good faith, the opposing party cannot be expected to have an obligation
to inquire into their contents.”187 Where, however, the front side of an order form
clearly contains a reference to the standard contract terms printed on the back side of
the same (both in the language of the offeror and in that of the offeree), those standard
contract terms have to be considered incorporated into the offer.188 In this author’s
opinion, it is not sufficient189 that the user refers to its standard contract terms
accessible on the Internet because, as previously mentioned, “the addressee is not
under a duty to get access to standard contract terms that the user wants to use against
the addressee.”190 If, however, the addressee is familiar with specific standard contract
terms used by opposing party because “the standard contract terms have been used on
the occasion of prior contracts between the parties, particularly in long standing
business relationships”,191 the standard contract terms do not have to be transmitted
to the addressee of the proposal.192
41 The question of whether the standard contract terms are incorporated into the offer
cannot be clearly distinguished from that of what terms are part of the offer (not the
contract). The aforementioned considerations are relevant with regard to the latter issue
seq.; Huber/Kröll, Deutsche Rechtsprechung zum UN-Kaufrecht in den Jahren 2001/2002, IPRax (2003)
309 (311); Gruber, in: MünchKommBGB (2016), Art. 14 para. 29; Piltz, Internationales Kaufrecht (2008)
para. 3-83; Schlechtriem/Schroeter, Internationales UN-Kaufrecht (2013) para. 254; Teklote, Die Einheitli-
chen Kaufgesetze und das deutsche AGB-Gesetz: Probleme bei Verwendung allgemeiner Geschäftsbedin-
gungen im CISG und im EKG/EAG (1994) pp. 112 et seq.; Ventsch/Kluth, Die Einbeziehung von
Allgemeinen Geschäftsbedingungen im Rahmen des UN-Kaufrechts, IHR (2003) 61 (61).
187 Landgericht Neubrandenburg (Germany) 3 August 2005, CISG-Online 1190; see also Landgericht
Fulda (Germany) 29 September 2015, CISG-Online 2716; Landgericht Trier (Germany) 8 January 2004,
CISG-Online 910.
188 See Oberlandesgericht Karlsruhe (Germany) 20 July 2004, CISG-Online 868; Amtsgericht Nordhorn
(Germany) 14 June 1994, CISG-Online 259.

189 Dornis, in: Honsell, Kommentar (2010), Vor Art. 14 para. 12; Piltz, IHR (2004) 133 (134); Ventsch/
Kluth IHR (2003) 124; contra see Gruber, in: MünchKommBGB (2016), Art. 14 para. 30; Stiegele/Halter,
Nochmals: Einbeziehung von Allgemeinen Geschäftsbedingungen im Rahmen des UN-Kaufrechts –
Zugänglichmachung im Internet, IHR (2003) 169 (169).
191 Gruber, in: MünchKommBGB (2016), Art. 14 para. 31.
192 See Huber/Kröll, Deutsche Rechtsprechung zum UN-Kaufrecht in den Jahren 2001/2002, IPRax
(2003) 309 (311); Magnus, in: Staudinger Kommentar (2013), Art. 14 para. 41.
240 Ferrari
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as well. As a result, it must be assumed that standard contract terms are not considered
part of the offer,193 when the addressee does not know or cannot understand the
contents and when a reasonable person of the same kind as the addressee cannot have
known or understood (for instance, because the language in which the standard
contract terms are drafted is neither one known to the addressee nor one commonly
used in the area of trade concerned).194
While the incorporation of standard contract terms is governed by the CISG provisions 42
on formation of contracts,195 in principle the determination of the appropriateness of
their contents is, pursuant to Art. 4(a), left to the applicable domestic law.196 This is true,
at least where the determination is not solely based on form requirements.197 This is the
case in Italy, for instance, because the principle of informality provided by Art. 11 would
apply (and override any domestic form requirements). If, according to the applicable
domestic law, an evaluation has to occur with respect to the appropriateness of the
contents of the standard contract terms, the evaluation must take into account that the
contract is for an international, and not a domestic, sale of goods. Thus, the CISG’s
values, rather than domestic ones, have to be taken into account.198

Art. 14 CISG, which, as mentioned earlier, can be traced back, at least partially, to 43
Art. 4(1) ULF,199 deeply influenced the PICC provision that determines when a proposal
constitutes an offer, namely Art. 2.1.2. Like Art. 14 CISG, Art. 2.1.2. PICC constitutes
the starting point for the analysis of contract formation by means of the traditional
offer-and-acceptance-approach.200
For a proposal to constitute an offer, Art. 2.1.2. PICC, like Art. 14 CISG, requires that 44
it indicates the offeror’s intention to be bound in case of acceptance and that it is
sufficiently definite. Unlike Art. 14 CISG, however, Art. 2.1.2. PICC does not determine
when this definitiveness requirement is met.201 It does not state, in other words, that
“[a] proposal is sufficiently definite if it indicates the goods and expressly or implicitly
fixes or makes provision for determining the quantity and the price”.202 This is
unsurprising, however, as Art. 2.1.2 PICC does not merely relate to contracts for the
sale of goods.
This is also the reason why the DCFR, the rules on formation of which are as much 45
based on the traditional approach to contract conclusion – based on offer and
193Contra see Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 14 para. 57.
194Compare Gruber, in: MünchKommBGB (2016), Art. 14 para. 33; in case law see Oberlandesgericht
Düsseldorf (Germany) 21 April 2004, CISG-Online 915.
195 Also see Oberlandesgericht Zweibrücken (Germany) 31 March 1998, CISG-Online 481.
196 In case law see Oberlandesgericht Düsseldorf (Germany), 21 April 2004, CISG-Online 915; Amtsger-
icht Nordhorn (Germany), 14 June 1994, CISG-Online 259; for more detailed remarks, see Dornis, in:
Honsell, Kommentar (2010), Intro. Art. 14 para. 15; Ferrari, in: Schlechtriem/Schwenzer, Kommentar
(German ed. 2013), Art. 4 para. 20.
197 Compare, for instance, Art. 1341(2) of the Italian Civil Code.
198 For this conclusion, see also Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 14 para. 12;
Karollus, UN-Kaufrecht: Hinweise für die Vertragspraxis, österreichische Juristische Blätter (1993) 23
(30); Ferrari, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2013), Art. 4 para. 20; for critical
remarks, see Schluchter, Die Gültigkeit von Kaufverträgen unter dem UN-Kaufrecht (1996) pp. 195 et seq.
199 See supra the text accompanying note 2.
200 See also Kleinheisterkamp, in: Vogenauer/Kleinheitserkamp (eds), Commentary on the Unidroit
Principles (2009), Art. 2.1.2. para. 1.

201 Nor does Art. 4(1) ULF determine when the definitiveness requirement is met.
202 Art. 14(1) CISG.
Ferrari 241
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acceptance – as those of the CISG and the PICC, while also requiring that a proposal
indicate the intention to be bound and be definite (Art. II-4:201(1)),203 also omits a
reference to the need for the proposal to indicate the goods and fix or make provision
for determining the quantity and the price.
46 Unlike the PICC, the DCFR deals, however, with the issue dealt with in Art. 14(2)
CISG, namely that of whether the proposal needs to be addressed to one or more
specific persons for it to be considered an offer. Unlike Art. 14(2) CISG, Art. II-4:201(2)
DCFR does not require that the proposal be addressed to one or more specific persons.
In other words, under the DCFR an offer to the public does not merely constitute an
invitation to make an offer.
47 It is also worth pointing out that the 2005 United Nations Convention on the Use of
Electronic Communications in International Contracts also addresses an issue dealt
with in Art. 14 CISG, more specifically, in Art. 14(2). In effect, like Art. 14(2) CISG,
Art. 11 of the 2005 Convention sets forth the rule according to which a proposal to
conclude a contract made through one or more electronic communications not
addressed to one or more specific persons, but which is generally accessible to parties
making use of information systems, constitutes a mere invitation to make an offer,
unless it clearly indicates the intention of the party making the proposal to be bound in
case of acceptance.
203 The provision referred to in the text is based upon Art. 2:201 PECL.
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Article 15
(1) An offer becomes effective when it reaches the offeree.
(2) An offer, even if it is irrevocable, may be withdrawn if the withdrawal reaches
the offeree before or at the same time as the offer.
Bibliography: Eörsi, Formation of contract, in: Wiener Übereinkommen von 1980 über den internatio-
nalen Warenkauf (1985), p. 43; Ferrari, Vendita internazionale di beni mobili. Artt. 14–24. Formazione
del contratto (2006); Leete, Contract Formation under the United Nations Convention on Contracts for
the International Sale of Goods and the Uniform Commercial Code: Pitfalls for the Unwary, 6 Temple
International and Comparative Law Journal (1992) 193; Ludwig, Der Vertragsabschluß nach UN-
Rechtsordnungen Englands und Deutschlands (1994); Murray, An Essay on the Formation of Contracts
and Related Matters under the United Nations Convention on Contracts for the International Sale of
Goods, 8 Journal of Law and Commerce (1998) 11; Perales Viscasillas, La Formación del contrato de
compraventa internacional de mercaderı́as (1996).
Outline
1. Withdrawal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
2. Death, insolvency and lack of legal capacity of the offeror. . . . . . . . . . . . . . . . . 15

Art. 15(1), the substantive rule of which can be traced back to Art. 5(1) ULF,1 states, 1
though not mandatorily,2 that an offer becomes effective only when it reaches the
addressee.3 Consequently, an offer that does not reach the addressee is ineffective4 and
cannot, therefore, be accepted.5 This is true even if the addressee learns of the contents
of the offer in a different manner.6
Art. 15 does not determine when an offer “reaches” the offeree; rather, it is Art. 24 2
that defines when a declaration reaches its addressee.7 Pursuant to Art. 24, an offer
1 See Rubino, Nuove leggi civ. comm. (1989) 53 (53 note 1); Magnus, in: Staudinger Kommentar (2013),
Art. 15 para. 4.
Perales Viscasillas, La Formación del contrato de compraventa internacional de mercaderı́as (1996) p. 376.
3 See Rechtbank Koophandel Tongeren (Belgium) 25 January 2005, CISG-Online 1106; in legal writing,
see, e. g., Garro/Zuppi, Compraventa internacional de mercaderı́as (2012), p. 125; Schlechtriem/Schroeter,

Internationales UN-Kaufrecht (2013) para. 260.
5 See also Audit, Vente Internationale (1990), p. 60; Dornis, in: Honsell, Kommentar (2010), Art. 15
para. 2; Ferrari/Torsello, International Sales Law – CISG (2015) p. 139; Lüderitz/Fenge, in: Soergel (ed),
6 In accord Eörsi, in: Bianca/Bonell, Commentary (1987), Art. 15 para. 2.1.2; Enderlein/Maskow/
Strohbach, Internationales Kaufrecht (1991) Art. 15 para. 1; Eörsi, Formation of contract, in: Wiener
Übereinkommen von 1980 über den internationalen Warenkauf (1985) p. 43 (48); Ferrari/Torsello,
International Sales Law – CISG (2015) p. 139; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary
(2005), Art. 15 para. 2.
7 Compare Adame Goddard, El Contrato de Compraventa Internacional (1994) p. 98; Saenger, in:
Bamberger/Roth (eds), Kommentar zum Bürgerlichen Gesetzbuch (2012), Art. 15 para. 2; Brunner/
Ferrari 243
3B2 9.1.580; Page size: 160.00mm 240.00mm
“reaches” the addressee when it is made orally to him or delivered by other means to
him personally, to his place of business or mailing address, or if he does not have a place
of business or mailing address, to his habitual residence.8 In other words, when
considering the question of when the offer might become effective (such as at the time
of declaration, time of dispatch, time of receipt by the offeree, time of knowledge by the
offeree),9 the drafters of the CISG decided in favour of the point in time that best
spreads the risk of non-receipt and incorrect transmission of the offer between the
persons concerned, i. e., the offeror and the offeree.10 While the offeror bears the risk of
transmission until the time of delivery,11 which entails that the offer becomes effective
as it was delivered and not as it was declared,12 and which under certain circumstances
may lead to the voidability of the offer according to domestic law,13 the addressee bears
the risk (loss, destruction, late knowledge, etc.) after delivery has occurred.14 The choice
in favour of the time of delivery therefore serves the interests of both parties.
3 The time when an offer reaches its addressee does not only determine when the
aforementioned risk to the offeror passes, but also when the offer can be accepted.15
Thus, it determines the beginning of the time period within which the offer can be
Pfisterer/Köster, Kommentar (2014), Art. 15 para. 1; Dornis, in: Honsell, Kommentar (2010), Art. 15
paras. 1 and 2; Eörsi, Formation of contract, in: Wiener Übereinkommen von 1980 über den inter-
nationalen Warenkauf (1985) p. 43 (48); Garro/Zuppi, Compraventa internacional de mercaderı́as (2012),
p. 125; Gillette/Walt, The UN Convention on Contracts for the International Sale of Goods (2016) p. 88;
Gruber, in: MünchKommBGB (2016), Art. 15 para. 1; Herber/Czerwenka, Kommentar (1991), Art. 15
para. 2; Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 15 CISG para. 5; Perales
Viscasillas, La Formación del contrato de compraventa internacional de mercaderı́as (1996) p. 374;
Rubino, Nuove leggi civ. comm. (1989) 53 (53); Schroeter, in: Schlechtriem/Schwenzer, Kommentar
(German ed. 2013), Art. 15 para. 2; Sono, Formation of International Contracts under the Vienna
Convention: A Shift above the Comparative Law, in: Sarcevic/Volken (eds), International Sale of Goods
(1986), p. 111 (115); Magnus, in: Staudinger Kommentar (2013), Art. 15 para. 5; Schroeter, in: Schlech-
8 Ferrari/Torsello, International Sales Law – CISG (2015) p. 139; Leete, Contract Formation under the
United Nations Convention on Contracts for the International Sale of Goods and the Uniform
Commercial Code: Pitfalls for the Unwary, 6 Temple International and Comparative Law Journal (1992)
193 (202 et seq.); Murray, An Essay on the Formation of Contracts and Related Matters under the United
Nations Convention on Contracts for the International Sale of Goods, 8 Journal of Law and Commerce
(1998) 11 (20); J. Pierre/V. Pierre, A Comparison of the Rules on Formation of Sales Contracts Under
the Louisiana Civil Code and the United Nations Convention on Contracts for the International Sale
of Goods: What Buyers and Sellers Should Know, 20 Southern University Law Review (1993) 189
(191 et seq.).
9 See Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 170; for comparative remarks on the issue at
hand, see Ferrari, La formazione del contratto, in: Galgano/Ajani/Ferrari (eds), Atlante di diritto privato
comparato (1999), pp. 129 (149 et seq.).
10 See also Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 171; Ferrari/Torsello, International Sales
Law – CISG (2015) p. 139.

11 Compare Dornis, in: Honsell, Kommentar (2010), Art. 15 para. 5; Ludwig, Der Vertragsabschluß
nach UN-Kaufrecht im Spannungsverhältnis von Common Law und Civil Law, dargestellt auf der
Grundlage der Rechtsordnungen Englands und Deutschlands (1994) p. 312; Lüderitz/Fenge, in: Soergel
(ed), Kommentar zum BGB. Schuldrechtliche Nebengesetze (2000), Art. 15 para. 3; Neumayer/Ming,
Convention de Vienne (1993), Art. 15 para. 1; Piltz, Internationales Kaufrecht (2008) para. 3-35; Stern,
Erklärungen im UNCITRAL-Kaufrecht (1990) p. 21.
12 Dornis, in: Honsell, Kommentar (2010), Art. 15 para. Gruber, in: MünchKommBGB (2016), Art. 15
para. 8; Magnus, in: Staudinger Kommentar (2013), Art. 15 para. 6.

13 See Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 15 para. 9; Magnus, in: Staudinger

Rubino, Nuove leggi civ. comm. (1989) 53 (53); an offer that has reached its addressee can be accepted by
the addressee even where the offer reached the addressee before the time that the offer was expected to
reach its addressee; see Neumayer/Ming, Convention de Vienne (1993), Art. 15 para. 1.
244 Ferrari
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accepted16 and also the point after which a revocable offer can be revoked.17 Before that
time an offer cannot be accepted.18 As previously discussed,19 this is true even where the
addressee learns of the offer in a different manner.20 If the addressee accepts the offer as
a precaution before the offer reaches the addressee, the contract does not come into
existence until the time the offer reaches the addressee (provided, obviously, that the
acceptance also reaches its addressee).21 Even where cross-offers are made, a contract
conclusion can occur.22 This may, however, cause problems relating to the exact time of
the contract conclusion. In this author’s opinion, the contract conclusion occurs when
the second of the two offers reaches its addressee.23
When an offer is addressed to an indefinite group of persons, and therefore can bind 4
the offeror only under certain circumstances,24 the offer becomes effective only when it
is possible to gain knowledge of the offer,25 unless, of course, the offer itself provides
otherwise.26
Though not stated explicitly, Art. 24 requires that the offer be expressed with 5
the consent of the offeror.27 This requirement is not met, for instance, where a third party,
without being authorized to do so, mails a letter that it has found in a drawer. In these
cases, there is no offer that is susceptible to being accepted,28 which means that even where
16 See Perales Viscasillas, La Formación del contrato de compraventa internacional de mercaderı́as
(1996) p. 375.
17 Ferrari/Torsello, International Sales Law – CISG (2015) p. 140; Schlechtriem, in: Schlechtriem/
Schwenzer, Commentary (2005), Art. 15 para. 2; Schlechtriem/Schroeter, in: Schlechtriem/Schwenzer,

Kommentar (German ed. 2013), Art. 15 para. 2.
18 Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 15 CISG para. 5; Schroeter,

20 Official Records (1981), p. 22; Audit, Vente Internationale (1990), p. 60; Dornis, in: Honsell,
Kommentar (2010), Art. 15 para. 2; Eörsi, in: Bianca/Bonell, Commentary (1987), Art. 15 para. 2.1.2;
Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 172; Enderlein/Maskow/Strohbach, Internationales
Kaufrecht (1991) Art. 15 para. 1; Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012),
Art. 15 CISG para. 5; Rubino, Nuove leggi civ. comm. (1989) 53 (53); Schlechtriem, in: Schlechtriem/
Schwenzer, Commentary (2005), Art. 15 para. 2; Witz/Salger/Lorenz, Kommentar (2016), Art. 15 para. 4;
21 See also Dornis, in: Honsell, Kommentar (2010), Art. 15 para. 2; Neumayer/Ming, Convention de
Vienne (1993), Art. 15 para. 1; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 15
para. 2; Magnus, in: Staudinger Kommentar (2013), Art. 15 para. 5; contra see Schnyder/Straub, in:
22 For this conclusion, see also Witz/Salger/Lorenz, Kommentar (2016), Art. 15 para. 5.
23 Gruber, in: MünchKommBGB (2016), Art. 15 para. 7; Perales Viscasillas, La Formación del contrato
de compraventa internacional de mercaderı́as (1996) p. 390.

25 See Dornis, in: Honsell, Kommentar (2010), Art. 15 para. 3; Ferrari, Vendita internazionale di beni
para. 5; Ludwig, Der Vertragsabschluß nach UN-Kaufrecht im Spannungsverhältnis von Common Law
p. 31; Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 15 para. 8.
26 Contra Achilles, Kommentar (2000) Art. 15 para. 1; Schlechtriem, in: Schlechtriem/Schwenzer,
Commentary (2005), Art. 15 para. 3; Magnus, in: Staudinger Kommentar (2013), Art. 15 para. 5; for a
partially different view see also Schroeter, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 15
para. 3.
27 See also Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 15 CISG para. 7;
Piltz, Internationales Kaufrecht (2008), para. 3-35.

28 See also Dornis, in: Honsell, Kommentar (2010), Art. 15 para. 4; Gruber, in: MünchKommBGB
(2016), Art. 15 para. 9; Magnus, in: Staudinger Kommentar (2013), Art. 15 para. 6; Schroeter, in:
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that letter reaches the addressee it does not become effective as an offer. The offeror bears
the burden of proving that the offer was dispatched without his consent.29

1. Withdrawal
6 According to Art. 15(2), the moment when the offer reaches the offereee also
determines the moment until which an offer – even an irrevocable one30 – can be
withdrawn.31 A validly withdrawn offer never becomes effective in the first place,32 and
therefore – by conceptual necessity – cannot be accepted.33 According to some
commentators, this is the basic point Art. 15 makes.34
7 Art. 15(2) does not define the term withdrawal; from this provision, however, it can
be derived that a withdrawal is a statement that has to reach its addressee to become
effective35 (and whose substantial validity requirements are determined by domestic
law36). This relates to a statement in itinere37 and aims at keeping the statement it relates
to from becoming effective.38 Thus, an offer cannot be withdrawn if it has already
reached the offeree.39
29 See Gruber, in: MünchKommBGB (2016), Art. 15 para. 20; Schlechtriem, in: Schlechtriem/Schwenzer,
Commentary (2005), Art. 15 para. 2 note 2; contra Dornis, in: Honsell, Kommentar (2010), Art. 15
para. 21.
30 Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 15 CISG para. 9; Piltz,
Internationales Kaufrecht (2008), para. 3-42.

31 See also Adame Goddard, El Contrato de Compraventa Internacional (1994) p. 98; Dı́ez-Picazo, in:
Dı́ez-Picazo, Comentario (1998), p. 173; Eörsi, Formation of contract, in: Wiener Übereinkommen von
1980 über den internationalen Warenkauf (1985) p. 43 (48); Leete, Contract Formation under the United
Nations Convention on Contracts for the International Sale of Goods and the Uniform Commercial
Code: Pitfalls for the Unwary, 6 Temple International and Comparative Law Journal (1992) 193 (206);
Perales Viscasillas, La Formación del contrato de compraventa internacional de mercaderı́as (1996)
p. 375; Rubino, Nuove leggi civ. comm. (1989) 53 (53 and 55); Schroeter, in: Schlechtriem/Schwenzer,
(1996) p. 382; Rubino, Nuove leggi civ. comm. (1989) 53 (54); Rudolph, Kommentar (1996), Art. 15
para. 3.
33 See Gruber, in: MünchKommBGB (2016), Art. 15 para. 14; Neumayer/Ming, Convention de Vienne
34 See Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 15 para. 4; Magnus, in: Staudinger

35 Dornis, in: Honsell, Kommentar (2010), Art. 15 para. 6; Magnus, in: Staudinger Kommentar (2013),
Art. 15 para. 7; Rudolph, Kommentar (1996), Art. 15 para. 3; Schlechtriem, in: Schlechtriem/Schwenzer,
Commentary (2005), Art. 15 para. 4; Schroeter, in: Schlechtriem/Schwenzer, Kommentar (German ed.
2013), Art. 15 para. 4; Stern, Erklärungen im UNCITRAL-Kaufrecht (1990) p. 21; Schroeter, in: Schlech-
para. 11; Magnus, in: Staudinger Kommentar (2013), Art. 15 para. 11; Saenger, in: Bamberger/Roth (eds),
Kommentar zum Bürgerlichen Gesetzbuch (2012), Art. 15 para. 3; Schroeter, in: Schlechtriem/Schwenzer,
Kommentar (German ed. 2013), Art. 15 para. 4; Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 15
para. 15.
37 Meeusen, Totstandkoming van de Overeenkomst, in: van Houtte/Erauw/Wautelet (eds), Het Weens
Koopverdrag (1997), p. 71 (78).

38 In accord Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 172; Dornis, in: Honsell, Kommentar
para. 8; Perales Viscasillas, La Formación del contrato de compraventa internacional de mercaderı́as
(1996) p. 377; Rubino, Nuove leggi civ. comm. (1989) 53 (54).
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For a withdrawal to have the intended effect on the offer, it must reach the offeree 8
before or at the same time as the offer that it aims to withdraw40 (however, when the
withdrawal reaches its addressee is to be determined, like the offer, on the basis of
Art. 24).41 For a withdrawal of an offer to have its intended effects, it is irrelevant
whether the addressee gains actual knowledge of it.42 This has various consequences. If
the withdrawal reaches the offeror before, or at the latest at the same time as the offer,
the offer does not become effective. This is true even if the addressee learns of the offer
at the same time or even before the withdrawal.43 On the other hand, the withdrawal
does not become effective even if the addressee of the withdrawal gains knowledge of it
before gaining knowledge of the offer if the offer has reached the addressee before the
withdrawal.44 However, a withdrawal that reaches the offeree after the offer can
constitute a revocation under Art. 16.45
A withdrawal must be distinguished from a mere clarification or modification of an 9
offer – neither of which, unlike the withdrawal, affect the effectiveness of an offer at all.
The question of whether a statement qualifies as a withdrawal, modification or simple
clarification of the offer is to be decided on the basis of an interpretation in light of
Art. 8.46
A withdrawal of an offer to the public is also possible.47 With regard to the question 10
of when such a withdrawal becomes effective (and, thus, leads to the offer to the public
never becoming effective) the same considerations as the ones mentioned earlier apply.
40 Leete, Contract Formation under the United Nations Convention on Contracts for the International Sale
Comparative Law Journal (1992) 193 (206); Murray, An Essay on the Formation of Contracts and Related
Matters under the United Nations Convention on Contracts for the International Sale of Goods, 8 Journal of
Law and Commerce (1998) 11 (25); Perales Viscasillas, La Formación del contrato de compraventa
internacional de mercaderı́as (1996) p. 377; Piltz, Internationales Kaufrecht (2008), para. 3-42; Schroeter, in:
Schlechtriem/Schwenzer, Commentary (2016), Art. 15 para. 4; contra, without justification, Jametti Greiner,
Der Vertragsabschluss, in: Hoyer/Posch (eds), Das Einheitliche Wiener Kaufrecht (1992), p. 43 (50).
41 See Ludwig, Der Vertragsabschluß nach UN-Kaufrecht im Spannungsverhältnis von Common Law
p. 311; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 15 para. 4; Magnus, in:
para. 10; Herber/Czerwenka, Kommentar (1991), Art. 15 para. 4; Ludwig, Der Vertragsabschluß nach UN-
Rechtsordnungen Englands und Deutschlands (1994) p. 303; Lüderitz/Fenge, in: Soergel (ed), Kommentar
zum BGB. Schuldrechtliche Nebengesetze (2000), Introduction to Art. 14 para. 4; Piltz, Internationales
Kaufrecht (2008), para. 3-42; Reinhart, Kommentar (1991), Art. 15 para. 2; Schroeter, in: Schlechtriem/
43 Gruber, in: MünchKommBGB (2016), Art. 15 para. 10; Magnus, in: Staudinger Kommentar (2013),
Art. 15 para. 9.
44 Herber/Czerwenka, Kommentar (1991), Art. 15 para. 4; Schnyder/Straub, in: Honsell, Kommentar
(1997), Art. 15 para. 14; Ludwig, Der Vertragsabschluß nach UN-Kaufrecht im Spannungsverhältnis von
Common Law und Civil Law, dargestellt auf der Grundlage der Rechtsordnungen Englands und Deutsch-
lands (1994) p. 313; Piltz, Internationales Kaufrecht (2008), para. 3-42; Stern, Erklärungen im UNCI-
TRAL-Kaufrecht (1990) pp. 21 et seq.; contra, see Jametti Greiner, Der Vertragsabschluss, in: Hoyer/
Posch (eds), Das Einheitliche Wiener Kaufrecht (1992), p. 43 (50).
45 See Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 173; Dornis, in: Honsell, Kommentar (2010),
Art. 15 para. 13; Gruber, in: MünchKommBGB (2016), Art. 15 para. 2; Piltz, Internationales Kaufrecht
(2008), para. 3-42; Rubino, Nuove leggi civ. comm. (1989) 53 (55); Magnus, in: Staudinger Kommentar
(2013), Art. 15 para. 9.
47 Dornis, in: Honsell, Kommentar (2010), Art. 15 para. 7; Schroeter, in: Schlechtriem/Schwenzer,
Commentary (2016), Art. 15 para. 6; contra Perales Viscasillas, La Formación del contrato de compra-
venta internacional de mercaderı́as (1996) p. 476.
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In order to prevent the offer to the public from becoming effective, the withdrawal must
occur in a manner that (theoretically) allows every potential addressee to gain knowl-
edge of it. This is surely the case when the form of the withdrawal mirrors that of the
offer to the public.48 But it is possible that a withdrawal taking a different form might
also bar the effectiveness of an offer to the public.49
11 There is dispute as to whether an oral offer can be withdrawn. Some commentators
hold that a withdrawal is possible until the oral statement is completed.50 In this
author’s opinion, this conclusion is not self-evident.51 This is due to the fact that when
the oral statement is interrupted, there is not yet a full offer that can be accepted.52
12 Art. 15 does not deal with the form the withdrawal has to take. The withdrawal is –
subject to Art. 12 – not subject to any form requirements.53 Thus, the withdrawal can
also be made in a form different from that of the offer.54
13 According to prevailing opinion, a partial withdrawal is admissible.55 However, there
is a dispute as to whether it is permissible to withdraw a withdrawal of an offer. Some
commentators reject this idea categorically.56 In this author’s opinion, that view is
untenable.57 Before the withdrawal becomes effective, the offeror can declare that the
withdrawal will not have any effect,58 (the permissibility of declarations not explicitly
governed by Part II, like a withdrawal of the withdrawal of the offer, arises out of
Art. 24). Therefore, as long as the withdrawal of the withdrawal reaches the offeror
before the original withdrawal, the offer becomes effective upon receipt.59
14 The party relying upon the effects of an offer or a withdrawal bears the burden of
proving that the offer or withdrawal reached the addressee.60
48 See also Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 15 para. 11.
51 Ferrari, Vendita internazionale di beni mobili. Artt. 14–24. Formazione del contratto (2006) pp. 55 et
seq.; contra Perales Viscasillas, La Formación del contrato de compraventa internacional de mercaderı́as
(1996) p. 381.
52 Dornis, in: Honsell, Kommentar (2010), Art. 15 para. 13; Schnyder/Straub, in: Honsell, Kommentar
(1997), Art. 15 para. 17.

Art. 15 para. 11; Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 15 CISG
para. 13; Rubino, Nuove leggi civ. comm. (1989) 53 (56); Rudolph, Kommentar (1996), Art. 15 para. 3;
in case law see Rechtbank Koophandel Tongeren (Belgium) 25 January 2005, CISG-Online 1106; contra
Piltz, Internationales Kaufrecht (2008), para. 3-42: suggesting that the withdrawal does not require any
form, irrespective of Article 12.
54 See also Dornis, in: Honsell, Kommentar (2010), Art. 15 para. 8; Enderlein/Maskow/Strohbach,
Internationales Kaufrecht (1991), Art. 15 para. 6; Herber/Czerwenka, Kommentar (1991), Art. 15 para. 5;
Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 15 CISG para. 13; Schlechtriem, in:
Schlechtriem/Schwenzer, Commentary (2005), Art. 15 para. 4; Lüderitz/Fenge, in: Soergel (ed), Kommen-
tar zum BGB. Schuldrechtliche Nebengesetze (2000), Art. 15 para. 4; Magnus, in: Staudinger Kommentar
(2013), Art. 15 para. 10; Witz/Salger/Lorenz, Kommentar (2016), Art. 15 para. 5; Schroeter, in: Schlech-
triem/Schwenzer, Commentary (2016), Art. 15 para. 5; in case law see Rechtbank Koophandel Tongeren
(Belgium) 25 January 2005, CISG-Online 1106.
55 See, among many, Dornis, in: Honsell, Kommentar (2010), Art. 15 para. 6; Magnus, in: Staudinger

56 See, e. g., Eörsi, in: Bianca/Bonell, Commentary (1987), Art. 15 para. 2.1.2; Neumayer/Ming, Conven-
tion de Vienne (1993), Art. 15 para. 2; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005),
Art. 15 para. 6.
57 Also compare Ferrari, Vendita internazionale di beni mobili. Artt. 14–24. Formazione del contratto
(2006) pp. 56 et seq.

Art. 15 para. 14.

59 Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 15 para. 21.
60 See also Achilles, Kommentar (2000) Art. 15 para. 2; Dornis, in: Honsell, Kommentar (2010), Art. 15
para. 21; Gruber, in: MünchKommBGB (2016), Art. 15 para. 19; Hepting/Müller, in Baumgärtel/Laumen
248 Ferrari
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2. Death, insolvency and lack of legal capacity of the offeror

The CISG does not contain any provisions that govern the effects of death, insol- 15
vency, or lack of legal capacity of the offeror subsequent to him issuing the offer and
before it reaches the addressee.61 It is therefore unsurprising that the impact of these
occurrences on the offer is in dispute. Some commentators hold the view that the CISG
contains an exhaustive list of reasons for which an offer becomes automatically
ineffective after issuance. Those commentators therefore believe that the CISG (im-
plicitly) deals with the issue, which is why they argue that no recourse is to be had to the
applicable domestic law – despite the fact that Art. 4(a) states that the CISG is not
concerned with “the validity of the contract or of any of its provisions or of any usage.”
As a consequence, these commentators believe that the issue must be solved from
within the CISG, and since death, insolvency, and lack of legal capacity are not among
the reasons listed that may have an impact on the effectiveness of an offer, they
conclude that these occurrences do not have an impact at all on the effectiveness of an
offer.62
In this author’s opinion, the opposite holds true.63 Since the drafters of the CISG 16
deliberately abstained from settling this question, it is an external gap, beyond the
CISG’s scope of application. Thus, the question must be settled on the basis of the law
applicable by virtue of the private international law rules of the forum state.64

The PICC contain a provision that is literally the same as Art. 15 CISG,65 namely 17
Art. 2.1.3, which is why no further comment on this provision is needed. A similar
provision, exclusively referring to the offer, is lacking, however, in the DCFR. There is,
(eds), Handbuch der Beweislast im Privatrecht (2009), Art. 15 CISG para. 2; Magnus, in: Staudinger
Kommentar (2013), Art. 15 para. 16; Saenger, in: Bamberger/Roth (eds), Kommentar zum Bürgerlichen
61 Perales Viscasillas, La Formación del contrato de compraventa internacional de mercaderı́as (1996)
p. 467; Witz/Salger/Lorenz, Kommentar (2016), Intro. to Art. 14 para. 8.

62 See Eörsi, in: Bianca/Bonell, Commentary (1987), Art. 16 para. 1.2.1; U. Huber, Der UNCITRAL-
Entwurf eines Übereinkommens über internationale Warenkaufverträge, 43 RabelsZ (1979) 412 (441);
Neumayer/Ming, Convention de Vienne (1993), Art. 15 para. 3; Rubino, Nuove leggi civ. comm. (1989)
58 (69); Magnus, in: Staudinger Kommentar (2013), Art. 15 paras 14 et seq.
63 Dornis, in: Honsell, Kommentar (2010), Art. 15 para. 19; Mankowski, in: Ferrari et al., Internatio-
nales Vertragsrecht (2012), Art. 15 CISG paras 21 et seq.; Schlechtriem, in: Schlechtriem/Schwenzer,
64 See also Achilles, Kommentar (2000) Art. 15 para. 1; Audit, Vente Internationale (1990), p. 62;
Brunner/Pfisterer/Köster, Kommentar (2014), Art. 15 para. 3; Ferrari, Vendita internazionale di beni

mobili. Artt. 14–24. Formazione del contratto (1996) p. 58; Gruber, in: MünchKommBGB (2016),
Art. 15 para. 17; Jametti Greiner, Der Vertragsabschluss, in: Hoyer/Posch (eds), Das Einheitliche Wiener
Kaufrecht (1992), p. 43 (51); Botschaft betreffend das Wiener Übereinkommen über Verträge über den
internationalen Warenkauf (1989) p. 773; Saenger, in: Bamberger/Roth (eds), Kommentar zum Bürgerli-
chen Gesetzbuch (2012), Art. 15 para. 2; Schmidt-Kessel, in: Schwenzer/Hager (eds), Festschrift für Peter
Schlechtriem zum 70. Geburtstag (2003) pp. 255 (256 et seq.); Schlechtriem/Schroeter, Internationales UN-
Kaufrecht (2013) para. 261; Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 15 para. 67; Schroeter,
in: Schlechtriem/Schwenzer, Kommentar (German ed. 2013), Art. 15 para. 8; Wey, Der Vertragsabschluss
beim Internationalen Warenkauf nach UNCITRAL und schweizerischen Recht (1984) para. 916; Schro-
eter, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 15 para. 9; Witz/Salger/Lorenz, Kommentar
(2016), Introduction to Art. 14 para. 8; see also Herber/Czerwenka, Kommentar (1991), Art. 15 para. 6,
where the authors get to the same result in respect, however, only to bankruptcy.
65 Kleinheisterkamp, in: Vogenauer/Kleinheitserkamp (eds), Commentary on the Unidroit Principles
(2009) Art. 2.1.3. para. 1.
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however, a provision (Art. 1:109 DCFR), based upon Art. 1:303 PECL, that deals,
among others, with the effectiveness of a notice. This provision makes it clear that all
notices are effective at the moment they reach their addressee. Although Art. 1:109
DCFR merely refers to notices, it seems, on the basis of an interpretation in light of that
provision’s model, i. e., Art. 1:303 PECL, that the concept of notice includes offers. It is
worth mentioning that the DCFR expressly deals with the effectiveness of the accep-
tance66 as well as the rejection of the offer,67 stipulating that they become effective at the
moment they reach their addressee. It would be inconsistent if the offer were to become
effective at a different moment in time.
18 It should be mentioned that the DCFR does not expressly refer to the withdrawal of
the offer, nor do the PECL. It does, however, in Art. I-1:109(5) DCFR68 state that a
“notice has no effect if a revocation of it reaches the addressee before or at the same
time as the notice.” The wording used by the drafters of the DCFR is imprecise, as the
“revocation” referred to is really a withdrawal. Be that as it may, from this provision one
can derive the offeror’s right to withdraw the offer.
66 See Art. 4:205(1) PICC.
67 See Art. 4:203 PICC.
68 See also Art. 1:303(5) PECL.
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Article 16
(1) Until a contract is concluded an offer may be revoked if the revocation reaches
the offeree before he has dispatched an acceptance.
(2) However, an offer cannot be revoked:
(a) if it indicates, whether by stating a fixed time for acceptance or otherwise,
that it is irrevocable; or
(b) if it was reasonable for the offeree to rely on the offer as being irrevocable
and the offeree has acted in reliance on the offer.
Bibliography: Andersen, CISG Article 16: A Well-placed Principle in the Law of Contract Formation?, in:
Lookofsky/Andersen (eds), The CISG Convention and Domestic Contract Law (2014), p. 35; Eörsi,
Formation of contract, in: Wiener Übereinkommen von 1980 über den internationalen Warenkauf
(1985), p. 43; Ferrari, Vendita internazionale di beni mobili. Artt. 14–24. Formazione del contratto
(2006); Konow, CISG Article 16 and Nordi Domestic Law: Some Challenges of Contract Formation Rules
in International Sales, in: Lookofsky/Andersen (eds), The CISG Convention and Domestic Contract Law
(2014), p. 47; Ludwig, Der Vertragsabschluß nach UN-Kaufrecht im Spannungsverhältnis von Common
(1994); Magnus, Die Allgemeinen Grundsätze im UN-Kaufrecht, 59 RabelsZ (1995) 469; Mather, Firm
offers under the UCC and the CISG, 105 Dickinson Law Review (2000) 31; Meeusen, Totstandkoming
van de Overeenkomst, in: van Houtte/Erauw/Wautelet (eds), Het Weens Koopverdrag (1997), p. 71;
Perales Viscasillas, La formación del contrato de compraventa internacional de mercaderı́as (1996);
J. Pierre/V. Pierre, A Comparison of the Rules on Formation of Sales Contracts Under the Louisiana
Civil Code and the United Nations Convention on Contracts for the International Sale of Goods: What
Buyers and Sellers Should Know, 20 Southern University Law Review (1993) 189; Sono, Formation of
International Contracts under the Vienna Convention: A Shift above the Comparative Law, in: Sarcevic/
Volken (eds), International Sale of Goods (1986), p. 111; Stoffel, Formation du contrat, in: Wiener
Übereinkommen von 1980 über den internationalen Warenkauf (1985), p. 55; Wey, Der Vertragsabs-
chluss beim Internationalen Warenkauf nach UNCITRAL und schweizerischen Recht (1984).
Outline
II. Detailed commentary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
1. Revocation (para. 1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
2. The end of the offeror’s right to revoke. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
3. The Irrevocability of the offer (para. 2) as per the offer itself . . . . . . . . . . . . . . 14
4. Irrevocability of the offer (para. 2) due to the offeree’s justified reliance
and the prohibition of venire contra factum proprium . . . . . . . . . . . . . . . . . . . . . 19
5. Damages in case of revocation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

By way of this dispositive1 provision, which had been very contentious on the 1
occasion of the Vienna Diplomatic Conference,2 even though for the most part it dates
1 Dornis, in: Honsell, Kommentar (2010), Art. 16 para. 28; Mankowski, in: Ferrari et al., Internationales

2 See Adame Goddard, El Contrato de Compraventa Internacional (1994) p. 99; Dornis, in: Honsell,
Kommentar (2010), Art. 16 para. 1; Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012),
Art. 16 CISG para. 2; Perales Viscasillas, La formación del contrato de compraventa internacional de
mercaderı́as (1996) pp. 391 et seq.; for the discussion on the occasion of the Vienna Diplomatic
Conference, see Official Records (1981), pp. 277 et seq.
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back to a provision already contained in the ULF3, the drafters of the CISG tried to
reach a compromise4 between those legal systems in which an offer is generally
irrevocable and those that consider an offer to be generally revocable.5 Equating the
former solution exclusively with that found in civil law countries and the latter with that
found in the common law countries is incorrect.6 In France and Italy, for instance, two
legal systems which undoubtedly belong to the civil law tradition, the rule is that an
offer is generally revocable.7
2 The result of the aforementioned efforts to reach a compromise may be summarized
as follows. An offer is generally revocable8 (either until the dispatch of the acceptance9
or until the moment of the conclusion of the contract, namely where acceptance occurs
by performance of an act indicating assent pursuant to Art. 18),10 provided that the
offeror does not indicate his intent to be irrevocably bound by the offer and the offeree
could not reasonably rely on the offer’s irrevocability and did not act in reliance on it.
3 Through this compromise, the drafters of the CISG have, according to some
commentators,11 also tried to find a balance between the interests of the offeror
3 Rubino, Nuove leggi civ. comm. (1989) 56 (58).

4 For a reference in legal writing to this compromise, see Eörsi, in: Bianca/Bonell, Commentary (1987),
Art. 16 para. 2.1.1; Bydlinski, Das allgemeine Vertragsrecht, in: Doralt (ed), Das UNCITRAL-Kaufrecht
im Vergleich zum österreichischen Recht (1985), p. 57 (66); Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario
(1998), p. 174; Ferrari, Vendita internazionale di beni mobili. Artt. 14–24. Formazione del contratto
(2006) p. 59; Lüderitz/Fenge, in: Soergel (ed), Kommentar zum BGB. Schuldrechtliche Nebengesetze
(2000), Art. 16 para. 1; Mather, Firm offers under the UCC and the CISG, 105 Dickinson Law Review
(2000) 31 (43); Meeusen, Totstandkoming van de Overeenkomst, in: van Houtte/Erauw/Wautelet (eds),
Het Weens Koopverdrag (1997), p. 71 (78); Perales Viscasillas, La formación del contrato de compraventa
internacional de mercaderı́as (1996) p. 418; Rubino, Nuove leggi civ. comm. (1989) 56 (57); Rudolph,
Kommentar (1996), Art. 16 para. 2; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005),
Art. 16 para. 1; Schlechtriem/Schroeter, Internationales UN-Kaufrecht (2013) para. 263; Schroeter, in:
Schlechtriem/Schwenzer, Commentary (2016), Art. 16 para. 1; UNCITRAL YB (1977), p. 80.
For critisism vis-à-vis this compromise, Eörsi, A propos the 1980 Vienna Convention on Contracts for the
International Sale of Goods, 31 American Journal of Comparative Law (1983) 333 (355 et seq.); Honnold/
Flechtner, Uniform Law (2009), paras 143 and 143.1; Neumayer/Ming, Convention de Vienne (1993),
Art. 16 para. 2.
5 See Audit, Vente Internationale (1990), p. 61; Dornis, in: Honsell, Kommentar (2010), Art. 16 para. 1;
Heuzé, Vente Internationale (2005), para. 178; for comparative remarks, see Ferrari, Formazione del
contratto, in: Galgano/Ferrari/Ajani (eds), Atlante di diritto privato comparato (1999), pp. 97 et seq.;
Mather, Firm offers under the UCC and the CISG, 105 Dickinson Law Review (2000) 31 (41 et seq.);
Rubino, Nuove leggi civ. comm. (1989) 56 (57).
6 See, however, Eörsi, Formation of contract, in: Wiener Übereinkommen von 1980 über den
internationalen Warenkauf (1985), p. 43 (48); Herber/Czerwenka Kommentar (1991), Art. 16 para. 1;

Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 16 para. 5; Meeusen, Totstandkoming van de
Overeenkomst, in: van Houtte/Erauw/Wautelet (eds), Het Weens Koopverdrag (1997), p. 71 (78);
Rudolph, Kommentar (1996), Art. 16 para. 2; Sono, Formation of International Contracts under the
Vienna Convention: A Shift above the Comparative Law, in: Sarcevic/Volken (eds), International Sale of
Goods (1986), p. 111 (114); Stern, Erklärungen im UNCITRAL-Kaufrecht (1990), p. 24; Stoffel, Forma-
tion du contrat, in: Wiener Übereinkommen von 1980 über den internationalen Warenkauf (1985), p. 55
(64).
7 Also see Ferrari, A Comparative Overview of Offer and Acceptance Inter Absentes, 10 Boston
University International Law Journal (1992) 171 (188 et seq.); Gruber, in: MünchKommBGB (2016),
Art. 16 para. 1; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 16 para. 1.
8 Dornis, in: Honsell, Kommentar (2010), Art. 16 para. 1; Ferrari/Torsello, International Sales Law –
CISG (2015) p. 140.

9 J. Pierre/V. Pierre, A Comparison of the Rules on Formation of Sales Contracts Under the Louisiana
Buyers and Sellers Should Know, 20 Southern University Law Review (1993) 189 (192).
10 See Art. 18(3).
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in being able to change his mind at any time and the offeree’s reliance on the
offer’s irrevocability.12
II. Detailed commentary

1. Revocation (para. 1)
In principle, any offer is revocable.13 In order for a revocation to be effective (and, thus, 4
eliminate the effectiveness of the offer and, consequently, the offeree’s possibility to accept
the offer), different preconditions must be met. As regards its contents, the revocation
must be designed in a way to allow a “reasonable person of the same kind” as the offeree
“in the same circumstances” (Art. 8(2)) to understand that it refers to the offer and is
intended to prevent it from becoming effective.14 The viewpoint of a reasonable offeree in
the same circumstances is not only decisive in determining whether the offeror’s statement
constitutes a revocation at all (rather than, for instance, a request for clarification), but also
in deciding whether the revocation is merely a partial one, which is certainly permissible
under the CISG,15 or a complete revocation of the offer.16
It is worth mentioning that a revocation, the substantive validity of which is, pursuant 5
to Art. 4(a), to be judged on the basis of the applicable domestic law rather than the
CISG,17 may not only relate to an offer ad certam personam, but also to an offer
addressed to the public.18 In this respect, what has been said with regard to the
withdrawal of an offer addressed ad incertas personas applies mutatis mutandis.19 The
revocation must be designed in a way for it to be able to reach all potential addressees of
the offer to the public.20 This does not mean, however, that the revocation must take the
same form or must be made using the same means as the offer to the public.21
Like the withdrawal of the offer, the revocation is a declaration of intent which (as a 6
rule) does not need to meet any form requirements22 and which must reach its
12 For a reference to the intended protection of the offeree, see Dornis, in: Honsell, Kommentar (2010),
Art. 16 para. 1; Stern, Erklärungen im UNCITRAL-Kaufrecht (1990), p. 23.

13 Ferrari/Torsello, International Sales Law – CISG (2015) p. 140; Garro/Zuppi, Compraventa inter-
nacional de mercaderı́as, 2012, S. 127.

14 For a similar statement, see Ferrari/Torsello, International Sales Law – CISG (2015) p. 140; Schnyder/
Straub, in: Honsell, Kommentar (1997), Art. 16 para. 6; Schroeter, in: Schlechtriem/Schwenzer, Commen-
tary (2010), Art. 16 para. 8.
15 Compare also Dornis, in: Honsell, Kommentar (2010), Art. 16 para. 2; Gruber, in: MünchKommBGB
(2016), Art. 16 para. 3; Schroeter, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 16 para. 3.
16 See Magnus, in: Staudinger Kommentar (2013), Art. 16 para. 6.
17 See Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 16 para. 3; Schroeter, in:

(2016), Art. 16 para. 3; Piltz, Internationales Kaufrecht (2008), para. 3-44; Rubino, Nuove leggi civ. comm.
(1989) 58 (63); Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 16 para. 7; Schroeter, in: Schlech-
triem/Schwenzer, Commentary (2016), Art. 16 para. 3; Wey, Der Vertragsabschluss beim Internationalen
Warenkauf nach UNCITRAL und schweizerischen Recht (1984) paras 886 et seq.
21 See Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 16 para. 7; Ludwig, Der Vertragsabschluß
Grundlage der Rechtsordnungen Englands und Deutschlands (1994) pp. 316 et seq.; contra, at least in
part, Herber/Czerwenka Kommentar (1991), Art. 16 para. 11; Perales Viscasillas, La formación del
contrato de compraventa internacional de mercaderı́as (1996) p. 477.
22 Dornis, in: Honsell, Kommentar (2010), Art. 16 para. 3; Rubino, Nuove leggi civ. comm. (1989) 58
(70); contra Piltz, Internationales Kaufrecht (2008), para. 3-44: suggesting that the revocation needs to
take the form of the offer it relates to.
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addressee to become effective.23 This can easily be inferred from para. 1, which requires
that the revocation “reaches the offeree before he has dispatched an acceptance”24
(without, however, defining when a revocation “reaches” its addressee, an issue rather
to be decided on the grounds of Art. 24).25 Therefore, what has been said in respect of
the withdrawal also applies in relation to revocation.26 It is not at all necessary that the
offeree gain knowledge of the revocation.27 Even where the offeree becomes aware of the
revocation, this is insufficient for the revocation to be effective.28 In effect, if the offeree
learns about the revocation before it reaches him, this does not lead to the offer losing
its effectiveness.29
7 A declaration intended to be a revocation, which reaches the offeree before the offer
shall be considered a withdrawal.30 Since a revocation becomes effective, as stated
earlier, when it reaches the offeree, it is possible to withdraw a revocation31 but not to
revoke it.32
2. The end of the offeror’s right to revoke

8 The offeror’s right to revoke the offer ends with the conclusion of the contract33
which is governed by Arts 18, 23 and 24. This does not come as a surprise,34 since,
“[o]nce the contract is formed, the parties can no longer alter the declarations required
for its formation; the declarations merge into the contract.”35 The right to revoke is to
be kept distinguished from the right to rescind a contract that has been already
concluded.
23 See Dornis, in: Honsell, Kommentar (2010), Art. 16 para. 2; Enderlein/Maskow/Strohbach, Interna-
tionales Kaufrecht (1991), Art. 16 para. 3; Ferrari/Torsello, International Sales Law – CISG (2015) p. 140;
Man-kowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 16 CISG paras 4 and 8; Perales
Viscasillas, La formación del contrato de compraventa internacional de mercaderı́as (1996) pp. 394 et seq.;
Rubino, Nuove leggi civ. comm. (1989) 58, 60; Saenger, in: Bamberger/Roth (eds), Kommentar zum
Bürgerlichen Gesetzbuch (2012), Art. 16 para. 2; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary
(2005), Art. 16 para. 3; Stern, Erklärungen im UNCITRAL-Kaufrecht (1990) p. 24; Wey, Der Vertragsabs-
chluss beim Internationalen Warenkauf nach UNCITRAL und schweizerischen Recht (1984) para. 886;
24 See Brunner/Pfisterer/Köster, Kommentar (2014), Art. 16 para. 1; Gruber, in: MünchKommBGB
(2016), Art. 16 para. 3; Perales Viscasillas, La formación del contrato de compraventa internacional de
mercaderı́as (1996) p. 395; Piltz, Internationales Kaufrecht (2008), para. 44.
25 Dornis, in: Honsell, Kommentar (2010), Art. 16 para. 5; Rubino, Nuove leggi civ. comm. (1989) 58
(62); Schroeter, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 16 para. 3.

27 See Dornis, in: Honsell, Kommentar (2010), Art. 16 para. 5; Schnyder/Straub, in: Honsell, Kommen-
tar (1997), Art. 16 para. 10.

28 Ferrari/Torsello, International Sales Law – CISG (2015) p. 140–141; Ludwig, Der Vertragsabschluß
Grundlage der Rechtsordnungen Englands und Deutschlands (1994) p. 314; Gruber, in: Münch-
KommBGB (2016), Art. 16 para. 4; Schroeter, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 16
para. 3.
29 In accord Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 16 para. 3.
30 Dornis, in: Honsell, Kommentar (2010), Art. 16 para. 5; Herber/Czerwenka Kommentar (1991)
Art. 16 para. 4.
32 Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 16 para. 29; Gruber, in: MünchKommBGB
(2016), Art. 16 para. 4; contra Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 16
para. 3.
33 See, for instance, Article 1328 of the Italian Codice civile; for a more detailed analysis of the
relationship between that provision and Art. 16 CISG, see Rubino, Nuove leggi civ. comm. (1989) 56 (58).
35 Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 16 para. 4; Schroeter, in:
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Apart from the end of the offeror’s right to revoke an offer due to the conclusion of 9
the contract, that right also ends, pursuant to para. 2, where the offeree dispatches – by
means appropriate in the circumstances, as required by Art. 27 – an acceptance.36 It is
worth pointing out that the right to revoke ends irrespective of whether the acceptance
later reaches the offeror or not.37 From this it clearly follows that the offeror’s right to
revoke is limited in time.38
At first sight, it may look like para. 1 causes uncertainties as to the point in time (that 10
of the conclusion of the contract or that of dispatch of the acceptance) that may be
relevant in a particular case.39 This, however, is not the case, since the moment of the
conclusion of the contract and that of the dispatch of the acceptance relate to different
situations. In this author’s opinion, for the purpose of ending the offeror’s right to
revoke an offer the time of the conclusion of the contract is relevant only if acceptance
is indicated by performing an act that exceptionally does not require a notice to the
offeror (Art. 18(3)).40 The mere performance of this act leads to the conclusion of the
contract, which is why a revocation that reaches the offeree prior to that act being
performed may deprive an offer of its effectiveness.41 In all other circumstances, the end
of the offeror’s right to revoke will depend on the dispatch of the offeree’s acceptance42
or, where the offeree indicates assent by performing an act that requires notice to the
offeror, on the dispatch of that notice.43
A revocation that reaches the offeree after the offeree has dispatched an acceptance 11
is ineffective,44 irrespective of whether the lateness is due to the offeror or not. As a
consequence, the conclusion of the contract – which the offeror wants to avoid – is
uncertain until the acceptance reaches the offeror.45 For instance, in the case where the
acceptance gets lost or does not reach the offeror for any other reason, the contract
will never be concluded.46 What is certain, however, is the fact that the offeror cannot
36 Compare Achilles, Kommentar (2000), Art. 16 para. 1; Adame Goddard, El Contrato de Compra-
venta Internacional (1994) p. 99; Dornis, in: Honsell, Kommentar (2010), Art. 16 para. 9; Ferrari/
Torsello, International Sales Law – CISG (2015) p. 141; Garro/Zuppi, Compraventa internacional de
mercaderı́as (2012), p. 129; Gillette/Walt, The UN Convention on Contracts for the International Sale
of Goods (2016) p. 89; Saenger, in: Bamberger/Roth (eds), Kommentar zum Bürgerlichen Gesetzbuch
(2012), Art. 16 para. 2; Meeusen, Totstandkoming van de Overeenkomst, in: van Houtte/Erauw/
Wautelet (eds), Het Weens Koopverdrag (1997), p. 71 (78); J. Pierre/V. Pierre, A Comparison of the
Rules on Formation of Sales Contracts Under the Louisiana Civil Code and the United Nations
Convention on Contracts for the International Sale of Goods: What Buyers and Sellers Should Know,
20 Southern University Law Review (1993) 189 (194); Rubino, Nuove leggi civ. comm. (1989) 53 (55);
Rudolph, Kommentar (1996), Art. 16 para. 3; Schlechtriem/Schroeter, Internationales UN-Kaufrecht
(2013) para. 263.
37 In accord Dornis, in: Honsell, Kommentar (2010), Art. 16 para. 15; Eörsi, in: Bianca/Bonell,
Commentary (1987), Art. 16 para. 3.1; Herber/Czerwenka Kommentar (1991), Art. 16 para. 5; Gruber,
in: MünchKommBGB (2016), Art. 16 para. 6; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary
(2005), Art. 16 para. 5; contra Magnus, in: Staudinger Kommentar (2013), Art. 16 para. 7.
38 Perales Viscasillas, La formación del contrato de compraventa internacional de mercaderı́as (1996)
p. 405; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 16 para. 4.

40 In accord Rubino, Nuove leggi civ. comm. (1989) 56 (59).
41 See also Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 16 para. 16; Perales Viscasillas, La
formación del contrato de compraventa internacional de mercaderı́as (1996) p. 410.

42 Compare Stern, Erklärungen im UNCITRAL-Kaufrecht (1990) p. 23.
43 Compare Dornis, in: Honsell, Kommentar (2010), Art. 16 para. 13; Herber/Czerwenka Kommentar
(1991), Art. 16 para. 6; Magnus, in: Staudinger Kommentar (2013), Art. 16 para. 7.
CISG (2015) p. 141; Schroeter, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 16 para. 5.
45 See also Adame Goddard, El Contrato de Compraventa Internacional (1994) p. 99; Schlechtriem, in:

46 Compare Neumayer/Ming, Convention de Vienne (1993), Art. 16 para. 3 note 6.
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have any impact anymore on the conclusion of the contract.47 It is up to the offeree,
and the offeree alone, to prevent the conclusion of the contract, by withdrawing the
acceptance,48 which is why one commentator referred to the offeree’s “absolute and
unilateral control”49 over the contract which allows the offeree to speculate at the
expense of the offeror.50 Of course, where the acceptance never reaches the offeror, the
contract cannot be deemed concluded.51
12 For a statement by the offeree to be able to end the offeror’s right to revoke the offer,
that statement must constitute an acceptance under the CISG. Thus, the dispatch of a
reply to an offer which purports to be an acceptance, but contains additional or
different terms which materially alter the offer,52 does not bring an end to the offeror’s
right to revoke the offer.53 Furthermore, where a statement by the offeree purporting to
be an acceptance is dispatched by a person other than the offeree who is not authorized
to do so, the offeror does not lose his right to revoke.
13 The burden of proving the ineffectiveness of the offer due to a timely revocation of
the same lies with the party invoking the offer’s ineffectiveness.54 The dispatch of the
acceptance, however, must always be proven by the offeree, as it pertains to the offeree’s
sphere and it would practically be impossible for the offeror to prove.55
3. The Irrevocability of the offer (para. 2) as per the offer itself

14 From para. 2(a) it is clear that an offer is irrevocable if the offer itself indicates that it
is irrevocable.56 Thus, where the offeror expressly states, irrespective of whether he does
so in writing or not,57 that the offer is irrevocable, a revocation will remain ineffective58
47 Rubino, Nuove leggi civ. comm. (1989) 56 (59); Stern, Erklärungen im UNCITRAL-Kaufrecht (1990)
p. 24; Eörsi, in: Bianca/Bonell, Commentary (1987), Art. 16 para. 3.1, referring to a “trap for the offeror”;
compare also Ludwig, Der Vertragsabschluß nach UN-Kaufrecht im Spannungsverhältnis von Common
(1994) p. 314.
48 See Herber/Czerwenka Kommentar (1991), Art. 16 para. 5; Gruber, in: MünchKommBGB (2016),
Art. 16 para. 7; Neumayer/Ming, Convention de Vienne (1993) Art. 16 para. 3 note 6; Rubino, Nuove
leggi civ. comm. (1989) 56 (60).
p. 415.
52 See Art. 19.
53 See Magnus, in: Staudinger Kommentar (2013), Art. 16 para. 7; Piltz, Internationales Kaufrecht
(2008), para. 3-46.

54 Achilles, Kommentar (2000), Art. 16 para. 3; Dornis, in: Honsell, Kommentar (2010), Art. 16
para. 29; Gruber, in: MünchKommBGB (2016), Art. 16 para. 21; Henniger, Die Frage der Beweislast im
Rahmen des UN-Kaufrechts (1995) pp. 208 et seq.; Hepting/Müller, in Baumgärtel/Laumen (eds),
Handbuch der Beweislast im Privatrecht (2009), Art. 16 CISG para. 2; Magnus, in: Staudinger Kommen-
tar (2013), Art. 16 para. 16; Saenger, in: Bamberger/Roth (eds), Kommentar zum Bürgerlichen Gesetz-
buch (2012), Art. 16 paras 2 and 5; Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 16 para. 32;
mentary (2005), Art. 16 para. 3; Schroeter, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 16
para. 3.
55 See Jung, Die Beweislastverteilung im UN-Kaufrecht (1996) pp. 96 et seq.; Gruber, in: Münch-
KommBGB (2016), Art. 16 para. 21; Reimers-Zocher, Beweislastfragen im Haager und Wiener Kaufrecht
(1995) p. 191; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 16 para. 4; Schnyder/
Straub, in: Honsell, Kommentar (1997), Art. 16 para. 32; contra Dornis, in: Honsell, Kommentar (2010),
Art. 16 para. 29.
56 Ferrari/Torsello, International Sales Law – CISG (2015), p. 141; Mankowski, in: Ferrari et al.,
Internationales Vertragsrecht (2012), Art. 16 CISG para. 10.

57 Mather, Firm offers under the UCC and the CISG, 105 Dickinson Law Review (2000) 31 (44).
256 Ferrari
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and the offeree can accept the offer despite that revocation.59 Unlike in some legal
systems,60 where the legislator provided for the offeror’s possibility to render irrevocable
an offer that is generally revocable, provided that the offer indicates a period of time for
which the offer remains irrevocable,61 under the CISG the offeror does not need to
indicate such a period of time.62 Thus, it is unsurprising that most commentators
consider an offer irrevocable in the event it includes expressions such as “fix”,63
“irrevocable”64 or “firm (irrevocable) offer”,65 irrespective of any indication of a time
period. In this author’s view, the wording “will be held open” does not necessarily
indicate the offeror’s intention to consider the offer irrevocable.66 The same is true as
regards the wording “will hold this offer open until …”.67 In the latter case, the
irrevocability of the offer may, however, derive from the (rebuttable) assumption – to
be examined in detail later – pursuant to which an offer stating a fixed time for
acceptance is irrevocable.68 In determining whether an offer is supposed to be irrevoc-
able, the rules of interpretation set forth in Art. 8 always have to be taken into
account.69
Where the offeror states a fixed time for which the offer shall be irrevocable, the offer 15
is then irrevocable during this time, even if the time period is unreasonable.70 The
failure to set a fixed time – which, as mentioned earlier, is a prerequisite for an offer’s
irrevocability in some legal systems71 – does not render the offer revocable pursuant to
the CISG.72 Neither does it lead to the offer binding the offeror in perpetuity.73 Rather,
the irrevocable offer lapses upon expiration of a reasonable time.74
An irrevocable offer is terminated for the same reasons as a revocable offer, except, of 16
course, for the revocation.75
59Ferrari/Torsello, International Sales Law – CISG (2015) p. 141.

60See Rubino, Nuove leggi civ. comm. (1989) 56 (57).
61 See Art. 1329 of the Italian Codice civile.
p. 425.
63 Brunner/Pfisterer/Köster, Kommentar (2014), Art. 16 para. 3; Enderlein/Maskow/Strohbach, Interna-
tionales Kaufrecht (1991), Art. 16 para. 6; Schroeter, in: Schlechtriem/Schwenzer, Commentary (2016),
Art. 16 para. 8.
65 Brunner/Pfisterer/Köster, Kommentar (2014), Art. 16 para. 3; Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario
(1998), p. 176; Dornis, in: Honsell, Kommentar (2010), Art. 16 para. 17; Mather, Firm offers under the UCC
and the CISG, 105 Dickinson Law Review (2000) 31 (44); Schlechtriem, in: Schlechtriem/Schwenzer,
Commentary (2005), Art. 16 para. 8; Magnus, in: Staudinger Kommentar (2013), Art. 16 para. 11.
66 Contra Dornis, in: Honsell, Kommentar (2010), Art. 16 para. 17; Piltz, Internationales Kaufrecht
(2008), para. 3-47; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 16 para. 8; Schro-
eter, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 16 para. 8.
67 Contra Eörsi, Formation of contract, in: Wiener Übereinkommen von 1980 über den internationalen
Warenkauf (1985), p. 43 (49); Mather, Firm offers under the UCC and the CISG, 105 Dickinson Law
Review (2000) 31 (44); Magnus, in: Staudinger Kommentar (2013), Art. 16 para. 11.
69 See also Gruber, in: MünchKommBGB (2016), Art. 16 para. 11; Rubino, Nuove leggi civ. comm.
(1989) 58 (66); Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 16 para. 8.

70 Mather, Firm offers under the UCC and the CISG, 105 Dickinson Law Review (2000) 31 (44).
71 This is true, for instance, under Italian law; see Art. 1329 of the Italian Codice civile.
p. 425; Rubino, Nuove leggi civ. comm. (1989) 58 (66).

73 See also Ludwig, Der Vertragsabschluß nach UN-Kaufrecht im Spannungsverhältnis von Common
(1994) p. 316; Perales Viscasillas, La formación del contrato de compraventa internacional de mercaderı́as
(1996) p. 426.
74 Rubino, Nuove leggi civ. comm. (1989) 58 (67); Rudolph, Kommentar (1996), Art. 16 para. 4.
75 See also Magnus, in: Staudinger Kommentar (2013), Art. 16 para. 10.
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17 The irrevocability of an offer does not necessarily need to be stated explicitly.76

Pursuant to para. 2(a), the irrevocability of an offer can also be indicated “otherwise”,
as long as the offeror’s intention to render the offer irrevocable is real.77 This appears to
be the case, for instance, where the offer states a fixed time for acceptance.78 In this
author’s view, however, fixing a time for acceptance does not necessarily compare to
rendering an offer irrevocable.79 Rather, it merely creates a – rebuttable – presumption
of irrevocability of the offer.80 This means, for instance, that where it is shown that
fixing a time for acceptance is merely intended to let the offer lapse after that time, an
offer cannot be considered irrevocable.81 This also means that – since the fixing of a
time for acceptance indicates that the offer is (presumably) irrevocable – the party
relying on the irrevocability of the offer must merely prove that a time for acceptance
has been fixed.82 It is up to the opposing party to prove that fixing a time for acceptance
did not render an offer irrevocable.83
18 From what has just been said, it follows that only an unambiguous wording may clear
all doubts.84 In this author’s view, the words “I stand by my offer until May 13” are
76 Ferrari/Torsello, International Sales Law – CISG (2015) p. 141; Saenger, in: Bamberger/Roth (eds),
Kommentar zum Bürgerlichen Gesetzbuch (2012), Art. 16 para. 3; Meeusen, Totstandkoming van de
Overeenkomst, in: van Houtte/Erauw/Wautelet (eds), Het Weens Koopverdrag (1997), p. 71 (79).
77 Official Records (1981), p. 22.
78 Rechtbank Limburg (Netherlands) 16 April 2014, CISG-Online 2542.
79 In accord Adame Goddard, El Contrato de Compraventa Internacional (1994) p. 101; Ferrari/
Torsello, International Sales Law – CISG (2015) p. 141; Sono, Formation of International Contracts under
the Vienna Convention: A Shift above the Comparative Law, in: Sarcevic/Volken (eds), International Sale
of Goods (1986), p. 111 (116); contra Bydlinski, Das allgemeine Vertragsrecht, in: Doralt (Hrsg.), Das
UNCITRAL-Kaufrecht im Vergleich zum österreichischen Recht (1985), p. 57 (67); Kabik, Through the
Looking-Glass: International Trade in the “Wonderland” of the United Nations Convention on Contracts
for the International Sale of Goods, 9 International Tax and Business Lawyer (1992) 408 (418); Leete,
Contract Formation under the United Nations Convention on Contracts for the International Sale of
Goods and the Uniform Commercial Code: Pitfalls for the Unwary, 6 Temple International and
Comparative Law Journal (1992) 193 (204 et seq.); Meeusen, Totstandkoming van de Overeenkomst, in:
van Houtte/Erauw/Wautelet (eds), Het Weens Koopverdrag (1997), p. 71 (79); Neumayer/Ming, Conven-
tion de Vienne (1993), Art. 16 para. 5 a; Reinhart, Kommentar (1991), Art. 17 para. 3.
80 See also Achilles, Kommentar (2000), Art. 16 para. 1; Brunner/Pfisterer/Köster, Kommentar (2014),
Art. 16 para. 3; Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 177; Dornis, in: Honsell, Kommentar
(2010), Art. 16 para. 18; Enderlein/Maskow/Strohbach, Internationales Kaufrecht (1991), Art. 16 para. 7;
Herber/Czerwenka Kommentar (1991), Art. 16 para. 9; Heuzé, Vente Internationale (2005), para. 179;
Honnold/Flechtner, Uniform Law (2009), para. 143.1; Jametti Greiner, Der Vertragsabschluss, in: Hoyer/
Posch (eds), Das Einheit-liche Wiener Kaufrecht (1992), p. 43 (51); Lüderitz/Fenge, in: Soergel (ed),
Kommentar zum BGB. Schuldrechtliche Nebengesetze (2000), Art. 16 para. 7; Karollus, UN-Kaufrecht
(1989) p. 65; Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 16 CISG para. 12;
Mather, Firm offers under the UCC and the CISG, 105 Dickinson Law Review (2000) 31 (45 et seq.); Perales
Viscasillas, La formación del contrato de compraventa internacional de mercaderı́as (1996) p. 439; Piltz,
Internationales Kaufrecht (2008), para. 3-48; Rubino, Nuove leggi civ. comm. (1989) 58 (66); Schnyder/
Straub, in: Honsell, Kommentar (1997), Art. 16 para. 20; Schroeter, in: Schlechtriem/Schwenzer, Commen-
tary (2016), Art. 16 para. 9; Sono, Restoration of the Rule of Reason in Contract Formation: Has There Been
Civil and Common Law Disparity?, 21 Cornell International Law Journal (1988) 477 (479); Stern, Erklärun-
gen im UNCITRAL-Kaufrecht (1990) pp. 19 et seq.; Stoffel, Formation du contrat, in: Wiener Übereinkom-
men von 1980 über den internationalen Warenkauf (1985), p. 55 (65); Wey, Der Vertragsabschluss beim
Internationalen Warenkauf nach UNCITRAL und schweizerischen Recht (1984) para. 857.
81 See Ferrari/Torsello, International Sales Law – CISG (2015) p. 141–142; Schlechtriem, in: Schlech-
triem/Schwenzer, Commentary (2005), Art. 16 para. 9; Wey, Der Vertragsabschluss beim Internationalen
Warenkauf nach UNCITRAL und schweizerischen Recht (1984) para. 857.
82 Audit, Vente Internationale (1990), p. 61.
83 Dornis, in: Honsell, Kommentar (2010), Art. 16 para. 29; Jung, Die Beweislastverteilung im UN-
Kaufrecht (1996) p. 100.

84 See also Herber/Czerwenka Kommentar (1991), Art. 16 para. 9; Honnold/Flechtner, Uniform Law
(2009), para. 143.
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sufficiently unambiguous.85 The same, however, may not be said of the following
wording: “Our offer is at any rate good until May 13”,86 since any reference to the
offeror’s intention to be firmly bound by the offer so as to consider it irrevocable seems
to be lacking. Irrespective of what has just been said, it must be pointed out that the
rules on interpretation provided by Art. 8 will always have to be resorted to in order to
determine whether an offer is irrevocable, which is why one may get to a result different
from the ones just mentioned. Resort to the interpretive criteria set forth in Art. 8 will
generally lead to the understanding of a reasonable person of the same kind as the
addressee of the offer becoming relevant.87
4. Irrevocability of the offer (para. 2) due to the offeree’s justified

reliance and the prohibition of venire contra factum proprium
Where it was reasonable for the offeree to rely on the irrevocability of the offer and 19
the offeree acted in reliance on the offer, the offeror may not effectively revoke the
offer.88 Accordingly, two prerequisites need to be met for an offer to be irrevocable
pursuant to Art. 16(2) CISG: there has to be a justified reliance on the irrevocability of
the offer and action has to have been taken in reliance thereupon.89
As for the first prerequisite, it is met where the offeree could assume, in light of the 20
specific circumstances, that the offeror felt irrevocably bound to the offer; this assump-
tion is “reasonable” only where a “reasonable person of the same kind” as the offeree
would, “in the same circumstances”, reach the same conclusion.90 This is the case, for
instance, where prior to acceptance costly price calculations are necessary of which the
offeror could not have been unaware.91
As mentioned, the offeree also has to have acted (or omitted to do so)92 in reliance on 21
the irrevocability of the offer.93 It can be said that the offeree has acted in reliance on the
irrevocability, for instance, where production is started,94 material is obtained95 or new
85In accord Eörsi, in: Bianca/Bonell, Commentary (1987), Art. 16 para. 2.2.1.
86In accord Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 16 CISG para. 16;
contra Eörsi, in: Bianca/Bonell, Commentary (1987), Art. 16 para. 2.2.1; Magnus, in: Staudinger Kom-
87 Mather, Firm offers under the UCC and the CISG, 105 Dickinson Law Review (2000) 31 (46 et seq.);
Gruber, in: MünchKommBGB (2016), Art. 16 para. 13.

88 See Ferrari/Torsello, International Sales Law – CISG (2015) p. 142; Perales Viscasillas, La formación
del contrato de compraventa internacional de mercaderı́as (1996) pp. 449 et seq.; Schroeter, in: Schlech-
nales Vertragsrecht (2012), Art. 16 CISG para. 17; Schnyder/Straub, in: Honsell, Kommentar (1997),
Art. 16 para. 22.
para. 21; Ferrari/Torsello, International Sales Law – CISG (2015) p. 142; Rudolph, Kommentar (1996),
Art. 16 para. 6.
91 See Brunner/Pfisterer/Köster, Kommentar (2014), Art. 16 para. 4; Kritzer, Guide to Practical Applica-
tions (1989) pp. 167 et seq.; Magnus, in: Staudinger Kommentar (2013), Art. 16 para. 13; Mather, Firm
offers under the UCC and the CISG, 105 Dickinson Law Review (2000) 31 (48 et seq.); Official Records
(1981), p. 22; Piltz, Internationales Kaufrecht (2008), para. 3-49; Schnyder/Straub, in: Honsell, Kommen-
tar (1997), Art. 16 para. 23.
92 See Dornis, in: Honsell, Kommentar (2010), Art. 16 para. 22; Gruber, in: MünchKommBGB (2016),
93 Adame Goddard, El Contrato de Compraventa Internacional (1994) p. 102; Jametti Greiner, Der
Vertragsabschluss, in: Hoyer/Posch (eds), Das Einheitliche Wiener Kaufrecht (1992), p. 43 (50).
94 So Audit, Vente Internationale (1990), p. 61; Heuzé, Vente Internationale (2005), para. 179.
(2010), Art. 16 para. 22; Eörsi, Formation of contract, in: Wiener Übereinkommen von 1980 über den
internationalen Warenkauf (1985), p. 43 (49).
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personnel is employed.96 For the purposes of the issue at hand it may also be relevant
that the offeree has rejected other offers.97
22 Many commentators98 derive from Art. 16(2)(b) the general principle99 pursuant to
which it is prohibited to venire contra factum proprium100. This general principle has
not only been recognized in the courts,101 but it has also been used by courts, for
instance, “to solve the question of a possible forfeiture of the defence of late notice, not
expressly settled in the Convention”.102
23 The burden of proof regarding the irrevocability based on Art. 16(2)(b) lies with the
party invoking the irrevocability of the offer.103
96 Enderlein/Maskow/Strohbach, Internationales Kaufrecht (1991), Art. 16 para. 9; Honnold/Flechtner,
Uniform Law (2009), para. 144; Meeusen, Totstandkoming van de Overeenkomst, in: van Houtte/Erauw/
Wautelet (eds), Het Weens Koopverdrag (1997), p. 71 (80); Gruber, in: MünchKommBGB (2016), Art. 16
para. 17; Perales Viscasillas, La formación del contrato de compraventa internacional de mercaderı́as
(1996) p. 452.
97 Gruber, in: MünchKommBGB (2016), Art. 16 para. 17; Schlechtriem, in: Schlechtriem/Schwenzer,
Commentary (2005), Art. 16 para. 11; Witz/Salger/Lorenz, Kommentar (2016), Art. 16 para. 14.
98 For a reference in legal writing to the prohibition to venire contra factum proprium as a general
principle upon which the CISG is based, see Achilles, Kommentar (2000), Art. 7 para. 8; Saenger, in:
Bamberger/Roth (eds), Kommentar zum Bürgerlichen Gesetzbuch (2012), Art. 7 para. 6; Brunner/
Pfisterer/Köster, Kommentar (2014), Art. 16 para. 4; Burkart, Interpretatives Zusammenwirken von
CISG und UNIDROIT Principles (2000) p. 195; Diesse, La bonne foi, la cooperation et le raisonnable
dans la Convention des Nations Unies relative à la vente internationale de marchandises (CVIM),
Journal du droit international (2002) 55 (62 and 83); Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998),
p. 177; Escher, RIW (1999) 495 (500); Felemegas, Comparative Editorial Remarks on the Concept of
Good Faith in the CISG and the PECL, 13 Pace International Law Review (Fall 2001) 399 (402); Ferrari,
General Principles and International Uniform Commercial Law Conventions: A Study of the 1980
Vienna Sales Convention and the 1988 UNIDROIT Conventions, Uniform Law Review (1997) 451
(464); Lüderitz/Fenge, in: Soergel (ed), Kommentar zum BGB. Schuldrechtliche Nebengesetze (2000),
Art. 7 para. 10; Najork, Treu und Glauben im CISG, Diss. Bonn, 2000, S. 105; H.-J. Vogel, Die
Untersuchungs- und Rügepflicht im UN-Kaufrecht (2000) p. 12; Witz/Salger/Lorenz, Kommentar
(2016), Art. 7 para. 14.
99 In general, see Ferrari, Das Verhältnis zwischen den UNIDROIT-Grundsätzen und den allgemeinen
Grundsätzen internationaler Einheitsprivatrechtkonvention. Zugleich ein Beitrag zur Lückenfüllung

durch staatliche Gerichte, JuristenZeitung (1998) 9 et seq.; Magnus, Die Allgemeinen Grundsätze im
UN-Kaufrecht, 59 RabelsZ (1995) 469 et seq.
100 Saenger, in: Bamberger/Roth (eds), Kommentar zum Bürgerlichen Gesetzbuch (2012), Art. 16
para. 4; Schlechtriem/Schroeter, Internationales UN-Kaufrecht (2013) para. 263.

101 See Oberlandesgericht München (Germany) 15 September 2004, CISG-Online 1013; Tribunale di
Padova (Italy) 31 March 2004, CISG-Online 823; Tribunale di Padova (Italy) 25 February 2004, CISG-
Online 819; Tribunale di Rimini (Italy) 26 November 2002, CISG-Online 737; US District Court for the
Southern District of New York (U.S.), Geneva Pharmaceuticals Tech. Corp. v Barr Labs. Inc., 10 May 2002,
CISG-Online 653; Arbitral Award, ICC 8786/1997, CISG-Online 749.
102 Arbitral Award, Internationales Schiedsgericht der Bundeskammer der gewerblichen Wirtschaft in
Österreich, SCH-4318, CISG-Online 120.

103 See also Achilles, Kommentar (2000), Art. 16 para. 3; Dornis, in: Honsell, Kommentar (2010),
Art. 16 para. 29; Gruber, in: MünchKommBGB (2016), Art. 16 para. 22; Hepting/Müller, in Baumgärtel/
Laumen (eds), Handbuch der Beweislast im Privatrecht (2009), Art. 16 CISG para. 10; Jung, Die
Beweislastverteilung im UN-Kaufrecht (1996) pp. 97 et seq.; Magnus, in: Staudinger Kommentar (2013),
Art. 16 para. 17; Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 16 CISG para. 29;
Saenger, in: Bamberger/Roth (eds), Kommentar zum Bürgerlichen Gesetzbuch (2012), Art. 16 para. 5;
Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 16 para. 32; Schroeter, in: Schlechtriem/Schwenzer,
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5. Damages in case of revocation

Since the CISG deals exhaustively with formation of contract,104 there is no room for 24
recourse to national law.105 Accordingly, the offeree may not claim damages (“e. g. for
his reliance interest on the basis of expenses or obligations arising under a substitute
transaction”106) on the grounds of remedies such as culpa in contrahendo; the CISG
implicitly also deals with this issue by barring the offeror’s liability for damages.107
Damages arising out of an intentional tort committed by the offeror are, however, 25
subject to the applicable domestic law, tort liability being excluded from the CISG’s
scope of application.108

Not unlike Art. 15 CISG, Art. 16 CISG can be found verbatim in the PICC. In effect, 26
Art. 2.1.4 PICC corresponds word for word to the provision commented on here. The
wording of the provision of the DCFR that deals with the revocation of the offer
(Art. II-4:202), however, differs slightly from that of Art. 16 CISG, as does the model
upon which Art. II-4:202 DCFR is based and to which it corresponds, namely Art. 2:202
PECL. In some instances, the differences in wording do not reflect a difference in
substance at all, but serve to make clear a result that is also reached under the CISG, by
way of interpretation. This is true, for instance, as regards the reference, in Art. II-
4:202(1) DCFR, to the fact that “[a]n offer may be revoked if the revocation reaches the
offeree before the offeree has dispatched an acceptance or, in cases of acceptance by
conduct, before the contract has been concluded.” Even though Art. 16 CISG does not
refer to acceptance by conduct and its impact on the revocability of an offer, the same
result is reached under the CISG as well.109 The same can be said in respect of Art. II-
Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 16 para. 30; Jametti Greiner, Der Vertragsabs-
chluss, in: Hoyer/Posch (eds), Das Einheitliche Wiener Kaufrecht (1992), p. 43 (46).
105 Brunner/Pfisterer/Köster, Kommentar (2014), Art. 16 para. 5; Karollus, UN-Kaufrecht (1989) p. 45;
Piltz, Internationales Kaufrecht (2008) para. 3-45; Schlechtriem, in: Schlechtriem/Schwenzer, Commen-
tary (2005), Art. 16 para. 13; contra Perales Viscasillas, La formación del contrato de compraventa
internacional de mercaderı́as (1996) p. 458.
106 Schlechtriem, in: Schlechtriem/Schwenzer (eds), Commentary (2005), Art. 16 para. 13.
107 See Achilles, Kommentar (2000), Art. 16 para. 2; Herber/Czerwenka Kommentar (1991), Art. 16
para. 12; Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 16 para. 30; Lüderitz/Fenge, in: Soergel
(ed), Kommentar zum BGB. Schuldrechtliche Nebengesetze (2000), Art. 16 para. 2; Meeusen, Totstand-
koming van de Overeenkomst, in: van Houtte/Erauw/Wautelet (eds), Het Weens Koopverdrag (1997),
p. 71 (80); Gruber, in: MünchKommBGB (2016), Art. 16 para. 9; Piltz, Internationales Kaufrecht (1993)
§ 3 para. 42; Rudolph, Kommentar (1996), Art. 16 para. 10; Magnus, in: Staudinger Kommentar (2005)
Art. 16 para. 14; Witz/Salger/Lorenz, Kommentar (2016), Introduction to Art. 14 para. 17; contra Goderre,
International Negotiations Gone Sour: Precontractual Liability under the United Nations Sales Conven-
tion, 66 University of Cincinnatti Law Review (1997) 257 (281); Heuzé, Vente Internationale (2005),
para. 180; Honnold/Flechtner, Uniform Law (2009), para. 150; Jametti Greiner, Der Vertragsabschluss, in:
Hoyer/Posch (eds), Das Einheitliche Wiener Kaufrecht (1992), p. 43 (46); Neumayer/Ming, Convention
de Vienne (1993), Art. 16 para. 6; Rosenberg, The Vienna Convention: Uniformity in Interpretation for
Gap-Filling – An Analysis and Application, 20 Australian Business Law Review (1992) 442 (452 et seq.);
Rubino, Nuove leggi civ. comm. (1989) 58 (64).
108 Magnus, in: Staudinger Kommentar (2013), Art. 16 para. 15; Schnyder/Straub, in: Honsell, Kom-
mentar (1997), Art. 16 para. 31; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 16
para. 13; contra Gruber, in: MünchKommBGB (2016), Art. 16 paras 9 and 19; for papers on the
relationship between the CISG and domestic tort law, see, e. g., Herber, Mangelfolgeschäden nach dem
CISG und nationales Deliktsrecht, IHR (2001) 187 et seq.
109 See the text accompanying note 9.
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4:202(2), pursuant to which “[a]n offer made to the public can be revoked by the same
means as were used to make the offer.”110
27 In some instances, however, it appears that the difference in wording compares to a
difference in substance. This is true, for instance, as regards Art. II-4:202(3)(b) DCFR,
pursuant to which an offer cannot be revoked if “the offer states a fixed time for its
acceptance”. Unlike Art. 16(2)(a) CISG, Art. II-4:202(3)(b) DCFR does not seem to set
forth a presumption as to the offer’s irrevocability.111 It appears, in other words, that the
offer containing a fixed time for acceptance necessarily constitutes an irrevocable offer.
110 See the text accompanying notes 18 et seq.
111 See the text accompanying notes 69 et seq.
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Article 17
An offer, even if it is irrevocable, is terminated when a rejection reaches the offeror.
Bibliography: Eörsi, Formation of contract, in: Wiener Übereinkommen von 1980 über den internatio-
nalen Warenkauf (1985), p. 43; Ferrari, Vendita internazionale di beni mobili. Artt. 14–24. Formazione
del contratto (2006); Meeusen, Totstandkoming van de Overeenkomst, in: van Houtte/Erauw/Wautelet
(eds), Het Weens Koopverdrag (1997), p. 71; Perales Viscasillas, La formación del contrato de compra-
venta internacional de mercaderı́as (1996).
Outline
1. Rejection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
2. Legal effects of the rejection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

This provision does not have a counterpart in the ULF1, however this did not hinder 1
commentators from assuming that the same rule applied under the ULF.2 It sets forth –
although not mandatorily3 – a rule to be found in many legal systems,4 pursuant to
which an offer – even an irrevocable one – is terminated when the rejection of the offer
reaches the offeror.5 The purpose behind this rule is to ensure that the offeror will be
free6 to conclude a contract with a third party once the offeree has rejected the offer;7 in
other words, the offeror is protected against a change of mind by the offeree after
receiving the rejection.8
1 Compare Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 179; Rocchietti, Nuove leggi civ. comm.
(1989) 71 (72); Magnus, in: Staudinger Kommentar (2013), Art. 17 para. 3.

2 See Schlechtriem, in: Dölle (ed), Komentar (1975), Art. 5 EAG paras 44 et seq.
3 See Dornis, in: Honsell, Kommentar (2010), Art. 17 para. 17; Ferrari, Vendita internazionale di beni
mobili. Artt. 14–24. Formazione del contratto (2006) p. 75; Schnyder/Straub, in: Honsell, Kommentar
(1997), Art. 17 para. 16.
4 See § 146 of the German Civil code.
5 Bydlinski, Das allgemeine Vertragsrecht, in: Doralt (ed), Das UNCITRAL-Kaufrecht im Vergleich
zum österreichischen Recht (1985), p. 57 (69); Dornis, in: Honsell, Kommentar (2010), Art. 17 para. 1;
Koopverdrag (1997), p. 71 (80); Neumayer/Ming, Convention de Vienne (1993), Art. 17 para. 1; Perales
Schlechtriem/Schroeter, Internationales UN-Kaufrecht (2013) para. 265.
6 See Dornis, in: Honsell, Kommentar (2010), Art. 17 para. 1; Piltz, Internationales Kaufrecht (2008) 3-
51; Rocchietti, Nuove leggi civ. comm. (1989) 71 (74); Schnyder/Straub, in: Honsell, Kommentar (1997),
Art. 17 para. 2.
7 See also Official Records (1981), p. 22; Adame Goddard, El Contrato de Compraventa Internacional
(1994) p. 103; Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 179; Eörsi, Formation of contract, in:
Wiener Übereinkommen von 1980 über den internationalen Warenkauf (1985), p. 43 (49); also compare
8 See also Honnold/Flechtner, Uniform Law (2009), para. 153; Perales Viscasillas, La formación del
contrato de compraventa internacional de mercaderı́as (1996) p. 460.
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2 In doing so, the provision refers to one of the main grounds for an offer’s termination
dealt with by the CISG.9 Other grounds for termination of the offer addressed by the
CISG are the revocation (Art. 16) and – subject to the rule set forth in Art. 21(2) – the
lapse of time for acceptance.10 A statement that purports to be an acceptance but
contains additions, limitations or other modifications that materially alter the offer does
not constitute an autonomous ground for termination of the offer; rather, it constitutes
a rejection of the original offer11 as well as a counter-offer.12
3 A withdrawal, on the other hand, does not lead at all to the termination of an offer, as
the termination of the offer requires that the offer has become effective in the first place;
a withdrawal, however, aims to preclude the offer’s effectiveness.13
4 Other grounds, such as death, the opening of insolvency proceedings,14 the loss of
one’s capacity to contract which in some legal systems may lead to the termination of
an offer are not governed by the CISG.15 Their effect on the offer is therefore to be
determined on the basis of the applicable domestic law.16

1. Rejection
5 The CISG does not explicitly define what constitutes a “rejection”. This does not
mean that it is impossible to define. Rather, a rejection may be defined as a statement,
9 Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 17 para. 1; Rocchietti, Nuove leggi civ. comm.
(1989) 71 (74).
10 See Adame Goddard, El Contrato de Compraventa Internacional (1994) pp. 103 et seq.; Perales

11 Compare Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 180; Gruber, in: MünchKommGB
(2007), Art. 17 para. 2; Magnus, in: Staudinger Kommentar (2013), Art. 17 para. 7; contra Dornis, in:
Honsell, Kommentar (2010), Art. 17 para. 1; Meeusen, Totstandkoming van de Overeenkomst, in: van
Houtte/Erauw/Wautelet (eds), Het Weens Koopverdrag (1997), p. 71 (80).
12 Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 17 para. 7; Rocchietti, Nuove leggi civ. comm.
(1989) 71 (73); Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 17 para. 2; Schroeter,
p. 77; Magnus, in: Staudinger Kommentar (2013), Art. 17 para. 6; contra Dornis, in: Honsell, Kommentar
(2010), Art. 17 para. 1; Perales Viscasillas, La formación del contrato de compraventa internacional de
mercaderı́as (1996) p. 464.
14 See Ferrari, in: MünchKommHGB (2013), Art. 15 paras 16 et seq.
15 See also Achilles, Kommentar (2000), Art. 15 para. 1; Audit, Vente Internationale (1990), p. 62; Saenger,
Pfisterer/Köster, Kommentar (2014), Art. 15 para. 3; Ferrari, Vendita internazionale di beni mobili. Artt.
14–24. Formazione del contratto (1996) p. 58; Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 15
para. 67; Jametti Greiner, Der Vertragsabschluss, in: Hoyer/Posch (eds), Das Einheitliche Wiener Kaufrecht
(1992), p. 43 (51); Botschaft betreffend das Wiener Übereinkommen über Verträge über den internationalen
Warenkauf (1989) p. 773; Gruber, in: MünchKommBGB (2016), Art. 15 para. 17; Schroeter, in: Schlechtriem/
Schwenzer, Kommentar (German ed. 2013), Art. 15 para. 8; Schmidt-Kessel, in: Schwenzer/Hager (Hrsg.),
Festschrift für Peter Schlechtiem zum 70. Geburtstag (2003), pp. 255 (256 et seq.); Witz/Salger/Lorenz,
Kommentar (2016), Introduction to Art. 14 para. 8; see also Herber/Czerwenka, Kommentar (1991), Art. 15
para. 6, where the authors get to the same result in respect, however, only to bankruptcy.
16 In accord Karollus, UN-Kaufrecht (1989) p. 62; Meeusen, Totstandkoming van de Overeenkomst, in:
van Houtte/Erauw/Wautelet (eds), Het Weens Koopverdrag (1997), p. 71 (81); Perales Viscasillas, La
formación del contrato de compraventa internacional de mercaderı́as (1996) p. 470; Schlechtriem, in:
Schlechtriem/Schwenzer, Commentary (2005), Art. 17 para. 6; contra Dı́ez-Picazo, in: Dı́ez-Picazo,
Comentario (1998), p. 180; Huber, Der UNCITRAL-Entwurf eines Übereinkommens über internationale
Warenkaufverträge, 43 RabelsZ (1979) 413 (441); Magnus, in: Staudinger Kommentar (2013), Art. 17
para. 6; Wey, Der Vertragsabschluss beim Internationalen Warenkauf nach UNCITRAL und schweizer-
ischen Recht (1984) para. 916; Witz/Salger/Lorenz, Kommentar (2016), Art. 17 para. 2.
264 Ferrari
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the effectiveness of which requires that it reach the offeror,17 by means of which the
offeree makes it clear that he refuses to accept the offer.18 The rejection may relate to
only part of the offer; in this case, however, it must be determined on the basis of the
Art. 19 whether the acceptance of that part of the offer that has not been rejected leads
to the conclusion of a contract.19 Therefore, the rejection corresponds to an offeree’s
waiver of the entitlement to accept the offer. Ultimately, this results in the offeror not
being bound to the offer any longer and free to offer the same goods to a third party.
The requirement that the rejection must reach its addressee to become effective 6
means that for the purpose of its effectiveness it is irrelevant whether the offeror actually
gains knowledge of the rejection;20 of course, validity issues may also have to be
considered when determining whether a statement produces the effects of a rejection.
The CISG, however, does not generally deal with validity issues (but for those connected
to formal validity); rather, these issues are left to the applicable domestic law.21
Since the rejection constitutes a refusal of the offer, there is no rejection and, thus, the 7
offer is not terminated, where the offeree simply makes inquiries22 or suggests some
modifications that are legally irrelevant.23 Whether a statement qualifies as a rejection or
as something that does not lead to the termination of the offer is to be determined on
the basis of an interpretation pursuant to Art. 8.24
If the offeree changes his mind regarding the rejection, he may prevent it from 8
becoming effective by means of an (overtaking25) withdrawal (which may at the same
time constitute acceptance);26 for the withdrawal to have this effect, it is sufficient also
in this respect27 that the withdrawal reach the offeror no later than the rejection.28
While a withdrawal of a rejection is possible, a revocation is not.29
For a statement to qualify as a rejection, it must neither take a given form30 (subject, 9
of course, to Art. 12), nor must a particular wording or the expression “rejection” be
used.31 A rejection may be effected explicitly, impliedly32 (for instance, by way of an
17 Dornis, in: Honsell, Kommentar (2010), Art. 17 para. 2; Rudolph, Kommentar (1996), Art. 17 para. 2;

18 Rocchietti, Nuove leggi civ. comm. (1989) 71 (72).
20 See also Dornis, in: Honsell, Kommentar (2010), Art. 17 para. 8; Ferrari, Vendita internazionale di
beni mobili. Artt. 14–24. Formazione del contratto (2006) p. 78; Schnyder/Straub, in: Honsell, Kommen-
tar (1997), Art. 17 para. 10.
22 See also Meeusen, Totstandkoming van de Overeenkomst, in: van Houtte/Erauw/Wautelet (eds), Het
Weens Koopverdrag (1997), p. 71 (80); Piltz, Internationales Kaufrecht (2008) 3-52; Witz/Salger/Lorenz,
23 Audit, Vente Internationale (1990), p. 62; Herber/Czerwenka, Kommentar (1991), Art. 17 para. 5.
(2016), Art. 17 para. 2; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 17 para. 2;
25 Witz/Salger/Lorenz, Kommentar (2016), Art. 17 para. 6.
26 See Herber/Czerwenka, Kommentar (1991), Art. 17 para. 6; Honnold/Flechtner, Uniform Law (2009),
para. 156; Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 17 para. 14; Neumayer/Ming, Conven-
tion de Vienne (1993), Art. 17 para. 2.
28 Audit, Vente Internationale (1990), p. 62; Magnus, in: Staudinger Kommentar (2013), Art. 17 para. 10.
29 Dornis, in: Honsell, Kommentar (2010), Art. 17 para. 14; contra, without any justification, Rocchietti,
Nuove leggi civ. comm. (1989) 71 (75).

32 Dornis, in: Honsell, Kommentar (2010), Art. 17 para. 6; Herber/Czerwenka, Kommentar (1991),
Art. 17 para. 5; Perales Viscasillas, La formación del contrato de compraventa internacional de mercader-
ı́as (1996) p. 461; Magnus, in: Staudinger Kommentar (2013), Art. 17 para. 8.
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“acceptance” containing material alterations vis-à-vis the offer)33 or by performing an

act implying rejection that, however, requires notice to the offer.34 If Art. 17 did not
require that the rejection reach the offeror, the sale to a third party of the goods referred
to in the offer could amount to a rejection.35 However, as the provision requires the
rejection to reach the offeror, the sale to a third party of the goods sold cannot by itself
amount to a rejection of the offer.36 If, however, the offeree notifies the offeror of the
sale to a third party of the goods offered, the offer is terminated when the notice reaches
the offeror.37
10 As mentioned already, in principle a partial rejection is possible. Where there is a
partial rejection, one has to, however, determine – in light of Art. 19 – whether the
acceptance of the remaining part of the offer constitutes an acceptance rather than a
counter-offer.
2. Legal effects of the rejection

11 The effects of a rejection that reaches the offeror are expressly set forth in Art. 17: the
offer, whether irrevocable or not, is terminated,38 and, thus, cannot be accepted any-
more by the offeree.39 This means, among others, that the offeree cannot change his
mind, even if the original time for acceptance has not yet expired.40
12 There is doubt as to whether a contract is concluded where a rejection and an
acceptance reach the offeror contemporaneously. Some commentators believe that it
is;41 most commentators, however, believe that a rejection should be treated like a
withdrawal; consequently, they suggest that where a rejection and an acceptance reach
the offeror at the same time, the rejection will produce its effects.42 It must be pointed
33 See Official Records (1981), p. 22; Neumayer/Ming, Convention de Vienne (1993), Art. 17 para. 2;
Reinhart, Kommentar (1991), Art. 17 para. 2.

34 Official Records (1981), p. 22; Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 179; Gruber, in:
MünchKommBGB (2016), Art. 17 para. 2; Ludwig, Der Vertragsabschluß nach UN-Kaufrecht im Span-
nungsverhältnis von Common Law und Civil Law, dargestellt auf der Grundlage der Rechtsordnungen
Englands und Deutschlands (1994) p. 317; Magnus, in: Staudinger Kommentar (2013), Art. 17 para. 8;
Rocchietti, Nuove leggi civ. comm. (1989) 71 (73); Piltz, Internationales Kaufrecht (2008) para. 3-51;
Saenger, in: Bamberger/Roth (eds), Kommentar zum Bürgerlichen Gesetzbuch (2012), Art. 17 para. 1.
35 In accord Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 17 para. 2; Schroeter,

36 Dornis, in: Honsell, Kommentar (2010), Art. 17 para. 4; Herber/Czerwenka, Kommentar (1991),
Art. 17 para. 6; Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 17 para. 6; Gruber, in: Münch-
KommBGB (2016), Art. 17 para. 3.
38 Brunner/Pfisterer/Köster, Kommentar (2014), Art. 17 para. 1; Ferrari, Vendita internazionale di beni
mobili. Artt. 14–24. Formazione del contratto (2006) pp. 81 et seq.; Magnus, in: Staudinger Kommentar
(2013), Art. 17 para. 9; Piltz, Internationales Kaufrecht (2008) para. 3-51; Schlechtriem/Schroeter, Inter-
nationales UN-Kaufrecht (2013) para. 265.
39 See Audit, Vente Internationale (1990), p. 62; Enderlein/Maskow/Strohbach, Internationales Kau-
frecht (1991) Art. 17 para. 1; Gruber, in: MünchKommBGB (2016), Art. 17 para. 4; Magnus, in: Staudin-
ger Kommentar (2013), Art. 17 para. 9; Witz/Salger/Lorenz, Kommentar (2016), Art. 17 para. 4.
40 Garro/Zuppi, Compraventa internacional de mercaderı́as, 2012, S. 133; Herber/Czerwenka, Kom-
mentar (1991), Art. 17 para. 7; Perales Viscasillas, La formación del contrato de compraventa internacio-
nal de mercaderı́as (1996) pp. 460 et seq.; Piltz, Internationales Kaufrecht (2008) para. 3-51.
41 Herber/Czerwenka, Kommentar (1991), Art. 17 para. 6.
Art. 17 para. 4; Neumayer/Ming, Convention de Vienne (1993), Art. 17 para. 2; Schlechtriem, in: Schlech-
triem/Schwenzer, Commentary (2005), Art. 17 para. 3; Schnyder/Straub, in: Honsell, Kommentar (1997),
Art. 17 para. 13; Schroeter, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 17 para. 3.
266 Ferrari
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out that this solution, although in line, for instance, with Art. 15, seems to contradict
the general principle of favor contractus43 upon which the CISG is based.
It is worth pointing out that the party claiming that no contract has been concluded 13
due to a rejection has to prove that a rejection has indeed occurred.44 Where a rejection
and an acceptance have reached the offeror at the same time, it is up to the party relying
on the lack of conclusion of the contract to prove in what order the two statements have
reached the offeror.45

Both the PICC (Art. 2.1.5) and the DCFR (Art. II-4:203) contain a provision that 14
deals with the rejection of the offer. It is, however, wrong to state that these rules are
literally the same as Art. 17.46 In effect, while both the PICC provisions and the DCFR
equivalent47 require, not unlike Art. 17 CISG, that the rejection reach the offeror for it
to terminate the offer, neither Art. 2.1.5 PICC nor Art. II-4:203 DCFR expressly deal
with the issue of whether an irrevocable offer is also terminated by a rejection. In this
author’s opinion, under the PICC and the DCFR one should be allowed to think so, but
neither the PICC nor the DCFR give any express guidance on this issue.
43 See Ferrari, Das Verhältnis zwischen den UNIDROIT-Grundsätzen und den allgemeinen Grundsät-
zen internationaler Einheitsprivatrechtkonventionen. Zugleich ein Beitrag zur Lückenfüllung durch

staatliche Gerichte, JuristenZeitung (1998) 9 (9 et seq.); Magnus, Die Allgemeinen Grundsätze im UN-
Kaufrecht, 59 RabelsZ (1995) 455 (483).
44 In accord Achilles, Kommentar (2000), Art. 17 para. 3; Dornis, in: Honsell, Kommentar (2010),
Art. 17 para. 18; Ferrari, Vendita internazionale di beni mobili. Artt. 14–24. Formazione del contratto
(2006) p. 83; Gruber, in: MünchKommBGB (2016), Art. 17 para. 7; Hepting/Müller, in Baumgärtel/
Laumen (eds), Handbuch der Beweislast im Privatrecht (2009), Art. 17 CISG para. 1; Jung, Die Bewei-
slastverteilung im UN-Kaufrecht (1996) p. 105; Magnus, in: Staudinger Kommentar (2013), Art. 17
para. 11; Saenger, in: Bamberger/Roth (eds), Kommentar zum Bürgerlichen Gesetzbuch (2012), Art. 17
para. 2.
45 Hepting/Müller, in Baumgärtel/Laumen (eds), Handbuch der Beweislast im Privatrecht (2009),
Art. 17 CISG paras 3 et seq.; Jung, Die Beweislastverteilung im UN-Kaufrecht (1996) p. 105.
46 For this erroneous statement see Kleinheisterkamp, in: Vogenauer/Kleinheitserkamp (eds), Com-
mentary on the Unidroit Principles (2009), Art. 2.1.5. para. 1.

47 The same also holds true for Art. 2:203 PECL, which stood as a model for Art. 4:203 DCFR.
Ferrari 267
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Article 18
(1) A statement made by or other conduct of the offeree indicating assent
to an offer is an acceptance. Silence or inactivity does not in itself amount to
acceptance.
(2) An acceptance of an offer becomes effective at the moment the indication of
assent reaches the offeror. An acceptance is not effective if the indication of assent
does not reach the offeror within the time he has fixed or, if no time is fixed, within
a reasonable time, due account being taken of the circumstances of the transaction,
including the rapidity of the means of communication employed by the offeror. An
oral offer must be accepted immediately unless the circumstances indicate other-
wise.
(3) However, if, by virtue of the offer or as a result of practices which the parties
have established between themselves or of usage, the offeree may indicate assent by
performing an act, such as one relating to the dispatch of the goods or payment of the
price, without notice to the offeror, the acceptance is effective at the moment the act
is performed, provided that the act is performed within the period of time laid down
in the preceding paragraph.
Bibliography: Bonell, La formazione del contratto di compravendita, in: La vendita internazionale.

La convenzione di Vienna dell’11 aprile 1980 (1981) p. 113; Eörsi, Formation of contract, in:
Wiener Übereinkommen von 1980 über den internationalen Warenkauf (1985), p. 43; Ferrari, Vendita
internazionale di beni mobili. Artt. 14–24. Formazione del contratto (2006); Jung, Die Beweislastver-
teilung im UN-Kaufrecht insbesondere bei Vertragsabschluß, bei Vertragsverletzungen des Käufers,
bei allgemeinen Bestimmungen sowie bei gemeinsamen Bestimmungen über Verkäufer- und Käuferp-
flicht (1996); Leete, Contract Formation under the United Nations Convention on Contracts for
the International Sale of Goods and the Uniform Commercial Code: Pitfalls for the Unwary,
6 Temple International and Comparative Law Journal (1992) 193; Ludwig, Der Vertragsabschluß nach
UN-Kaufrecht im Spannungsverhältnis von Common Law und Civil Law, dargestellt auf der Grundlage
der Rechtsordnungen Englands und Deutschlands (1994) p. 318; Meeusen, Totstandkoming van de
Overeenkomst, in: van Houtte/Erauw/Wautelet (eds), Het Weens Koopverdrag (1997), p. 71; Murray,
An Essay on the Formation of Contracts and Related Matters under the United Nations Convention on
Contracts for the International Sale of Goods, 8 Journal of Law and Commerce (1988) 11; Perales
Viscasillas, La Formación del contrato de compraventa internacional de mercaderı́as (1996); Schultz,
Rolling Contract Formation under the UN Convention on Contracts for the International Sale of
Goods, 35 Cornell International Law Journal (2001) 263; Sono, Formation of International Contracts
under the Vienna Convention: A Shift above the Comparative Law, in: Sarcevic/Volken (eds),
International Sale of Goods (1986), p. 111; Stoffel, Formation du contrat, in: Wiener Übereinkommen
von 1980 über den internationalen Warenkauf (1985), p. 55; Wey, Der Vertragsabschluss beim
Internationalen Warenkauf nach UNCITRAL und schweizerischen Recht (1984).
Outline
1. Acceptance by express declaration, acceptance by conduct, silence and
inactivity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
a) Acceptance by express declaration and acceptance by conduct. . . . . . . . 7
b) Silence and inactivity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
2. Effectiveness of the declaration of acceptance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
a) The principle that acceptance must reach the offeror . . . . . . . . . . . . . . . . . . 13
b) Acceptance without an indication reaching the offeror . . . . . . . . . . . . . . . . 17
268 Ferrari
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3. Time for acceptance (para. 2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
a) Fixed time for acceptance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
b) Reasonable term of acceptance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
c) Immediate acceptance of an oral offer. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
4. Burden of proof . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35

This provision, the contents of which can be traced back to various provisions of the 1
ULF1 and which, like most CISG provisions, is non-mandatory,2 defines the term
“acceptance” (para. 1) and establishes when an acceptance (of the original offer or of a
counter-offer)3 becomes effective. In doing so, the provision distinguishes between
different situations (paras 2 and 3).4
The acceptance is a declaration of intent, which (in principle) is not subject to any 2
form requirement5 and must – generally – reach the offeror for it to become effective.6
The acceptance, however, can also be an act, to be effected within given time frame,7
by which the offeree expresses assent to the offer.8 Though sometimes argued,9 the
acceptance does not necessarily have to be “unconditional.” Indeed, as can be derived
from Art. 19(2), the acceptance can contain additional or different terms compared
to those of the offer and still lead to the conclusion of the contract.10 Whether a
declaration amounts to an acceptance or merely constitutes a confirmation of receipt
of the offer,11 a request for clarification,12 or a similar statement which will not lead
1 Schroeter, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2013), Art. 18 para. 1; Schroeter, in:

di Vienna dell’11 aprile 1980 (1981) p. 113 (129); Ferrari, Vendita internazionale di beni mobili. Artt. 14–
24. Formazione del contratto (2006) p. 85; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary
(2005), Art. 18 para. 5; Witz/Salger/Lorenz, Kommentar (2016), Art. 18 para. 3.
4 Rocchietti, Nuove leggi civ. comm. (1989) 77 (77); Schroeter, in: Schlechtriem/Schwenzer, Kommentar
(German ed. 2013), Art. 18 para. 2; Schroeter, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 18
para. 2.
5 Ferrari/Torsello, International Sales Law – CISG (2015) p. 143; Schroeter, in: Schlechtriem/Schwenzer,

(2010), Art. 18 para. 4; Ferrari, Vendita internazionale di beni mobili. Artt. 14–24. Formazione del
contratto (2006) p. 86; Gillette/Walt, The UN Convention on Contracts for the International Sale of
Goods (2016) p. 90; Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 18 para. 13; Perales Visca-
sillas, La Formación del contrato de compraventa internacional de mercaderı́as (1996) p. 482; Magnus,
in: Staudinger Kommentar (2013), Art. 18 para. 6; Piltz, Internationales Kaufrecht (2008), paras 65 et
seq.; Schroeter, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 18 para. 24; see also Oberster
Gerichtshof (Austria) 13 December 2012, CISG-Online 2438 (distinguishing between three types of
situations).
7 See Dornis, in: Honsell, Kommentar (2010), Art. 18 para. 4; Ferrari/Torsello, International Sales Law –
CISG (2015) p. 143; Perales Viscasillas, La Formación del contrato de compraventa internacional de
8 In accord Ludwig, Der Vertragsabschluß nach UN-Kaufrecht im Spannungsverhältnis von Common
(1994) p. 318; Gruber, in: MünchKommBGB (2016), Art. 18 para. 2; Perales Vis-casillas, La Formación del
contrato de compraventa internacional de mercaderı́as (1996) pp. 481 et seq.
9 See Landgericht Kassel (Germany) 14 July 1994, CISG-Online 194.
10 See Heuzé, Vente Internationale (2005), para. 186.
12 See Sono, Formation of International Contracts under the Vienna Convention: A Shift above the
Comparative Law, in: Sarcevic/Volken (eds), International Sale of Goods (1986), p. 111 (124).
Ferrari 269
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to the conclusion of a contract13 must be determined through interpretation based

on Art. 8.14
3 As a declaration of intent, the acceptance, not unlike the offer, withdrawal, or
revocation, must comply with the validity requirements of the applicable domestic
law.15 The applicable domestic law is also relevant for determining whether an
acceptance that reaches a party other than the offeror leads to the conclusion of the
contract.
4 In principle (Art. 11), the acceptance does not have to meet any form require-
ments16 (which leads, inter alia, to the acceptance not necessarily having to have the
same form as the offer).17 Where, however, one of the parties has its place of business
in a Contracting State that declared an Art. 96 reservation, a contract for the
international sale of goods – and, thus, the acceptance as well – may be subject to
form requirements, which would make it impossible, for instance, that the perfor-
mance of an act indicating assent would lead to the conclusion of the contract.18 Also,
where the offeror requires that the acceptance take a particular form, and as the
“master of the offer”19 the offeror is certainly entitled to do so,20 acceptance taking a
different form does not lead to the conclusion of the contract;21 rather, this amounts
13 See Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 181.

14 Brunner/Pfisterer/Köster, Kommentar (2014), Art. 18 para. 3; Enderlein/Maskow/Strohbach, Interna-
tionales Kaufrecht (1991), Art. 18 para. 1; Farnsworth, in: Bianca/Bonell, Commentary (1987), Art. 18
para. 2.1; Ferrari/Torsello, International Sales Law – CISG (2015) p. 143–144; Gruber, in: Münch-
KommBGB (2016), Art. 18 para. 2; Ludwig, Der Vertragsabschluß nach UN-Kaufrecht im Spannungs-
verhältnis von Common Law und Civil Law, dargestellt auf der Grundlage der Rechtsordnungen
Englands und Deutschlands (1994) p. 319; Magnus, in: Staudinger Kommentar (2013), Art. 18 para. 7;
Koopverdrag (1997), p. 71 (81); Perales Viscasillas, La Formación del contrato de compraventa inter-
nacional de mercaderı́as (1996) p. 482; Piltz, Internationales Kaufrecht (2008) 3-57; Schroeter, in:
Schlechtriem/Schwenzer, Kommentar (German ed. 2013), Art. 18 para. 4; Schroeter, in: Schlechtriem/
Schwenzer, Commentary (2016), Art. 18 para. 4; in case law see Oberster Gerichtshof (Austria) 13 De-
cember 2012, CISG-Online 2438; Oberlandesgericht Frankfurt (Germany) 30 August 2000, CISG-Online
594; Landgericht Aurich (Germany) 8 May 1998, CISG-Online 518.
15 Dornis, in: Honsell, Kommentar (2010), Art. 18 para. 5; Schlechtriem, in: Schlechtriem/Schwenzer,
Commentary (2005), Art. 18 para. 3; Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 18 para. 14;
Schroeter, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2013), Art. 18 para. 3.
16 In accord Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 181; Dornis, in: Honsell, Kommentar
contratto (2006) p. 88; Ferrari/Torsello, International Sales Law – CISG (2015) p. 144; Gruber, in:
MünchKommBGB (2016), Art. 18 para. 6; Mankowski, in: Ferrari et al., Internationales Vertragsrecht
(2012), Art. 18 CISG para. 4; Neumayer/Ming, Convention de Vienne (1993), Art. 18 para. 1; Rocchietti,
Nuove leggi civ. comm. (1989) 77 (78); Schultz, Rolling Contract Formation under the UN Convention
on Contracts for the International Sale of Goods, 35 Cornell International Law Journal (2001) 263 (278);
17 See Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 18 para. 15; Meeusen, Totstandkoming
van de Overeenkomst, in: van Houtte/Erauw/Wautelet (eds), Het Weens Koopverdrag (1997), p. 71 (81);
pp. 484 et seq.; Magnus, in: Staudinger Kommentar (2013), Art. 18 para. 8; Schroeter, in: Schlechtriem/
18 Enderlein/Maskow/Strohbach, Internationales Kaufrecht (1991), Art. 18 para. 2.
19 See Gruber, in: MünchKommBGB (2016), Art. 18 para. 6; Neumayer/Ming, Convention de Vienne
Lüderitz/Fenge, in: Soergel, Kommentar zum BGB. Schuldrechtliche Nebengesetze (2000), Art. 18 para. 2;
21 See Dornis, in: Honsell, Kommentar (2010), Art. 18 para. 6; Perales Viscasillas, La Formación del
contrato de compraventa internacional de mercaderı́as (1996) p. 582; Rocchietti, Nuove leggi civ. comm.
(1989) 77 (78); Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 18 para. 15.
270 Ferrari
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to a counter-offer.22 The alternate view, according to which a contract is concluded
despite the lack of the required form, at least where the use of a different form does
not alter the terms of the offer materially in terms of Art. 19,23 is untenable. The fact
that the offeror requires compliance with a particular form requirement means that
the use of a different form must always be considered as a “material” modification of
the offer in terms of Art. 19, based on the governing principle of freedom from form
requirements. Form requirements can also be imposed by the practices established
between the parties, usages that are binding upon the parties by virtue of Art. 9, or
simply by an agreement between the parties.
If the acceptor uses a language different from the one used by the offeror, the 5
acceptor’s reply does not amount to an acceptance, unless the language used is that of
the offeror, the language used during the negotiations, or a language the use of which
was provided for in the offer.24
For a reply to the offer to amount to an acceptance it is not necessary that certain 6
formulations or expressions (such as “acceptance”) be used.25

1. Acceptance by express declaration, acceptance by conduct, silence
and inactivity
a) Acceptance by express declaration and acceptance by conduct. Acceptance does 7
not necessarily have to occur by means of an express declaration;26 a given conduct can
also amount to acceptance and, thus, lead to the conclusion of the contract.27 However,
Art. 18(1) sets some boundaries for conduct that can amount to acceptance by provid-
ing that “silence or inactivity does not in itself amount to acceptance.”28
22Adame Goddard, El Contrato de Compraventa Internacional (1994) p. 107.

23Magnus, in: Staudinger Kommentar (2013), Art. 18 para. 8 and Art. 19 para. 9; Witz/Salger/Lorenz,
24 Ferrari, Vendita internazionale di beni mobili. Artt. 14–24. Formazione del contratto (2006) pp. 89 et
seq.; Ferrari/Torsello, International Sales Law – CISG (2015) p. 144; Magnus, in: Staudinger Kommentar
(2013), Art. 18 para. 9.
p. 497; Schroeter, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 18 para. 5; in case law see
Rechtbank Koophandel Tongeren (Belgium) 25 January 2005, CISG-Online 1106.
26 See Landgericht Bielefeld (Germany) 18 January 1991, CISG-Online 174, holding that an acceptance
does not have to be express, more recently see Oberster Gerichtshof (Austria) 29 November 2005, CISG-
Online 1227; in legal writing see Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012),
(2010), Art. 18 para. 8; Ferrari/Torsello, International Sales Law – CISG (2015) p. 145; Herber/Czerwenka,
Kommentar (1991), Art. 18 para. 5; Gruber, in: MünchKommBGB (2016), Art. 18 para. 3; J. Pierre/
V. Pierre, A Comparison of the Rules on Formation of Sales Contracts Under the Louisiana Civil Code
and the United Nations Convention on Contracts for the International Sale of Goods: What Buyers and
Sellers Should Know, 20 Southern University Law Review (1993) 189 (192); Rocchietti, Nuove leggi civ.
comm. (1989) 77 (78); Saenger, in: Bamberger/Roth (eds), Kommentar zum Bürgerlichen Gesetzbuch
(2012), Art. 18 para. 2; Schlechtriem/Schroeter, Internationales UN-Kaufrecht (2013) para. 267; Stoffel,
p. 55 (66); Witz/Salger/Lorenz, Kommentar (2016), Art. 18 para. 8.
Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 18 CISG para. 5; Schnyder/Straub,
in: Honsell, Kommentar (1997), Art. 18 para. 27; in case law see Cour d’Appel Paris (France) 10 Septem-
ber 2003, CISG-Online 788; Cour d’Appel Liège (Belgium) 28 April 2003, CISG-Online 944.
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8 Although it has to be determined (through interpretation on the basis of Art. 8)29

on the basis of a case-by-case approach if a given conduct amounts to acceptance,30
there are certain types of conduct that generally indicate assent to the offer.31 In this
respect, above all one has to mention32 the shipment of the goods purchased.33
The shipment of the goods purchased amounts to acceptance, as is also confirmed
by case law,34 even where the goods shipped are non-conforming goods under
Art. 3535 – provided that the shipment of the non-conforming goods does not
constitute a “substitute offer” and therefore merely amounts to a counter-offer36. The
shipment of parts of the goods purchased also constitutes, as a matter of principle,
conduct amounting to acceptance.37 The same is true with respect to the payment or
partial payment of the purchase price.38 Further examples of conduct that generally
amounts to acceptance are:39 the opening of a letter of credit for the purchase price,40
29 Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 18 CISG para. 6; Rocchietti,
Nuove leggi civ. comm. (1989) 77 (79); Schlechtriem/Schroeter, Internationales UN-Kaufrecht (2013)
para. 267; in case law see Oberlandesgericht Frankfurt (Germany) 30 August 2000, CISG-Online 594.
30 Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 182; Ferrari/Torsello, International Sales Law –
CISG (2015) p. 145.

31 See also Schroeter, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 18 para. 13.
32 See Farnsworth, in: Bianca/Bonell, Commentary (1987), Art. 18 para. 2.2; Mankowski, in: Ferrari
et al., Internationales Vertragsrecht (2012), Art. 18 CISG paras 6 et seq.; Perales Viscasillas, La Formación
del contrato de compraventa internacional de mercaderı́as (1996) pp. 501 et seq.; Schroeter, in: Schlech-
triem/Schwenzer, Kommentar (German ed. 2013), Art. 18 para. 7 a; Witz/Salger/Lorenz, Kommentar
(2016), Art. 18 para. 5.
33 Brunner/Pfisterer/Köster, Kommentar (2004), Art. 18 para. 6; Ferrari/Torsello, International Sales
Law – CISG (2015) p. 145; Piltz, Internationales Kaufrecht (2008) para. 59; Rocchietti, Nuove leggi civ.
comm. (1989) 77 (79); Saenger, in: Bamberger/Roth (eds), Kommentar zum Bürgerlichen Gesetzbuch
(2012), Art. 18 para. 4.
34 See Landgericht Bielefeld (Germany) 18 January 1991, CISG-Online 174.
35 In accord Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 18 CISG para. 6;
Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 18 para. 31; Gruber, in: MünchKommBGB (2016),
Art. 18 para. 5; Schroeter, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2013), Art. 18 para. 7 c;
Wey, Der Vertragsabschluss beim Internationalen Warenkauf nach UNCITRAL und schweizerischen
Recht (1984) para. 1069; Schroeter, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 18 para. 15;
36 See also Achilles, Kommentar (2000), Art. 18 para. 2; Schlechtriem, in: Schlechtriem/Schwenzer,
Commentary (2005), Art. 18 para. 7; contra Magnus, in: Staudinger Kommentar (2013), Art. 18
para. 11, holding that the conscious dispatch of non-conforming goods always constitutes a counter-
offer.
37 In accord Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 18 para. 7; contra
Oberlandesgericht Frankfurt (Germany) 23 May 1995, CISG-Online 185: delivery of the goods bought is
to be considered an acceptance, whereas the delivery of only part of the goods does not.
para. 4; Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 182; Ferrari, Vendita internazionale di beni
mobili. Artt. 14–24. Formazione del contratto (2006) p. 91; in case law see US District Court, Western
District Washington at Tacoma (U.S.), Barbara Berry, S. A. de C. V. v Ken M. Spooner Farms, Inc.,
13 April 2006, CISG-Online 1354: payment of the purchase price and opening of the packaging constitute
an acceptance; Handelsgericht des Kantons St. Gallen (Switzerland) 29 April 2004, CISG-Online 962:
payment of the sums requested in the offer compares to an acceptance.
39 See also Ferrari/Torsello, Internationales Sales Law – CISG (2015) p. 145–146; Schnyder/Straub, in:

40 Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 182; Enderlein/Maskow/Strohbach, Internatio-
nales Kaufrecht (1991), Art. 18 para. 2; Heuzé, Vente Internationale (2005), para. 184; Gruber, in:
MünchKommBGB (2016), Art. 18 para. 4; Mankowski, in: Ferrari et al., Internationales Vertragsrecht
(2012), Art. 18 CISG para. 7; Rocchietti, Nuove leggi civ. comm. (1989) 77 (87); Rudolph, Kommentar
(1996), Art. 18 para. 2; in case law see US District Court, Northern District of Illinois, Eastern Division
(U.S.), Magellan International Corp. v Salzgitter Handel GmbH, 7 December 1999, CISG-Online 439;
Arbitral Award, Comisión pare la Protección del Comercio Exterior de México (Mexico), Conservas La
Costen ~a v Lanı́n, 29 April 1996, CISG-Online 350.
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the dispatch of an invoice or the signature thereof by the buyer,41 the cashing of a
cheque sent with the offer,42 the processing of the goods by the buyer,43 the entering
into transactions to make the production of the goods possible and the commencing
of production.44 Several courts have held that the unconditional acceptance of a
shipment of non-conforming goods amounts to an implicit acceptance of the mod-
ified offer that the shipment of the non-conforming goods implies.45
One must wonder about the relationship that exists between the possibility to conclude a 9
contract through conduct indicating assent (Art. 18(2)) and the basic necessity that the
acceptance reach the offeror provided for in Art. 18(1).46 Art. 18 itself deals with that
relationship by providing in para. 3 an exception47 (for certain conduct indicating assent) to
the principle that acceptance must reach the offeror for it to lead to contract conclusion.
Accordingly, receipt is not necessary in those cases in which the acceptor is, as an exception,
not required to give notice to the offeror of the conduct indicating assent.48 “Thus, conduct
indicating assent generally amounts to acceptance only in those cases where notice thereof
reaches the offeror in a way that allows the offeror to gain knowledge of that notice.”49
b) Silence and inactivity. From Art. 18(1) it can be derived that silence and inactivity 10
also can amount to conduct indicating assent on the part of the acceptor,50 provided that
other circumstances exist that indicate the acceptor’s intention to accept the offer.51 Silence
and inactivity on their own can be regarded neither as acceptance52 nor as refusal.53
41See Cámara Nacional de Apelaciones en lo Comercial (Argentina) 14 October 1993, CISG-Online 87.
42Achilles, Kommentar (2000), Art. 18 para. 1; Schnyder/Straub, in: Honsell, Kommentar (1997),
Art. 18 para. 30.
43 See Oberster Gerichtshof (Austria) 13 December 2012, CISG-Online 2438; Oberlandesgericht Saar-
brücken (Germany) 13 January 1993, CISG-Online 83.

44 Brunner/Pfisterer/Köster, Kommentar (2014), Art. 18 para. 6; see also Heuzé, Vente Internationale
(2005), para. 184; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 18 para. 7.
45 For this statement, see Witz/Salger/Lorenz, Kommentar (2016), Art. 18 para. 5, citing to Cour de
Cassation (France) 27 January 1998, CISG-Online 309; Oberlandesgericht Frankfurt (Germany) 23 May
1995, CISG-Online 185; Oberlandesgericht Saarbrücken (Germany) 13 January 1993, CISG-Online 83; see
also Piltz, Internationales Kaufrecht (2008) para. 3-59, citing to Landgericht Krefeld (Germany) 24 Sep-
tember 1992, CISG-Online 62; for case law holding that taking delivery of the goods amounts to an
acceptance, see Handelsgericht des Kantons Zug (Switzerland) 2 December 2004, CISG-Online 1194;
Oberlandesgericht Schleswig-Holstein (Germany) 29 October 2002, CISG-Online 717.
46 See also Rocchietti, Nuove leggi civ. comm. (1989) 77 (79 et seq.).
47 For this qualification, see Oberster Gerichtshof (Austria) 13 December 2012, CISG-Online 2438.
48 In accord Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 182; Schlechtriem, in: Schlechtriem/
Schwenzer, Commentary (2005), Art. 18 para. 7; Schroeter, in: Schlechtriem/Schwenzer, Commentary

(2016), Art. 18 para. 44.
49 Magnus, in: Staudinger Kommentar (2013), Art. 18 para. 14; also compare Herber/Czerwenka,

50 Stoffel, Formation du contrat, in: Wiener Übereinkommen von 1980 über den internationalen
Warenkauf (1985), p. 55 (66).

51 See also Heuzé, Vente Internationale (2005), para. 185; Schlechtriem, in: Schlechtriem/Schwenzer,
Commentary (2005), Art. 18 para. 9; Schroeter, in: Schlechtriem/Schwenzer, Kommentar (German ed.
2013), Art. 18 para. 9; Schroeter, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 18 para. 18.
52 In case law see U.S. District Court, Middle District of Pennsylvania (U.S.), It’s Intoxicating, Inc. v.
Maritim Hotelgesellschaft mbH and Daniela Zimmer, 13 July 2013, CISG-Online 2492; Rechtbank
s’Hertogenbosch (Netherlands) 23 January 2013, CISG-Online 2393; Bundesgericht (Switzerland) 5 April
2005, CISG-Online 1012; Oberlandesgericht Graz (Austria) 7 March 2002, CISG-Online 669; Rechtbank
Rotterdam (Netherlands) 12 July 2001, CISG-Online 968; Rechtbank Koophandel Hasselt (Belgium)
p. 512; Rudolph, Kommentar (1996), Art. 18 para. 3; Sono, Formation of International Contracts under
of Goods (1986), p. 111 (122).
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11 Circumstances which may indicate intent to accept the offer include the agreement
of the parties to that effect54 (which may have been reached, for instance, when
concluding a framework agreement),55 the practices established between the parties,56
as well as the usages that are binding upon the parties on the grounds of Art. 9.57 The
rules governing the effect of silence following a commercial letter of confirmation are
generally not considered to be usages under Art. 9(2),58 which is why the addressee’s
silence following the receipt of a commercial letter of confirmation will generally not
amount to acceptance of the terms contained in the letter of confirmation that
are different from those already agreed upon. Still, where the rules on silence following
a commercial letter of confirmation are in force in the countries where the parties
have their place of business, silence amounts to the acceptance of the terms contained
in the letter of confirmation. The same is true where the parties are used to
conducting business in countries where silence following a commercial letter of
confirmation amounts to acceptance of the terms contained therein and where the
rules on silence following a commercial letter of confirmation are known and regularly
observed.59
54 Heuzé, Vente Internationale (2005), para. 190; Meeusen, Totstandkoming van de Overeenkomst, in:
van Houtte/Erauw/Wautelet (eds), Het Weens Koopverdrag (1997), p. 71 (82); Neumayer/Ming, Conven-
tion de Vienne (1993), Art. 18 para. 2.
55 See also Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 185.
56 See Bundesgericht (Switzerland) 5 April 2005, CISG-Online 1012; see also Schroeter, in: Schlechtriem/

57 See Official Records (1981), p. 23; Achilles, Kommentar (2000), Art. 18 para. 3; Farnsworth, in:
Bianca/Bonell, Commentary (1987), Art. 18 para. 2.3; Enderlein/Maskow/Strohbach, Internationales

Kaufrecht (1991), Art. 18 para. 3; Ferrari, Vendita internazionale di beni mobili. Artt. 14–24. Forma-
zione del contratto (2006) p. 94; Heuzé, Vente Internationale (2005), para. 190; Ludwig, Der
Vertragsabschluß nach UN-Kaufrecht im Spannungsverhältnis von Common Law und Civil Law,
dargestellt auf der Grundlage der Rechtsordnungen Englands und Deutschlands (1994) p. 321; Schny-
der/Straub, in: Honsell, Kommentar (1997), Art. 18 para. 34; Gruber, in: MünchKommBGB (2016),
Art. 18 paras 6 and 21; Perales Viscasillas, La Formación del contrato de compraventa internacional de
mercaderı́as (1996) pp. 520 et seq.; Piltz, Internationales Kaufrecht (2008) para. 3-62; Rocchietti, Nuove
leggi civ. comm. (1989) 77 (80); Schultz, Rolling Contract Formation under the UN Convention on
Contracts for the International Sale of Goods, 35 Cornell International Law Journal (2001) 263 (273 et
seq.); Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 18 para. 9; Schroeter, in:
Schlechtriem/Schwenzer, Commentary (2016), Art. 18 para. 19; Magnus, in: Staudinger Kommentar
(2013), Art. 18 para. 12.
58 See Kröll/Hennecke, Kaufmännische Bestätigungsschreiben beim internationalen Warenkauf, Ra-
belsZ 67 (2003) 448 (489 et seq.); Gruber, in: MünchKommBGB (2016), Art. 18 para. 24; Neumayer/
Ming, Convention de Vienne (1993), Art. 18 para. 3; Piltz, Internationales Kaufrecht (2008) paras. 3-63 et
seq.; Rudolph, Kommentar (1996), Art. 18 para. 4; Magnus, in: Staudinger Kommentar (2013), Art. 18
para. 13.
59 In accord Holl/Kessler, “Selbstgeschaffenes Recht der Wirstschaft” und Einheitsrechtstellung der
Handelsbräuche und Geplogenheiten im Wiener UN-Kaufrecht, RIW (1995) 457 (459); Gruber, in:
MünchKommBGB (2016), Art. 18 para. 24; Magnus, in: Staudinger Kommentar (2013), Art. 9 para. 27.
274 Ferrari
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A statement by the offeror that silence or inactivity on the part of the offeree will 12
amount to acceptance will have no effect.60 Thus, no contract is concluded where the
offeree does not at all react to the delivery of goods not ordered.61
2. Effectiveness of the declaration of acceptance

a) The principle that acceptance must reach the offeror. Generally, a declaration of 13
acceptance must reach the offeror for it to become effective,62 as expressly mentioned in
Art. 18(2), first sentence. This requirement also generally applies with regard to conduct
indicating assent.63 From this it follows that such conduct only becomes effective when
a notice (of any kind) of said conduct reaches the offeror in a manner that allows the
offeror to gain knowledge of that notice.64 In this author’s opinion, nowhere in the text
of Art. 18 does it say that the receipt of the notice leads to the conclusion of the contract
even where the notice originates from a third party.65
60 See Audit, Vente Internationale (1990), p. 63; Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 185;
Dornis, in: Honsell, Kommentar (2010), Art. 18 para. 6; Enderlein/Maskow/Strohbach, Internationales

Kaufrecht (1991), Art. 18 para. 3; Farnsworth, in: Bianca/Bonell, Commentary (1987), Art. 18 para. 2.3;
Ferrari, Vendita internazionale di beni mobili. Artt. 14–24. Formazione del contratto (2006) p. 95; Hepting/
Müller, in: Baumgärtel/Laumen (eds), Handbuch der Beweislast im Privatrecht (2009), Art. 18 CISG para. 2;
Herber/Czerwenka, Kommentar (1991), Art. 18 para. 6; Ludwig, Der Vertragsabschluß nach UN-Kaufrecht
im Spannungsverhältnis von Common Law und Civil Law, dargestellt auf der Grundlage der Rechtsord-
nungen Englands und Deutschlands (1994) p. 320; Magnus, in: Staudinger Kommentar (2013), Art. 18
para. 12; Meeusen, Totstandkoming van de Overeenkomst, in: van Houtte/Erauw/Wautelet (eds), Het
Weens Koopverdrag (1997), p. 71 (82); Gruber, in: MünchKommBGB (2016), Art. 18 para. 6; Neumayer/
Ming, Convention de Vienne (1993), Art. 18 para. 2; Perales Viscasillas, La Formación del contrato de
compraventa internacional de mercaderı́as (1996) pp. 515 et seq.; Rocchietti, Nuove leggi civ. comm. (1989)
77 (80); Schultz, Rolling Contract Formation under the UN Convention on Contracts for the International
Sale of Goods, 35 Cornell International Law Journal (2001) 263 (273); Lüderitz/Fenge, in: Soergel,
Kommentar zum BGB. Schuldrechtliche Nebengesetze (2000), Art. 18 para. 12.
61 See Gruber, in: MünchKommBGB (2016), Art. 18 para. 20; Schlechtriem, in: Schlechtriem/Schwenzer,
Commentary (2005), Art. 18 para. 9; Witz/Salger/Lorenz, Kommentar (2016), Art. 18 para. 11.
62 Compare Adame Goddard, El Contrato de Compraventa Internacional (1994) p. 108; Dornis, in:
Honsell, Kommentar (2010), Art. 18 paras. 10 and 31 et seq.; Herber/Czerwenka, Kommentar (1991),
Art. 18 para. 3; Leete, Contract Formation under the United Nations Convention on Contracts for the
International Sale of Goods and the Uniform Commercial Code: Pitfalls for the Unwary, 6 Temple
International and Comparative Law Journal (1992) 193 (206 et seq.); Magnus, in: Staudinger Kommentar
Weens Koopverdrag (1997), pp. 71 (83); Gruber, in: MünchKommBGB (2016), Art. 18 para. 7; Murray,
An Essay on the Formation of Contracts and Related Matters under the United Nations Convention on
Contracts for the International Sale of Goods, 8 Journal of Law and Commerce (1988) 11 (21);
Schlechtriem/Schroeter, Internationales UN-Kaufrecht (2013) para. 269; Schroeter, in: Schlechtriem/
Schwenzer, Commentary (2016), Art. 18 para. 24; Neumayer/Ming, Convention de Vienne (1993),
Art. 18 para. 1; Perales Viscasillas, La Formación del contrato de compraventa internacional de mercader-
ı́as (1996) p. 528; Schroeter, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2013), Art. 18 para. 13.
63 See Dornis, in: Honsell, Kommentar (2010), Art. 18 para. 21; Gruber, in: MünchKommBGB (2016),
Art. 18 para. 7; Piltz, Internationales Kaufrecht (2008), para. 3-67; Rocchietti, Nuove leggi civ. comm.
(1989) 77 (83); Rudolph, Kommentar (1996), Art. 18 para. 9; Schnyder/Straub, in: Honsell, Kommentar
(1997), Art. 18 para. 36.
64 Official Records (1981), p. 23; Ferrari/Torsello, Internationales Sales Law – CISG (2015) p. 146;
Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 18 CISG para. 14; Schnyder/
Straub, in: Honsell, Kommentar (1997), Art. 18 para. 37; Magnus, in: Staudinger Kommentar (2013),
Art. 18 para. 14; contra Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 18 para. 13.
65 This, however, appears to be the prevalent view; see Farnsworth, in: Bianca/Bonell, Commentary
(1987), Art. 18 para. 2.7; Bonell, La formazione del contratto di compravendita, in: La vendita inter-
nazionale. La convenzione di Vienna dell’11 aprile 1980 (1981) p. 113 (129); Herber/Czerwenka,
Kommentar (1991), Art. 18 para. 9; Rocchietti, Nuove leggi civ. comm. (1989) 77 (83 et seq.); Magnus,
in: Staudinger Kommentar (2013), Art. 18 para. 14.
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14 In those exceptional cases where silence or inactivity may lead to the conclusion of a
contract, the contract is concluded at the moment in which the other circumstances that
indicate the acceptor’s intention to assent come into existence.66
15 The moment in which an acceptance “reaches” the offeror is to be determined
pursuant to Art. 24.67 Only the fact that the acceptance reached the offeror is decisive;
the fact that the offeror becomes otherwise aware of the acceptance before the
acceptance reached him is of no relevance and does not lead to the conclusion of the
contract.68
16 The acceptance “travels” at the risk of the acceptor.69 This means that the acceptor is
bound by the acceptance as it is received by the offeror,70 subject to the acceptor’s ability
to rescind it on the basis of the applicable domestic law.71
17 b) Acceptance without an indication reaching the offeror. From para. 3 it follows,
by way of an exception,72 that conduct indicating assent may be effective and, thus, lead
to the conclusion of the contract even if the offeror was in no position to become aware
of such conduct.73 This requires, however, that the acceptor is authorized not to notify
the offeror of the performance of acts indicating assent.74 Such authorization, which can
either relate to a specific act indicating assent or be framed in more general terms,75 can
originate, as stated for instance by the Austrian Supreme Court,76 from a waiver on the
part of the offeror of the need for a notice, from an agreement between the parties,77
from the practices established between the parties, or from usages78 that are binding
upon the parties pursuant to Art. 9.79
66 Rocchietti, Nuove leggi civ. comm. (1989) 77 (81 et seq.).

67 Dornis, in: Honsell, Kommentar (2010), Art. 18 para. 32; Ludwig, Der Vertragsabschluß nach UN-
Rechtsordnungen Englands und Deutschlands (1994) p. 321.
69 Achilles, Kommentar (2000), Art. 18 para. 4; Enderlein/Maskow/Strohbach, Internationales Kaufrecht
(1991), Art. 18 para. 6; Ferrari/Torsello, Internationales Sales Law – CISG (2015), p. 147; Leete, Contract
Formation under the United Nations Convention on Contracts for the International Sale of Goods and
the Uniform Commercial Code: Pitfalls for the Unwary, 6 Temple International and Comparative Law
Journal (1992) 193 (207); Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 18 CISG
para. 15; Murray, An Essay on the Formation of Contracts and Related Matters under the United Nations
Convention on Contracts for the International Sale of Goods, 8 Journal of Law and Commerce (1988) 11
(28); Neumayer/Ming, Convention de Vienne (1993), Art. 18 para. 4; Rudolph, Kommentar (1996),
Art. 18 para. 5; Magnus, in: Staudinger Kommentar (2013), Art. 18 para. 24.
72 Ferrari/Torsello, Internationales Sales Law – CISG (2015) p. 147; Mankowski, in: Ferrari et al.,
Internationales Vertragsrecht (2012), Art. 18 CISG para. 16; Schlechtriem/Schroeter, Internationales UN-
Kaufrecht (2013) para. 270.
73 Contra Honnold/Flechtner, Uniform Law (2009), para. 164.
75 Compare Ferrari/Torsello, Internationales Sales Law – CISG (2015) p. 147; Schnyder/Straub, in:

76 Oberster Gerichtshof (Austria) 13 December 2012, CISG-Online 2438.
79 See Adame Goddard, El Contrato de Compraventa Internacional (1994) p. 109; Bonell, La forma-
zione del contratto di compravendita, in: La vendita internazionale. La convenzione di Vienna dell’11
aprile 1980 (1981) p. 113 (129); Brunner/Pfisterer/Köster, Kommentar (2014), Art. 18 para. 12; Dornis, in:
Honsell, Kommentar (2010), Art. 18 para. 33; Eörsi, Formation of contract, in: Wiener Übereinkommen
von 1980 über den internationalen Warenkauf (1985), p. 43 (50); Ferrari, Vendita internazionale di beni
(1997), Art. 18 para. 40; Leete, Contract Formation under the United Nations Convention on Contracts
for the International Sale of Goods and the Uniform Commercial Code: Pitfalls for the Unwary, 6 Temple
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As “master of the offer,” the offeror is certainly entitled to waive the need for a 18
notice informing him of the performance of acts indicating assent to reach him
and, thus, anticipate that the moment in time at which the contract is concluded will
be the time the act indicating assent is performed.80 It is doubtful whether formula-
tions such as “ship immediately,” “rush shipment,” “procure without delay,” “require
immediate shipping,” etc., necessarily indicate the offeror’s willingness to waive the
notice requirement. Rather, in this author’s opinion, one has to interpret those
statements in light of Art. 8 to determine whether a waiver is intended.81 Suggesting
that those statements always indicate that willingness does not seem to be appro-
priate.82
In either case (i. e., both where authorization to accept by performing acts indicating 19
assent without the need to notify the offeror of such performance stems from the offer,
and where it stems from the practices established between the parties, or from trade
usages binding upon the parties pursuant to Art. 9) a subsequent notice to the offeror is
not required.83
There is dispute as to whether authorization by the offeror to accept without the 20
acceptance having to reach the offeror merely relates to acts indicating assent, or
whether it can also relate to more “traditional” acceptances, i. e., those that take the
form of declarations. In this author’s opinion, the possibility of authorizing the acceptor
to accept without the need for the acceptance to reach the offeror is not limited to
acceptance by conduct.84 Whether the offeror has authorized the acceptor to forgo
International and Comparative Law Journal (1992) 193 (207); Meeusen, Totstandkoming van de Over-
eenkomst, in: van Houtte/Erauw/Wautelet (eds), Het Weens Koopverdrag (1997), p. 71 (84); Gruber, in:
MünchKommBGB (2016), Art. 18 para. 8; Murray, An Essay on the Formation of Contracts and Related
Matters under the United Nations Convention on Contracts for the International Sale of Goods, 8 Journal
of Law and Commerce (1988) 11 (30); Perales Viscasillas, La Formación del contrato de compraventa
internacional de mercaderı́as (1996) p. 537; Piltz, Internationales Kaufrecht (1993) § 3 para. 64; Roc-
chietti, Nuove leggi civ. comm. (1989) 77 (80 and 88); Sono, Formation of International Contracts under
of Goods (1986), p. 111 (121); Magnus, in: Staudinger Kommentar (2013), Art. 18 para. 25; Stoffel,
Formation du contrat, in: Wiener Übereinkommen von 1980 über den internationalen Warenkauf
(1985), p. 55 (66); Witz/Salger/Lorenz, Kommentar (2016), Art. 18 para. 9.
80 Ferrari/Torsello, Internationales Sales Law – CISG (2015) p. 147.
81 See also Dornis, in: Honsell, Kommentar (2010), Art. 18 para. 34; Mankowski, in: Ferrari et al.,

82 In accord Farnsworth, in: Bianca/Bonell, Commentary (1987), Art. 18 para. 3.4; Herber/Czerwenka,
Kommentar (1991), Art. 18 para. 12; contra Audit, Vente Internationale (1990), p. 63; Brunner/Pfisterer/
Köster, Kommentar (2104), Art. 18 para. 12 note 704; Enderlein/Maskow/Strohbach, Internationales
Kaufrecht (1991), Art. 18 para. 12; Eörsi, Formation of contract, in: Wiener Übereinkommen von 1980
über den internationalen Warenkauf (1985), p. 43 (50); Honnold/Flechtner, Uniform Law (2009),
para. 163; Gruber, in: MünchKommBGB (2016), Art. 18 para. 9; Perales Viscasillas, La Formación del
contrato de compraventa internacional de mercaderı́as (1996) p. 510; Rocchietti, Nuove leggi civ. comm.
(1989) 77 (88); Rudolph, Kommentar (1996), Art. 18 para. 9; Schlechtriem, in: Schlechtriem/Schwenzer,
Commentary (2005), Art. 18 para. 20; Lüderitz/Fenge, in: Soergel, Kommentar zum BGB. Schuldrecht-
liche Nebengesetze (2000), Art. 18 para. 11.
83 Dornis, in: Honsell, Kommentar (2010), Art. 18 para. 38; Leete, Contract Formation under the
United Nations Convention on Contracts for the International Sale of Goods and the Uniform
Commercial Code: Pitfalls for the Unwary, 6 Temple International and Comparative Law Journal (1992)
193 (208); Ludwig, Der Vertragsabschluß nach UN-Kaufrecht im Spannungsverhältnis von Common Law
p. 322; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 18 para. 23; Wey, Der
Vertragsabschluss beim Internationalen Warenkauf nach UNCITRAL und schweizerischen Recht (1984)
para. 1039; contra Honnold/Flechtner, Uniform Law (2009), para. 164; Gruber, in: MünchKommBGB
(2016), Art. 18 para. 11.
84 In accord Dornis, in: Honsell, Kommentar (2010), Art. 18 para. 37; Gruber, in: MünchKommBGB
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notification constitutes an issue of interpretation, and therefore requires recourse to the

interpretive criteria set forth in Art. 8.85 In interpreting the offeror’s intention, regard is
also to be had to the fact that such authorization has the effect of anticipating the
moment of the conclusion of the contract.
21 An indication of assent that does not need to reach the offeror becomes effective as
soon as it occurs.86 A notice to the offeror of the assent being given is not necessary for
the acceptance to be effective;87 thus, where the time at which the act indicating assent is
performed (or the acceptance of the offer which exceptionally does not have to reach
the offeror is given) precedes the time determined by para. 2, within which the
acceptance must reach the offeror, and provided that the assent indicated does not
differ materially from the offer, the contract is concluded.88 Thus, contract conclusion
occurs at a time prior to that of receipt.89 This means, for instance, that the possibility of
a withdrawal of an acceptance provided for in Art. 22 does not exist for these kinds of
acceptances,90 provided that the particular conduct does not take the form of qualified
silence.91 In contrast, the revocation of an acceptance is always excluded, irrespective of
whether the indication of assent has to reach the offeror in order to become effective.92
Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 18 para. 44; contra Farnsworth, in: Bianca/Bonell,
Commentary (1987), Art. 18 para. 2.8; Enderlein/Maskow/Strohbach, Internationales Kaufrecht (1991),
Art. 18 para. 12; Honnold/Flechtner, Uniform Law (2009), para. 163; Neumayer/Ming, Convention de
Vienne (1993), Art. 18 para. 6; Reinhart, RdNr. 6; Wey, Der Vertragsabschluss beim Internationalen
Warenkauf nach UNCITRAL und schweizerischen Recht (1984) paras 951 et seq.
86 See Brunner/Pfisterer/Köster, Kommentar (2014), Art. 18 para. 12; Ferrari/Torsello, Internationales
Sales Law – CISG (2015) p. 148; Garro/Zuppi, Compraventa internacional de mercaderı́as (2012), p. 125;
Murray, An Essay on the Formation of Contracts and Related Matters under the United Nations
Convention on Contracts for the International Sale of Goods, 8 Journal of Law and Commerce (1988)
11 (30); Perales Viscasillas, La Formación del contrato de compraventa internacional de mercaderı́as
Art. 18 para. 4; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 18 para. 22; Stoffel,
p. 55 (60); Sono, Formation of International Contracts under the Vienna Convention: A Shift above the
Comparative Law, in: Sarcevic/Volken (eds), International Sale of Goods (1986), p. 111 (121); Magnus, in:
87 Farnsworth, in: Bianca/Bonell, Commentary (1987), Art. 18 paras 2.8 et seq.; Schnyder/Straub, in:
Honsell, Kommentar (1997), Art. 18 para. 45; Leete, Contract Formation under the United Nations
Convention on Contracts for the International Sale of Goods and the Uniform Commercial Code: Pitfalls
for the Unwary, 6 Temple International and Comparative Law Journal (1992) 193 (207 et seq.); Magnus,
88 Eörsi, Formation of contract, in: Wiener Übereinkommen von 1980 über den internationalen
Warenkauf (1985), p. 43 (50); Jametti Greiner, Der Vertragsabschluss, in: Hoyer/Posch (eds), Das
Einheitliche Wiener Kaufrecht (1992) p. 43 (56); Mankowski, in: Ferrari et al., Internationales Vertrags-
recht (2012), Art. 18 CISG para. 19; in case law see Oberster Gerichtshof (Austria) 13 December 2012,
CISG-Online 2438.
89 Compare Witz/Salger/Lorenz, Kommentar (2016), Art. 18 para. 9.
Art. 18 para. 58; Enderlein/Maskow/Strohbach, Internationales Kaufrecht (1991), Art. 18 para. 17; Gruber,
in: MünchKommBGB (2016), Art. 18 para. 10; Neumayer/Ming, Convention de Vienne (1993), Art. 18
para. 8; Rudolph, Kommentar (1996), Art. 18 para. 10; Schlechtriem, in: Schlechtriem/Schwenzer, Com-
mentary (2005), Art. 18 para. 22; Lüderitz/Fenge, in: Soergel, Kommentar zum BGB. Schuldrechtliche
Nebengesetze (2000), Art. 18 para. 14.
92 Dornis, in: Honsell, Kommentar (2010), Art. 18 para. 59; Lüderitz/Fenge, in: Soergel, Kommentar
zum BGB. Schuldrechtliche Nebengesetze (2000), Art. 18 para. 14; Sono, Formation of International
Contracts under the Vienna Convention: A Shift above the Comparative Law, in: Sarcevic/Volken (eds),
International Sale of Goods (1986), p. 111 (116); Schnyder/Straub, in: Honsell, Kommentar (1997),
Art. 18 para. 62.
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An indication of assent, which does not need to reach the offeror, must fulfil all 22
content requirements in order to lead to a contract conclusion. It therefore must
basically mirror the offer.93 It is doubtful94 whether the exceptions to this rule, found
in Art. 19(2), pursuant to which a reply to an offer, which purports to be an acceptance
but contains additional or different terms that do not materially alter the terms of the
offer, may constitute an acceptance, also apply to conduct indicating assent. This is due
to the fact that in order for a contract to be concluded despite immaterial modifications
of the offer, Art. 19(2) requires that there be no objection to the modifications – which,
however, in the case of an indication of assent that does not need to reach the offeror,
may occur only long after the act indicating assent has been performed since the offeror
may become aware of those acts only long after they have taken place. In this author’s
opinion, this results in the contract in these cases being subject to a resolutive condition
until the expiration of the time for objection,95 which starts to run when the offeror
becomes aware of the acts indicating the immaterially modified assent.
3. Time for acceptance (para. 2)

a) Fixed time for acceptance. Every offer is effective for a limited period of time 23
only.96 This is for the benefit of the offeror, as it limits the time period in which the
addressee of the offer can speculate at the cost of the offeror.97 This limitation can be
derived directly from the offer (Art. 18(2) second sentence, first alternative) or, if the
offeror has not fixed a time limit, from Art. 18(2) second sentence, second alternative.
As a result, when the offeror fixes a time for acceptance, other criteria, such as the 24
reasonableness, are wholly irrelevant in light of both, the provision at hand,98 which
provides for the priority of the fixed time period and the autonomy the offeror enjoys as
“master of the offer.”
The time can be fixed either expressly or implicitly.99 When the period of time is 25
fixed by the offeror, it must be pointed out that it is not required that the offeror refer to
an exact date (“until October 26th”).100 The offeror can also fix a period within which
the acceptance can occur by reference to particular events101 whose date can be
determined (such as the “beginning of the New York Fashion Week”), or by indicating
a specific period of time that allows for the determination of when the acceptance has to
have occurred (“until at the latest 15 days after receipt of this offer”).102 It is unlikely
that formulations like “answer immediately,” “shortly,” “promptly,” or similar formula-
p. 101.
para. 41; Ferrari, Vendita internazionale di beni mobili. Artt. 14–24. Formazione del contratto (2006)
p. 102.
98 Compare Gruber, in: MünchKommBGB (2016), Art. 18 para. 14.
99 Ferrari/Torsello, International Sales Law – CISG (2015) p 148; Meeusen, Totstandkoming van de
Overeenkomst, in: van Houtte/Erauw/Wautelet (eds), Het Weens Koopverdrag (1997), p. 71 (86);
Rocchietti, Nuove leggi civ. comm. (1989) 77 (84).
100 Dornis, in: Honsell, Kommentar (2010), Art. 18 para. 49; Piltz, Internationales Kaufrecht (2008),
para. 3-72; see also Schroeter, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 18 para. 27.
101 Dornis, in: Honsell, Kommentar (2010), Art. 18 para. 49; Schlechtriem, in: Schlechtriem/Schwenzer,

Art. 18 para. 14; Witz/Salger/Lorenz, Kommentar (2016), Art. 18 para. 21.
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tions must be considered as fixing a time for acceptance, as they appear too indefinite.103
Thus, where an interpretation based on Art. 8 does not allow one to state that these
formulations are meant to fix the time for acceptance pursuant to Art. 18(2) second
sentence, first alternative, Art. 18(2) second sentence, second alternative will apply.104
26 The offeror’s discretion regarding the length of the time period for acceptance is
unfettered. It is therefore irrelevant whether the time for acceptance fixed by the offeror
would have to be considered “unreasonable” pursuant to the criteria to be resorted to
under Art. 18(2) second sentence, second alternative, absent a time fixed by the offer.105
Therefore, neither a period that would have to be considered too short nor one that
would have to be considered too long will be changed into a reasonable period of time.
27 Where the acceptance is subject to the authorization of a third party, it will depend
on the applicable domestic law whether the authorization has retroactive effects or not,
i. e., whether the contract is concluded at the time when the acceptance reaches the
offeror or at the time of the authorization.106
28 b) Reasonable term of acceptance. If no time has been fixed by the offeror for
acceptance, the acceptance must reach the offeror within a reasonable time.107 In
determining that “reasonable time,” Art. 18(2) second sentence, second alternative,
expressly requires that due account be “taken of the circumstances of the transac-
tion.”108 These circumstances can relate to any of the three time periods which together
compose the reasonable time for acceptance:109 the time for the offer to reach the offeree
(the importance of which results from the fact that Art. 18(2), second sentence, second
alternative, expressly refers to the “the rapidity of the means of communication
employed by the offeror” as an element to be taken into account),110 the time for
consideration of the offer needed by the offeree, and the time for the reply purporting to
be an acceptance to reach the offeror.111
29 The express reference to the “rapidity of the means of communication employed by
the offeror” indicates the existence of a close relationship between the first and the last
time periods referred to in the earlier paragraph, which together compose the reason-
able time. This leads, in part, to the result that where the means of communication
employed for the acceptance corresponds to that employed for the offer, the reason-

104 See also Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 18 para. 14; contra
Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 18 para. 53.
106 Schroeter, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2013), Art. 18 para. 14; Schroeter,

(2010), Art. 18 paras. 51 et seq.; Ferrari/Torsello, International Sales Law – CISG (2015) p. 148; Garro/
Zuppi, Compraventa internacional de mercaderı́as (2012) p. 135; Rocchietti, Nuove leggi civ. comm.
(1989) 77 (84); Schlechtriem/Schroeter, Internationales UN-Kaufrecht (2013) para. 274.
mentar (2010), Art. 18 para. 52; Neumayer/Ming, Convention de Vienne (1993), Art. 18 para. 4; Schroeter,
zum österreichischen Recht (1985), p. 57 (69); Meeusen, Totstandkoming van de Overeenkomst, in: van
Houtte/Erauw/Wautelet (eds), Het Weens Koopverdrag (1997), p. 71 (86); Perales Viscasillas, La Forma-
ción del contrato de compraventa internacional de mercaderı́as (1996) p. 575; Schlechtriem/Schroeter,
Internationales UN-Kaufrecht (2013) para. 275.
111 For this tripartite, see Ferrari/Torsello, International Sales Law – CISG (2015) p. Schnyder/Straub, in:
Honsell, Kommentar (1997), Art. 18 para. 56; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary
280 Ferrari
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ableness of the time period referred to in Art. 18(2), second sentence, second alternative,
depends basically on the time for consideration of the offer by the offeree.112 The offeree
is, however, not obliged to use the same means of communication as was used for the
offer – provided that this is not required by the offer, the practices established between
the parties, or the trade usages that are binding upon the parties pursuant to Art. 9.113
The offeree can choose means that are quicker or slower than those used by the offeror;
a very long time required for the reply by the offeree to reach the offeror may be
counterbalanced by a very short time for consideration, and vice versa.
In determining the reasonableness of the time for acceptance, the importance of the 30
time period for consideration of the offer becomes evident from what has already been
stated.114 When examining the time for consideration, account must be taken – above
all – of the nature of the goods offered (including whether they are perishable or
seasonal goods),115 price stability, the overall complexity of the transaction, the need to
obtain further information (most notably in the context of contracts of a high value) or
to negotiate with subcontractors or creditors, as well as the process of decision making
on the part of the offeree.116
The reasonableness of the time for acceptance can also be derived from trade usages 31
that bind the parties under Art. 9.
In CISG case law,117 an acceptance that had occurred after more than two weeks was 32
considered as “still being reasonable under Art. 18(2) CISG.”118
The “reasonable time” to accept a counter-offer is usually shorter than the time to 33
accept an offer, since in this instance the parties involved already know about the
particular circumstances.
c) Immediate acceptance of an oral offer. Pursuant to Art. 18(2), third sentence, an 34
oral offer must be accepted immediately,119 unless the circumstances (including the
need to obtain certain information or a given permission120) or the offer itself121 indicate
112 For a similar statement, see Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 18
para. 15.
113 In accord Dornis, in: Honsell, Kommentar (2010), Art. 18 para. 52; Rocchietti, Nuove leggi civ. comm.
(1989) 77 (85); Rudolph, Kommentar (1996), Art. 18 para. 6; Witz/Salger/Lorenz, Kommentar (2016), Art. 18
para. 24, state, however, that one has to resort to a means of communication which is at least as quick.
114 See also Piltz, Internationales Kaufrecht (2008), para. 3-77.
115 Compare Witz/Salger/Lorenz, Kommentar (2016), Art. 18 para. 24.
116 For this and other examples, see Brunner/Pfisterer/Köster, Kommentar (2014), Art. 18 para. 9;
Dornis, in: Honsell, Kommentar (2010), Art. 18 para. 52; Enderlein/Maskow/Strohbach, Internationales
Kaufrecht (1991), Art. 18 para. 9; Herber/Czerwenka, Kommentar (1991), Art. 18 para. 15; Schnyder/
Straub, in: Honsell, Kommentar (1997), Art. 18 para. 56; Gruber, in: MünchKommBGB (2016), Art. 18
para. 19; Perales Viscasillas, La Formación del contrato de compraventa internacional de mercaderı́as
(1996) pp. 577 et seq.; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 18 para. 15.
117 For a reference to the case law under ULIS, see Magnus, in: Staudinger Kommentar (2013), Art. 18
para. 19.
118 Landgericht Bielefeld (Germany) 18 January 1991, CISG-Online 174.
119 Adame Goddard, El Contrato de Compraventa Internacional (1994) p. 110; Dornis, in: Honsell,
Kommentar (2010), Art. 18 para. 42; Enderlein/Maskow/Strohbach, Internationales Kaufrecht (1991),

Art. 18 para. 10; Schlechtriem/Schroeter, Internationales UN-Kaufrecht (2013) para. 274; Schroeter, in:
Schlechtriem/Schwenzer, Kommentar (German ed. 2013), Art. 18 para. 16.
120 Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 184; Mankowski, in: Ferrari et al., Internatio-
nales Vertragsrecht (2012), Art. 18 CISG para. 28; Schlechtriem, in: Schlechtriem/Schwenzer, Commen-
tary (2005), Art. 18 para. 16; Lüderitz/Fenge, in: Soergel, Kommentar zum BGB. Schuldrechtliche
121 Compare Farnsworth, in: Bianca/Bonell, Commentary (1987), Art. 18 para. 2.6; Magnus, in: Staudinger
Kommentar (2013), Art. 18 para. 20; Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012),
Art. 18 CISG para. 26; Schroeter, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 18 para. 31.
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otherwise.122 The basic applicability requirement of this part of Art. 18, which greatly
restricts the time for consideration of the offer by the offeree, is the existence of an oral
offer. An oral offer encompasses not only situations where the parties involved (or their
intermediaries who, however, must have power of representation, the existence of which
is to be determined on the basis of the applicable domestic law) are physically present in
the same space; rather, it is “merely” necessary that an “indication of assent is possible
immediately after the offer has been made”.123 Thus, an offer made via telephone124 as
well as one made via radio must also be accepted immediately.125 In contrast, an offer
communicated via email,126 telefax or by videotext does not constitute an oral offer and,
thus, does not have to be accepted immediately.127 An offer delivered by a messenger
must be accepted immediately.128 However, “in that case the necessity for its transmis-
sion to the addressee or the distance between the addressee and offeror are part of the
circumstances which may exclude the need for immediate acceptance.”129
4. Burden of proof
35 The party invoking the conclusion of a contract must prove the existence of the
prerequisites of contract conclusion, such as offer and acceptance and the fact that the
acceptance reached the offeror.130 This party, however, does not have to prove that the
acceptance reached the offeror in a timely manner.131 Rather, it is the party claiming
122 In case law see Kantonsgericht Freiburg (Switzerland) 11 October 2004, CISG-Online 964.
123 Gruber, in: MünchKommBGB (2016), Art. 18 para. 16; in accord Dornis, in: Honsell, Kommentar
contratto (2006) p. 106; Luig, Der internationale Vertragsschluss. Der Vergleich von UN-Kaufrecht,
UNIDROIT Principles und Principles of European Contract Law (2003) p. 176; Piltz, Internationales
Kaufrecht (2008), para. 3-73.
Weens Koopverdrag (1997), p. 71 (86); Gruber, in: MünchKommBGB (2016), Art. 18 para. 15; Perales
Viscasillas, La Formación del contrato de compraventa internacional de mercaderı́as (1996) pp. 577 and
585; Piltz, Internationales Kaufrecht (2008), para. 3-76; Rudolph, Kommentar (1996), Art. 18 para. 7;
Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 18 para. 17; Witz/Salger/Lorenz,
127 Brunner/Pfisterer/Köster, Kommentar (2014), Art. 18 para. 10; Neumayer/Ming, Convention de
Vienne (1993), Art. 18 para. 5; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 18
128 In accord Dornis, in: Honsell, Kommentar (2010), Art. 18 para. 44; Lüderitz/Fenge, in: Soergel,
Kommentar zum BGB. Schuldrechtliche Nebengesetze (2000), Art. 18 para. 10; contra Witz/Salger/
Lorenz, Kommentar (2016), Art. 18 para. 23.
129 Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 18 para. 17; see also Dornis, in:
Honsell, Kommentar (2010), Art. 18 para. 47; Gruber, in: MünchKommBGB (2016), Art. 18 para. 17.
130 In accord Dornis, in: Honsell, Kommentar (2010), Art. 18 para. 62; Hepting/Müller, in: Baumgärtel/
Laumen (eds), Handbuch der Beweislast im Privatrecht (2009), Art. 18 CISG para. 1; Jung, Die Bewei-
slastverteilung im UN-Kaufrecht insbesondere bei Vertragsabschluß, bei Vertragsverletzungen des Käu-
fers, bei allgemeinen Bestimmungen sowie bei gemeinsamen Bestimmungen über Verkäufer- und
Käuferpflicht (1996) p. 107; Gruber, in: MünchKommBGB (2016), Art. 18 para. 27; Magnus, in: Staudin-
ger Kommentar (2013), Art. 18 para. 30; Mankowski, in: Ferrari et al., Internationales Vertragsrecht
(2012), Art. 18 CISG para. 30; Saenger, in: Bamberger/Roth (eds), Kommentar zum Bürgerlichen
131 Contra Jung, Die Beweislastverteilung im UN-Kaufrecht insbesondere bei Vertragsabschluß, bei
Vertragsverletzungen des Käufers, bei allgemeinen Bestimmungen sowie bei gemeinsamen Bestimmungen
über Verkäufer- und Käuferpflicht (1996) pp. 112 et seq.; Schlechtriem, in: Schlechtriem/Schwenzer,
282 Ferrari
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that the acceptance reached the offeror in an untimely manner who has to prove when
the acceptance reached the offeror.132

The rules found in Art. 18 CISG are not characteristic of the CISG; they can also be 36
found in other international instruments. This is true, for instance, as regards the PICC.
Art. 18(1) CISG, for instance, has its counterpart in Art. 2.1.6(1) PICC. Art. 18(2) CISG,
however, is mirrored in Art. 2.1.6(2) PICC only in respect to that part that refers to the
moment at which an acceptance becomes effective. The PICC equivalent of the CISG
rule on the time for acceptance (Art. 18(2) CISG last sentence) is contained in Art. 2.1.7.
As for the rule that addresses the issue of when an acceptance becomes effective that is
indicated by performing an act that exceptionally does not require notice to the offeror
(Art. 18(3) CISG), its counterpart can be found in Art. 2.1.6(3) PICC. Unsurprisingly,
the latter provision does not refer to the examples of such acts (dispatch of the goods or
payment of the price) found in the CISG provision, as the PICC refer to all kind of
contracts, not merely those for the sale of goods.
Provisions dealing – basically in the same way – with the issues addressed by Art. 18 37
CISG can also be found in the DCFR. The relevant provisions are Art. II-4:204,133 where
acceptance is defined; Art. II-4:205,134 where the issue of time of conclusion of the
contract is addressed, and Art. II-4:206,135 which deals with the time limit for accep-
tance.
132 Dornis, in: Honsell, Kommentar (2010), Art. 18 para. 62; Hepting/Müller, in: Baumgärtel/Laumen
(eds), Handbuch der Beweislast im Privatrecht (2009), Art. 18 CISG para. 6; also compare Ferrari,
Vendita internazionale di beni mobili. Artt. 14–24. Formazione del contratto (2006) p. 107.
133 This provision is based on Art. 2:204 PECL.
Ferrari 283
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Article 19
(1) A reply to an offer which purports to be an acceptance but contains additions,
limitations or other modifications is a rejection of the offer and constitutes a counter-
offer.
(2) However, a reply to an offer which purports to be an acceptance but contains
additional or different terms which do not materially alter the terms of the offer
constitutes an acceptance, unless the offeror, without undue delay, objects orally to the
discrepancy or dispatches a notice to that effect. If he does not so object, the terms of the
contract are the terms of the offer with the modifications contained in the acceptance.
(3) Additional or different terms relating, among other things, to the price,
payment, quality and quantity of the goods, place and time of delivery, extent of one
party’s liability to the other or the settlement of disputes are considered to alter the
terms of the offer materially.
Bibliography: Eörsi, Formation of contract, in: Wiener Übereinkommen von 1980 über den internationalen
Warenkauf (1985), p. 43; Ferrari, Vendita internazionale di beni mobili. Artt. 14–24. Formazione del
contratto (2006); Håstad, Article 19 CISG & Scandinavian Domestic Law: Conflict of Peaceful Coexistence?
in: Lookofsky/Andersen (eds.), The CISG Convention and Domestic Contract Law (2014), p. 79; Jametti
Greiner, Der Vertragsabschluss, in: Hoyer/Posch (eds), Das Einheitliche Wiener Kaufrecht (1992), p. 43;
Kröll/Hennecke, Kollidierende Allgemeine Geschäftsbedingungen in internationalen Kaufverträgen, RIW
(2001) 736; Kühl/Hingst, Das UN-Kaufrecht und das Recht der AGB, in: Festgabe Herber (1999) p. 50;
Leete, Contract Formation under the United Nations Convention on Contracts for the International Sale of
Goods and the Uniform Commercial Code: Pitfalls for the Unwary, 6 Temple International and Comparative
Law Journal (1992) 193; Ludwig, Der Vertragsabschluß nach UN-Kaufrecht im Spannungsverhältnis von
lands (1994); Meeusen, Totstandkoming van de Overeenkomst, in: van Houtte/Erauw/Wautelet (eds), Het
Weens Koopverdrag (1997), p. 71; Moccia, The United Nations Convention on Contracts for the Interna-
tional Sale of Goods and the “Battle of the Forms”, 13 Fordham International Law Journal (1989) 649;
Murray, An Essay on the Formation of Contracts and Related Matters under the United Nations Convention
on Contracts for the International Sale of Goods, 8 Journal of Law and Commerce (1998) 11; Nakata,
Sounds of Silence Bellow Forth Under the CISG’s International Battle of Forms, 7 Transnational Lawyer
(1994) 141; Neumayer, Offene Fragen zur Anwendung des Abkommens der Vereinten Nationen über den
internationalen Warenkauf, RIW (1994) 99; Neumayer, Das Wiener Kaufrechtsübereinkommen und die
sogenannte “battle of forms”, in: FS Hans Giger (1989), p. 501; Noussias, Die Zugangsbedürftigkeit von
Mitteilungen nach den Einheitlichen Haager Kaufgesetzen und nach dem UN-Kaufgesetz (1983); Perales
Viscasillas, “Battle of the Forms” Under the 1980 United Nations Convention on Contracts for the
International Sale of Goods and the Principles of International Commercial Contracts, 10 Pace International
Law Review (1998) 97; Perales Viscasillas, La Formación del contrato de compraventa internacional de
mercaderı́as (1996); Schultz, Rolling Contract Formation under the UN Convention on Contracts for the
International Sale of Goods, 35 Cornell International Law Journal (2001) 263; Sono, Formation of Interna-
tional Contracts under the Vienna Convention: A Shift above the Comparative Law, in: Sarcevic/Volken
(eds), International Sale of Goods (1986), p. 111; Steenfsgaard, Article 19 CISG & Scandinavian Domestic
Law: Conflict or Peaceful Coexistence, in: Lookofsky/Andersen (eds.), The CISG Cnvention and Domestic
Contract Law (2014), p. 59; Stoffel, Formation du contrat, in: Wiener Übereinkommen von 1980 über den
internationalen Warenkauf (1985), p. 55; Sukurs, Harmonizing the Battle of the Forms: A Comparison of the
United States, Canada, and the United Nations Convention on Contracts for the International Sale of Goods,
34 Vanderbilt Journal of Transnational Law (2001) 1481; van Alstine, Consensus, Dissensus, and Contractual
Obligation Through the Prism of Uniform International Sales Law, 37 Virginia Journal of International Law
(1996) 1; van Alstine, Fehlender Konsens beim Vertragsabschluß nach dem einheitlichen UN-Kaufrecht: eine
rechtsvergleichende Untersuchung auf der Grundlage des deutschen sowie des US-amerikanischen Rechts
(1995); van der Velden, Uniform International Sales Law and the Battle of Forms, FS Georges Sauveplanne
(1984), p. 233; Vergne, The “Battle of the Forms” Under the 1980 United Nations Convention on Contracts
for the International Sale of Goods, 33 American Journal of Comparative Law (1985) 233; Winship, The
Hague Principles, the CISG and the “Battle of Forms”, 4 Penn. St. J. L. & Int’l Aff. (2015) 151.
284 Ferrari
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Outline
II. Detailed commentary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
1. Reply containing additions or different terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
a) Additions, limitations or other modifications . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
b) Material alterations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
c) Immaterial alterations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
d) “Battle of forms” and commercial letter of confirmation . . . . . . . . . . . . . . . 14
e) Legal consequences of material and immaterial modifications . . . . . . . . . 18
2. Objection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
a) Preface. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
b) Timeliness and consequences of an objection. . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
3. Burden of proof . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25

Art. 19 (with the exception of para. 3)1 can be traced back to Art. 7 ULF.2 Art. 19(1) 1
states the basic principle3 that the terms of an acceptance must fully correspond to
those of the offer in order to count as an acceptance of the offer and lead to the
conclusion of the proposed contract.4 The origin of this basic principle is the “mirror-
image-rule”,5 which is currently in force in most legal systems,6 as various commen-
1Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 19 CISG para. 2.
2For remarks on the history of this provision, see Perales Viscasillas, La Formación del contrato de
compraventa internacional de mercaderı́as (1996) pp. 626 et seq.; van Alstine, Fehlender Konsens beim
Vertragsabschluß nach dem einheitlichen UN-Kaufrecht: eine rechtsvergleichende Untersuchung auf der
Grundlage des deutschen sowie des US-amerikanischen Rechts (1995) pp. 195 et seq.
3 Garro/Zuppi, Compraventa internacional de mercaderı́as (2012), p. 140.
mobili. Artt. 14–24. Formazione del contratto (2006) p. 108; Schlechtriem/Schroeter, Internationales UN-
Kaufrecht (2013) para. 278; in recent case law, see Rechtbank Koophandel Tongeren (Belgium) 25 January
2005, CISG-Online 1106; but see Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 19 para. 3.
5 U.S. District Court, W.D. Pa. (U.S.), Roser Technologies, Inc. v. Carl Schreiber GmbH, 10 September
2013, CISG-Online 2490; U.S. District, D. Minn. (U.S.), Travelers Property Cas. Co. of America v. Saint-
Gobain Technical Fabrics Canada Ltd., 31 January 2007, CISG-Online 1435 (also 1522); US District
Court, Northern District of Illinois, Eastern Division (U.S.), Magellan International Corporation v
Salzgitter Handel GmbH, 7 December 1999, CISG-Online 439; in legal writing see Audit, Vente
Internationale (1990), p. 68; Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), pp. 186 et seq.; Ferrari,
Vendita internazionale di beni mobili. Artt. 14–24. Formazione del contratto (2006) p. 109; Ferrari/
Torsello, International Sales Law – CISG (2015) p. 151; Gabriel, Practitioner’s Guide to the Convention
on Contracts for the International Sale of Goods (CISG) and the Uniform Commercial Code (UCC)
(1994) p. 59; Gillette/Walt, The UN Convention on Contracts for the International Sale of Goods (2016)
p. 95; Nakata, Sounds of Silence Bellow Forth Under the CISG’s International Battle of Forms, 7
Transnational Lawyer (1994) 141 (151); Neumayer/Ming, Convention de Vienne (1993), Art. 19 para. 1;
pp. 629 et seq.; Schultz, Rolling Contract Formation under the UN Convention on Contracts for the
International Sale of Goods, 35 Cornell International Law Journal (2001) 263 (282); Smart, Formation of
Contracts in Louisiana under the United Nations Convention for the International Sale of Goods, 53
Louisiana Law Review (1993) 1339 (1351); Magnus, in: Staudinger Kommentar (2013), Art. 19 para. 7;
Sukurs, Harmonizing the Battle of the Forms: A Comparison of the United States, Canada, and the
United Nations Convention on Contracts for the International Sale of Goods, 34 Vanderbilt Journal of
Transnational Law (2001) 1481 (1495); van Alstine, Consensus, Dissensus, and Contractual Obligation
Through the Prism of Uniform International Sales Law, 37 Virginia Journal of International Law (1996) 1
(22).
6 See Rudolph, Kommentar (1996), Art. 19 para. 4; Lüderitz/Fenge, in: Soergel (ed), Kommen-tar zum
BGB. Schuldrechtliche Nebengesetze (2000), Art. 19 para. 1; Schroeter, in: Schlechtriem/Schwenzer,

Kommentar (German ed. 2013), Art. 19 para. 2; Witz/Salger/Lorenz, Kommentar (2016), Art. 19 para. 1;
Ferrari 285
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tators have emphasized.7 Art. 19(1) determines the relationship that must exist
between the contents of the offer and that of the acceptance in order to lead to the
conclusion of the contract.
2 Art. 19(2), which is as dispositive as Art. 19(1),8 contains an exception to the so-
called “mirror-image-rule”,9 as it allows for a contract conclusion even where the
acceptance does not mirror the offer,10 provided that the points on which the accep-
tance differs from the offer do not materially alter the offer. Art. 19(3), on the other
hand, contains a rebuttable presumption that any differences relating to the issues
exhaustively listed are of a material nature.11
3 For Art. 19(1) to apply, the offeree must act with the intention to be bound when
issuing the acceptance,12 as can be easily derived from that part of the provision which
refers to “the reply to an offer which purports to be an acceptance.”13 If the reply of the
offeree merely constitutes a request for clarification,14 or only contains a reference to the
offeree’s expectations, Art. 19 is not applicable. This has been emphasized by both
commentators15 and courts.16 The issue of whether the offeree’s reply is intended to be
an acceptance or a different kind of statement is to be addressed by interpretation
pursuant to Art. 8 CISG.17
also compare Farnsworth, in: Bianca/Bonell, Commentary (1987), Art. 19 para. 1.1; for a comparative
analysis relating to the mirror-image rule, see Ferrari, Formazione del contratto, in: Galgano/Ferrari/
Ajani (eds), Atlante di diritto privato comparato (1999), pp. 97 et seq.
7 See Zwart, The New International Law of Sales: A Marriage Between Socialist, Third World,
Common, and Civil Law Principles, 13 North Carolina Journal of International Law and Commercial
Regulation (1988) 109 (117).
9 See Bellelli, Nuove leggi civ. comm. (1989), 90 (92); Brunner/Pfisterer/Köster, Kommentar (2014),
Art. 19 para. 1; Dornis, in: Honsell, Kommentar (2010), Art. 19 para. 1; Ferrari/Torsello, International
Sales Law – CISG (2015) p. 151–152; Garro/Zuppi, Compraventa internacional de mercaderı́as (2012),
p. 140; Gillette/Walt, The UN Convention on Contracts for the International Sale of Goods (2016) p. 95;
Jenkins, Contract Resurrected! Contract Formation: Common Law – UCC – CISG, 40 N.C. J. Int’l L. &
Com. Reg. (2015) 245 (284); Magnus, in: Staudinger Kommentar (2013), Art. 19 para. 7; Sukurs,
Harmonizing the Battle of the Forms: A Comparison of the United States, Canada, and the United
Nations Convention on Contracts for the International Sale of Goods, 34 Vanderbilt Journal of
Transnational Law (2001) 1481 (1495); Tomko, United Nations Convention on the International Sale of
Goods: Its Effect on United States and Canadian Sales Law, 66 University of Detroit Law Review (1988)
73 (88); van Alstine, Consensus, Dissensus, and Contractual Obligation Through the Prism of Uniform
International Sales Law, 37 Virginia Journal of International Law (1996) 1 (26).
12 Piltz, Internationales Kaufrecht (2008), para. 95.
13 Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 189; Dornis, in: Honsell, Kommentar (2010),
Art. 19 para. 3; Lüderitz/Fenge, in: Soergel (ed), Kommentar zum BGB. Schuldrechtliche Nebengesetze
(2000), Art. 19 para. 2.
14 See Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 19 para. 7; Meeusen, Totstandkoming van
de Overeenkomst, in: van Houtte/Erauw/Wautelet (eds), Het Weens Koopverdrag (1997), p. 71 (89);
p. 643.
15 Bellelli, Nuove leggi civ. comm. (1989), 90 (91); Dornis, in: Honsell, Kommentar (2010), Art. 19
para. 3; Enderlein/Maskow/Strohbach, Internationales Kaufrecht (1991), Art. 19 para. 2; Ferrari, Vendita

internazionale di beni mobili. Artt. 14–24. Formazione del contratto (2006) p. 110; Saenger, in: Bamber-
ger/Roth (eds), Kommentar zum Bürgerlichen Gesetzbuch (2012), Art. 19 para. 2; Schlechtriem, in:
Schlechtriem/Schwenzer, Commen-tary (2005), Art. 19 para. 7; Schroeter, in: Schlechtriem/Schwenzer,
16 Oberster Gerichtshof (Austria) 6 February 1996, CISG-Online 224.
17 Achilles, Kommentar (2000), Art. 19 para. 1; Bellelli, Nuove leggi civ. comm. (1989), 90 (91);
Brunner/Pfisterer/Köster, Kommentar (2014), Art. 19 para. 2; Dornis, in: Honsell, Kommentar (2010),
Art. 19 para. 3; Herber/Czerwenka, Kommentar (1991), Art. 19 para. 8; Gruber, in: MünchKommBGB
286 Ferrari
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II. Detailed commentary

1. Reply containing additions or different terms
a) Additions, limitations or other modifications. Art. 19(2) provides an exception to 4
the rule whereby only an acceptance that mirrors the offer can lead to the conclusion of
the contract.18 In effect, as long as a reply to an offer that purports to be an acceptance
contains only “additional or different terms which do not materially alter the terms of
the offer,” a contract can be concluded, unless the offeror, without undue delay, objects
orally to the discrepancy or dispatches a notice to that effect. According to some
commentators, this rule conforms with a trend encountered in various domestic legal
systems.19
With respect to the phrase “additional or different terms”, it is worth pointing out 5
that it differs from Art. 19(1), where reference is made to “additions, limitations or
other modifications.” This terminological discrepancy has no substantive impact,
however.20
The additional elements referred to in Art. 19 are those elements not mentioned in 6
the offer.21 For the purposes of Art. 19, those additions that merely mirror provisions of
the applicable law (irrespective of whether domestic law or the CISG is applicable) are
irrelevant.22 The same is true with respect to those additions that are consistent with
practices established between the parties, or usages that bind the parties pursuant to
Art. 9.23 Also, where the additions relate to issues which are covered, although not
expressly, in the offer, they are irrelevant too.24
“Different terms” under the CISG are all other elements that lead to discrepancies 7
between the acceptance and the offer.25 Mere terminological, grammatical or typo-
graphic discrepancies, however, generally should not fall into that category,26 because
(2016), Art. 19 paras 4 et seq.; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 19
CISG (2015) p. 151; Garro/Zuppi, Compraventa internacional de mercaderı́as (2012), p. 140; Murray, An
Essay on the Formation of Contracts and Related Matters under the United Nations Convention on
Contracts for the International Sale of Goods, 8 Journal of Law and Commerce (1998) 11 (41 et seq.).
19 Vergne, The “Battle of the Forms” Under the 1980 United Nations Convention on Contracts for the
International Sale of Goods, 33 American Journal of Comparative Law (1985) 233 (253 et seq.).
(1997), Art. 19 para. 11.

21 Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 189; Gruber, in: MünchKommBGB (2016),
Art. 19 para. 10.

22 In accord Brunner/Pfisterer/Köster, Kommentar (2014), Art. 19 para. 2; Dornis, in: Honsell, Kom-
mentar (2010), Art. 19 para. 6; Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 19
CISG para. 11; Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 19 para. 9; Schlechtriem, in:
(2013), Art. 19 para. 19; Perales Viscasillas, La Formación del contrato de compraventa internacional de
mercaderı́as (1996) pp. 648 et seq.; Schroeter, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 19
para. 9.
23 Piltz, Internationales Kaufrecht (1993) § 3 para. 83; Schlechtriem, in: Schlechtriem/Schwenzer,

24 Piltz, Internationales Kaufrecht (2008), para. 3-95; Schroeter, in: Schlechtriem/Schwenzer, Kommen-
tar (German ed. 2013), Art. 19 para. 6.

26 In accord Brunner/Pfisterer/Köster, Kommentar (2014), Art. 19 para. 2; Ferrari, Vendita internazio-
nale di beni mobili. Artt. 14–24. Formazione del contratto (2006) p. 112; Piltz, Internationales Kaufrecht
(1993) § 3 para. 82; Rudolph, Kommentar (1996), Art. 19 para. 4; Schlechtriem, in: Schlechtriem/Schwen-
zer, Commentary (2005), Art. 19 para. 5; Schroeter, in: Schlechtriem/Schwenzer, Kommentar (German ed.
Ferrari 287
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despite this type of discrepancy,27 the parties are generally in full agreement, and
therefore Art. 19(2) need not come into play.28 Of course, an interpretation based on
Art. 8 may lead to the opposite result.29
8 Art. 8 is also relevant in determining if an acceptance accompanied by an offer leads
to the discrepancies that bar contract conclusion pursuant to Art. 19.30 If the acceptance
is independent from the accompanying offer, a contract is formed (with the terms
contained in the original offer). If, however, the acceptance and the accompanying offer
are closely linked, one must assume that the offeree made a counter-offer.31 It is clear
from these brief remarks that what constitutes an acceptance will depend very much on
the circumstances of the particular case. Therefore, it is unsurprising that a court has
ruled that ordering a greater quantity than that offered by the offeror as well as ordering
different goods will not lead to a contract conclusion, even with respect to the quantity
originally offered by the offeror.32
9 b) Material alterations. A reply by the offeree that purports to be an acceptance but
contains additional or different terms only leads to a contract where those terms do not
materially alter the offer. If the offeree’s reply contains material differences, it is treated
as a rejection,33 which results in the termination of the offer, as set forth in Art. 17.34 At
the same time, that reply constitutes a counter-offer,35 the acceptance of which is also
governed by the provisions of the CISG.36
2013), Art. 19 para. 5; contra Eörsi, Formation of contract, in: Wiener Übereinkommen von 1980 über
den internationalen Warenkauf (1985), pp. 43 (pp. 50 et seq.).
27 See also Ludwig, Der Vertragsabschluß nach UN-Kaufrecht im Spannungsverhältnis von Common Law
pp. 331 et seq.; Witz/Salger/Lorenz, Kommentar (2016), Art. 19 para. 5; for further details, see Wey, Der
Vertragsabschluss beim Internationalen Warenkauf nach UNCITRAL und schweizerischen Recht (1984)
paras 580 et seq. and 1209 et seq.
28 Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 190; Schnyder/Straub, in: Honsell, Kommentar
(1997), Art. 19 para. 9; Piltz, Internationales Kaufrecht (1993) § 3 para. 82; Schlechtriem, in: Schlechtriem/
Schwenzer, Commentary (2005), Art. 19 para. 5; Magnus, in: Staudinger Kommentar (2013), Art. 19 para. 9;
van der Velden, Uniform International Sales Law and the Battle of Forms, FS Georges Sauveplanne (1984),
p. 233 (237); contra Farnsworth, in: Bianca/Bonell, Commentary (1987), Art. 19 para. 1.5.
29 Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 19 para. 9; see also Schroeter, in: Schlechtriem/

(1997), Art. 19 para. 7.

31 See also Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 19 para. 7; compare,
however, Bellelli, Nuove leggi civ. comm. (1989), 90 (91).

32 Oberlandesgericht Frankfurt (Germany) 4 April 1994, CISG-Online 110.
33 Ferrari/Torsello, International Sales Law – CISG (2015) p. 152; Schroeter, in: Schlechtriem/Schwen-
zer, Kommentar (German ed. 2013), Art. 19 para. 10; Schroeter, in: Schlechtriem/Schwenzer, Commen-
tary (2016), Art. 19 para. 19.
Art. 19 para. 10; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 19 para. 10; Schnyder/
Straub, in: Honsell, Kommentar (1997), Art. 19 para. 17; van Alstine, Consensus, Dissensus, and Contractual
Obligation Through the Prism of Uniform International Sales Law, 37 Virginia Journal of International Law
(1996) 1 (26); in case law see Bundesgericht (Switzerland) 5 April 2005, CISG-Online 1012.
CISG (2015) p. 152; Piltz, Internationales Kaufrecht (2008), para. 3-98; Schroeter, in: Schlechtriem/
Schwenzer, Commentary (2016), Art. 19 para. 20; in case law, see U.S. District Court, D. Col. (U.S.),
Orica Australia Pty Ltd. v. Aston Evaporative Services, LLC., 28 July 2015, CISG-Online 2661.
36 Compare Kantonsgericht Freiburg (Switzerland) 11 October 2004, CISG-Online 964; in legal writing
see Piltz, Internationales Kaufrecht (2008), para. 3-103.
288 Ferrari
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The determination that an additional or different term is material depends on the 10
circumstances of the particular case.37 Despite the wording of Art. 19(3), this is also true
with respect to the terms explicitly (but not exhaustively)38 listed in that provision (the
price,39 payment,40 quality41 and quantity42 of the goods, place and time of delivery,
extent of one party’s liability to the other,43 settlement of disputes),44 because Art. 19(3)
– as emphasized both by commentators45 and courts46 – only states a rebuttable
presumption of the materiality of differences relating to those terms.47 Therefore, as
37 Achilles, Kommentar (2000), Art. 19 para. 2; Enderlein/Maskow/Strohbach, Internationales Kaufrecht
(1991), Art. 19 para. 5; Ferrari/Torsello, International Sales Law – CISG (2015) p. 152; Ludwig, Der
dargestellt auf der Grundlage der Rechtsordnungen Englands und Deutschlands (1994) p. 330; Neu-
mayer/Ming, Convention de Vienne (1993), Art. 19 para. 4; Reinhart, Kommentar (1991), Art. 19 para. 6;
Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 19 para. 9; Schnyder/Straub, in:
Honsell, Kommentar (1997), Art. 19 para. 13; Schroeter, in: Schlechtriem/Schwenzer, Kommentar (Ger-
man ed. 2013), Art. 19 para. 8 note 26.
para. 5; Bellelli, Nuove leggi civ. comm. (1989), 90 (93); Bydlinski, Das allgemeine Vertragsrecht, in:
Doralt (ed), Das UNCITRAL-Kaufrecht im Vergleich zum österreichischen Recht (1985), p. 57 (72);
Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 191; Eörsi, Formation of contract, in: Wiener
Übereinkommen von 1980 über den internationalen Warenkauf (1985), p. 43 (51); Ferrari, Vendita
internazionale di beni mobili. Artt. 14–24. Formazione del contratto (2006) p. 114; Leete, Contract
Formation under the United Nations Convention on Contracts for the International Sale of Goods and
the Uniform Commercial Code: Pitfalls for the Unwary, 6 Temple International and Comparative Law
Journal (1992) 193 (213); Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 19 CISG
Weens Koopverdrag (1997), p. 71 (90); Perales Viscasillas, “Battle of the Forms” Under the 1980 United
Nations Convention on Contracts for the International Sale of Goods and the Principles of International
Commercial Contracts, 10 Pace International Law Review (1998) 97 (137); Piltz, Internationales
Kaufrecht (1993) § 3 para. 89; Lüderitz/Fenge, in: Soergel (ed), Kommentar zum BGB. Schuldrechtliche
Nebengesetze (2000), Art. 19 para. 3; Sono, Formation of International Contracts under the Vienna
Convention: A Shift above the Comparative Law, in: Sarcevic/Volken (eds), International Sale of Goods
(1986), p. 111 (125); Magnus, in: Staudinger Kommentar (2013), Art. 19 para. 19; van Alstine, Consensus,
Dissensus, and Contractual Obligation Through the Prism of Uniform International Sales Law, 37
Virginia Journal of International Law (1996) 1 (24).
39 In case law see Bundesgericht (Switzerland) 5 April 2005, CISG-Online 1012; Primer tribunal
colegiado en materia civil del primer circuito (Spain) 10 March 2005, CISG-Online 1004; Oberster
Gerichtshof (Austria) 9 March 2000, CISG-Online 573.
40 Oberlandesgericht Frankfurt (Germany) 4 March 1994, CISG-Online 110.
41 Hof Gent (Belgium) 8 November 2004, CISG-Online 982.
42 See Cour de Cassation (France) 27 May 2014, CISG-Online 2514; Bundesgericht (Switzerland) 5 April
2005, CISG-Online 1012; Oberlandesgericht Frankfurt (Germany) 23 May 1995, CISG-Online 185.
43 Rechtbank Gelderland (Netherlands) 30 July 2014, CISG-Online 2541.
zum österreichischen Recht (1985), p. 57 (72); Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 191;
Enderlein/Maskow/Strohbach, Internationales Kaufrecht (1991), Art. 19 para. 8; Ferrari, Vendita inter-
nazionale di beni mobili. Artt. 14–24. Formazione del contratto (2006) pp. 115 et seq.; Karollus, UN-
Kaufrecht (1989) p. 70; Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 19 CISG
para. 13; Schroeter, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 19 para. 15; Neumayer/Ming,
Convention de Vienne (1993), Art. 19 para. 3; Perales Viscasillas, La Formación del contrato de
compraventa internacional de mercaderı́as (1996) pp. 660 et seq.; Piltz, Internationales Kaufrecht (1993)
§ 3 para. 87; Piltz, Neue Entwicklungen im UN-Kaufrecht, NJW (2000) 553 (557); Piltz, Internationales
Kaufrecht (2008), para. 3-99; van Alstine, Fehlender Konsens beim Vertragsabschluß nach dem einheitli-
chen UN-Kaufrecht: eine rechtsvergleichende Untersuchung auf der Grundlage des deutschen sowie des
US-amerikanischen Rechts (1995), pp. 200 et seq.
46 Oberster Gerichtshof (Austria) 20 March 1997, CISG-Online 269; contra Primer tribunal colegiado en
materia civil del primer circuito (Spain) 10 March 2005, CISG-Online 1004.
47 See also Achilles, Kommentar (2000), Art. 19 para. 2; Saenger, in: Bamberger/Roth (eds), Kommentar
zum Bürgerlichen Gesetzbuch (2012), Art. 19 para. 5; Brunner/Pfisterer/Köster, Kommentar (2014),
Ferrari 289
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the Austrian Supreme Court notes,48 it is possible “that alterations of these terms will
be classified as immaterial due to special circumstances of the particular case, practi-
ces established between the parties, pre-contractual negotiations or usage.”49 This
has important consequences for the allocation of the burden of proof, as it imposes
upon the party claiming that a contract was concluded the responsibility for proving
that a contract was indeed concluded despite the (material) differences between offer
and acceptance in respect of the aforementioned elements (price, quantity, quality,
etc.).50
11 c) Immaterial alterations. Except for the elements expressly listed in Art. 19(3), no
other elements lead to a presumption of the material nature of their alteration.51 This
means that the distinction between material and immaterial alterations becomes even
more difficult, and a careful consideration of the circumstances of the particular case
even more important.52 Nevertheless, in this author’s opinion, it is still possible to
identify some more general rules from which to infer the material or immaterial nature
of the alterations, although under certain circumstances (in light of the practices
established between the parties, usages that bind the parties pursuant to Art. 9 or an
agreement of the parties, for example) these rules may not apply. Alterations, for
instance, that deal with questions not addressed in the offer and that adopt solutions
contrary to those of the applicable law should be considered material alterations.53 A
choice of law clause contained in a reply to an offer, leading to the application of a law
that would not be applicable absent that choice, must also be considered a material
alteration.54 For the same reason, a reply to the offer containing a penalty clause,55 or a
right to revoke not generally granted in the same circumstances by the applicable law,
Art. 19 para. 4; Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 191; Ferrari/Torsello, International
Sales Law – CISG (2015) p. 152–153; Magnus, in: Staudinger Kommentar (2013), Art. 19 para. 16; Jametti
Greiner, Der Vertragsabschluss, in: Hoyer/Posch (eds), Das Einheitliche Wiener Kaufrecht (1992), p. 43
(52); Schroeter, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2013), Art. 19 para. 8 b; contra
Herber/Czerwenka, Kommentar (1991), Art. 19 para. 11; Heuzé, RdNo. 186; Ludwig, Der Vertrags-
abschluß nach UN-Kaufrecht im Spannungsverhältnis von Common Law und Civil Law, dargestellt auf
der Grundlage der Rechtsordnungen Englands und Deutschlands (1994) p. 333; Gruber, in: Münch-
KommBGB (2016), Art. 19 para. 7; Reinhart, Kommentar (1991), Art. 19 para. 6; Witz/Salger/Lorenz,
Kommentar (2016), Art. 19 para. 9; US District Court, Southern District of New York (U.S.), Filanto
S. p. A. v Chilewich International Corp., 14 April 1992, CISG-Online 45.
48 See also Oberlandesgericht Naumburg (Germany) 27 April 1999, CISG-Online 512.
49 Oberster Gerichtshof (Austria) 20 March 1997, CISG-Online 269; in legal writing see Gruber, in:
MünchKommBGB (2016), Art. 19 para. 8; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary

(2005), Art. 19 para. 8.
para. 5; Gruber, in: MünchKommBGB (2016), Art. 19 para. 9; Perales Viscasillas, “Battle of the Forms”
Under the 1980 United Nations Convention on Contracts for the International Sale of Goods and the
Principles of International Commercial Contracts, 10 Pace International Law Review (1998) 97 (137).
54 Achilles, Kommentar (2000), Art. 19 para. 2; Brunner/Pfisterer/Köster, Kommentar (2014), Art. 19
para. 4; Magnus, in: Staudinger Kommentar (2013), Art. 19 para. 19; Schlechtriem/Schroeter, Internatio-
nales UN-Kaufrecht (2013) para. 280; Schroeter, in: Schlechtriem/Schwenzer, Commentary (2010), Art. 19
para. 17; see also OLG Linz (Austria) 23 March 2005, CISG-Online 1376.
55 Brunner/Pfisterer/Köster, Kommentar (2014), Art. 19 para. 4; Rudolph, Kommentar (1996), Art. 19
290 Ferrari
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does not constitute an acceptance.56 The same is true with respect to a reply containing
an arbitration clause57 or a choice of forum clause.58
If the offeror requires that the reply to the offer take a given form, noncompliance with 12
that form requirement must be considered a material alteration of the offer.59 The reason
for this is the CISG’s principle of freedom from form requirements, set forth in Arts 11 and
29. Thus, if the offeror explicitly requires compliance with a particular form requirement,
this shows that compliance with that form requirement is so important to the offeror that
non-compliance on the side of the offeree cannot lead to the conclusion of the contract.60
Whether modifications are immaterial also can depend on other elements, such as the 13
overall content of the contract as well as its value and the economic circumstances.61 Some
commentators also suggest that consideration should be given to whether a reasonable
person in the same circumstances as the offeree would agree to the modification.62
Furthermore, in deciding whether a modification by the seller constitutes a material
modification, regard should be had to whether the modification is beneficial to the offeror63
(for instance, because it provides for a higher price or because it imposes on the offeree the
obligation to deliver the goods to the offeror at no extra cost).64 In these instances, one may
assume that the modification does not materially alter the offer65 – a view adopted by the
Austrian Supreme Court.66 The same is true with respect to those instances where the
modification relates to the packaging of the goods67 or their mode of shipment;68 though,
56
57
Ferrari/Torsello, International Sales Law – CISG (2015) p. 154; Gruber, in: MünchKommBGB (2016),
Art. 19 para. 6; Nakata, Sounds of Silence Bellow Forth Under the CISG’s International Battle of Forms, 7
Transnational Lawyer (1994) 141 (161); Piltz, Internationales Kaufrecht (1993) § 3 para. 88; Sukurs,
Harmonizing the Battle of the Forms: A Comparison of the United States, Canada, and the United
Nations Convention on Contracts for the International Sale of Goods, 34 Vanderbilt Journal of
Transnational Law (2001) 1481 (1497); in case law US District Court, Southern District of New York
(U.S.), Filanto S. p. A. v Chilewich International Corporation, 14 April 1992, CISG-Online 45.
58 Cour de Cassation (France) 16 July 1998, CISG-Online 344; in legal writing Farnsworth, in: Bianca/
Bonell, Commentary (1987), Art. 19 para. 2.8; Gruber, in: MünchKommBGB (2016), Art. 19 para. 6;
Sono, Formation of International Contracts under the Vienna Convention: A Shift above the Comparative
Law, in: Sarcevic/Volken (eds), International Sale of Goods (1986), p. 111 (pp. 126 et seq.).
59 Ferrari/Torsello, International Sales Law – CISG (2015) p. 154; Mankowski, in: Ferrari et al., Internatio-
nales Vertragsrecht (2012), Art. 19 CISG para. 25; contra Bellelli, Nuove leggi civ. comm. (1989), 90 (92).
62 Lüderitz/Fenge, in: Soergel (ed), Kommentar zum BGB. Schuldrechtliche Nebengesetze (2000),
Art. 19 para. 4; Magnus, in: Staudinger Kommentar (2013), Art. 19 para. 19, citing to Piltz, Internatio-
nales Kaufrecht (1993) § 3 para. 89, and Loewe, Internationales Kaufrecht (1989) pp. 43 et seq.; Man-
kowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 19 CISG para. 9.
63 Schlechtriem/Schroeter, Internationales UN-Kaufrecht (2013) para. 280; Schroeter, in: Schlechtriem/
Schwenzer, Commentary (2016), Art. 19 para. 16; contra Bellelli, Nuove leggi civ. comm. (1989), 90 (93).
64 See also Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 19 CISG para. 12;

para. 5; Bydlinski, Das allgemeine Vertragsrecht, in: Doralt (ed), Das UNCITRAL-Kaufrecht im Vergleich
zum österreichischen Recht (1985), p. 57 (72); Gruber, in: MünchKommBGB (2016), Art. 19 para. 8;
Neumayer/Ming, Convention de Vienne (1993), Art. 19 para. 3; Rudolph, Kommentar (1996), Art. 19
para. 8; Magnus, in: Staudinger Kommentar (2013), Art. 19 para. 19; Witz/Salger/Lorenz, Kommentar
(2016), Art. 19 para. 10; contra Herber/Czerwenka, Kommentar (1991), Art. 19 para. 11.
66 Oberster Gerichtshof (Austria) 20 March 1997, CISG-Online 269.
67 Provided that the packaging itself is not part of the goods offered, as in the case, for instance, of
designer products in relation to which the packaging may be relevant. Rather, references are made to the
packaging as a means of protecting the goods from risks relating to their transport.
68 Bellelli, Nuove leggi civ. comm. (1989), 90 (93); Honnold/Flechtner, Uniform Law (2009), para. 167;
Ferrari 291
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under certain circumstances, the modification relating to those elements can, of course, also
constitute material modifications.69 As for case law, an important decision rendered by a
German court held that a modification requiring complaints to be made within one month
from date of invoice is immaterial.70 This is not convincing; nor is the holding that, in a
reply to an offer, a request to keep the reply confidential does not constitute a material
modification.71
14 d) “Battle of forms” and commercial letter of confirmation. The issue of the “battle
of forms” has been intensely debated, not only during the drafting of the CISG,72 but also
during the discussions of Art. 19.73 The practical importance of the “battle of forms”74
becomes evident if one bears in mind that each contracting party will normally try to
include its own standard contract terms, and that the standard contract terms of the
various contracting parties usually (aside from the rare cases where both parties use the
same standard contract terms)75 differ from each other.76 The question of what standard
contract terms become part of the contract is controversial.77 What is uncontroversial is
that there is no special CISG provision dealing with the “battle of forms”,78 which is why
69 Oberlandesgericht Hamm (Germany) 22 September 1992, CISG-Online 57.
70 Landgericht Baden-Baden (Germany) 14 August 1991, CISG-Online 24.
71 See Legfelsóbb Birósag (Hungary) 25 September 1992, CISG-Online 63.
72 See Official Records (1981), pp. 288 et seq.
73 For papers on the “battle of forms”, see Baumgartner, Contract Formation under the CISG and
under the Unidroit Principles: Special Focus on the Issue of the Battle of the Forms (2008); Blodgett, The
UN Convention on the Sale of Goods and the “Battle of the Forms”, 18 Colorado Lawyer (1989) 421 et
seq.; Ferrante, Contr. impr./Europa (2003) 485 ff.; ders., Unif. L. Rev. (2003) 975 ff.; Gabriel, 49 Bus. Law.
(1994) 1053 et seq.; Janssen, De “battle of forms” in het Weens Koopverdrag. Het probleem van
tegenstrijdige algemene voorwarden in het internationale kooprecht, Weekblad voor Privaatrecht,
Notariaat en Registratie (2002) 453 et seq.; Kelso, The United Nations Convention on Contracts for the
International Sale of Goods: Contract Formation and the Battle of Forms, 21 Columbia Journal of
Transnational Law (1982) 529 ff.; Moccia, The United Nations Convention on Contracts for the
International Sale of Goods and the “Battle of the Forms”, 13 Fordham International Law Journal
(1989) 649 et seq.; Nakata, Sounds of Silence Bellow Forth Under the CISG’s International Battle of
Forms, 7 Transnational Lawyer (1994) 141 et seq.; Neumayer, Das Wiener Kaufrechtsübereinkommen
und die sogenannte “battle of forms”, in: FS Hans Giger (1989), pp. 501 et seq.; Perales Viscasillas, “Battle
of the Forms” Under the 1980 United Nations Convention on Contracts for the International Sale of
Goods and the Principles of International Commercial Contracts, 10 Pace International Law Review
(1998) 97 et seq.; Perales Viscasillas, La batalla de los formularios en la Convencion de Viena de 1980
sobre compraventa internacional de mercaderias, La Ley (1996) 1 et seq.; Rühl, The Battle of the Forms:
Comparative and economic observations, 24 University of Pennsylvania Journal of International Eco-
nomic Law (2003) 189 et seq.; Vergne, The “Battle of the Forms” Under the 1980 United Nations
Convention on Contracts for the International Sale of Goods, 33 American Journal of Comparative Law
(1985) 233 et seq.
74 Wittmann, “Bedingungs- Ping-Pong” nach einheitlichem Kaufrecht, Computer und Recht (1989)
1078 (1079).
75 For an example of standard contract terms used by both parties which thus, cannot conflict, see van
der Velden, Uniform International Sales Law and the Battle of Forms, FS Georges Sauveplanne (1984),
p. 233 (p. 234).
76 Bellelli, Nuove leggi civ. comm. (1989), 90 (92); Heuzé, Vente Internationale (2005), para. 187;
Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 19 CISG para. 39; Moccia, The
United Nations Convention on Contracts for the International Sale of Goods and the “Battle of the
Forms”, 13 Fordham International Law Journal (1990) 649 (659); Rudolph, Kommentar (1996), Art. 19
para. 10; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 19 para. 19.
77 For an overview of where the discussion stands see, in case law, Bundesgerichtshof (Germany)
9 January 2002, CISG-Online 651.

Koopverdrag (1997), p. 71 (89); Stoffel, Formation du contrat, in: Wiener Übereinkommen von 1980
über den internationalen Warenkauf (1985), p. 55 (71); Schroeter, in: Schlechtriem/Schwenzer, Commen-
tary (2016), Art. 19 para. 33.
292 Ferrari
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one has to have recourse to Art. 19.79 Some commentators, however, hold the opposite
view and suggest instead that the question at hand must be answered on the basis of the
applicable domestic law.80 This view is hardly justifiable,81 the question at hand not being
one of those not governed by the CISG and, therefore, subject to domestic law.
In this author’s opinion, the issue of the “battle of forms” must be solved on the 15
basis of Art. 19.82 From this it follows that when the offeree replies to an offer
containing standard contract terms by sending an acceptance that also contains
standard contract terms, one must determine, as with every other reply to an offer,
whether the reply contains additional or different terms that materially alter the offer.
If it does not, i. e., if the discrepancies between the various terms included in the offer
and acceptance are immaterial,83 a contract will come to existence, and its contents
will be determined by the standard contract terms used by the offeror on which there
is agreement and the standard contract terms of the offeree that do not materially alter
79 Gabriel, The Battle of the Forms: A Comparison of the United Nations Convention for the
International Sale of Goods and the Uniform Commercial Code, 49 Business Lawyer (1994) 1053
(1058); Hartnell, Rousing the Sleeping Dog: The Validity Exception to the Convention on Contracts for
the International Sale of Goods, 18 Yale Journal of International Law (1993) 1 (12 et seq.); Holthausen,
Vertraglicher Ausschluß des UN-Übereinkommens über internationale Warenkaufverträge, RIW (1989)
513 (517 et seq.); Jametti Greiner, Der Vertragsabschluss, in: Hoyer/Posch (eds), Das Einheitliche Wiener
Kaufrecht (1992), p. 43 (p. 52); Kröll/Hennecke, Kollidierende Allgemeine Geschäftsbedingungen in
internationalen Kaufverträgen, RIW (2001) 736 (740); Kühl/Hingst, Das UN-Kaufrecht und das Recht
der AGB, in: Festgabe Herber (1999) p. 50 (p. 55); Ludwig, Der Vertragsabschluß nach UN-Kaufrecht im
Spannungsverhältnis von Common Law und Civil Law, dargestellt auf der Grundlage der Rechtsordnun-
gen Englands und Deutschlands (1994) p. 336; Mankowski, in: Ferrari et al., Internationales Vertragsrecht
(2012), Art. 19 CISG paras 33 et seq.; Gruber, in: MünchKommBGB (2016), Art. 19 para. 18; Perales
Viscasillas, “Battle of the Forms” Under the 1980 United Nations Convention on Contracts for the
International Sale of Goods and the Principles of International Commercial Contracts, 10 Pace Interna-
tional Law Review (1998) 97 (140); Schroeter, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 19
para. 33; Rudolph, Kommentar (1996), Art. 19 para. 10; Magnus, in: Staudinger Kommentar (2013),
Art. 19 paras 2 and 20; van Alstine, Fehlender Konsens beim Vertragsabschluß nach dem einheitlichen
UN-Kaufrecht: eine rechtsvergleichende Untersuchung auf der Grundlage des deutschen sowie des US-
amerikanischen Rechts (1995) p. 206; contra, however, Hellner, The Vienna Convention and Standard
Form Contracts, in: Sarcevic/Volken (eds), International Sale of Goods (1986), p. 335 (p. 342); in case law
see, e. g., OLG Linz (Austria) 23 March 2005, CISG-Online 1376; Bundesgerichtshof (Germany) 9 January
80 Dessemontet, La Convention des Nations Unies du 11 Avril 1980 sur les contrats de vente
internationale de marchandises, in: Dessemontet (ed), Les contrats de vente internationale de marchan-
dises (1991), p. 47 (p. 56); Ebenroth, Internationale Vertragsgestaltung im Spannungsverhältnis zwischen
ABGB, IPR-Gesetz und UN-Kaufrecht, österreichische Juristische Blätter (1986) 681 (686); U. Huber, Der
UNCITRAL-Entwurf eines Übereinkommens über internationale Warenkaufverträge, 43 RabelsZ (1979)
413 (445); Murray, An Essay on the Formation of Contracts and Related Matters under the United
(1998) 11 (42 et seq.); Vergne, The “Battle of the Forms” Under the 1980 United Nations Convention on
Contracts for the International Sale of Goods, 33 American Journal of Comparative Law (1985) 233
(256 et seq.); Winship, Changing Contract Practices in the Light of the United Nations Sales Convention:
A Guide For Practitioners, 29 International Lawyer (1995) 525 (544).
81 See also Moccia, The United Nations Convention on Contracts for the International Sale of Goods
and the “Battle of the Forms”, 13 Fordham International Law Journal (1989) 649 (674 et seq.); van der
Velden, Uniform International Sales Law and the Battle of Forms, FS Georges Sauveplanne (1984), p. 233
(p. 243).
82 Dornis, in: Honsell, Kommentar (2010), Art. 19 para. 37; Gillette/Walt, The UN Convention on
Contracts for the International Sale of Goods (2016) p. Magnus, in: Staudinger Kommentar (2013),
Art. 19 para. 20; Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 19 CISG paras.
32 et seq.; OLG Linz (Austria) 23 March 2005, CISG-Online 1376; Hoge Raad (Netherlands) 28 January
2005, CISG-Online 1002; Bundesgerichtshof (Germany) 9 January 2002, CISG-Online 651; contra Eben-
roth, JBl. (1986) 681 (686).
83 Rudolph, Kommentar (1996), Art. 19 para. 11, stating that this is the case, from a practical point of
view.
Ferrari 293
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the offer.84 On the other hand, if the modifications do materially alter the offer, no
contract has come into existence.85 The view that in both of these instances a contract is
concluded on the basis of the knock-out rule – a view held both by commentators86 and
courts87 – cannot be shared. If the contract is executed, one must assume that the (original)
offeror has accepted the counter-offer of the offeree containing the (materially different)
standard contract terms.88 This rule has been called by both commentators89 and courts90
the “last shot rule”.
84 Bellelli, Nuove leggi civ. comm. (1989), 90 (92); Dornis, in: Honsell, Kommentar (2010), Art. 19 para. 39;
Enderlein/Maskow/Strohbach, Internationales Kaufrecht (1991), Art. 19 para. 4; Herber/Czerwenka, Kom-

mentar (1991), Art. 19 para. 18; Perales Viscasillas, “Battle of the Forms” Under the 1980 United Nations
Convention on Contracts for the International Sale of Goods and the Principles of International Commercial
Contracts, 10 Pace International Law Review (1998) 97 (147); Schroeter, in: Schlechtriem/Schwenzer,
Kommentar (German ed. 2013), Art. 19 para. 36; Stoffel, Formation du contrat, in: Wiener Übereinkommen
von 1980 über den internationalen Warenkauf (1985), p. 55 (p. 73); Magnus, in: Staudinger Kommentar
85 Jametti Greiner, Der Vertragsabschluss, in: Hoyer/Posch (eds), Das Einheitliche Wiener Kaufrecht
(1992), p. 43 (p. 53).

86 Achilles, Kommentar (2000), Art. 19 para. 5; Audit, Vente Internationale (1990), p. 70; De Nova,
Condizioni generali di contratto confliggenti, in: Digiesto delle discipline privatistiche. Sezione di diritto
civile (2000), p. 201; Kühl/Hingst, Das UN-Kaufrecht und das Recht der AGB, in: Festgabe Herber (1999),
p. 50 (p. 56); Gruber, in: MünchKommBGB (2016), Art. 19 para. 24; Niggemann, Die Bedeutung des
Inkrafttretens des UN-Kaufrechts für den deutsch-französischen Wirtschaftsverkehr, RIW (1991) 372
(377); Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 19 para. 20; Schlechtriem/
Schroeter, Internationales UN-Kaufrecht (2013) para. 287; Schroeter, in: Schlechtriem/Schwenzer, Com-
mentary (2016), Art. 19 para. 38; Sieg, Allgemeine Geschäftsbedingungen im grenzüberschreitenden
Geschäftsverkehr, RIW (1997) 811 (814); Lüderitz/Fenge, in: Soergel (ed), Kommentar zum BGB.
Schuldrechtliche Nebengesetze (2000), Art. 19 para. 5; Ventsch/Kluth, Die Einbeziehung von Allgemeinen
Geschäftsbedingungen im Rahmen des UN-Kaufrechts, IHR (2003) 61 (63 et seq.); Kröll/Hennecke,
Kollidierende Allgemeine Geschäftsbedingungen in internationalen Kaufverträgen, RIW (2001) 736
(742); Schroeter, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2013), Art. 19 para. 25; Magnus,
in: Staudinger Kommentar (2013), Art. 19 paras 24 et seq.; Stoffel, Formation du contrat, in: Wiener
Übereinkommen von 1980 über den internationalen Warenkauf (1985), p. 55 (p. 75).
87 Cour de Cassation (France) 16 July 1998, CISG-Online 344; Amtsgericht Kehl (Germany) 6 October

88 Audit, Vente Internationale (1990), pp. 69 et seq.; Dornis, in: Honsell, Kommentar (2010), Art. 19
para. 40; Herber/Czerwenka, Kommentar (1991), Art. 19 para. 18; Leete, Contract Formation under the
United Nations Convention on Contracts for the International Sale of Goods and the Uniform Commercial
Code: Pitfalls for the Unwary, 6 Temple International and Comparative Law Journal (1992) 193 (214);
Neumayer, Das Wiener Kauf-rechtsübereinkommen und die sogenannte “battle of forms”, in: FS Hans Giger
(1989), p. 501 (p. 524); Perales Viscasillas, “Battle of the Forms” Under the 1980 United Nations Convention
on Contracts for the International Sale of Goods and the Principles of International Commercial Contracts,
10 Pace International Law Review (1998) 97 (145); Rudolph, Kommentar (1996), Art. 19 para. 11; Sono,
Formation of International Contracts under the Vienna Convention: A Shift above the Comparative Law, in:
Sarcevic/Volken (eds), International Sale of Goods (1986), p. 111 (p. 127 et seq.).
Frisch, Commercial Common Law, the United Nations Convention on the International Sales of Goods, and
the Inertia of Habit, 74 Tulane Law Review (1999) 495 (517); Gillette/Walt, The UN Convention on Contracts
for the International Sale of Goods (2016) p. 95; Kelso, The United Nations Convention on Contracts for the
International Sale of Goods: Contract Formation and the Battle of the Forms, 21 Columbia Journal of
Transnational Law (1983) 529 (554); Leete, Contract Formation under the United Nations Convention on
Contracts for the International Sale of Goods and the Uniform Commercial Code: Pitfalls for the Unwary, 6
Temple International and Comparative Law Journal (1992) 193 (214); Meeusen, Totstandkoming van de
Overeenkomst, in: van Houtte/Erauw/Wautelet (eds), Het Weens Koopverdrag (1997), p. 71 (p. 93); Schultz,
Rolling Contract Formation under the UN Convention on Contracts for the International Sale of Goods, 35
Cornell International Law Journal (2001) 263 (282); Sukurs, Harmonizing the Battle of the Forms: A
Comparison of the United States, Canada, and the United Nations Convention on Contracts for the
International Sale of Goods, 34 Vanderbilt Journal of Transnational Law (2001) 1481 (1496 and 1499).
90 U.S. Court of Appeals, 7th Circuit (U.S.), VLM Food Trading Intern., Inc. v. Illinois Trading Co.,
21 January 2016, 811 F.3 d 247; U.S. District Court, D. Minn. (U.S.), Travelers Property Cas. Co. of
294 Ferrari
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The “last shot rule” does not apply91 only where a contract is concluded with the 16
exclusion of the conflicting standards terms, as a result of either an agreement by the
parties (concluded, for instance, on the occasion of a framework agreement), the
practices established between the parties, or the usages that are binding upon the parties
pursuant to Art. 9.
The CISG does not provide any special provision to deal with silence following a 17
commercial letter of confirmation. In this situation as well, one has to resort to
Art. 19.92 As a result, under the CISG one generally (i. e., where the practices established
between the parties or the usages that are binding upon them do not provide
otherwise)93 cannot apply the rule currently applied in Germany concerning silence
following a commercial letters of confirmation. That rule leads to the modification of
the terms of the contract as long as this does not violate the good faith principle,94 a
view also held by courts.95 Only where an international usage of the kind referred to in
Art. 9(2) exists as to the effects of silence following a commercial letter of confirmation,
or where practices between the parties have been established to that effect, can silence
following a commercial letter of confirmation be considered to alter the contract, within
the limits just mentioned.96
e) Legal consequences of material and immaterial modifications. If the modifica- 18
tions contained in the offeree’s reply to the offer are immaterial, and if the offeror does
not object without undue delay to those modifications, the contract comes into
existence with the content of the offer97 as modified by the (immaterial) modifications
America v. Saint-Gobain Technical Fabrics Canada Ltd., 31 January 2007, CISG-Online 1435 (also 1522);
Oberster Gerichtshof (Austria) 13 September 2001, CISG-Online 644; Oberlandesgericht Köln (Germany)
24 May 2006, CISG-Online 1232; Oberlandesgericht Düsseldorf (Germany) 25 July 2003, CISG-Online
919.
93 See also Karollus, UN-Kaufrecht (1989) p. 72; Schultz, Rolling Contract Formation under the UN
Convention on Contracts for the International Sale of Goods, 35 Cornell International Law Journal
(2001) 263 (286).
zum österreichischen Recht (1985), p. 57 (p. 78 et seq.); Karollus, UN-Kaufrecht (1989), p. 72; Schlech-
triem, in: Schlechtriem/Schwenzer, Commentary (2005), Introduction to Art. 14 paras 17 et seq.; Magnus,
in: Staudinger Kommentar (2013), Art. 19 para. 26; for comparative remarks on the commercial letter of
confirmation, see Esser, Commercial Letters of Confirmation in International Trade: Austrian, French,
German and Swiss Law and Uniform Law Under the 1980 Sales Convention, 18 Georgia Journal of
International and Comparative Law (1988) 427 et seq.
95 See Handelsgericht des Kantons Zürich (Switzerland) 10 July 1996, CISG-Online 227.
96 See also Landgericht Hamburg (Germany) 19 June 1997, CISG-Online 283; Oberlandesgericht
Frankfurt (Germany) 5 July 1995, CISG-Online 258; in legal writing, see Schultz, Rolling Contract
Formation under the UN Convention on Contracts for the International Sale of Goods, 35 Cornell
International Law Journal (2001) 263 (286).
97 Compare Adame Goddard, El Contrato de Compraventa Internacional (1994) p. 105; Audit, Vente
Internationale (1990), p. 69; Saenger, in: Bamberger/Roth (eds), Kommentar zum Bürgerlichen Gesetz-
buch (2012), Art. 19 para. 4; Bellelli, Nuove leggi civ. comm. (1989), 90 (92); Dı́ez-Picazo, in: Dı́ez-Picazo,
Comentario (1998), p. 193; Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 19 para. 22; Ludwig,
dargestellt auf der Grundlage der Rechtsordnungen Englands und Deutschlands (1994) p. 329; Meeusen,
Totstandkoming van de Overeenkomst, in: van Houtte/Erauw/Wautelet (eds), Het Weens Koopverdrag
(1997), p. 71 (90); Gruber, in: MünchKommBGB (2016), Art. 19 para. 14; Perales Viscasillas, La Forma-
ción del contrato de compraventa internacional de mercaderı́as (1996) p. 640; J. Pierre/V. Pierre, A
Comparison of the Rules on Formation of Sales Contracts Under the Louisiana Civil Code and the United
Nations Convention on Contracts for the International Sale of Goods: What Buyers and Sellers Should
Know, 20 Southern University Law Review (1993) 189 (194 et seq.); Rendell, The New U. N. Convention
on International Sales Contracts: An Overview, 15 Brooklyn Journal of International Law (1989) 23 (29);
Ferrari 295
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contained in the reply of the offeree98 – a solution also adopted in case law.99 The time
of contract conclusion is the time when the acceptance containing the immaterial
modifications reaches the offeror.100
19 If the reply to the offer contains material modifications, that reply has the same
effects as a rejection of the offer,101 and thus terminates the offer pursuant to Art. 17.102
However, this reply containing material modifications constitutes a counter-offer that is
just as subject to the CISG’s provisions on offer and acceptance as the original offer.103
2. Objection
20 a) Preface. As previously discussed, a reply to an offer containing only immaterial
modifications constitutes an acceptance, which is why it leads to the conclusion of the
contract when it reaches the offeror.104 Until expiration of the time for objection, however,
the contract is subject to the condition105 that the offeror not object to the modifications.
This possibility, that the offeror might object to the contract conclusion even where the
reply to the offer “merely” contains immaterial modifications, has been criticized on the
grounds that it provides an opportunity for the offeror to speculate at the risk of the
offeree.106 This view cannot be shared. The offeror must be put in a position not to be
bound by a contract the offeror did not want when making the offer.107
Schlechtriem/Schroeter, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2013), Art. 19 para. 14;
Schultz, Rolling Contract Formation under the UN Convention on Contracts for the International Sale of
Goods, 35 Cornell International Law Journal (2001) 263 (282); Sono, Formation of International
Contracts under the Vienna Convention: A Shift above the Comparative Law, in: Sarcevic/Volken (eds),
International Sale of Goods (1986), p. 111 (125); Magnus, in: Staudinger Kommentar (2013), Art. 19
98 Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 19 CISG para. 26; Schlech-
triem/Schroeter, Internationales UN-Kaufrecht (2013) para. 278.

99 See Oberster Gerichtshof (Austria) 20 March 1997, CISG-Online 269; Tribunal de Commerce de
Nivelles (Belgium) 19 September 1995, CISG-Online 366; Arbitral Award, ICC 8611, CISG-Online 326.
zum österreichischen Recht (1985), p. 57 (p. 73); Ferrari, Vendita internazionale di beni mobili. Artt. 14–
24. Formazione del contratto (2006) p. 128.
102 Ludwig, Der Vertragsabschluß nach UN-Kaufrecht im Spannungsverhältnis von Common Law und
Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 19 para. 10; Witz/Salger/Lorenz,
103 See also Achilles, Kommentar (2000), Art. 19 para. 5; Schnyder/Straub, in: Honsell, Kommentar
(1997), Art. 19 para. 18; Ludwig, Der Vertragsabschluß nach UN-Kaufrecht im Spannungsverhältnis von
lands (1994) p. 329; Piltz, Internationales Kaufrecht (1993) § 3 para. 93; Piltz, Internationales Kaufrecht
(2008), para. 3-102 et seq.; Reinhart, Kommentar (1991), Art. 19 para. 2; Schlechtriem, in: Schlechtriem/
105 See Brunner/Pfisterer/Köster, Kommentar (2014), Art. 19 para. 3; Dornis, in: Honsell, Kommentar
(2010), Art. 19 para. 20; Karollus, UN-Kaufrecht (1989) p. 69; Ludwig, Der Vertragsabschluß nach UN-
Rechtsordnungen Englands und Deutschlands (1994) p. 329 note 140; Neumayer, Das Wiener Kaufrecht-
sübereinkommen und die sogenannte “battle of forms”, in: FS Hans Giger (1989), p. 501 (p. 518); ders.,
Der Vertragsschluss nach dem Recht des internationalen Warenkaufs (Wiener Übereinkommen von
1980), in: Festschrift Werner Lorenz (1991), p. 747 (759); Magnus, in: Staudinger Kommentar (2013),
Art. 19 para. 14; contra Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 19 para. 15.
106 See Murray, An Essay on the Formation of Contracts and Related Matters under the United Nations
(42).
107 Audit, Vente Internationale (1990), p. 69; Mankowski, in: Ferrari et al., Internationales Vertragsrecht
(2012), Art. 19 CISG para. 27.
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An objection can be defined as a statement that relates to the reply by the offeree 21
(which has to have already reached the offeror)108 and allows the offeror to avoid being
bound by a contract concluded under the conditions imposed by the acceptor. In order
to be effective, the objection must meet both the requirements laid down by the
applicable domestic law as to its validity109 (except for its formal validity, as that is a
matter governed by the CISG)110 and those laid down by the CISG itself. The objection
need not reach its addressee, unlike an offer, revocation, withdrawal or acceptance.111 It
can easily be derived from Art. 19(2)112 that the objection merely needs to be dispatched
in an appropriate manner113 to become effective. Thus, the acceptor bears the risk of
loss of the objection.114 This result can be justified on the grounds that it is the acceptor
who initiates the “abnormity”115 – in the sense of the deviation from the original offer.
Still, in order to protect the acceptor, it is necessary that the objection comply with
certain requirements relating, for instance, to the exact and accurate indication of the
address of the addressee, etc.116 A revocation of the objection is not possible, since the
objection becomes effective upon dispatch.117
The objection does not have to comply with a particular form requirement;118 the 22
objection also does not have to contain specific words to be effective.119 An objection
may be effective independently from whether it is made orally, in writing or via
108 An objection sent by the offeror prior to the reply containing additions or modifications reaching
the offeror is ineffective; Dornis, in: Honsell, Kommentar (2010), Art. 19 para. 30; Schnyder/Straub, in:
para. 4; Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 19 para. 27.

112 Contra Neumayer, Offene Fragen zur Anwendung des Abkommens der Vereinten Nationen über
den internationalen Warenkauf, RIW (1994) 99 (103); Neumayer/Ming, Convention de Vienne (1993),
Art. 19 para. 2.
113 See also Enderlein/Maskow/Strohbach, Internationales Kaufrecht (1991), Art. 19 para. 6; Herber/
Czerwenka, Kommentar (1991), Art. 19 para. 14; Jametti Greiner, Der Vertragsabschluss, in: Hoyer/Posch
(eds), Das Einheitliche Wiener Kaufrecht (1992), p. 43 (52); Karollus, UN-Kaufrecht (1989) p. 69; Ludwig,
Der Vertragsabschluß nach UN-Kaufrecht im Spannungsverhält-nis von Common Law und Civil Law,
dargestellt auf der Grundlage der Rechtsordnungen Eng-lands und Deutschlands (1994) p. 330; Noussias,
Die Zugangsbedürftigkeit von Mitteilungen nach den Einheitlichen Haager Kaufgesetzen und nach dem
UN-Kaufgesetz (1983) pp. 119 et seq.; Perales Viscasillas, La Formación del contrato de compraventa
internacional de mercaderı́as (1996) p. 637; Reinhart, Kommentar (1991), Art. 19 para. 5; Schlechtriem,
in: Schlechtriem/Schwenzer, Commentary (2005), Art. 19 para. 16; Lüderitz/Fenge, in: Soergel (ed),
Kom-mentar (2005), Art. 19 para. 13; Witz/Salger/Lorenz, Kommentar (2016), Art. 19 para. 12; contra
Neumayer, Offene Fragen zur Anwendung des Abkommens der Vereinten Nationen über den inter-
nationalen Warenkauf, RIW (1994) 99 (103); Neumayer/Ming, Convention de Vienne (1993), Art. 19
para. 2.
para. 3; Dornis, in: Honsell, Kommentar (2010), Art. 19 para. 29; Enderlein/Maskow/Strohbach, Inter-
nationales Kaufrecht (1991), Art. 19 para. 6; Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 19
para. 27; Gruber, in: MünchKommBGB (2016), Art. 19 para. 15; Noussias, Die Zugangsbedürftigkeit von
Mitteilungen nach den Einheitlichen Haager Kaufgesetzen und nach dem UN-Kaufgesetz (1983) p. 120;
Piltz, Internationales Kaufrecht (1993) § 3 para. 100; Reinhart, Kommentar (1991), Art. 19 para. 5;
Magnus, in: Staudinger Kommentar (2013), Art. 19 para. 13; Witz/Salger/Lorenz, Kommentar (2016),
Art. 19 para. 12; contra Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 192.
(1997), Art. 19 para. 30.

Ferrari 297
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electronic means.120 From the text of Art. 19(2) it follows, however, that it is insufficient
for an offeror to indicate its intention not to be bound by the immaterial modifications
of the offeree merely by performing an act.121
23 b) Timeliness and consequences of an objection. An objection must be made
“without undue delay” (i. e., “sans retard injustifié”). From both the English and French
text one can easily gather that an “immediate” objection, or an objection “without
delay” is not necessary,122 provided that the offeror is not to be blamed for the delay123
or the delay was unavoidable.124
24 A timely objection retroactively dissolves a contract that already was concluded.125 If the
offeror does not object or does so in an untimely fashion, the contract remains effective. In
these cases, the contents of the contract is determined by both the terms of the offer that
do not contradict the immaterial modifications, and the immaterial modifications con-
tained in the acceptance, as noted both in scholarly writing126 and case law.127
3. Burden of proof
25 For the allocation of the burden of proof, one must distinguish between the rule set
forth in para. (1), pursuant to which any discrepancy between offer and acceptance
leads to the rejection of the offer, and the exception found in para. (2), pursuant to
which a reply to an offer that contains modifications can lead to contract conclusion.
26 That the requirements of the basic rule are met must be proved by the party who
invokes the rule.128 The same is true with regard to the exception. Thus, the person
relying upon a concluded contract – generally the acceptor129 – must prove that the

(1997), Art. 19 para. 25; contra Witz/Salger/Lorenz, Kommentar (2016), Art. 19 para. 12.
122 See Brunner/Pfisterer/Köster, Kommentar (2014), Art. 19 para. 3, and more specifically note 715;
also compare Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 19 para. 26; Gruber, in: Münch-
123 See Herber/Czerwenka, Kommentar (1991), Art. 19 para. 14; Perales Viscasillas, La Formación del
contrato de compraventa internacional de mercaderı́as (1996) p. 640; for some contradicting statements,
see Rudolph, Kommentar (1996), Art. 19 para. 9.
124 Magnus, in: Staudinger Kommentar (2013), Art. 19 para. 13; contra, see Schnyder/Straub, in:

Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 19 para. 31; Schlechtriem, in: Schlechtriem/
para. 14.
126 Achilles, Kommentar (2000), Art. 19 para. 4; Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998),
p. 193; Murray, An Essay on the Formation of Contracts and Related Matters under the United Nations
(43); Neumayer/Ming, Convention de Vienne (1993), Art. 19 para. 2; Perales Viscasillas, La Formación del
contrato de compraventa internacional de mercaderı́as (1996) p. 640; Piltz, Internationales Kaufrecht
(1993) § 3 para. 99; Witz/Salger/Lorenz, Kommentar (2016), Art. 19 para. 13.
127 Compare Oberster Gerichtshof (Austria) 20 March 1997, CISG-Online 269.
128 See Dornis, in: Honsell, Kommentar (2010), Art. 19 para. 45; Jung, Die Beweislastverteilung im UN-
Kaufrecht insbesondere bei Vertragsabschluß, bei Vertragsverletzungen des Käufers, bei allgemeinen
Bestimmungen sowie bei gemeinsamen Bestimmungen über Verkäufer- und Käuferpflicht (1996) p. 129;
Hepting/Müller, in Baumgärtel/Laumen (eds), Handbuch der Beweislast im Privatrecht (2009), Art. 19
CISG para. 2.
p. 133; Henninger, Die Frage der Beweislast im Rahmen des UN-Kaufrechts (1995) p. 210; Gruber, in:
MünchKommBGB (2016), Art. 19 para. 30; Jung, Die Beweislastverteilung im UN-Kaufrecht insbeson-
dere bei Vertragsabschluß, bei Vertragsverletzungen des Käufers, bei allgemeinen Bestimmungen sowie
bei gemeinsamen Bestimmungen über Verkäufer- und Käuferpflicht (1996) p. 130.
298 Ferrari
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modifications contained in the reply do not materially alter the offer.130 The party
arguing that the contract was not concluded must prove that an objection has been
dispatched in a timely fashion.131

Art. 19 CISG has a counterpart in various international instruments; Art. 2.1.11 27
PICC, for instance, deals with modified acceptance. It does so in basically the same
manner as Arts 19(1) and 19(2) CISG. It does not, however, contain a provision
comparable to Art. 19(3) CISG which contains a presumption as to the material nature
of modifications relating to the price, payment, quality and quantity of the goods, place
and time of delivery, extent of one party’s liability to the other and the settlement of
disputes.
Unlike the CISG, the PICC set forth a rule relating to both letters of confirmation and 28
the battle of forms. As regards the former issue, it is dealt with in Art. 2.1.12, pursuant
to which, “[i]f a writing which is sent within a reasonable time after the conclusion of
the contract and which purports to be a confirmation of the contract contains
additional or different terms, such terms become part of the contract, unless they
materially alter the contract or the recipient, without undue delay, objects to the
discrepancy.”
As regards the issue of the “battle of forms”, it is addressed in Art. 2.1.22 PICC, on 29
the basis of the “knock-out-rule”,132 the rule also adopted by Art. II-4:209 DCFR and
Art. 2:209 PECL. The latter instruments also set forth rules on modified acceptance
(namely Art. II-4:208 DCFR and Art. 2:208 PECL) which are based upon Art. 19 CISG.
130 Achilles, Kommentar (2000), Art. 19 para. 6; Schnyder/Straub, in: Honsell, Kommentar (1997),
Art. 19 para. 30; Henninger, Die Frage der Beweislast im Rahmen des UN-Kaufrechts (1995) p. 210;
Hepting/Müller, in Baumgärtel/Laumen (eds), Handbuch der Beweislast im Privatrecht (2009), Art. 19
CISG para. 9; Magnus, in: Staudinger Kommentar (2013), Art. 19 para. 27; contra Saenger, in: Bamberger/
Roth (eds), Kommentar zum Bürgerlichen Gesetzbuch (2012), Art. 19 para. 6.
132 See Fejös, Battle of the Forms Under the CISG, 11 Vindobona Journal of International Commercial
Law and Arbitration (2007) 113 (126 et seq.); Monti, A Comment on “An Ex-Ante View of the Battle of
the Forms: Inducing Parties to Draft Reasonable Terms” by Omri Ben Shahar, International Review of
Law and Economics (2005) 371 (276 note 20); Naudé, in: Vogenauer/Kleinheitserkamp (eds), Commen-
tary on the Unidroit Principles (2009), Art. 2.1.22. paras 1 and 3 et seq.; Wildner, Art. 19 CISG: The
German Approach to the Battle of the Forms in International Contract Law: The Decision of the Federal
Supreme Court of Germany of 9 January 2002, 20 Pace International Law Review (2008) 1 (10 et seq.).
Ferrari 299
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Article 20
(1) A period of time for acceptance fixed by the offeror in a telegram or a letter
begins to run from the moment the telegram is handed in for dispatch or from the
date shown on the letter or, if no such date is shown, from the date shown on the
envelope. A period of time for acceptance fixed by the offeror by telephone, telex or
other means of instantaneous communication, begins to run from the moment that
the offer reaches the offeree.
(2) Official holidays or non-business days occurring during the period for accep-
tance are included in calculating the period. However, if a notice of acceptance cannot
be delivered at the address of the offeror on the last day of the period because that
day falls on an official holiday or a non-business day at the place of business of the
offeror, the period is extended until the first business day which follows.
Bibliography: Ferrari, Vendita internazionale di beni mobili. Artt. 14–24. Formazione del contratto
(2006); Ludwig, Der Vertragsabschluß nach UN-Kaufrecht im Spannungsverhältnis von Common Law
und Civil Law, dargestellt auf der Grundlage der Rechtsordnungen Englands und Deutschlands (1994);
Koopverdrag (1997), p. 71; Murray, An Essay on the Formation of Contracts and Related Matters under
the United Nations Convention on Contracts for the International Sale of Goods, 8 Journal of Law and
Commerce (1998) 11; Perales Viscasillas, La Formación del contrato de compraventa internacional de
mercaderı́as (1996); J. Pierre/V. Pierre, A Comparison of the Rules on Formation of Sales Contracts
Under the Louisiana Civil Code and the United Nations Convention on Contracts for the International
Sale of Goods: What Buyers and Sellers Should Know, 20 Southern University Law Review (1993) 189.
Outline
1. Beginning of the period for acceptance (para. 1) . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2. Calculation and expiry of the period of time (para. 2) . . . . . . . . . . . . . . . . . . . . . 7
3. The rule in Art. 20(2) as general principle upon which the CISG is based 12

1 This provision – which is dispositive in nature1 – determines when the period for
acceptance starts to run (para. 1), how that period is calculated, and when it lapses
(para. 2).2 Consequently, resort to domestic law for these issues is inadmissible.3 This
provision applies to both the period in which the revocation of the offer is excluded and
the period after which the offer will lapse.4
1 See Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 194; Dornis, in: Honsell, Kommentar (2010),
(2006) p. 135; Perales Viscasillas, La Formación del contrato de compraventa internacional de mercader-
ı́as (1996) p. 586.
Koopverdrag (1997), p. 71 (86).

3 See Dornis, in: Honsell, Kommentar (2010), Art. 20 para. 1; Schnyder/Straub, in: Honsell, Kommentar
(1997), Art. 20 para. 2.

4 See Hepting/Müller, in Baumgärtel/Laumen (eds), Handbuch der Beweislast im Privatrecht (2009),
Art. 20 CISG para. 1; Farnsworth, in: Bianca/Bonell, Commentary (1987), Art. 20 para. 3.1; Schlechtriem,
in: Schlechtriem/Schwenzer, Commentary (2005), Art. 20 para. 1; Schlechtriem/Schroeter, in: Schlecht-
300 Ferrari
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1. Beginning of the period for acceptance (para. 1)
Art. 20(1), which can be traced back to Art. 8(2) ULF,5 determines when a time fixed 2
by the offeror through reference not to a given date, but rather to a period of time6 (for
instance “within three weeks”) begins to run.7 In doing so, the provision at hand draws a
distinction between a number of different means of communication used for the offer;8 it
does not, however, determine whether the period of time fixed is one for the exclusion of
the possibility of revoking the offer, or one after which the offer will lapse.9 If the offeror
has fixed a period of time for acceptance by reference to a calendar date (“from 26
October” or “until 26 October”), or an event in time that allows for the determination of
a calendar date (“until the beginning of the Munich fashion week”), Art. 20(1) is not
applicable.10 Under certain circumstances, Art. 20(1) may be inapplicable even where a
time is not fixed by reference to a calendar date or an event that allows for the
determination of such date. If, for example, a clause states “10 days consideration period,”
one must assume that this period will begin to run when the offer reaches its addressee, as
before that moment the addressee cannot possibly consider it.11
Recourse to Art. 20(1) is unnecessary where a “reasonable time” referred to in 3
Art. 18(2) is concerned.12
Where it emerges from the offer itself13 (in this respect reference should be made to 4
Art. 8)14 from an agreement between the parties,15 from the practices established
riem/Schwenzer, Kommentar (German ed. 2013), Art. 20 para. 1; Schroeter, in: Schlechtriem/Schwenzer,
5 See Napoli, Nuove leggi civ. comm. (1989) 94 (95); Lüderitz/Fenge, in: Soergel (ed), Kommentar zum
BGB. Schuldrechtliche Nebengesetze (2000), Art. 20 para. 2; Magnus, in: Staudinger Kommentar (2013),
Art. 20 para. 2; Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 20 CISG para. 2.
6 The time fixed need not be a reasonable one to lead to the application to para. 1; see Napoli, Nuove
leggi civ. comm. (1989) 94, 95.

7 See Witz/Salger/Lorenz, Kommentar (2016), Art. 20 para. 1.
(2010), Art. 20 para. 2 et seq.

Farnsworth, in: Bianca/Bonell, Commentary (1987), Art. 20 para. 2.1; Ferrari, Vendita internazionale di
beni mobili. Artt. 14–24. Formazione del contratto (2006) p. 136; Ludwig, Der Vertragsabschluß nach
UN-Kaufrecht im Spannungsverhältnis von Common Law und Civil Law, dargestellt auf der Grundlage
der Rechtsordnungen Englands und Deutschlands (1994) p. 323; Magnus, in: Staudinger Kommentar
(2013), Art. 20 para. 4; Witz/Salger/Lorenz, Kommentar (2016), Art. 20 para. 4; Meeusen, Totstandkom-
ing van de Overeenkomst, in: van Houtte/Erauw/Wautelet (eds), Het Weens Koopverdrag (1997), p. 71
(86); Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 20 para. 7; Schroeter, in: Schlechtriem/
11 Dornis, in: Honsell, Kommentar (2010), Art. 20 para. 3; Honnold/Flechtner, Uniform Law (2009),
para. 171; Gruber, in: MünchKommBGB (2016), Art. 20 para. 3; contra Murray, An Essay on the
Formation of Contracts and Related Matters under the United Nations Convention on Contracts for the
International Sale of Goods, 8 Journal of Law and Commerce (1998) 11 (20 et seq.).
12 Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 20 para. 6; Rudolph, Kommentar (1996),

13 See also Witz/Salger/Lorenz, Kommentar (2016), Art. 20 para. 2; Schnyder/Straub, in: Honsell,
Kommentar (1997), Art. 20 para. 5; Murray, An Essay on the Formation of Contracts and Related
Matters under the United Nations Convention on Contracts for the International Sale of Goods, 8
Journal of Law and Commerce (1998) 11 (21); Piltz, Internationales Kaufrecht (1993) § 3 para. 69;
14 Compare Rudolph, Kommentar (1996), Art. 20 para. 3.
15 Neumayer/Ming, Convention de Vienne (1993), Art. 20 para. 1.
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between them, or from any usage that binds the parties pursuant to Art. 9, that the
period of time starts to run at a different time, the rule set forth in Art. 20(1) does not
apply.16
5 The issue of when a period of time begins to run depends on the means of commu-
nication used.17 When a telegram is used, the period begins to run from a moment that is
easy to ascertain: the moment the telegram is handed over for dispatch. If a period of time
is fixed in a letter, it starts to run from the date shown on that letter,18 i. e., a time also
easily recognizable by the offeree.19 If no such date is shown, the period of time begins to
run on the date shown on the envelope,20 which is normally the postmark date.21 If
neither the letter nor the envelope show a date (or if it is not legible,22 or cannot be
ascertained for any other reason), one must refer to the time the offer reaches the
addressee;23 actual dispatch is irrelevant for determining the moment at which the period
starts to run.24 If more than one date is shown on the envelope, the earliest one is taken
into account.25 The day relevant for the purpose of determining when a period of time
starts to run pursuant to Art. 20(1) is included in the period of time.26
6 Art. 20(1) second sentence states that where the period of time for acceptance is fixed
by telephone, telex, or other means of instantaneous communication, the period of time
begins to run from the moment the offer reaches the offeree.27 “Means of instantaneous
Herber/Czerwenka, Kommentar (1991), Art. 19 para. 3; Honnold/Flechtner, Uniform Law (2009),

para. 171; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 20 para. 3; Magnus, in:
17 Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 20 CISG para. 6; Meeusen,
(1997), p. 71 (87); Perales Viscasillas, La Formación del contrato de compraventa internacional de
19 Herber/Czerwenka, Kommentar (1991), Art. 19 para. 2; Witz/Salger/Lorenz, Kommentar (2016),
Art. 20 para. 6; UNCITRAL YB (1978), p. 118.

20 Adame Goddard, El Contrato de Compraventa Internacional (1994) p. 110; Saenger, in: Bamberger/
Roth (eds), Kommentar zum Bürgerlichen Gesetzbuch (2012), Art. 20 para. 2; J. Pierre/V. Pierre, A
Comparison of the Rules on Formation of Sales Contracts Under the Louisiana Civil Code and the United
Nations Convention on Contracts for the International Sale of Goods: What Buyers and Sellers Should
Know, 20 Southern University Law Review (1993) 189 (193); Piltz, Internationales Kaufrecht (1993) § 3
para. 69.
21 Napoli, Nuove leggi civ. comm. (1989) 9 (95); Schlechtriem, in: Schlechtriem/Schwenzer, Commen-
tary (2005), Art. 20 para. 2; Schroeter, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 20 para. 2.
Art. 20 para. 6; Meeusen, Totstandkoming van de Overeenkomst, in: van Houtte/Erauw/Wautelet (eds),
Het Weens Koopverdrag (1997), p. 71 (87); Schroeter, in: Schlechtriem/Schwenzer, Kommentar (German
ed. 2013), Art. 20 para. 2; contra Witz/Salger/Lorenz, Kommentar (2016), Art. 20 para. 6, where the
authors refer to the day of actual dispatch.
24 Audit, Vente Internationale (1990), p. 66; Saenger, in: Bamberger/Roth (eds), Kommentar zum
Bürgerlichen Gesetzbuch (2012), Art. 20 para. 2; Enderlein/Maskow/Strohbach, Internationales Kaufrecht

(1991), Art. 20 para. 2; Gruber, in: MünchKommBGB (2016), Art. 20 para. 5; Schlechtriem, in: Schlech-
triem/Schwenzer, Commentary (2005), Art. 20 para. 2; Magnus, in: Staudinger Kommentar (2013),
Art. 20 para. 8; Schroeter, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2013), Art. 20 para. 2;
25 Gruber, in: MünchKommBGB (2016), Art. 20 para. 7; Witz/Salger/Lorenz, Kommentar (2016),
Art. 20 para. 6.
26 Piltz, Internationales Kaufrecht (1993) § 3 para. 70.
27 Murray, An Essay on the Formation of Contracts and Related Matters under the United Nations
(21); Napoli, Nuove leggi civ. comm. (1989) 94 (96 et seq.).
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communication” can be defined as those means that allow the time of dispatch and time
of receipt by the addressee to almost coincide,28 such as communications by radio,29 by
telefax, email,30 teletext,31 sms, etc.32 Because oral communications also constitute
instantaneous communications, the rule set forth in Art. 20(1) second sentence extends
to oral communications as well.33 The same rule also applies to oral communications
made by a messenger.34
2. Calculation and expiry of the period of time (para. 2)

Art. 20(2), which is as dispositive in nature as Art. 20(1), and which has an 7
antecedent in Art. 29 of the 1974 UNCITRAL Convention on the Limitation Period in
the International Sale of Goods,35 sets forth a rule that is widely accepted.36 Pursuant to
Art. 20(2), official holidays and non-business days are included in calculating the
period37 (independently from whether the period of time is fixed by the offeror or
whether it is a reasonable one).38 In doing so, the provision prevents the problems that
would inevitably arise if in international sales transactions official holidays and non-
business days were not to be counted.39
28 Herber/Czerwenka, Kommentar (1991), Art. 19 para. 5; Schnyder/Straub, in: Honsell, Kommentar
(1997), Art. 20 para. 12; Gruber, in: MünchKommBGB (2016), Art. 20 para. 4; Lüderitz/Fenge, in: Soergel
(ed), Kommentar zum BGB. Schuldrechtliche Nebengesetze (2000), Art. 20 para. 2; Magnus, in: Staudin-
ger Kommentar (2013), Art. 20 para. 6.
30 Contra Dornis, in: Honsell, Kommentar (2010), Art. 20 para. 10; for a reference to the importance of
electronic means of communication to contracts governed by the CISG, see Ferrari, Einige kurze
Anmerkungen zur Awendbarkeit des UN-Kaufrechts beim Vertragsschluss über das Internet, EuLF
(2001) 301 (306).
32 See also Ferrari, Vendita internazionale di beni mobili. Artt. 14–24. Formazione del contratto (2006)
pp. 139 et seq.; Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 20 para. 12; Gruber, in: Münch-
KommBGB (2016), Art. 20 para. 4; Perales Viscasillas, La Formación del contrato de compraventa
internacional de mercaderı́as (1996) p. 593; Piltz, Internationales Kaufrecht (1993) § 3 para. 68; Rudolph,
Kommentar (1996), Art. 20 para. 5; Lüderitz/Fenge, in: Soergel (ed), Kommentar zum BGB. Schuldrecht-
liche Nebengesetze (2000), Art. 20 para. 5; Magnus, in: Staudinger Kommentar (2013), Art. 20 para. 10.
para. 3; Herber/Czerwenka, Kommentar (1991), Art. 19 para. 5; Magnus, in: Staudinger Kommentar
(2013), Art. 20 para. 11.
34 Gruber, in: MünchKommBGB (2016), Art. 20 para. 4; Schlechtriem, in: Schlechtriem/Schwenzer,
Commentary (2005), Art. 20 para. 3; Witz/Salger/Lorenz, Kommentar (2016), Art. 20 para. 5; Schroeter,
35 Napoli, Nuove leggi civ. comm. (1989) 94 (95).
36 Herber/Czerwenka, Kommentar (1991), Art. 19 para. 7; Gruber, in: MünchKommBGB (2016),
Art. 20 para. 8; Magnus, in: Staudinger Kommentar (2013), Art. 20 para. 12; contra Ludwig, Der
dargestellt auf der Grundlage der Rechtsordnungen Englands und Deutschlands (1994) p. 399.
37 Dornis, in: Honsell, Kommentar (2010), Art. 20 para. 13; J. Pierre/V. Pierre, A Comparison of the
Rules on Formation of Sales Contracts Under the Louisiana Civil Code and the United Nations
Convention on Contracts for the International Sale of Goods: What Buyers and Sellers Should Know, 20
Southern University Law Review (1993) 189 (193); Schnyder/Straub, in: Honsell, Kommentar (1997),
Art. 20 para. 15.
39 Napoli, Nuove leggi civ. comm. (1989) 94 (98); Schlechtriem, in: Schlechtriem/Schwenzer, Commen-
tary (2005), Art. 20 para. 5; Schroeter, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2013),
Art. 20 para. 5; see also Brunner/Pfisterer/Köster, Kommentar (2014), Art. 20 para. 2; Gruber, in: Münch-
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8 However, Art. 20(2) second sentence states an exception to the foregoing rule: if a
notice of acceptance cannot be delivered at the place of business of the offeror40 (or his
mailing address, or if the offeror does not have a place of business or mailing address,
his habitual residence)41 on the last day of the period because that day falls on an official
holiday or a non-business day at the place of business of the offeror, the period is
extended until the next business day.42 This exception also applies (by analogy) in cases
where the notice of acceptance is made orally.43
9 Therefore, the importance of the meaning of the terms “official holidays” and “non-
business days” becomes apparent. While the determination of an “official holiday” does
not cause any problems,44 the same cannot be said with respect to the determination of
“non-business days.” Some commentators hold the view that for a day to be considered
a “non-business day,” a statutory provision is required.45 More convincingly, others
argue that non-business days on which there is no business because of national, regional
or local usage are also to be considered.46 Circumstances that only affect the offeror or
his business, such as illness, work outings, or a strike do not extend the period until the
first business day that follows.47
10 The period does not extend to the first business day that follows, however, where it is
possible for the offeror to know of the acceptance because he is present in his office on
an official holiday or on a non-business day.48
11 For the period to extend to the first business day that follows, the impossibility of
delivering the acceptance must be caused by the fact that the last day of the period falls
on an official holiday or a non-business day.49 The burden of proof for this impossibility
is on the party relying upon the conclusion of the contract, despite the acceptance
reaching the offeror after the lapse of the period of time for acceptance.50
40 Dornis, in: Honsell, Kommentar (2010), Art. 20 para. 21; where the addressee has multiple places of
business, the place of business is relevant to which the declaration is addressed; see Rudolph, Kommentar
(1996), Art. 20 para. 6.
41 See Art. 24.
42 J. Pierre/V. Pierre, A Comparison of the Rules on Formation of Sales Contracts Under the Louisiana
Buyers and Sellers Should Know, 20 Southern University Law Review (1993) 189 (193); Schroeter, in:
44 Napoli, Nuove leggi civ. comm. (1989) 94 (98).
45 Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 20 para. 6; similarly Perales
Viscasillas, La Formación del contrato de compraventa internacional de mercaderı́as (1996) p. 594.

Art. 20 para. 10; Napoli, Nuove leggi civ. comm. (1989) 94 (98); Eörsi, Formation of contract, in: Wiener
Übereinkommen von 1980 über den internationalen Warenkauf (1985), p. 43 (51).
47 See Brunner/Pfisterer/Köster, Kommentar (2014), Art. 20 para. 2; Gruber, in: MünchKommBGB
(2016), Art. 20 para. 10, Rudolph, Kommentar (1996), Art. 20 para. 6; Schlechtriem, in: Schlechtriem/
para. 13; contra Meeusen, Totstandkoming van de Overeenkomst, in: van Houtte/Erauw/Wautelet (eds),
Het Weens Koopverdrag (1997), p. 71 (87); Neumayer/Ming, Convention de Vienne (1993), Art. 20
para. 2.
48 Dornis, in: Honsell, Kommentar (2010), Art. 20 para. 20; Farnsworth, in: Bianca/Bonell, Commen-
tary (1987), Art. 20 para. 3.3; Napoli, Nuove leggi civ. comm. (1989) 94 (98); Perales Viscasillas, La
Formación del contrato de compraventa internacional de mercaderı́as (1996) p. 594; Schlechtriem, in:
(2013), Art. 20 para. 13.
49 See also Gruber, in: MünchKommBGB (2016), Art. 20 para. 11; Witz/Salger/Lorenz, Kommentar
(2016), Art. 20 para. 9.

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3. The rule in Art. 20(2) as general principle upon which the CISG is
based
Pursuant to Art. 7(2), questions concerning matters governed by the CISG which are 12
not expressly settled in it are to be settled in conformity with the general principles on
which the CISG is based. According to many commentators,51 the rules found in
Art. 20(2) concerning the calculation and expiry of the period of time for acceptance
must be considered general principles in the sense of Art. 7(2). Thus one may also apply
them to periods of time other than that for acceptance, provided that the CISG itself
does not state otherwise.52

The PICC also contain a provision, namely Art. 2.1.8, that addresses the issue of 13
when a period of acceptance fixed by the offeror starts to run. Unlike Art. 20(1) CISG,
Art. 2.1.8 PICC does not, however, make any distinction as to what means of commu-
nication is used for the offer, which is why one commentator stated that “Art. 2.1.8 is a
simplified version of Art. 20 CISG.”53 In effect, pursuant to Art. 2.1.8 PICC, “[a] period
of acceptance fixed by the offeror begins to run from the time that the offer is
dispatched. A time indicated in the offer is deemed to be the time of dispatch unless
the circumstances indicate otherwise.” This rule can lead, however, to results different
from those reached under Art. 20(1) CISG. This is the case, for instance, where a period
of time for acceptance is fixed in a letter. Pursuant to Art. 20(1) CISG, in this case the
time for acceptance begins to run from the date shown on the letter. Under Art. 2.1.8
PICC, however, that date is irrelevant where the circumstances indicate a time of
dispatch. Thus, “[t]he fact that the transmitted letter indicates an earlier date can thus
not shorten the offeree’s period for accepting the offer.”54
The PICC also contain a provision – Art. 1.12 – dealing with the computation of time 14
set by parties, i. e., the issue addressed in Art. 20(2) CISG. The PICC rule basically
corresponds to that found in the CISG, even though it is phrased differently, in broader
terms. Art. 1.12 PICC also contains, however, a provision on the time zone to be taken
Art. 20 para. 15; Hepting/Müller, in Baumgärtel/Laumen (eds), Handbuch der Beweislast im Privatrecht
(2009), Art. 20 CISG para. 5; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 20
para. 6; Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 20 para. 27.
51 Burkart, Interpretatives Zusammenwirken von CISG und UNIDROIT Principles (2000) pp. 199 et
seq.; Dornis, in: Honsell, Kommentar (2010), Art. 20 para. 27; Farnsworth, in: Bianca/Bonell, Commen-
tary (1987), Art. 20 para. 3.1; Ferrari, Das Verhältnis zwischen den UNIDROIT-Grundsätzen und den
allgemeinen Grundsätzen internationaler Einheitsprivatrechtkonventionen. Zugleich ein Beitrag zur
Lückenfüllung durch staatliche Gerichte, JZ (1998) 9 (12); Gruber, in: MünchKommBGB (2016), Art. 20
para. 14; Magnus, Die Allgemeinen Grundsätze im UN-Kaufrecht, 59 RabelsZ (1995) 469 (486–487);
Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 20 CISG para. 17; Lüderitz/Fenge,
in: Soergel (ed), Kommentar zum BGB. Schuldrechtliche Nebengesetze (2000), Art. 20 para. 8; Schroeter,
Schwenzer, Commentary (2016), Art. 20 para. 8; Witz/Salger/Lorenz, Kommentar (2016), Art. 20 para. 3;
contra Reinhart, Kommentar (1991), Art. 4 para. 7.
52 See also Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 195; Ferrari, Vendita internazionale di
beni mobili. Artt. 14–24. Formazione del contratto (2006) pp. 144 et seq.; Herber/Czerwenka, Kommentar
(2009), Art. 2.1.8. para. 1.

(2009), Art. 2.1.8. para. 2.
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into account in the computation of the time set by the parties, an issue not addressed by
the CISG at all.
15 It should be noted that the DCFR also contains a provision on the computation of
time, namely Art. I-1:110, paras 5 and 6 of which address the issues governed by
Art. 20(2) CISG.55
55 See Art. 1:304 PECL, upon which Art. I-1:110 is based.
306 Ferrari
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Article 21
(1) A late acceptance is nevertheless effective as an acceptance if without delay the
offeror orally so informs the offeree or dispatches a notice to that effect.
(2) If a letter or other writing containing a late acceptance shows that it has been
sent in such circumstances that if its transmission had been normal it would have
reached the offeror in due time, the late acceptance is effective as an acceptance
unless, without delay, the offeror orally informs the offeree that he considers his offer
as having lapsed or dispatches a notice to that effect.
(2006); Ludwig, Der Vertragsabschluß nach UN-Kaufrecht im Spannungsverhältnis von Common Law
und Civil Law, dargestellt auf der Grundlage der Rechtsordnungen Englands und Deutschlands (1994);
Koopverdrag (1997), p. 71; Murray, An Essay on the Formation of Contracts and Related Matters under
the United Nations Convention on Contracts for the International Sale of Goods, 8 Journal of Law and
Commerce (1998) 11; Noussias, Die Zugangsbedürftigkeit von Mitteilungen nach den Einheitlichen
Haager Kaufgesetzen und nach dem UN-Kaufgesetz (1983) p. 115; Perales Viscasillas, La Formación del
contrato de compraventa internacional de mercaderı́as (1996); Wey, Der Vertragsabschluss beim Inter-
nationalen Warenkauf nach UNCITRAL und schweizerischen Recht (1984).
Outline
1. Late acceptance and approval by the offeror . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
a) Scope of Art. 21(1) and the approval of a late acceptance . . . . . . . . . . . . . . 5
b) Effects of the approval . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
2. Lateness due to delays in transmission (Art. 21(2)). . . . . . . . . . . . . . . . . . . . . . . . . 11
a) Discernible delay in transmission . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
b) Effects of the offeror’s protest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
3. Opportunity for speculation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
4. Burden of proof . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

Art. 18(2) provides that an acceptance is not effective if the indication of assent 1
does not reach the offeror within the time he has fixed or, if no time is fixed, within
a reasonable time.1 Art. 21, which is non-mandatory2 in nature and can be traced
1 Brunner/Pfisterer/Köster, Kommentar (2014), Art. 21 para. 1; Dornis, in: Honsell, Kommentar (2010),
Art. 21 para. 1; Meeusen, Totstandkoming van de Overeenkomst, in: van Houtte/Erauw/Wautelet (eds),
Het Weens Koopverdrag (1997), p. 71 (88); Gruber, in: MünchKommBGB (2016), Art. 21 para. 1; Perales
Viscasillas, La Formación del contrato de compraventa internacional de mercaderı́as (1996) p. 597;
Schlechtriem/Schroeter, Internationales UN-Kaufrecht (2013) para. 275.
2 Compare Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 198; Dornis, in: Honsell, Kommentar
contratto (2006) p. 146; Schroeter, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2013), Art. 21
para. 15; Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 21 para. 42; Perales Viscasillas, La
Formación del contrato de compraventa internacional de mercaderı́as (1996) p. 571; Rudolph, Kommen-
tar (1996), Art. 21 para. 10; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 21
Ferrari 307
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back to Art. 9 ULF,3 provides an exception to this rule by allowing a contract to be

formed under certain circumstances even by a late acceptance.4 In doing so, Art. 21
distinguishes between two different reasons for the lateness of the acceptance.5
Art. 21(1) governs every late acceptance, irrespective of the grounds for the delay,6
while Art. 21(2), which prevails as lex specialis over Art. 21(1),7 deals with the case
in which the lateness of the acceptance is due to a discernible delay in its transmission.
2 The aforementioned provisions both require the existence of an effective acceptance;8
where an acceptance is ineffective for a reason other than the one referred to in Art. 18,
neither provision applies.9
3 Both provisions also require that the late acceptance, or the conduct amounting to
acceptance,10 constitute an acceptance11 (and not, for instance, a mere request for
clarifications).12
4 Furthermore, neither provision distinguishes between the expiration of a time
fixed by the offeror, or if no time was fixed, that of a “reasonable time”.13 Also, none
of the aforementioned provisions distinguishes between material and immaterial
lateness.14

1. Late acceptance and approval by the offeror
5 a) Scope of Art. 21(1) and the approval of a late acceptance. Art. 21(1) governs all
cases of late acceptance, irrespective of whether the acceptance is late because it was
dispatched late or whether the acceptance reaches the offeror late despite its timely
3 Magnus, in: Staudinger Kommentar (2013), Art. 21 para. 3; Schlechtriem, in: Schlechtriem/Schwenzer,
Commentary (2005), Art. 21 para. 1; Schroeter, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 21
para. 1.
4 Ferrari/Torsello, International Sales Law – CISG (2015) p. 148–149; Mankowski, in: Ferrari et al.,

5 Lipari, Nuove leggi civ. comm. (1989) 98 (100); Schroeter, in: Schlechtriem/Schwenzer, Commentary
(2016), Art. 21 para. 2.

6 Ferrari/Torsello, International Sales Law – CISG, 2015, S. 149; Neumayer/Ming, Convention de
Vienne (1993), Art. 21 para. 1; Saenger, in: Bamberger/Roth (eds), Kommentar zum Bürgerlichen
Gesetzbuch (2012), Art. 21 para. 1; contra Schlechtriem, in: Schlechtriem/Schwenzer, Commentary
(2005), Art. 21 para. 2.
mobili. Artt. 14–24. Formazione del contratto (2006) p. 146; Herber/Czerwenka, Kommentar (1991),
Art. 19 para. 2; Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 21 para. 3; Lipari, Nuove leggi civ.
comm. (1989) 98 (103).
10 Art. 21 applies to all kind of acceptances; Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 197.
11 In accord Ferrari, Vendita internazionale di beni mobili. Artt. 14–24. Formazione del contratto
(2006) p. 147; Gruber, in: MünchKommBGB (2016), Art. 21 para. 3; Perales Viscasillas, La Formación del
contrato de compraventa internacional de mercaderı́as (1996) p. 602; Schlechtriem, in: Schlechtriem/
para. 8.
(1997), Art. 21 para. 11.

p. 601; Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 21 para. 8.

14 Achilles, Kommentar (2000), Art. 21 para. 2; Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 198;
Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 21 para. 10; Schlechtriem, in: Schlechtriem/
para. 9.
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dispatch.15 Thus, Art. 21(1) does not draw a distinction between the various reasons for
lateness.16 In cases of delayed transmission of a timely dispatched acceptance, Art. 21(1)
does not apply, though this is because Art. 21(2) has priority due to it being lex
specialis17 and not because these cases would not fall within the scope of Art. 21(1).
For a contract to be concluded despite a late acceptance, the offeror must inform the 6
acceptor without delay – orally or in writing18 – that he is treating the acceptance as
effective.19 This statement of approval by the offeror is a declaration of will20 (its validity
governed by the applicable domestic law21), and can be made in any form22 that allows
for a “dispatch”23 and expresses the offeror’s will to consider the late acceptance
effective. Therefore, an approval made by telefax, email24 or telex is as effective as one
made by letter;25 an approval by mere conduct is, however, insufficient.26 This approval
does not require that specific formulations or expressions be used.
Whether the approval is made “without delay” depends on the amount of time that 7
elapses between the moment when the late acceptance reaches the offeror (or when the act
indicating assent is performed)27 and the moment the approval is dispatched28 – which is
15 Contra Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 21 para. 2, but see also
para. 5; see also Schroeter, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 21 para. 2.
Art. 21 para. 5; Gruber, in: MünchKommBGB (2016), Art. 21 para. 4; Herber/Czerwenka, Kommentar
(1991), Art. 19 para. 2; Neumayer/Ming, Convention de Vienne (1993), Art. 21 para. 1; Magnus, in:
Staudinger Kommentar (2013), Art. 21 para. 9; Saenger, in: Bamberger/Roth (eds), Kommentar zum
Bürgerlichen Gesetzbuch (2012), Art. 21 para. 1; Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 21
para. 9; contra Perales Viscasillas, La Formación del contrato de compraventa internacional de mercader-
ı́as (1996) p. 599.
18 In accord Achilles, Kommentar (2000), Art. 21 para. 2; Saenger, in: Bamberger/Roth (eds), Kommen-
tar zum Bürgerlichen Gesetzbuch (2012), Art. 21 para. 2; Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario
(1998), p. 198; Karollus, UN-Kaufrecht (1989) p. 74; Neumayer/Ming, Convention de Vienne (1993),
Art. 21 para. 1; Rudolph, Kommentar (1996), Art. 21 para. 4; Schlechtriem, in: Schlechtriem/Schwenzer,
Commentary (2005), Art. 21 para. 9; Lüderitz/Fenge, in: Soergel (ed), Kommentar zum BGB. Schuld-
rechtliche Nebengesetze (2000), Art. 21 para. 3; Magnus, in: Staudinger Kommentar (2013), Art. 21
para. 11.
20 See Dornis, in: Honsell, Kommentar (2010), Art. 21 para. 8; Neumayer/Ming, Convention de Vienne
(1993), Art. 21 para. 1; Rudolph, Kommentar (1996), Art. 21 para. 4; Saenger, in: Bamberger/Roth (eds),
Kommentar zum Bürgerlichen Gesetzbuch (2012), Art. 21 para. 2.
mobili. Artt. 14–24. Formazione del contratto (2006) pp. 148 et seq.; Gruber, in: MünchKommBGB
24 Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 21 CISG para. 13; see also
Schroeter, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2013), Art. 21 para. 9, requiring, how-
ever, that the addressee, i. e., the offeree, agreed to the use of electronic means of communication. It
should be noted, however, that there is nothing in the CISG that requires such an agreement.
26 Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 21 para. 16; Perales Viscasillas, La Formación
del contrato de compraventa internacional de mercaderı́as (1996) p. 612; Piltz, Internationales Kaufrecht
(1993) § 3 para. 106.
27 Wey, Der Vertragsabschluss beim Internationalen Warenkauf nach UNCITRAL und schweizerischen
Recht (1984) para. 1175.

28 Farnsworth, in: Bianca/Bonell, Commentary (1987), Art. 21 para. 2.2; Ferrari, Vendita internazionale
di beni mobili. Artt. 14–24. Formazione del contratto (2006) pp. 149 et seq.; Ludwig, Der
dargestellt auf der Grundlage der Rechtsordnungen Englands und Deutschlands (1994) p. 341; Perales
Viscasillas, La Formación del contrato de compraventa internacional de mercaderı́as (1996) p. 608; Piltz,
Ferrari 309
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the only relevant moment,29 since, as can be derived from the text of the provision at hand,
it is irrelevant whether the approval ever reaches the acceptor.30 This means, on the one
hand, that a withdrawal of the approval is not possible,31 and, on the other hand, that the
acceptor bears the risk of loss of the approval,32 because the approval is effective even if it
gets lost or reaches the acceptor late.33
8 The time period for an approval made “without delay” does not coincide34 with the
time period referred to in Art. 19 with respect to the timeliness of the objection.35 The
time period referred to in Art. 21(1) is shorter.36 This can easily be derived from a
comparison of the wording of the two provisions. While Art. 19(2) requires an objection
to be made “without undue delay,” Art. 21(1) requires that approval be made “without
Internationales Kaufrecht (1993) § 3 para. 106; Reinhart, Kommentar (1991), Art. 21 para. 4; Schlech-
triem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 21 para. 8; Schlechtriem/Schroeter, Inter-
nationales UN-Kaufrecht (2013) para. 275.
29 Brunner/Pfisterer/Köster, Kommentar (2014), Art. 21 para. 2; Ferrari/Torsello, International Sales
Law – CISG (2015) p. 149; Jametti Greiner, Der Vertragsabschluss, in: Hoyer/Posch (eds), Das
Einheitliche Wiener Kaufrecht (1992), p. 43 (p. 54); Mankowski, in: Ferrari et al., Internationales
Vertragsrecht (2012), Art. 21 CISG para. 11; Murray, An Essay on the Formation of Contracts and
Related Matters under the United Nations Convention on Contracts for the International Sale of
Goods, 8 Journal of Law and Commerce (1998) 11 (33 et seq.); Noussias, Die Zugangsbedürftigkeit von
Mitteilungen nach den Einheitlichen Haager Kaufgesetzen und nach dem UN-Kaufgesetz (1983)
pp. 115 et seq.; Perales Viscasillas, La Formación del contrato de compraventa internacional de
mercaderı́as (1996) p. 608; Rudolph, Kommentar (1996), Art. 21 para. 3; Saenger, in: Bamberger/Roth
(eds), Kommentar zum Bürgerlichen Gesetzbuch (2012), Art. 21 para. 2; Schlechtriem, in: Schlechtriem/
Schwenzer, Commentary (2005), Art. 21 para. 7; Lüderitz/Fenge, in: Soergel (ed), Kommentar zum
BGB. Schuldrechtliche Nebengesetze (2000), Art. 21 para. 3; Schroeter, in: Schlechtriem/Schwenzer,
Kommentar (German ed. 2013), Art. 21 para. 7; Witz/Salger/Lorenz, Kommentar (2016), Art. 21
para. 5.
Art. 21 para. 11; Schroeter, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 21 para. 7; contra
Lipari, Nuove leggi civ. comm. (1989) 98 (104); Neumayer, Offene Fragen zur Anwendung des Abkom-
mens der Vereinten Nationen über den internationalen Warenkauf, RIW (1994) 99 (104); Neumayer/
Ming, Convention de Vienne (1993), Art. 21 para. 2.
31 In accord Ferrari/Torsello, International Sales Law – CISG (2015) p. 149; Saenger, in: Bamberger/
Roth (eds), Kommentar zum Bürgerlichen Gesetzbuch (2012), Art. 21 para. 2; Schnyder/Straub, in:
Honsell, Kommentar (1997), Art. 21 para. 22; contra Lipari, Nuove leggi civ. comm. (1989) 98 (104);
Art. 21 para. 4; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 21 para. 12; Schro-
eter, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2013), Art. 21 para. 12; for a criticism of this
contrary view, see Dornis, in: Honsell, Kommentar (2010), Art. 21 para. 17.
32 Dornis, in: Honsell, Kommentar (2010), Art. 21 para. 12; Ludwig, Der Vertragsabschluß nach UN-
Rechtsordnungen Englands und Deutschlands (1994) pp. 341 (et seq.); Noussias, Die Zugangsbedürf-
tigkeit von Mitteilungen nach den Einheitlichen Haager Kaufgesetzen und nach dem UN-Kaufgesetz
(1983) p. 116; Piltz, Internationales Kaufrecht (2008), para. 3-119; Rudolph, Kommentar (1996), Art. 21
para. 4; Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 21 para. 17; Witz/Salger/Lorenz, Kom-
mentar (2016), Art. 21 para. 5; contra Neumayer/Ming, Convention de Vienne (1993), Art. 21 para. 2.
33 Ferrari/Torsello, International Sales Law – CISG (2015) p. 149; Gruber, in: MünchKommBGB (2016),
Art. 21 para. 6; Murray, An Essay on the Formation of Contracts and Related Matters under the United
(1998) 11 (34); Magnus, in: Staudinger Kommentar (2013), Art. 21 para. 11; Schnyder/Straub, in: Honsell,
34 Contra Achilles, Kommentar (2000), Art. 21 para. 2; Witz/Salger/Lorenz, Kommentar (2016), Art. 21
para. 5.
35 See also Schlechtriem, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2004), Art. 21 para. 8
note 29.
Art. 21 para. 7; Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 21 para. 20.
310 Ferrari
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delay.”37 This does not mean, however that the offeror should not have the time to
consider whether it is convenient or not to accept.38
b) Effects of the approval. Where all requirements for an effective and valid 9
approval are met, including those of the applicable domestic law (which governs
the approval’s validity – with the exception of its formal validity), the contract is
deemed to have been concluded when the late acceptance reached the offeror,39 or in
case of acceptance indicated by the performance of an act, at the time that act was
performed.40
Where an approval contains any additional or different terms from those of the 10
acceptance – even immaterial ones – a contract cannot be deemed to have been
concluded.41 The same is true in cases where the offeror does not react at all.42
2. Lateness due to delays in transmission (Art. 21(2))

a) Discernible delay in transmission. As discussed ele=sewhere,43 where the lateness 11
of the acceptance is exclusively caused by the transmission,44 the rule set forth in
Art. 21(2) (which in essence traces a rule found in § 149 BGB (German Civil Code))45
applies, provided that certain requirements are met. According to Art. 21(2), a late
acceptance contained in a letter or other writing is effective as an acceptance if the letter
or other writing shows that it was sent under such circumstances that if its transmission
had been normal, it would have reached the offeror in due time. This provision aims to

39 Official Records (1981), p. 25; Achilles, Kommentar (2000), Art. 21 para. 3; Adame Goddard,
El Contrato de Compraventa Internacional (1994) p. 112; Brunner/Pfisterer/Köster, Kommentar

(2014), Art. 21 para. 1; Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 198; Dornis, in: Honsell,
Kommentar (2010), Art. 21 para. 34; Enderlein/Maskow/Strohbach, Internationales Kaufrecht (1991),
Art. 21 para. 3; Ferrari/Torsello, International Sales Law – CISG (2015) p. 149–150; Herber/Czerwenka,
Kommentar (1991), Art. 19 para. 4; Heuzé, Vente Internationale (2005), para. 192 note 132; Karollus,
UN-Kaufrecht (1989) p. 75; Lipari, Nuove leggi civ. comm. (1989) 98 (101); Ludwig, Der
dargestellt auf der Grundlage der Rechtsordnungen Englands und Deutschlands (1994) p. 342; Gruber,
in: MünchKommBGB (2016), Art. 21 para. 9; Mankowski, in: Ferrari et al., Internationales Vertrags-
recht (2012), Art. 21 CISG para. 4; Neumayer/Ming, Convention de Vienne (1993), Art. 21 para. 2;
Rudolph, Kommentar (1996), Art. 21 para. 5; Saenger, in: Bamberger/Roth (eds), Kommentar zum
Bürgerlichen Gesetzbuch (2012), Art. 21 para. 2; Schroeter, in: Schlechtriem/Schwenzer, Kommentar
(German ed. 2013), Art. 21 paras 2 and 10; Lüderitz/Fenge, in: Soergel (ed), Kommentar zum BGB.
Schuldrechtliche Nebengesetze (2000), Art. 21 para. 5; Magnus, in: Staudinger Kommentar (2013),
Art. 21 para. 12; expressing some doubts, Farnsworth, in: Bianca/Bonell, Commentary (1987), Art. 21
para. 2.2.
40 Dornis, in: Honsell, Kommentar (2010), Art. 21 para. 34; Schroeter, in: Schlechtriem/Schwenzer,
Kommentar (German ed. 2013), Art. 21 para. 6; Witz/Salger/Lorenz, Kommentar (2016), Art. 21 para. 4;
41 For a somewhat different view, see Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 21
para. 14; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 21 para. 11; Lüderitz/Fenge,
in: Soergel (ed), Kommentar zum BGB. Schuldrechtliche Nebengesetze (2000), Art. 21 para. 6.
42 Herber/Czerwenka, Kommentar (1991), Art. 19 para. 5; Piltz, Internationales Kaufrecht (1993) § 3
para. 108; in case law see Landgericht Hamburg (Germany) 21 December 2001, CISG-Online 1092.
Art. 21 para. 17.

45 Lipari, Nuove leggi civ. comm. (1989) 98 (102); Gruber, in: MünchKommBGB (2016), Art. 21
para. 2; Rudolph, Kommentar (1996), Art. 21 para. 2; Lüderitz/Fenge, in: Soergel (ed), Kommentar zum
BGB. Schuldrechtliche Nebengesetze (2000), Art. 21 para. 8.
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protect the acceptor,46 who has done everything in his power for the acceptance to reach
the offeror in due time, and therefore should be able to rely on the conclusion of the
contract.47 Still, the offeror is protected too,48 as he can prevent contract conclusion, by
informing the acceptor that he considers the acceptance lapsed by means of an oral or
written notice to that effect.49
12 In light of this, the importance of an exact distinction between Art. 21(1) and 21(2) is
evident. As a further example, while pursuant to para. 1 a contract is not concluded
when the offeror does not react at all, a contract is concluded pursuant to para. 2 when
the offeror does not react.50 Additionally, para. 2 provides for an exception to the
general rule set forth in para. 1 only with respect to acceptances contained in a letter or
other writing.51 Para. 2 is not otherwise applicable.52
13 Art. 21(2) requires that an acceptance would have reached the offeror in time – i. e.,
within the time stated in Art. 18(2) – if its transmission had been normal.53 Logically, this
presupposes that the acceptance was dispatched before the time for acceptance has lapsed.
Unlike para. 2., para. 1 of Art. 21 does not require this, which is why it also applies in cases
where the acceptance has been dispatched after the time for acceptance has lapsed.
14 It also follows that the lateness must be caused by the abnormal transmission. The
circumstances that may adversely affect transmission can relate to the transmission of a
specific acceptance, such as a specific acceptance being misrouted at a post office,54 or
may affect the transmission on a more general level, such as a general strike,55 inclement
weather, blockage of a street, etc.56
46 Audit, Vente Internationale (1990), p. 66; Brunner/Pfisterer/Köster, Kommentar (2014), Art. 21
para. 3; Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 199; Schroeter, in: Schlechtriem/Schwenzer,

p. 610.
48 Audit, Vente Internationale (1990), p. 66; Ludwig, Der Vertragsabschluß nach UN-Kaufrecht im
Spannungsverhältnis von Common Law und Civil Law, dargestellt auf der Grundlage derRechtsordnun-
gen Englands und Deutschlands (1994) p. 344; Murray, An Essay on the Formation of Contracts and
Related Matters under the United Nations Convention on Contracts for the International Sale of Goods, 8
Journal of Law and Commerce (1998) 11(35); Schroeter, in: Schlechtriem/Schwenzer, Kommentar (Ger-
man ed. 2013), Art. 21 para. 16.
49 For a reference to the rationale behind Art. 21(2), see Schroeter, in: Schlechtriem/Schwenzer,

para. 35; Ferrari/Torsello, International Sales Law – CISG (2015) p. 150; Lipari, Nuove leggi civ. comm.
(1989) 98 (100 and 102); Ludwig, Der Vertragsabschluß nach UN-Kaufrecht im Spannungsverhältnis von
lands (1994) p. 343; Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 21 CISG
para. 18; Murray, An Essay on the Formation of Contracts and Related Matters under the United Nations
(35); Perales Viscasillas, La Formación del contrato de compraventa internacional de mercaderı́as (1996)
p. 599.
(1996) p. 599; Rudolph, Kommentar (1996), Art. 21 para. 1; Lüderitz/Fenge, in: Soergel (ed), Kommentar
zum BGB. Schuldrechtliche Nebengesetze (2000), Art. 21 para. 2; Schroeter, in: Schlechtriem/Schwenzer,
52 In accord Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 21 para. 25.
para. 3; Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 199.

54 Piltz, Internationales Kaufrecht (2008), para. 3-116; Schroeter, in: Schlechtriem/Schwenzer, Kommentar
(German ed. 2013), Art. 21 para. 17; Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 21 para. 24.
56 Ferrari/Torsello, International Sales Law – CISG (2015) p. 150; Gruber, in: MünchKommBGB (2016),
312 Ferrari
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Art. 21(2) is not applicable where lateness is due to reasons other than delays in 15
transmission, such as use of an incorrect address.57
In this author’s opinion,58 a transmission is not “normal” either if the acceptor uses 16
means of communication that are inappropriate in the circumstances, with regard to the
trade concerned, the internationality of the relationship, etc.59
Art. 21(2) also presupposes that the writing containing the acceptance shows that the 17
acceptance would have reached the offeror on time if transmission had been normal.60
The issue of what elements have to be taken into account to determine this is
controversial. Some commentators hold that subjective elements, such as comments
made by the acceptor, also have to be taken into account.61 In this author’s opinion, this
view cannot be shared.62 The wording of the provision clearly indicates that the writing
has to “show […] that it has been sent in such circumstances” such that if its
transmission had been normal, it would have reached the offeror in due time, thus
making it clear that only objective63 elements, i. e., elements over which the acceptor
has no control,64 are relevant in determining whether the transmission would have
reached the offeror in due time. If the writing does not show that the lateness is due to
a delay in transmission, Art. 21(1) applies.65
b) Effects of the offeror’s protest. If the aforementioned requirements are met (i. e., 18
if the lateness is caused by a delay in the transmission and this can be derived from the
writing containing the acceptance), a contract is concluded66 at the time when the late
acceptance reaches the offeror.67 If the offeror wants to avoid the conclusion of the
contract, the offeror must protest “without delay.”68 It is worth pointing out that the
offeror will not necessarily protest; there are instances in which the offeror may have an
Art. 21 para. 20; Ferrari/Torsello, International Sales Law – CISG (2015) p. 150–151; Meeusen, Totstand-
koming van de Overeenkomst, in: van Houtte/Erauw/Wautelet (eds), Het Weens Koopverdrag (1997), p. 71
(88); Gruber, in: MünchKommBGB (2016), Art. 21 para. 17; Magnus, in: Staudinger Kommentar (2013),
Art. 21 para. 14; Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 21 CISG para. 20;
Law, dargestellt auf der Grundlage der Rechtsordnungen Englands und Deutschlands (1994) p. 343;
59 See also Perales Viscasillas, La Formación del contrato de compraventa internacional de mercaderı́as
(1996) p. 613; contra, see Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 21 para. 19;
Koopverdrag (1997), p. 71 (88); Schroeter, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2013),
Art. 21 para. 18.
61 Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 199; Schlechtriem, in: Schlechtriem/Schwenzer,

62 Herber/Czerwenka, Kommentar (1991), Art. 19 para. 7; Reinhart, Kommentar (1991), Art. 21 para. 5.
63 Gruber, in: MünchKommBGB (2016), Art. 21 para. 18; Neumayer/Ming, Convention de Vienne
(1993), Art. 21 para. 3; Reinhart, Kommentar (1991), Art. 21 para. 5.

64 Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 21 para. 26; Ludwig, Der Vertragsabschluß
Grundlage der Rechtsordnungen Englands und Deutschlands (1994) p. 345.
Lipari, Nuove leggi civ. comm. (1989) 98 (103); Piltz, Internationales Kaufrecht (1993) § 3 para. 104;
Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 21 para. 18; Magnus, in: Staudinger
66 Heuzé, Vente Internationale (2005), para. 192.
67 Adame Goddard, El Contrato de Compraventa Internacional (1994) p. 112; Ferrari/Torsello, Inter-
national Sales Law – CISG (2015) p. 151; Rudolph, Kommentar (1996), Art. 21 para. 8.
68 Audit, Vente Internationale (1990), p. 67; Lipari, Nuove leggi civ. comm. (1989) 98 (102); Schroeter,
Ferrari 313
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interest in the contract being concluded – for instance, where there has been a change in
the economic conditions that favours the offeror.69 The acceptor is, thus, exposed to the
will of the offeror, who alone can decide the fate of the contract70 because the acceptor
cannot do anything to make the acceptance ineffective once it reached the offeror71 –
not even in the time between the date on which the acceptance reached the offeror and
the time of dispatch of the protest on the part of the offeror.72
19 For the protest of the offeror – which can be made both orally or in writing73 – to
prevent the contract from being concluded, it is not necessary that it reaches the
acceptor;74 its dispatch is sufficient,75 from which one can easily derive the impossibility
of a withdrawal of the protest.76 From this one can also derive that it is the acceptor who
bears the risk of loss of the protest.77
20 A statement dispatched before the late acceptance reaches the offeror amounts to a
protest in the sense of Art. 21(2) and prevents the contract from being concluded only
where it is sent after the time for acceptance has already lapsed.78
3. Opportunity for speculation

21 From the above it clearly follows that it is the offeror, and the offeror alone, who
controls the fate of the contract where the acceptance has not reached the offeror, or
where the act indicating assent has not been performed in due time. According to the
69 For a reference to the possibility on the part of the offeror to speculate at the cost of the offeree, see
Ferrari, in: MünchKommHGB (2013), Art. 21 para. 21.

72 Contra Farnsworth, in: Bianca/Bonell, Commentary (1987), Art. 21 para. 3.3; Herber/Czerwenka,
Kommentar (1991), Art. 19 para. 9; Murray, An Essay on the Formation of Contracts and Related
Matters under the United Nations Convention on Contracts for the International Sale of Goods, 8
Journal of Law and Commerce (1998) 11 (33).
73 Neumayer/Ming, Convention de Vienne (1993), Art. 21 para. 3; Piltz, Internationales Kaufrecht
(1993) § 3 para. 103; Rudolph, Kommentar (1996), Art. 21 para. 8; Schroeter, in: Schlechtriem/Schwenzer,
74 Ferrari/Torsello, International Sales Law – CISG (2015) p. 151; Perales Viscasillas, La Formación del
contrato de compraventa internacional de mercaderı́as (1996) p. 613; Rudolph, Kommentar (1996),

Art. 21 para. 3.
para. 3; Diez-Picazo, Ann. der. civ. (1995) 31; Ferrari, Vendita internazionale di beni mobili. Artt. 14–24.
Formazione del contratto, (2006) p. 156; Jametti Greiner, Der Vertragsabschluss, in: Hoyer/Posch (eds), Das
Einheitliche Wiener Kaufrecht (1992), p. 43 (54); Ludwig, Der Vertragsabschluß nach UN-Kaufrecht im
Spannungsverhältnis von Common Law und Civil Law, dargestellt auf der Grundlage der Rechtsordnungen
Englands und Deutschlands (1994) pp. 344 and 404; Gruber, in: MünchKommBGB (2016), Art. 21 para. 19;
Murray, An Essay on the Formation of Contracts and Related Matters under the United Nations
(33 et seq.); Noussias, Die Zugangsbedürftigkeit von Mitteilungen nach den Einheitlichen Haager Kaufge-
setzen und nach dem UN-Kaufgesetz (1983) pp. 120 et seq.; Perales Viscasillas, La Formación del contrato
de compraventa internacional de mercaderı́as (1996) p. 613; Schlechtriem, in: Schlechtriem/Schwenzer,
Commentary (2005), Art. 21 para. 20; Wey, Der Vertragsabschluss beim Internationalen Warenkauf nach
UNCITRAL und schweizerischen Recht (1984) para. 191; Witz/Salger/Lorenz, Kommentar (2016), Art. 21
para. 11; contra Neumayer/Ming, Convention de Vienne (1993), Art. 21 para. 4; Ng’ong’ola, The Vienna
Sales Convention of 1980 in the Southern Africa Legal Environment: Formation of a Contract of Sale, 4
African Journal of International and Comparative Law (1992) 835 (852).
76 Dornis, in: Honsell, Kommentar (2010), Art. 21 para. 31; contra Gruber, in: MünchKommBGB
(2016), Art. 21 para. 21.

77 Ferrari/Torsello, International Sales Law – CISG (2015) p. 151; Piltz, Internationales Kaufrecht
(1993) § 3 para. 103; Reinhart, Kommentar (1991), Art. 21 para. 6.

78 In accord Dornis, in: Honsell, Kommentar (2010), Art. 21 para. 29; Gruber, in: MünchKommBGB
contra Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 21 para. 32.
314 Ferrari
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prevailing view, this allows the offeror to speculate at the acceptor’s cost,79 as in a case
where there has been a lengthy delay in the transmission of the acceptance and during
that delay economic conditions have changed.80 To counter the offeror’s potential for
speculation, some commentators suggest that an approval under Art. 21(1) or a protest
under Art. 21(2) should be considered ineffective where there has been an essential
delay.81 Other commentators suggest that “considerably delayed declarations of accep-
tance contain an inherent limitation on the period of their validity and that they lapse
after the expiry of that period.”82 Despite the differences between the theories, more
often than not they get to the same result which, in this author’s view, is certainly
justified – at least where the case falls under the sphere of application of Art. 21(2).
4. Burden of proof
Since Art. 21 provides for an exception to the general rule set forth in Art. 18, pursuant 22
to which a late acceptance does not lead to the conclusion of the contract, the allocation
of the burden of proof under Art. 21 is reversed compared to the allocation of the burden
of proof under Art. 18.83 The party invoking the contract conclusion under Art. 21(1)84
bears the burden of proving that the offeror has, without delay, informed the acceptor
that he considers the late acceptance to be nevertheless effective, or has dispatched a
notice to that effect.85 To the extent that Art. 21(2) applies, the party invoking the
conclusion of a contract must prove, on the one hand, that the writing containing the
acceptance shows that the lateness is exclusively caused by problems in its transmission.86
79 See Adame Goddard, El Contrato de Compraventa Internacional (1994) p. 112; Farnsworth, in:
Bianca/Bonell, Commentary (1987), Art. 21 para. 3.3; Brunner/Pfisterer/Köster, Kommentar (2014),

Art. 21 para. 3; Dornis, in: Honsell, Kommentar (2010), Art. 21 para. 39; Ludwig, Der Vertragsabschluß
Grundlage der Rechtsordnungen Englands und Deutschlands (1994) p. 341; Magnus, in: Staudinger
Kommentar (2013), Art. 21 para. 19; Meeusen, Totstandkoming van de Overeenkomst, in: van Houtte/
Erauw/Wautelet (eds), Het Weens Koopverdrag (1997), p. 71 (88); Murray, An Essay on the Formation of
Contracts and Related Matters under the United Nations Convention on Contracts for the International
Sale of Goods, 8 Journal of Law and Commerce (1998) 11 (35 et seq.); Perales Viscasillas, La Formación
del contrato de compraventa internacional de mercaderı́as (1996) pp. 618 et seq.; Schlechtriem, in:
Schlechtriem/Schwenzer, Commentary (2005), Art. 21 paras 4 and 23; Schnyder/Straub, in: Honsell,
Kommentar (1997), Art. 21 para. 39; Wey, Der Vertragsabschluss beim Internationalen Warenkauf nach
UNCITRAL und schweizerischen Recht (1984) para. 1165.
81 Compare Farnsworth, in: Bianca/Bonell, Commentary (1987), Art. 21 para. 3.4; Herber/Czerwenka,
Kommentar (1991), Art. 19 para. 8; Honnold/Flechtner, Uniform Law (2009), para. 175; Gruber, in:
MünchKommBGB (2016), Art. 21 para. 20; Magnus, in: Staudinger Kommentar (2013), Art. 21 para. 19.
82 Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 21 para. 23; see also Brunner/
Pfisterer/Köster, Kommentar (2014), Art. 21 para. 3.

83 See Henninger, Die Frage der Beweislast im Rahmen des UN-Kaufrechts (1995) p. 211.
84 See also Schroeter, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 21 para. 24.
85 Achilles, Kommentar (2000), Art. 21 para. 7; Ferrari, Vendita internazionale di beni mobili. Artt. 14–
24. Formazione del contratto (2006) p. 159; Henninger, Die Frage der Beweislast im Rahmen des UN-
Kaufrechts (1995) p. 211; Gruber, in: MünchKommBGB (2016), Art. 21 para. 24; contra Magnus, in:
Staudinger Kommentar (2013), Art. 21 para. 20, stating that it is up to the offeror to prove dispatch of a
notice pursuant to which the late acceptance is effective; in accord Saenger, in: Bamberger/Roth (eds),
Kommentar zum Bürgerlichen Gesetzbuch (2012), Art. 21 para. 4.
Art. 21 para. 24; Hepting/Müller, in Baumgärtel/Laumen (eds), Handbuch der Beweislast im Privatrecht
(2009), Art. 21 CISG paras. 3 et seq.; Jung, Die Beweislastverteilung im UN-Kaufrecht (1996) pp. 124 et
seq.; Magnus, in: Staudinger Kommentar (2013), Art. 21 para. 19; Mankowski, in: Ferrari et al., Inter-
nationales Vertragsrecht (2012), Art. 21 CISG paras 24 et seq.; contra, at least partially, Schnyder/Straub,
in: Honsell, Kommentar (1997), Art. 21 para. 41.
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23 Late acceptance is an issue also dealt with in the PICC, more specifically, in Art. 2.1.9.
Although at first sight it may look like Art. 21 CISG and Art. 2.1.9 PICC lead to the
same result, as the wording is very similar, there are various differences. While both
provisions allow for a late acceptance to nevertheless be effective as an acceptance if the
acceptor is notified to that effect, the requirements for a late acceptance to be effective
pursuant to Art. 21(1) CISG and Art. 2.1.9 PICC are different. In effect, while Art. 21(1)
CISG requires that notice be given “without delay”, Art. 2.1.9 PICC “merely” requires
that notice be given “without undue delay”, thus allowing for consideration of the
circumstances of the case and, thus, for more flexibility. Also, while under Art. 21(1)
CISG it is sufficient for the (written) notice to be dispatched for the effects of the notice
to be produced,87 the same is not true under the PICC. In effect, the CISG solution “is
not applicable to the differently worded Art 2.1.9(1) [PICC]. There is no distinction
between oral and written notifications as Art. 1.10 applies to all forms and means of
communication. Although the notice must be dispatched “without undue delay”, it will
only become effective and trigger the contract’s formation retroactively when it reaches
the offeror (Art. 1.10(2)).”88
24 Similarly, for a notice of protest under Art. 21(2) CISG to produce its effects, it is
sufficient for it to be dispatched,89 while under the PICC it is, once again, required that
the notice reaches its addressee, i. e., the acceptor.
25 As regards the DCFR, its solution (to be found in Art. II-4:207) seems to be modelled
more after the PICC provision referred to above than Art. 21 CISG, as it also requires
that the notice reach the acceptor (pursuant to Art. I-1:109(3) DCFR) and be made
“without undue delay”. In this respect, the DCFR also differs from the PECL, as
Art. 2:207 PECL requires that notice occur “without delay”.
87See the text accompanying notes 25 et seq.
88Kleinheisterkamp, in: Vogenauer/Kleinheitserkamp (eds), Commentary on the Unidroit Principles
(2009), Art. 2.1.9. para. 7.
89 See the text accompanying note 71.
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Article 22
An acceptance may be withdrawn if the withdrawal reaches the offeror before or at
the same time as the acceptance would have become effective.
Bibliography: Ferrari, Vendita internazionale di beni mobili. Artt. 14–24. Formazione del contratto (2006);
Ludwig, Der Vertragsabschluß nach UN-Kaufrecht im Spannungsverhältnis von Common Law und Civil Law,
dargestellt auf der Grundlage der Rechtsordnungen Englands und Deutschlands (1994); Meeusen, Totstand-
koming van de Overeenkomst, in: van Houtte/Erauw/Wautelet (eds), Het Weens Koopverdrag (1997), p. 71;
Murray, An Essay on the Formation of Contracts and Related Matters under the United Nations Convention
on Contracts for the International Sale of Goods, 8 Journal of Law and Commerce (1998) 11.
Outline
1. Withdrawal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2. Effects of a withdrawal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

This (non-mandatory)1 provision, which can be traced back to Art. 10 ULF,2 states 1
that the acceptor may change his mind after accepting the offer and prevent the
acceptance from becoming effective. This possibility constitutes the counterpart to the
offeror’s ability to withdraw the offer, provided for in Art. 15;3 pursuant to that
provision, the offeror may withdraw an offer even if it is irrevocable. For the withdrawal
of both the offer and the acceptance to be effective, it is required that the withdrawal
reaches its addressee before or (at the latest) at the same time as the declaration to
which it is related.4 For the effectiveness of the withdrawal it is irrelevant whether its
addressee gains knowledge of it before gaining knowledge of the acceptance.5
(1997), Art. 22 para. 25.
2 Lüderitz/Fenge, in: Soergel (ed), Kommentar zum BGB. Schuldrechtliche Nebengesetze (2000), Art. 22
para. 1; Magnus, in: Staudinger Kommentar (2013), Art. 22 para. 2; Schroeter, in: Schlechtriem/Schwen-
zer, Kommentar (German ed. 2013), Art. 22 para. 1; Schroeter, in: Schlechtriem/Schwenzer, Commentary
(2016), Art. 22 para. 1.
3 See Achilles, Kommentar (2000), Art. 22 para. 1; Brunner/Pfisterer/Köster, Kommentar (2014), Art. 22
para. 1; Dornis, in: Honsell, Kommentar (2010), Art. 22 para. 1; Loewe, Internationales Kaufrecht (1989)
p. 46; Ludwig, Der Vertragsabschluß nach UN-Kaufrecht im Spannungsverhältnis von Common Law und
Art. 22 para. 1; J. Pierre/V. Pierre, A Comparison of the Rules on Formation of Sales Contracts Under the
Louisiana Civil Code and the United Nations Convention on Contracts for the International Sale of Goods:
What Buyers and Sellers Should Know, 20 Southern University Law Review (1993) 189 (194); Magnus, in:
Staudinger Kommentar (2013), Art. 22 para. 4; Witz/Salger/Lorenz, Kommentar (2016), Art. 22 para. 1.
Art. 22 para. 1; Murray, An Essay on the Formation of Contracts and Related Matters under the United
(1998) 11 (28); Witz/Salger/Lorenz, Kommentar (2016), Art. 22 para. 5.
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2 But while an offer can generally be revoked,6 an acceptance is irrevocable7 because

once it becomes effective – generally when it reaches the offeror – the contract is
concluded pursuant to Art. 23.8 Only where the acceptor’s right to revoke the accep-
tance is provided for in the acceptance can the conclusion of the contract be avoided
after the acceptance has reached the offeror.9

1. Withdrawal
3 Not unlike the withdrawal of an offer,10 the withdrawal of an acceptance constitutes a
declaration of intent aimed at preventing the acceptance in itinere from becoming
effective. For the withdrawal to become effective, it must reach the offeror.11 The
withdrawal can relate to the acceptance as a whole or only to parts of it.12 Whether an
acceptance in respect of which a partial withdrawal has been made constitutes an
acceptance depends on Art. 19.13 If the withdrawal is solely aimed at preventing the
additional or different terms of the acceptance vis-à-vis the offer from becoming
effective, the partially modified acceptance will certainly lead to the conclusion of the
contract when it reaches the offeror.14
4 Whether a statement by the acceptor constitutes a withdrawal must be decided on the
basis of the interpretive criteria set forth in Art. 8;15 the interpreter may well determine
that the acceptor merely wanted to clarify certain points.16
5 The validity requirements of withdrawal are not governed by the CISG,17 except for
those relating to its formal validity – which is why one must have recourse to the
applicable domestic law to settle, for instance, the issues of legal capacity, fraud, duress,
mistake or the power of representation.18 Subject to Art. 12, a withdrawal can take
6 See Art. 16.

7 See Farnsworth, in: Bianca/Bonell, Commentary (1987), Art. 22 para. 2.2; Schnyder/Straub, in:
Honsell, Kommentar (1997), Art. 22 para. 22; Gruber, in: MünchKommBGB (2016), Art. 22 para. 2;
Rudolph, Kommentar (1996), Art. 22 para. 2; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary
(2005), Art. 22 para. 4; vgl. aber Musumeci, Nuove leggi civ. comm. (1989) 104 (104).
8 Dornis, in: Honsell, Kommentar (2010), Art. 22 para. 18; Lüderitz/Fenge, in: Soergel (ed), Kommentar
zum BGB. Schuldrechtliche Nebengesetze (2000), Art. 22 para. 1; see also Ferrari, Vendita internazionale
di beni mobili. Artt. 14–24. Formazione del contratto (2006) pp. 160 et seq.
Magnus, in: Staudinger Kommentar (2013), Art. 22 paras 1 and 5.
11 Dornis, in: Honsell, Kommentar (2010), Art. 22 para. 6; Mankowski, in: Ferrari et al., Internationales
Vertragsrecht (2012), Art. 22 CISG para. 4; Reinhart, Kommentar (1991), Art. 22 para. 2; Magnus, in:

14 Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 22 para 5; Schlechtriem/Schro-
eter, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2013), Art. 22 para. 5.

15 Dornis, in: Honsell, Kommentar (2010), Art. 22 para. 7; Magnus, in: Staudinger Kommentar (2013),
Art. 22 para. 4; Neumayer/Ming, Convention de Vienne (1993), Art. 22 para. 2.

17 Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 22 para. 11; Schroeter, in: Schlechtriem/

18 Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 22 para. 4; Schlechtriem/Schro-
eter, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2013), Art. 22 para. 4.
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any form.19 In particular, the acceptor is not obliged to use the form taken by the
acceptance,20 nor must the same means of dispatch be used.21 Also, for a declaration to
constitute a withdrawal, it is not necessary that certain formulations or words (such as the
“withdrawal”) be used.22
Since a withdrawal becomes effective only upon its receipt by the offeror,23 which 6
means that a withdrawal of a withdrawal is possible,24 its dispatch is insufficient to
prevent contract conclusion.25 It is necessary that the withdrawal reaches the offeror.26 If
the acceptance and the withdrawal reach the offeror at the same time, the withdrawal
has priority;27 as mentioned, the fact that the offeror gains knowledge of the acceptance
prior to gaining knowledge of the withdrawal is irrelevant.28
Therefore, it follows that the indication of assent by performing an act, as referred to 7
in Art. 18(3), cannot be withdrawn.29 Where an acceptance is made orally, it becomes
effective as soon as it is made, which is why withdrawal is not possible,30 at least if one
defines “withdrawal” of an acceptance as a statement referring to an acceptance that is
still in itinere.31
19 Dornis, in: Honsell, Kommentar (2010), Art. 22 para. 9; Saenger, in: Bamberger/Roth, Kommentar
zum Bürgerlichen Gesetzbuch (2007), Art. 22 para. 1.

20 Magnus, in: Staudinger Kommentar (2013), Art. 22 para. 8; Mankowski, in: Ferrari et al., Internatio-
nales Vertragsrecht (2012), Art. 22 CISG para. 4; Witz/Salger/Lorenz, Kommentar (2016), Art. 22 para. 6.
para. 4.
23 See also Denkschrift der Deutschen Bundesregierung zum Übereinkommen der Vereinten Nationen
(1980) p. 45.
26 Dornis, in: Honsell, Kommentar (2010), Art. 22 para. 12; Meeusen, Totstandkoming van de Over-
eenkomst, in: van Houtte/Erauw/Wautelet (eds), Het Weens Koopverdrag (1997) p. 71 (85); Neumayer/
Ming, Convention de Vienne (1993), Art. 22 para. 1.
(2016), Art. 22 para. 3.

28 Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 22 CISG para. 6; Schnyder/
Straub, in: Honsell, Kommentar (1997), Art. 22 para. 12.

29 Achilles, Kommentar (2000), Art. 22 para. 1; Adame Goddard, El Contrato de Compraventa Inter-
nacional (1994) p. 113; Brunner/Pfisterer/Köster, Kommentar (2014), Art. 22 para. 1; Dornis, in: Honsell,
Kommentar (2010), Art. 22 para. 4; Ferrari, Vendita internazionale di beni mobili. Artt. 14–24. For-
mazione del contratto (2006) p. 163; Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012),
Art. 22 CISG para. 8; Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 22 para. 14; Ludwig, Der
dargestellt auf der Grundlage der Rechtsordnungen Englands und Deutschlands (1994) p. 246; Gruber,
in: MünchKommBGB (2016), Art. 22 para. 4; Neumayer/Ming, Convention de Vienne (1993), Art. 22
para. 1; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 22 para. 3; Lüderitz/Fenge,
in: Soergel (ed), Kommentar zum BGB. Schuldrechtliche Nebengesetze (2000), Art. 22 para. 2; Magnus,
in: Staudinger Kommentar (2013), Art. 22 para. 10; Schroeter, in: Schlechtriem/Schwenzer, Commentary
(2016), Art. 22 para. 3; Wey, Der Vertragsabschluss beim Internationalen Warenkauf nach UNCITRAL
und schweizerischen Recht (1984) para. 1070; Witz/Salger/Lorenz, Kommentar (2016), Art. 22 para. 3.
30 Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 200; Mankowski, in: Ferrari et al., Internationales
para. 13; Gruber, in: MünchKommBGB (2016), Art. 22 para. 4; Reinhart, Kommentar (1991), Art. 22
31 Excluding the withdrawal of an oral acceptance, see also Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario
(1998), p. 200; Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 22 para. 13; Ludwig, Der
dargestellt auf der Grundlage der Rechtsordnungen Englands und Deutschlands (1994) p. 346; contra
Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 22 para. 3; Magnus, in: Staudinger
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2. Effects of a withdrawal
8 A withdrawal prevents the acceptance from becoming effective and, consequently, the
contract from being concluded.32 In this respect it does not matter whether the
acceptance to be withdrawn is a timely acceptance or a late acceptance governed by
Art. 21;33 the withdrawal of a late acceptance is also possible only up to the moment the
late acceptance reaches the offeror.34 Since a withdrawal becomes effective only once it
reaches the offeror, a withdrawal of a withdrawal has to be possible; on the other hand,
the revocation of a withdrawal is not possible.35
9 The acceptor’s option of withdrawing an acceptance is the counterpart of the
offeror’s option to withdraw an offer – provided for in Art. 15.36 Nevertheless, some
commentators have criticized the acceptor’s possibility of withdrawing an acceptance;
they argue that since the offeror may no longer revoke his offer after the acceptance
has been dispatched (Art. 16(1)), the rule in Art. 22 allows the acceptor to speculate37
at the offeror’s cost.38 It is true that the acceptor can choose a slow means of
communication for transmitting the acceptance and thus cut off the offeror’s possibi-
lity to revoke the offer while maintaining the option to withdraw the acceptance by
using a quicker means of communication to react to market changes.39 This does not
mean, however, that a withdrawal made to take advantage of market changes must
necessarily be considered ineffective for violating the principle of good faith.40 In this
author’s opinion, further elements must exist for a withdrawal made between the time

33 Herber/Czerwenka, Kommentar (1991), Art. 19 para. 2; Mankowski, in: Ferrari et al., Internationales
para. 17; Neumayer/Ming, Convention de Vienne (1993), Art. 22 para. 2; Magnus, in: Staudinger Kom-
34 Ludwig, Der Vertragsabschluß nach UN-Kaufrecht im Spannungsverhältnis von Common Law und
Gruber, in: MünchKommBGB (2016), Art. 22 para. 6; Magnus, in: Staudinger Kommentar (2013), Art. 22
para. 9; contra Honnold/Flechtner, Uniform Law (2009), para. 174, and Neumayer/Ming, Convention de
Vienne (1993), Art. 22 para. 2.
35 Dornis, in: Honsell, Kommentar (2010), Art. 22 paras. 2 and 16; Ferrari, Vendita internazionale di
beni mobili. Artt. 14–24. Formazione del contratto (2006) p. 164; Schnyder/Straub, in: Honsell, Kom-
mentar (1997), Art. 22 paras 20 et seq.; Gruber, in: MünchKommBGB (2016), Art. 22 para. 5.
37 Adame Goddard, El Contrato de Compraventa Internacional (1994) p. 113; Farnsworth, in: Bianca/
Bonell, Commentary (1987), Art. 22 para. 3.1; Ludwig, Der Vertragsabschluß nach UN-Kaufrecht im
gen Englands und Deutschlands (1994) p. 345; Meeusen, Totstandkoming van de Overeenkomst, in: van
Houtte/Erauw/Wautelet (eds), Het Weens Koopverdrag (1997), p. 71 (85); Murray, An Essay on the
Formation of Contracts and Related Matters under the United Nations Convention on Contracts for the
International Sale of Goods, 8 Journal of Law and Commerce (1998) 11 (29); Neumayer/Ming, Conven-
tion de Vienne (1993), Art. 22 para. 1; Schroeter, in: Schlechtriem/Schwenzer, Commentary (2016),
Art. 22 para. 6; for critical comments, see Murray, An Essay on the Formation of Contracts and Related
Matters under the United Nations Convention on Contracts for the International Sale of Goods, 8 Journal
of Law and Commerce (1998) 11 (28 et seq.).
38 See for a partially different argument Witz/Salger/Lorenz, Kommentar (2016), Art. 22 para. 2.
Art. 22 para. 12.

40 This view is, however, held for instance by Farnsworth, in: Bianca/Bonell, Commentary (1987),
Art. 22 para. 3.1; Brunner/Pfisterer/Köster, Kommentar (2014), Art. 22 para. 3; Herber/Czerwenka, Kom-
mentar (1991), Art. 19 para. 2; Kritzer S. 191 f.; Magnus, in: Staudinger Kommentar (2013), Art. 22
para. 12; Rudolph, Kommentar (1996), Art. 22 para. 3.
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of dispatch of the acceptance and its receipt by the offeror, with the goal of taking
advantage of a change in the market situation, to be ineffective.41
The party arguing that the contract is not concluded bears the burden of proving that 10
an effective withdrawal has been made.42

Art. 2.1.20 PICC corresponds – word for word – to Art. 22 CISG, which is why there 11
is no need to comment on it. The DCFR, however, does not contain a provision that
expressly allows for the withdrawal of an offer. One may, however, invoke Art. I-
1:109(5) DCFR – which is based upon Art. 1:303(5) PECL – to derive the acceptor’s
right to withdraw the acceptance. This is despite the fact that Art. I-1:109(5) DCFR
refers to the right to “revoke” rather than that to “withdraw”.43 This is simply due to the
imprecise language used by the drafters of the DCFR. From the provision de quo, it
clearly results that what is meant is not the right to revoke.
Enderlein/Maskow/Strohbach, Internationales Kaufrecht (1991), Art. 22 para. 1; Schlechtriem, in: Schlech-

42 Dornis, in: Honsell, Kommentar (2010), Art. 22 para. 21; Jung, Die Beweislastverteilung im UN-
Kaufrecht (1996) p. 126; Gruber, in: MünchKommBGB (2016), Art. 22 para. 10; Reimers-Zocher, Bewei-
slastfragen im Haager und Wiener Kaufrecht (1995) p. 195; Saenger, in: Bamberger/Roth (eds), Kom-
mentar zum Bürgerlichen Gesetzbuch (2012), Art. 22 para. 1; Schroeter, in: Schlechtriem/Schwenzer,
Kommentar (German ed. 2013), Art. 22 para. 4; Schnyder/Straub, in: Honsell, Kommentar (1997),
Art. 22 para. 24.
43 This is even more surprising, as the provision upon which Art. I-1:109(5) DCFR is based, namely
Art. 1:303(5) PECL, expressly refers to “withdrawal”.
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Article 23
A contract is concluded at the moment when an acceptance of an offer becomes
effective in accordance with the provisions of this Convention.
(2006); Ludwig, Der Vertragsabschluß nach UN-Kaufrecht im Spannungsverhältnis von Common
(1994).
Outline
II. Detailed commentary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1. Time of contract conclusion. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2. Place of contract conclusion. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

1 This (non-mandatory)1 provision, which does not have a predecessor in the ULF,2
establishes that a contract is concluded when the acceptance becomes effective.3 This
provision is somewhat superfluous,4 since Art. 18 already sets forth the rule pursuant to
which a contract is concluded at the time when the acceptance becomes effective,5 i. e.,
when the indication of assent reaches the offeror6 or when the performance of an act
1 Bernardi, Nuove leggi civ. comm. (1989) 106 (107); Ferrari, Vendita internazionale di beni mobili.
Artt. 14–24. Formazione del contratto (2006) p. 166; Mankowski, in: Ferrari et al., Internationales
para. 10; Karollus, UN-Kaufrecht (1989) p. 76; Gruber, in: MünchKommBGB (2016), Art. 23 para. 4;
Rudolph, Kommentar (1996), Art. 23 para. 3; Magnus, in: Staudinger Kommentar (2013), Art. 23 para. 4.
2 Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 202; Magnus, in: Staudinger Kommentar (2013),
3 In case law see Canadian International Trade Tribunal (Canada), Cherry Stix Ltd. v President of the
Canada Borders Services Agency, 6 October 2005, CISG-Online 1140; Hof Gent (Belgium) 8 November
2004, CISG-Online 982; US Circuit Court of Appeals, 9th Circuit (U.S.), Chateau des Charmes Wines
Ltd. v Sabaté USA, Sabaté S. A., 5 May 2003, CISG-Online 767; Arbitral Award, ICC 10 329/2000,
Yearbook Comm. Arb. (2004) 108 et seq.; Rechtbank Rotterdam (Netherlands) 14 October 1999, CISG-
Online 1312.
4 For a similar assessment, see Dornis, in: Honsell, Kommentar (2010), Art. 23 para. 1: “no independent
meaning”; Farnsworth, in: Bianca/Bonell, Commentary (1987), Art. 23 para. 2.1: “scarcely necessary”;
Brunner/Pfisterer/Köster, Kommentar (2014), Art. 23 para. 1: “no additional value”; Herber/Czerwenka,
Kommentar (1991), Art. 23 para. 2: “superfluous”; Rudolph, Kommentar (1996), Art. 23 para. 1: “this
provisions is superfluous”; Saenger, in: Bamberger/Roth (eds), Kommentar zum Bürgerlichen Gesetzbuch
(2012), Art. 23 para. 1: “no autonomous meaning”; Schlechtriem/Schroeter, in: Schlechtriem/Schwenzer,
Kommentar (German ed. 2013), Art. 23 para. 1: “Art. 23 provides the obvious”; Schroeter, in: Schlech-
triem/Schwenzer, Commentary (2016), Art. 23 para. 1: “Article is self-evident”; see, however, Mankowski,
in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 23 CISG para. 1.
5 Ferrari/Torsello, International Sales Law – CISG (2015) p. 155; Garro/Zuppi, Compraventa interna-
cional de mercaderı́as (2012), p. 134; Schroeter, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 23
para. 1.
6 Compare Rechtbank Koophandel Oudenaarde (Belgium) 10 July 2001, CISG-Online 1785.
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amounting to acceptance takes place.7 Thus, in principle,8 one must resort to9 that rule
when, in the CISG, reference is made to the moment at which the contract is
concluded.10 Where domestic law (such as domestic tax, accounting, or bankruptcy
law) refers to the moment of contract conclusion, one must interpret domestic law to
determine if recourse is to be had to that moment (as defined by the CISG) or rather to
one to be determined on the basis of domestic law.11
1. Time of contract conclusion

With respect to the moment of contract conclusion, the drafters of the CISG have 2
favoured the so-called “receipt-theory”12 over other theories that determine that the
contract is concluded at a different point in time, such as the “theory of declaration”,
the “mail-box-rule” and the theory on the basis of which the contract is concluded upon
the offeror gaining knowledge of the acceptance.13 This does not mean that a contract
cannot be concluded at a different point in time. This may be the case when the parties
agree to degorate from the “receipt-theory”, or when a contract is not concluded by
means of the “traditional” approach, through offer and acceptance,14 because in these
cases Art. 23 is not applicable.15 In such cases a contract is considered concluded when
7 See also Bernardi, Nuove leggi civ. comm. (1989) 106 (107); Enderlein/Maskow/Strohbach, Inter-
nationales Kaufrecht (1991), Art. 23 para. 1; Gillette/Walt, The UN Convention on Contracts for the
International Sale of Goods (2016) p. 87; Schroeter, in: Schlechtriem/Schwenzer, Commentary (2016),
Schlechtriem/Schwenzer, Kommentar (German ed. 2013), Art. 23 para. 1.
8 But see Art. 18(3); compare Ludwig, Der Vertragsabschluß nach UN-Kaufrecht im Spannungsver-
hältnis von Common Law und Civil Law, dargestellt auf der Grundlage der Rechtsordnungen Englands
und Deutschlands (1994) p. 348.
9 Compare, e. g., Art. 1(2); Art. 9(2); Art. 10(a); Art. 33(c); Art. 35(2)(b); Art. 35(3); Art. 42(1);
Art. 42(2)(a); Art. 55; Art. 57(2); Art. 68; Art. 71(1); Art. 73(3); Art. 74; Art. 79(1); Art. 100(2).
10 Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 23 CISG para. 5; Perales

11 Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 202; Honnold/Flechtner, Uniform Law (2009),
para. 178; Neumayer/Ming, Convention de Vienne (1993), Art. 23 para. 1; Schlechtriem, in: Schlechtriem/
para. 6; Schroeter, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2013), Art. 23 para. 2; Witz/
Salger/Lorenz, Kommentar (2016), Art. 23 para. 3; contra Bernardi, Nuove leggi civ. comm. (1989) 106
(107).
12 See also Adame Goddard, El Contrato de Compraventa Internacional (1994) p. 91; Ferrari, Vendita
internazionale di beni mobili. Artt. 14–24. Formazione del contratto (2006) p. 168; Ferrari/Torsello,
International Sales Law – CISG (2015) p. 155; Leete, Contract Formation under the United Nations
Convention on Contracts for the International Sale of Goods and the Uniform Commercial Code: Pitfalls
for the Unwary, 6 Temple International and Comparative Law Journal (1992) 193 (207).
13 For comparative remarks, see Ferrari, Offer and Acceptance Inter Absentes, in: Smits (ed), Elgar
Encyclopedia of Comparative Law (2006), pp. 497 et seq.; Ferrari, A Comparative Overview of Offer and
Acceptance Inter Absentes, 10 Boston University International Law Journal (1992) 171 et seq.; Ferrari,
Formation of Contracts in South American Legal Systems, 16 Loyola Los Angeles International and
Comparative Law Journal (1994) 629 et seq.
14 See also Dornis, in: Honsell, Kommentar (2010), Art. 23 para. 2; Herber/Czerwenka, Kommentar
(1991), Art. 23 para. 2; for the admissibility of different modes of contract conclusion under the CISG, see
Oberlandesgericht München (Germany) 8 March 1995, CISG-Online 145.
15 Ferrari/Torsello, International Sales Law – CISG (2015) p. 155–156; Schlechtriem, in: Schlechtriem/
Schwenzer, Commentary (2005), Art. 23 para. 6; Schroeter, in: Schlechtriem/Schwenzer, Commentary

(2016), Art. 23 para. 3.
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the parties have reached an agreement; to determine when this is the case, resort is to be
had to the rules of interpretation set forth in Art. 8.16
3 Where the contract is concluded subject to a condition precedent, the contract is not
concluded upon receipt of the acceptance by the offeror, but rather at the moment in
time agreed upon by the parties,17 which is to be determined by resort to the rules of
interpretation set forth in Art. 8.18 In general, this will be the moment in time at which
the condition is met.19
4 The issue of when a contract is concluded that by law requires for its effectiveness the
consent of a third party, such as a governmental entity or body, must be settled on the
basis of the applicable domestic law,20 because this issue falls outside the CISG’s scope
of application.21 Where, however, it is the parties who have agreed that the effectiveness
of the contract depends on the assent of a third party, the moment at which the contract
is concluded depends on an interpretation of the parties’ agreement pursuant to
Art. 8.22
5 The party relying upon the contract conclusion or upon the contract conclusion
having occurred at a given point in time must prove all relevant facts.23
2. Place of contract conclusion

6 Art. 23 does not determine the place where the contract is concluded.24 Proposals to
that effect made during the drafting process25 were rejected as were the proposals made
16 See Ferrari/Torsello, International Sales Law – CISG (2015) p. 156; Magnus, in: Staudinger Kom-
mentar (2013), Art. 23 para. 5; Brunner/Pfisterer/Köster, Kommentar (2014), Art. 23 para. 2 note 758;
Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 202; Gruber, in: MünchKommBGB (2016), Art. 23
para. 3; Rudolph, Kommentar (1996), Art. 23 para. 2.
17 Ferrari/Torsello, International Sales Law – CISG (2015) p. 156; Mankowski, in: Ferrari et al.,
Internationales Vertragsrecht (2012), Art. 23 CISG para. 9; Schroeter, in: Schlechtriem/Schwenzer, Kom-
mentar (German ed. 2013), Art. 23 para. 3.
18 In accord Dornis, in: Honsell, Kommentar (2010), Art. 23 para. 2; Ferrari, Vendita internazionale di
beni mobili. Artt. 14–24. Formazione del contratto (2006) p. 169; Gruber, in: MünchKommBGB (2016),
Art. 23 para. 4; Magnus, in: Staudinger Kommentar (2013), Art. 23 para. 4.
19 Ferrari/Torsello, International Sales Law – CISG (2015) p. 156; contra Schnyder/Straub, in: Honsell,
Kommentar (1997), Art. 23 para. 5, and Rudolph, Kommentar (1996), Art. 23 para. 4, who prefer to
search for a solution in the applicable domestic law.
21 See also Gruber, in: MünchKommBGB (2016), Art. 23 para. 5; Magnus, in: Staudinger Kommentar
para. 6; Schroeter, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2013), Art. 23 para. 4.
22 For a similar statement, see Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 23
para. 4: “that reservation must be interpreted in order to establish whether consent is to take effect
retroactively or only when given.”
mobili. Artt. 14–24. Formazione del contratto (2006) p. 170; Ferrari/Torsello, International Sales Law –
CISG (2015) p. 156; Hepting/Müller, in: Baumgärtel/Laumen (eds), Handbuch der Beweislast im Priva-
trecht (2009), Art. 23 CISG; in case law, see Landgericht Frankfurt (Germany) 6 July 1994, CISG-Online
257.
24 Official Records (1981), p. 26; Adame Goddard, El Contrato de Compraventa Internacional (1994)
p. 115; Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 203; Dornis, in: Honsell, Kommentar (2010),
Art. 23 para. 5; Farnsworth, in: Bianca/Bonell, Commentary (1987), Art. 23 para. 3.3; Ferrari/Torsello,
International Sales Law – CISG (2015) p. 156–157; Ludwig, Der Vertragsabschluß nach UN-Kaufrecht im
gen Englands und Deutschlands (1994) p. 347; Neumayer/Ming, Convention de Vienne (1993), Art. 23
para. 1; Rudolph, Kommentar (1996), Art. 23 para. 5; Lüderitz/Fenge, in: Soergel (ed), Kommentar zum
BGB. Schuldrechtliche Nebengesetze (2000), Art. 23 para. 2; Magnus, in: Staudinger Kommentar (2013),
Art. 23 para. 8.
25 Compare UNCITRAL YB (1997), p. 81.
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during the Vienna Conference.26 In this author’s opinion,27 one therefore has to resort
to the applicable domestic law to determine the place of conclusion of the contract.28

The results reached by means of the rule set forth in Art. 23 CISG are the same as 7
those that are reached under the PICC, the DCFR and the PECL, even though these
instruments do not contain a provision mirroring Art. 23 CISG, which is unsurprising,
given that Art. 23 CISG is basically superfluous. Rather, the results are to be reached on
the basis of those provisions that constitute the counterparts to Art. 18 CISG. In this
respect, it is worth mentioning that Art. 18(1) CISG, for instance, has its counterpart in
Art. 2.1.6(1) PICC. Art. 18(2) CISG, however, is mirrored in Art. 2.1.6(2) PICC only in
respect to that part that refers to the moment at which an acceptance becomes effective.
As for the rule that addresses the issue of when an acceptance becomes effective that is
indicated by performing an act that exceptionally does not require notice to the offeror
(Art. 18(3) CISG), its counterpart can be found in Art. 2.1.6(3) PICC. Unsurprisingly,
the latter provision does not refer to the examples of such acts (dispatch of the goods or
payment of the price) found in the CISG provision, as the PICC refer to all kind of
contracts, not merely those for the sale of goods.
Provisions dealing – basically in the same way – with the issues addressed by Art. 18 8
CISG can also be found in the DCFR. The relevant provisions are Art. II-4:204,29 where
acceptance is defined, and Art. II-4:205,30 where the issue of time of conclusion of the
contract is addressed.
26See Official Records (1981), pp. 290 et seq.
27See Ferrari, Vendita internazionale di beni mobili. Artt. 14–24. Formazione del contratto (2006)
p. 170.
28 In accord Dornis, in: Honsell, Kommentar (2010), Art. 23 para. 5; Farnsworth, in: Bianca/Bonell,
Commentary (1987), Art. 23 para. 3.3; Ferrari/Torsello, International Sales Law – CISG (2015) p. 157;
Koopverdrag (1997), p. 71 (95); Gruber, in: MünchKommBGB (2016), Art. 23 para. 6; Rudolph, Kom-
mentar (1996), Art. 23 para. 5; Lüderitz/Fenge, in: Soergel (ed), Kommentar zum BGB. Schuldrechtliche
Nebengesetze (2000), Art. 23 para. 2; Magnus, in: Staudinger Kommentar (2013), Art. 23 para. 8;
Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 23 para. 9; Witz/Salger/Lorenz, Kommentar
(2016), Art. 23 para. 6; contra Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 23
para. 7, holding that the issue constitutes an “internal gap” that has to be filled by resorting to the general
principles upon which the CISG is based; for this statement see – unsurprisingly – Schroeter, in:
Schlechtriem/Schwenzer, Commentary (2016), Art. 23 para. 7; in accord Achilles, Kommentar (2000),
Art. 23 para. 3; Adame Goddard, El Contrato de Compraventa Internacional (1994) p. 115; Bernardi,
Nuove leggi civ. comm. (1989) 106 (108); Schroeter, in: Schlechtriem/Schwenzer, Kommentar (German
ed. 2013), Art. 23 para. 7.
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Article 24
For the purposes of this Part of the Convention, an offer, declaration of acceptance
or any other indication of intention “reaches” the addressee when it is made orally to
him or delivered by any other means to him personally, to his place of business or
mailing address or, if he does not have a place of business or mailing address, to his
habitual residence.
Bibliography: Bydlinski, Das allgemeine Vertragsrecht, in: Doralt (ed), Das UNCITRAL-Kaufrecht im
Vergleich zum österreichischen Recht (1985), p. 57; Eörsi, Formation of contract, in: Wiener Überein-
kommen von 1980 über den internationalen Warenkauf (1985), p. 43; Ferrari, Vendita internazionale
di beni mobili. Artt. 14–24. Formazione del contratto (2006); Jung, Die Beweislastverteilung im UN-
Bestimmungen sowie bei gemeinsamen Bestimmungen über Verkäufer- und Käuferpflicht (1996) pp. 80;
Law, dargestellt auf der Grundlage der Rechtsordnungen Englands und Deutschlands (1994); Meeusen,
(1997), p. 71; Noussias, Die Zugangsbedürftigkeit von Mitteilungen nach den Einheitlichen Haager
Kaufgesetzen und nach dem UN-Kaufgesetz (1983); Perales Viscasillas, Contract Conclusion under
CISG, 16 Journal of Law and Commerce (1997) 315; Perales Viscasillas, La formación del contrato de
compraventa internacional de mercaderı́as (1996); Wey, Der Vertragsabschluss beim Internationalen
Warenkauf nach UNCITRAL und schweizerischen Recht (1984).
Outline
1. “Oral” declarations. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2. Declarations by “other means”. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
3. Preventing declarations from reaching the addressee . . . . . . . . . . . . . . . . . . . . . . 15
4. Burden of proof . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

1 This (non-mandatory)1 provision defines when a declaration “reaches” its addressee.2
This definition applies to all declarations relevant for the conclusion of the contract3
(such as offer, revocation of the offer, withdrawal of the offer, rejection of an offer,
acceptance, withdrawal of the acceptance).4 However, this rule does not apply to those
declarations concerning the formation of contract which exceptionally5 become effective
para. 43; Ferrari, Vendita internazionale di beni mobili. Artt. 14–24. Formazione del contratto (2006)
p. 171; Schroeter, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2013), Art. 24 para. 31; Schroeter,
2 Achilles, Kommentar (2000), Art. 24 para. 1; Ferrari/Torsello, International Sales Law – CISG (2015)
p. 157; Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 24 para. 1.
4 See also Dornis, in: Honsell, Kommentar (2010), Art. 24 para. 2; Gruber, in: MünchKommBGB
(2016), Art. 24 para. 1; Pace, Nuove leggi civ. comm. (1989) 109 (109); Rudolph, Kommentar (1996),
Art. 24 para. 1; Witz/Salger/Lorenz, Kommentar (2016), Art. 24 para. 4; Schroeter, in: Schlechtriem/
5 For a reference to the exceptions, see Achilles, Kommentar (2000), Art. 24 para. 1; Ferrari, Vendita
internazionale di beni mobili. Art. 14–24. Formazione del contratto (2006) pp. 172 et seq.; Schnyder/
326 Ferrari
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at a different point in time, such as an act indicating assent, which, pursuant to
Art. 18(3), becomes effective upon its performance,6 or an objection by the offeror to
immaterial modifications and alterations contained in the acceptance, which, like the
approval of a late acceptance,7 becomes effective upon dispatch.8 In other words, the
drafters of the CISG preferred the so-called “receipt-theory”9 over other theories that
determine that the contract is concluded at a different point in time, such as the “theory
of declaration,” the “mail-box-rule”, and the theory on the basis of which the contract is
concluded when the offeror gains knowledge of the acceptance.10
Declarations falling in the sphere of application of Part III CISG, are not generally 2
governed by the rule set forth in Art. 24 with respect to declarations relevant for the
conclusion of a contract;11 rather, they are governed by the “dispatch-rule,” pursuant to
which they become effective upon their dispatch.12 This, however, does not mean that
Art. 24 cannot be applied by analogy13 where Part III expressly requires14 that a
declaration become effective when it “reaches” its addressee.15 Similarly, Art. 24 should
Straub, in: Honsell, Kommentar (1997), Art. 24 para. 6; Lüderitz/Fenge, in: Soergel (ed), Kommentar zum
BGB. Schuldrechtliche Nebengesetze (2000), Art. 24 para. 1.
6 Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 24 para. 4.
7 See Art. 21.
8 Also see Brunner/Pfisterer/Köster, Kommentar (2014), Art. 24 para. 1; Dornis, in: Honsell, Kommen-
tar (2010), Art. 24 para. 2; Ferrari/Torsello, International Sales Law – CISG (2015) p. 157; Jametti Greiner,
Der Vertragsabschluss, in: Hoyer/Posch (eds), Das Einheitliche Wiener Kaufrecht (1992), p. 43 (p. 55);
Magnus, in: Staudinger Kommentar (2013), Art. 24 para. 7; Perales Viscasillas, La formación del contrato
de compraventa internacional de mercaderı́as (1996) pp. 227 (et seq.); Schnyder/Straub, in: Honsell,
9 Eörsi, Formation of contract, in: Wiener Übereinkommen von 1980 über den internationalen Ware-
nkauf (1985), p. 43 (p. 53); Jametti Greiner, Der Vertragsabschluss, in: Hoyer/Posch (eds), Das Einhei-
tliche Wiener Kaufrecht (1992), p. 43 (p. 55); Neumayer/Ming, Convention de Vienne (1993), Art. 24
para. 1; Stoffel, Formation du contrat, in: Wiener Übereinkommen von 1980 über den internationalen
Warenkauf (1985), p. 55 (p. 59); Thieffry/Granier, La vente internationale (1985) p. 71.
10 Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 24 para. 4; Perales Viscasillas, Contract
Conclusion under CISG, 16 Journal of Law and Commerce (1997) 315 (315).
12 Compare Brunner/Pfisterer/Köster, Kommentar (2014), Art. 24 para. 1; Bydlinski, Das allgemeine
Vertragsrecht, in: Doralt (ed), Das UNCITRAL-Kaufrecht im Vergleich zum österreichischen Recht
(1985), p. 57 (65); Ferrari, Vendita internazionale di beni mobili. Artt. 14–24. Formazione del contratto
(2006) p. 173.
13 In accord Farnsworth, in: Bianca/Bonell, Commentary (1987), Art. 24 para. 3.1; Dı́ez-Picazo, in:
Dı́ez-Picazo, Comentario (1998), pp. 204 et seq.; Gruber, in: MünchKommBGB (2016), Art. 24 para. 2;
Herber/Czerwenka, Kommentar (1991), Art. 24 para. 8; Honnold/Flechtner, Uniform Law (2009),
para. 179; Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 24 para. 7; Kritzer, Guide to Practical
Applications of the United Nations Convention on Contracts for the International Sale of Goods (1989)
p. 196; Magnus, in: Staudinger Kommentar (2013), Art. 24 para. 9; Neumayer/Ming, Convention de
Vienne (1993), Art. 24 para. 1; Perales Viscasillas, La formación del contrato de compraventa internacio-
nal de mercaderı́as (1996) p. 231; Rudolph, Kommentar (1996), Art. 24 para. 2; Saenger, in: Bamberger/
Roth (eds), Kommentar zum Bürgerlichen Gesetzbuch (2012), Art. 24 para. 1; Witz/Salger/Lorenz,
14 See, e. g., Arts 47(2), 48(4), 63(2), 65(1), 65(2), 79(4).
15 Arguing in favour of the application by analogy of Art. 24, see Achilles, Kommentar (2000), Art. 24
para. 1; Farnsworth, in: Bianca/Bonell, Commentary (1987), Art. 24 para. 3.1; Brunner/Pfisterer/Köster,
Kommentar (2014), Art. 24 para. 1; Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 205; Enderlein/
Maskow/Strohbach, Internationales Kaufrecht (1991), Art. 24 para. 1; Noussias, Die Zugangsbedürftigkeit
von Mitteilungen nach den Einheitlichen Haager Kaufgesetzen und nach dem UN-Kaufgesetz (1983)
p. 152; Honnold/Flechtner, Uniform Law (2009), para. 179; Kritzer, Guide to Practical Applications of the
United Nations Convention on Contracts for the International Sale of Goods (1989) p. 196; Pace, Nuove
leggi civ. comm. (1989) 109, 111; Lüderitz/Fenge, in: Soergel (ed), Kommentar zum BGB. Schuldrechtliche
Nebengesetze (2000), Art. 24 para. 2; Witz/Salger/Lorenz, Kommentar (2016), Art. 24 para. 6; see, how-
ever, Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 24 paras 2 and 4, for
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apply by analogy to those declarations that per agreement of the parties become
effective upon receipt.16

1. “Oral” declarations
3 The provision distinguishes between declarations made orally and those made “by
any other means.”17 Like the ULF (Uniform Law on the Formation of Contracts for the
International Sale of Goods), the CISG does not distinguish between direct and indirect
means of communication.18 However, the distinction is not irrelevant, as it may be
helpful in defining what is an “oral” declaration: “the provision’s history makes it clear
that ‘oral’ communication was regarded solely as one which could be understood
immediately and the ‘receipt’ of which could instantly be ascertained and queried by
the party who had made it.”19 This means that declarations made over the phone or via
radio have to be treated as “oral” declarations,20 because they immediately reach the ear
of the addressee,21 while declarations left by a person on an answering machine cannot
be treated as “oral” declarations in the sense of the provision at hand.22
4 From the above it also follows that declarations made by electronic means of
communication (Internet, etc.) do not constitute “oral” declarations under Art. 24,23
unless the means used allow for “a direct dialogue similar to one conducted in the
presence of another person (as eg in a ‘chat forum’ over the internet)”.24
5 A declaration made orally by an intermediary with power of representation to the
addressee (or to an intermediary with power of representation for said addressee)
contradicting remarks; whereas in para. 2 the author suggests to apply Art. 24 directly rather than by
analogy to those declarations of Part III that do not become effective upon dispatch, in para. 4 he refers to
the applicability by analogy; see also Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005),
Art. 24 para. 2, who argues that that Art. 24 embodies a general principle upon which the CISG is based
(Art. 7(2)); see also Schroeter, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2013), Art. 24
17 See Audit, Vente Internationale (1990), p. 56; Dornis, in: Honsell, Kommentar (2010), Art. 24 para. 5;
Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 24 para. 5; Schroeter, in: Schlech-
Art. 24 para. 9.
18 Ferrari/Torsello, International Sales Law – CISG (2015) p. 158; see also, in relation to the ULIS
(Uniform Law on the International Sale of Goods), von Caemmerer, Die Haager Konferenz über die
internationale Vereinheitlichung des Kaufrechts vom 2. bis 25 April 1964, RabelsZ (1965) 123 et seq.
20 Compare Dı́ez-Picazo, in: Dı́ez-Picazo, Comentario (1998), p. 205; Dornis, in: Honsell, Kommentar
(2010), Art. 24 para. 5; Karollus, UN-Kaufrecht (1989) p. 57; Gruber, in: MünchKommBGB (2016),
Art. 24 para. 4; Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 24 para. 5; Piltz,
Internationales Kaufrecht (1993) § 3 para. 34; Saenger, in: Bamberger/Roth (eds), Kommentar zum
Bürgerlichen Gesetzbuch (2012), Art. 24 para. 2; Schroeter, in: Schlechtriem/Schwenzer, Commentary
(2016), Art. 24 para. 5.
22 Achilles, Kommentar (2000), Art. 24 para. 2; Dornis, in: Honsell, Kommentar (2010), Art. 24 para. 5;
Art. 24 para. 3; Saenger, in: Bamberger/Roth (eds), Kommentar zum Bürgerlichen Gesetzbuch (2012),
Art. 24 para. 2; Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 24 para. 10; Schroeter, in: Schlech-
23 Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 24 para. 4; Witz/Salger/Lorenz,

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must be treated as an “oral” declaration under Art. 2425 and, therefore, “reaches” the
addressee (or the addressee’s intermediary) at the moment it is made. The question of
who qualifies as an intermediary with power of representation must be answered on the
basis of the applicable domestic law.26 If the intermediary lacks power of representation,
declarations made by or to such an intermediary must be regarded as “non-oral”
declarations.27 As the possibility of interacting, which characterizes oral declarations,28
does not exist where declarations are left on an answering machine,29 these declarations
become effective only when they “reach” the addressee, i. e., when they are being
recorded by the machine.30
“Oral” declarations reach the addressee when they are “made.”31 Some commenta- 6
tors have interpreted the wording of this provision to mean that in order to “reach”
the addressee, the addressee has to have gained knowledge of the declarations.32 This
is not compelling33 because while drafting the CISG the theory pursuant to which a
declaration becomes effective upon it being known by its addressee was expressly
rejected.34 This, however, does not mean that for an oral declaration to “reach” its
addressee it is merely sufficient that the declaration be communicated.35 Rather,
the declaration must be formulated (as regards both its content and language) in a
25 In accord Dornis, in: Honsell, Kommentar (2010), Art. 24 para. 7; Enderlein/Maskow/Strohbach,
Internationales Kaufrecht (1991), Art. 24 para. 6; Farnsworth, in: Bianca/Bonell, Commentary (1987),
Art. 24 para. 2.3; Ferrari, Vendita internazionale di beni mobili. Artt. 14–24. Formazione del contratto
Art. 24 para. 2; Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 24 para. 14; Gruber, in: Münch-
KommBGB (2016), Art. 24 para. 8; Perales Viscasillas, La formación del contrato de compraventa
internacional de mercaderı́as (1996) p. 233; Rudolph, Kommentar (1996), Art. 24 para. 4; Schroeter, in:
Schlechtriem/Schwenzer, Commentary (2016), Art. 24 para. 7; Schroeter, in: Schlechtriem/Schwenzer,
Kommentar (German ed. 2013), Art. 24 para. 7; Wey, Der Vertragsabschluss beim Internationalen
Warenkauf nach UNCITRAL und schweizerischen Recht (1984) para. 795.
26 Brunner/Pfisterer/Köster, Kommentar (2014), Art. 24 para. 3; Dı́ez-Picazo, in: Dı́ez-Picazo, Comen-
tario (1998), p. 206; Herber/Czerwenka, Kommentar (1991), Art. 24 para. 4; Ludwig, Der
dargestellt auf der Grundlage der Rechtsordnungen Englands und Deutschlands (1994) p. 308; Perales
Magnus, in: Staudinger Kommentar (2013), Art. 24 para. 23; Schroeter, in: Schlechtriem/Schwenzer,
27 Ferrari/Torsello, International Sales Law – CISG (2015) p. 159; Rudolph, Kommentar (1996), Art. 24
para. 4; Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 24 para. 14; contra Dornis, in: Honsell,
Kommentar (2010), Art. 24 para. 8; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005),
para. 2; Gruber, in: MünchKommBGB (2016), Art. 24 para. 4; Neumayer/Ming, Convention de Vienne
(1993), Art. 24 para. 3; Lüderitz/Fenge, in: Soergel (ed), Kommentar zum BGB. Schuldrechtliche Neben-
gesetze (2000), Art. 24 para. 3.
30 Perales Viscasillas, Contract Conclusion under CISG, 16 Journal of Law and Commerce (1997) 315
(315); Witz/Salger/Lorenz, Kommentar (2016), Art. 24 para. 8.

31 See Ferrari/Torsello, International Sales Law – CISG (2015) p. 159; Magnus, in: Staudinger Kom-

32 Noussias, Die Zugangsbedürftigkeit von Mitteilungen nach den Einheitlichen Haager Kaufgesetzen
und nach dem UN-Kaufgesetz (1983) pp. 26 et seq.; Owsisa, Formation of Contract, A Comparative Study
under English, French, Islamic and Iranian Law (1994) pp. 550 et seq.; Pace, Nuove leggi civ. comm.
(1989) 109 (109); Perales Viscasillas, La formación del contrato de compraventa internacional de
mercaderı́as (1996) p. 235; Lüderitz/Fenge, in: Soergel (ed), Kommentar zum BGB. Schuldrechtliche
33 See also Gruber, in: MünchKommBGB (2016), Art. 24 para. 6.
34 See UNCITRAL YB (1978), pp. 36 et seq.
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way that would allow a reasonable person of the same kind as the addressee36
(and, therefore, with the same language skills as the addressee or as a reasonable
person involved in the same trade as the addressee),37 and in the same circumstances
(among which one must count the volume of the oral declaration) to gain knowledge
of it.38 Where the declaring party has made such a declaration, the risk of the
declaration being misunderstood lies with the addressee.39
2. Declarations by “other means”

7 All declarations which, irrespective of the means of communication used,40 do not
constitute “oral” declarations must be considered declarations “delivered by any other
means.”41
8 These declarations, which have to have been put in circulation with the declaring
party’s knowledge and approval,42 “reach” the addressee when their delivery occurs.43
Delivery (to be interpreted autonomously)44 occurs when the declaration arrives within
the addressee’s “sphere of control”,45 so as to allow the addressee under normal
circumstances to gain knowledge of the declaration.46 Whether the addressee actually
gains knowledge of the declaration is irrelevant.47 Like the “oral” declaration, the

37 See Oberlandesgericht Hamm (Germany) 8 February 1995, CISG-Online 141.
38 In accord Ferrari/Torsello, International Sales Law – CISG (2015) p. 159; Gruber, in: Münch-
KommBGB (2016), Art. 24 para. 6; Rudolph, Kommentar (1996), Art. 24 para. 6; Schroeter, in: Schlech-
triem/Schwenzer, Kommentar (German ed. 2013), Art. 24 para. 10; see Schroeter, in: Schlechtriem/
Schwenzer, Commentary (2016), Art. 24 para. 11: “a declaration must at least be perceptible”.
39 Contra Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 24 para. 13; Schlechtriem, in: Schlech-

41 Dornis, in: Honsell, Kommentar (2010), Art. 24 para. 10; Lüderitz/Fenge, in: Soergel (ed), Kommen-
tar zum BGB. Schuldrechtliche Nebengesetze (2000), Art. 24 para. 4; Schnyder/Straub, in: Honsell,
42 See also Dornis, in: Honsell, Kommentar (2010), Art. 24 para. 13; Ferrari, in: MünchKommHGB
(2013), Art. 15 para. 6.

43 Achilles, Kommentar (2000), Art. 24 para. 3; Ferrari/Torsello, International Sales Law – CISG (2015)
p. 160.
nales Vertragsrecht (2012), Art. 24 para. 16.

45 See Bydlinski, Das allgemeine Vertragsrecht, in: Doralt (ed), Das UNCITRAL-Kaufrecht im Vergle-
ich zum österreichischen Recht (1985), p. 57 (p. 64); Neumayer/Ming, Convention de Vienne (1993),
Art. 24 para. 1; Schlechtriem/Schroeter, Internationales UN-Kaufrecht (2013) para. 293; Schnyder/Straub,
in: Honsell, Kommentar (1997), Art. 24 paras 2 and 20; Schroeter, in: Schlechtriem/Schwenzer, Commen-
tary (2016), Art. 24 para. 18; Witz/Salger/Lorenz, Kommentar (2016), Art. 24 para. 11.
para. 2; Dornis, in: Honsell, Kommentar (2010), Art. 24 para. 14; Farnsworth, in: Bianca/Bonell, Com-
mentary (1987), Art. 24 para. 2.4; Ferrari, Vendita internazionale di beni mobili. Artt. 14–24. Formazione
del contratto (2006) p. 178; Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 24 para. 20; Ludwig,
dargestellt auf der Grundlage der Rechtsordnungen Englands und Deutschlands (1994) p. 303; Gruber, in:
MünchKommBGB (2016), Art. 24 para. 13; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary
(2005), Art. 24 para. 13; Magnus, in: Staudinger Kommentar (2013), Art. 24 para. 15; Mankowski, in:
Ferrari et al., Internationales Vertragsrecht (2012), Art. 24 para. 17; Wey, Der Vertragsabschluss beim
Internationalen Warenkauf nach UNCITRAL und schweizerischen Recht (1984) paras 795 et seq.
47 Official Records (1981), p. 26; Farnsworth, in: Bianca/Bonell, Commentary (1987), Art. 24 para. 24;
Enderlein/Maskow/Strohbach, Internationales Kaufrecht (1991), Art. 24 para. 4; Schnyder/Straub, in:

Honsell, Kommentar (1997), Art. 24 para. 20; Meeusen, Totstandkoming van de Overeenkomst, in: van
Houtte/Erauw/Wautelet (eds), Het Weens Koopverdrag (1997), p. 71 (96); Neumayer/Ming, Convention
de Vienne (1993), Art. 24 para. 1; Pace, Nuove leggi civ. comm. (1989) 109 (110); Rudolph, Kommentar
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declaration delivered by any other means must also be formulated in a way to allow a
reasonable person in the same circumstances as the addressee to understand it.48 This
means, for instance, that the language used must generally be one that is known to the
addressee.49 The fact that the addressee knows a given language may be derived, for
example, from previous business relations between the declaring party and the addres-
see, or from the bargaining process.50 Likewise, where the language is one generally used
by parties to contracts of the type involved in the particular trade concerned, its use
does not affect the issue of whether the declaration has “reached” its addressee.51 Use of
the English language does not allow one to state that the declaration is always and
necessarily comprehensible, as knowledge of English cannot be assumed.52 The CISG
does not require the addressee to have the statements translated.53
Delivery by service of process can be, but is not necessarily always sufficient for a 9
declaration to be considered as having reached its addressee.54
Art. 24 allows for delivery of non-oral declarations by different means without 10
requiring, unlike Art. 27, that those means be “appropriate in the circumstances”.55 In
effect, non-oral declarations can be handed over personally56 to the addressee (or to the
addressee’s representative).57 Where the delivery occurs by handing over the non-oral
declarations personally, the place of delivery is irrelevant;58 thus, delivery can occur in a
hotel, at the addressee’s place of business, at the addressee’s place of sojourn, etc.59
Alternatively, delivery may take place at the addressee’s habitual residence or mailing 11
address.60 Therefore, a letter posted in the addressee’s mailbox61 must be considered as
Schlechtriem/Schwenzer, Kommentar (German ed. 2013), Art. 24 para. 18; Schroeter, in: Schlechtriem/
48 See Oberlandesgericht Hamm (Germany) 8 February 1995, CISG-Online 141.
49 Ferrari/Torsello, International Sales Law – CISG (2015) p. 160; for a reference to language problems
as an impediment for effectiveness, see, apart from Oberlandesgericht Hamm (Germany) 8 February 1995,
CISG-Online 141, Amtsgericht Kehl (Germany) 6 October 1995, CISG-Online 162.
51 See Brunner/Pfisterer/Köster, Kommentar (2014), Art. 24 para. 2; Schlechtriem, in: Schlechtriem/
Schwenzer, Commentary (2005), Art. 24 para. 16; in case law, see Oberlandesgericht Hamm (Germany)
8 February 1995, CISG-Online 141.
52 See also Oberlandesgericht Hamm (Germany) 8 February 1995, CISG-Online 141; in legal writing,
see Dornis, in: Honsell, Kommentar (2010), Art. 24 para. 38; Ferrari, Vendita internazionale di beni
Art. 24 para. 19; Schroeter, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2013), Art. 24
para. 38; contra Kühl/Hingst, Das UN-Kaufrecht und das Recht der AGB, in: Festgabe Herber (1999)
p. 50 (53); Lüderitz/Fenge, in: Soergel (ed), Kommentar zum BGB. Schuldrechtliche Nebengesetze (2000),
53 In accord Dornis, in: Honsell, Kommentar (2010), Art. 24 para. 38; contra Witz/Salger/Lorenz,

CISG (2015) p. 161; Gruber, in: MünchKommBGB (2016), Art. 24 para. 12; Schroeter, in: Schlechtriem/
55 Ferrari/Torsello, International Sales Law – CISG (2015) p. 161; Schlechtriem, in: Schlechtriem/

56 See Official Records (1981), p. 26; Witz/Salger/Lorenz, Kommentar (2016), Art. 24 para. 12.
57 See Ferrari/Torsello, International Sales Law – CISG (2015) p. 161.
Art. 24 para. 24; Herber/Czerwenka, Kommentar (1991), Art. 24 para. 3; Gruber, in: MünchKommBGB
(2016), Art. 24 para. 21; Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 24
para. 19.
60 See Rechtbank Amsterdam (Netherlands) 5 October 1994, CISG-Online 446.
61 Dornis, in: Honsell, Kommentar (2010), Art. 24 para. 25; Piltz, Internationales Kaufrecht (2008),
para. 3-39.
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reaching the addressee just as a letter inserted into the addressee’s post office box62 or a
message left on the addressee’s answering machine.63 Similarly, a telefax reaches the
addressee when the addressee’s telefax machine prints the declaration,64 provided that
the telefax machine is under the addressee’s control.65 If the telefax machine is not
under the addressee’s control, the telefax reaches the addressee when a printed copy of
the telefax is delivered to the addressee.66 If printing is not possible because the telefax
machine ran out of paper, one has to assume that the declaration has nevertheless
reached the addressee.67 Dropping a notice into the addressee’s mailbox informing the
addressee about a registered mailed letter also qualifies as delivery under Art. 24.68 The
view that in these cases the declaration “reaches” its addressee only at the beginning of
the next business day is not convincing.69 Emails reach ther addressee when they enter
the server.70
12 Delivery at the addressee’s place of habitual residence, a concept that corresponds to
that found in Art. 10,71 amounts to a delivery that allows the declaration to “reach” the
addresse for the purposes of Art. 24 only where the addressee does not have a place of
business or mailing address.72 If a declaration is delivered to the addressee’s place of
habitual residence despite the fact that the addressee has a place of business or a mailing
address, the declaration is treated as if it never reached the addressee.73 However, if the
addressee gains knowledge of the declaration, he may not invoke the fact that the
declaration was delivered at the wrong place.74 This can be derived from the CISG’s
general principle of good faith.75 The fact that the addressee gains knowledge of the
62 Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 24 para. 12; Wey, Der Vertrag-
sabschluss beim Internationalen Warenkauf nach UNCITRAL und schweizerischen Recht (1984)
63 Ferrari/Torsello, International Sales Law – CISG (2015) p. 161; Neumayer/Ming, Convention de

64 See also Witz/Salger/Lorenz, Kommentar (2016), Art. 24 para. 11; contra Piltz, Internationales
Kaufrecht (2008), para. 20; Gruber, in: MünchKommBGB (2016), Art. 24 para. 13; Brunner/Pfisterer/
Köster, Kommentar (2014), Art. 24 para. 2; Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 24
para. 23; Neumayer/Ming, Convention de Vienne (1993), Art. 24 para. 3.
65 See Ferrari/Torsello, International Sales Law – CISG (2015) p. 161; Neumayer/Ming, Convention de
Vienne (1993), Art. 24 para. 3; Achilles, Kommentar (2000), Art. 24 para. 4.

(2016), Art. 24 para. 14; Neumayer/Ming, Convention de Vienne (1993), Art. 24 para. 3.
68 Ferrari/Torsello, International Sales Law – CISG (2015) p. 161–162; Perales Viscasillas, Contract
Conclusion under CISG, 16 Journal of Law and Commerce (1997) 315 (315); Schnyder/Straub, in:
Honsell, Kommentar (1997), Art. 24 para. 23; contra Dornis, in: Honsell, Kommentar (2010), Art. 24
para. 23; Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 24 para. 12; Schroeter, in:
Schlechtriem/Schwenzer, Kommentar (German ed. 2013), Art. 24 para. 20; Wey, Der Vertragsabschluss
beim Internationalen Warenkauf nach UNCITRAL und schweizerischen Recht (1984) para. 804.
69 See, however, Herber/Czerwenka, Kommentar (1991), Art. 24 para. 6.
71 Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 24 para. 21.
(2006) p. 180; Ferrari/Torsello, International Sales Law – CISG (2015) p. 162; Gruber, in: Münch-
KommBGB (2016), Art. 24 para. 21; Jametti Greiner, Der Vertragsabschluss, in: Hoyer/Posch (eds), Das
Einheitliche Wiener Kaufrecht (1992), p. 43 (p. 55); Pace, Nuove leggi civ. comm. (1989) 109 (109);
73 Neumayer/Ming, Convention de Vienne (1993), Art. 24 para. 2; Witz/Salger/Lorenz, Kommentar
(2016), Art. 24 para. 14.

74 For this conclusion see also Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2012),
Art. 24 para. 22.

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declaration also entails that the declaring party is bound by the declaration, provided
that delivery at the wrong place is to be imputed to the declaring party – this results
from the CISG’s general principle pursuant to which it is prohibited to venire contra
factum proprium.76
An issue closely related to the one of when a declaration reaches its addressee is that 13
of delivery outside business hours. Some commentators hold that a declaration deliv-
ered outside business hours, such as a telefax received after the closing of the store,
reaches the addressee only at the beginning of the next business day.77 This view cannot
be shared,78 because it would shift the risks relating to the communication from the
addressee to the declaring party.79 Hence, under the CISG declarations delivered outside
business hours “reach” the addressee at the moment when they are delivered pursuant
to Art. 24.80
What has been said in regards to non-oral declarations also applies to notices 14
addressed to the offeror that an act indicating assent has been performed, where the
notice is not superfluous on account “of the offer or as a result of practices which the
parties have established between themselves or of usage.”81
3. Preventing declarations from reaching the addressee

The drafters of the CISG did not lay down specific rules dealing with the addressee’s 15
conduct (consisting, for instance, of disconnecting a telefax, refusing to accept a letter,
etc.) that results in a declaration not reaching the addressee.82 In this author’s opinion,
this should not lead one to automatically resort to the applicable domestic law to resolve
the issue.83 Rather, the issue is to be resolved on the basis of the general principles
underlying the CISG,84 pursuant to which it is prohibited to venire contra factum
76 The prohibition to venire contra factum proprium is often considered a general principle upon which
the CISG is based; see, e. g., Audit, Vente Internationale (1990), pp. 51 et seq.; Ferrari, Das Verhältnis
zwischen den UNIDROIT-Grundsätzen und den allgemeinen Grundsätzen internationaler Einheitspriva-
trechtkonventionen. Zugleich ein Beitrag zur Lückenfüllung durch staatliche Gerichte, JuristenZeitung
(1998) 9 (12); Ferrari, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2013), Art. 7 para. 50;
Herber/Czerwenka, Kommentar (1991), Art. 7 para. 6.
77 Audit, Vente Internationale (1990), p. 56; Saenger, in: Bamberger/Roth (eds), Kommentar zum
Bürgerlichen Gesetzbuch (2012), Art. 24 para. 4; Herber/Czerwenka, Kommentar (1991), Art. 24 para. 6;
(2000), Art. 24 para. 5; Wey, Der Vertragsabschluss beim Internationalen Warenkauf nach UNCITRAL
und schweizerischen Recht (1984) para. 803.
78 In accord Brunner/Pfisterer/Köster, Kommentar (2014), Art. 24 para. 3; Dornis, in: Honsell, Kom-
mentar (2010), Art. 24 paras 17 and 36; Enderlein/Maskow/Strohbach, Internationales Kaufrecht (1991),
Art. 24 para. 4; Ferrari/Torsello, International Sales Law – CISG (2015) p. 162–163; Karollus, UN-
Kaufrecht (1989) p. 59; Meeusen, Totstandkoming van de Overeenkomst, in: van Houtte/Erauw/Wautelet
(eds), Het Weens Koopverdrag (1997), p. 71 (96); Perales Viscasillas, La formación del contrato de
compraventa internacional de mercaderı́as (1996) p. 243; Piltz, Internationales Kaufrecht (1993) § 3
para. 37; contra Herber/Czerwenka, Kommentar (1991), Art. 24 para. 6.
79 See also Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 24 para. 14.
80 Contra Jametti Greiner, Der Vertragsabschluss, in: Hoyer/Posch (eds), Das Einheitliche Wiener
Kaufrecht (1992), p. 43 (55), suggesting that one should refer to a general principle without, however,
identifying the general principle.
81 In accord Dornis, in: Honsell, Kommentar (2010), Art. 24 para. 30; Magnus, in: Staudinger Kom-

CISG (2015) p. 163; Neumayer/Ming, Convention de Vienne (1993), Art. 24 para. 4.

83 Ferrari, Vendita internazionale di beni mobili. Artt. 14–24. Formazione del contratto (2006) pp. 182
et seq.
84 See also Gruber, in: MünchKommBGB (2016), Art. 24 para. 23; Neumayer/Ming, Convention de
Ferrari 333
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proprium.85 Where the addressee consciously or intentionally86 prevents a declaration

from reaching him, the declaration must be considered as having reached the addressee
“at the moment when it would have done so, had [the addressee] not prevented that
event”,87 i. e., at the moment the declaration would have reached the addressee under
“normal” circumstances.88
4. Burden of proof
16 The party invoking the fact that the declaration has reached the addressee must prove
this fact,89 irrespective of whether that party is the declaring party or the addressee.90
17 If receipt of the declaration fails because it has been prevented, the party invoking
that the declaration would have reached the addressee at a given time must prove that
proper delivery has been attempted and that the declaration did not reach the addressee
due to factors lying solely within the addressee’s sphere of control.91

18 Art. 24 CISG is not the only provision to be found in international instruments that
deales with the issue of when a communication “reaches” its addressee. Art. 1.10(3)
PICC also deals with that issue, by stating that “a notice ‘reaches’ a person when given
to that person orally or delivered at that person’s place of business or mailing address.”
Even a cursory reading of the two provisions shows that there is a difference, in that
Art. 1.10(3) PICC does not refer to the addressee’s habitual residence, unlike Art. 24
CISG. One has to wonder, therefore, whether a notice delivered at the habitual residence
of the addressee can at all be effective. In this author’s opinion, the answer should be
85 See also Ferrari, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2013), Art. 7 para. 48.
86 Negligence by itself is insufficient; in accord Schnyder/Straub, in: Honsell, Kommentar (1997),
Art. 24 para. 41; Magnus, in: Staudinger Kommentar (2013), Art. 24 para. 25; contra Karollus, UN-
Kaufrecht (1989) p. 60.
87 Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 24 para. 17; Saenger, in: Bam-
berger/Roth (eds), Kommentar zum Bürgerlichen Gesetzbuch (2012), Art. 24 para. 5; Brunner/Pfisterer/
Köster, Kommentar (2014), Art. 24 para. 4; Herber/Czerwenka, Kommentar (1991), Art. 24 para. 5;
Karollus, UN-Kaufrecht (1989) p. 60.
Art. 24 para. 41; Ferrari/Torsello, International Sales Law – CISG (2015) p. 162; Mankowski, in: Ferrari
et al., Internationales Vertragsrecht (2012), Art. 24 para. 28; Schroeter, in: Schlechtriem/Schwenzer,
Kommentar (German ed. 2013), Art. 24 para. 42.
para. 44; Gruber, in: MünchKommBGB (2016), Art. 24 para. 27; Jung, Die Beweislastverteilung im UN-
Bestimmungen sowie bei gemeinsamen Bestimmungen über Verkäufer- und Käuferpflicht (1996) pp. 80
et seq.; Magnus, in: Staudinger Kommentar (2013), Art. 24 para. 26; Mankowski, in: Ferrari et al.,
Internationales Vertragsrecht (2012), Art. 24 para. 30; Reimers-Zocher, Beweislastfragen im Haager und
Wiener Kaufrecht (1995) p. 189; Saenger, in: Bamberger/Roth (eds), Kommentar zum Bürgerlichen
Gesetzbuch (2012), Art. 24 para. 6; Schroeter, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 24
90 In accord Hepting/Müller, in: Baumgärtel/Laumen (eds), Handbuch der Beweislast im Privatrecht
(2009), Art. 24 CISG para. 1; Jung, Die Beweislastverteilung im UN-Kaufrecht insbesondere bei
Vertragsabschluß, bei Vertragsverletzungen des Käufers, bei allgemeinen Bestimmungen sowie bei
gemeinsamen Bestimmungen über Verkäufer- und Käuferpflichten (1996) pp. 82 et seq.
91 Hepting/Müller, in: Baumgärtel/Laumen (eds), Handbuch der Beweislast im Privatrecht (2009),
Art. 24 CISG para. 8; Ferrari, Vendita internazionale di beni mobili. Artt. 14–24. Formazione del contra-
tto (2006) p. 183; Jung, Die Beweislastverteilung im UN-Kaufrecht insbesondere bei Vertragsabschluß, bei
Vertragsverletzungen des Käufers, bei allgemeinen Bestimmungen sowie bei gemeinsamen Bestimmungen
über Verkäufer- und Käuferpflichten (1996) p. 89; Gruber, in: MünchKommBGB (2016), Art. 24 para. 27.
334 Ferrari
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positive, at least where the addressee has neither a place of business or a mailing
address. This is the solution adopted not only by Art. 24 CISG, but also by Art. 1:303(3)
PECL and by the DCFR. As regards the latter instrument, however, it is made clear that
a notice delivered to the habitual residence is effective not only when the addressee has
no place of business, but even where there is such place of business but “the notice does
not relate to a business matter.”92
It is worth pointing out that the DCFR also determines when a notice transmitted by 19
electronic means “reaches” its addressee: “when it can be accessed by the addressee”.93
Art. 10 of the 2005 United Nations Convention on the Use of Electronic Communica-
tions in International Contracts is – unsurprisingly – more specific on the issue and
states that “[t]he time of receipt of an electronic communication is the time when it
becomes capable of being retrieved by the addressee at an electronic address designated
by the addressee […]. An electronic communication is presumed to be capable of being
retrieved by the addressee when it reaches the addressee’s electronic address.”
92 Art. I-1:109(4)(b) DCFR.
93 Art. I-1:109(4)(c) DCFR.
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PART III
Sale of Goods
Chapter I
General Provisions
Article 25
A breach of contract committed by one of the parties is fundamental if it results in
such detriment to the other party as substantially to deprive him of what he is
entitled to expect under the contract, unless the party in breach did not foresee and a
reasonable person of the same kind in the same circumstances would not have
foreseen such a result.
Bibliography: Babiak, Defining “Fundamental Breach” Under the United Nations Convention on Contracts
for the International Sale of Goods, 6 Temple International and Comparative Law Journal (1992) 113;
Ferrari, Fundamental Breach Under the UN Sales Convention: 25 Years of Article 25 CISG, 25 Journal of
Law and Commerce (2005–06) 489; Graffi, Case Law on the Concept of “Fundamental Breach” in the
Vienna Sales Convention, 3 Revue de droit des affaires internationales (2003) 337; Karambelas, United
Nations Convention on the International Sale of Goods: An International Law as Domestic Law, Washington
Lawyer (April 2009) 27; Koch, The Concept of Fundamental Breach under the United Nations Convention
on Contracts for the International Sale of Goods, Review of the Convention on Contracts for the
International Sale of Goods (CISG) (1998) 177; Magnus, The Remedy of Avoidance of Contract Under
CISG – General Remarks and Special Cases, 25 Journal of Law and Commerce (2005–06) 423; Mullis,
Avoidance for breach under the Vienna Convention; a critical analysis of some of the early cases, in:
Andreas/Jarborg (eds), Anglo-Swedish Studies in Law (1998), p. 326; Perales Viscasillas, The Nachfrist
Remedy, in: Celebrating Success: 25 Years United Nations Convention on Contracts for the International
Sale of Goods (2005), p. 91; Reiley, International Sales Contracts: The UN Convention and Related
Transnational Law (2008); Rustad, Understanding Sales, Leases, and Licenses in a Global Perspective
(2008); Schlechtriem, Subsequent Performance and Delivery Deadlines- Avoidance of CISG Sales Contracts
Due to Non-conformity of the Goods, 18 Pace International Law Review (2006) 82; Schlechtriem, Basic
Structures and General Concepts of the CISG as Models for a Harmonisation of the Law of Obligations, 10
Juridica International (2005) 27; Schlechtriem, Interpretation, Gap-Filling and Further Developments of the
U. N. Sales Convention, 16 Pace International Law Review (2004) 279; Schwenzer, Avoidance of the Contract
in Case of Non-Conforming Goods (Article 49(1)(A) CISG), 25 Journal of Law and Commerce (2005–06)
437; Schwenzer/Hachem, The CISG – Successes and Pitfalls, 57 American Journal of Comparative Law (2009)
457; Whittington, Reconsidering Domestic Sale of Goods Remedies in Light of the CISG, 37 Victoria
University of Wellington Law Review (2006) 421; CISG-AC Opinion no 5, The buyer’s right to avoid the
contract in case of non-conforming goods or documents, 7 May 2005. Rapporteur: Professor Dr. Ingeborg
Schwenzer, LL.M., Professor of Private Law, University of Basel (at http://www.cisg-ac.org).
Outline
1. Departure from domestic laws. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
2. Requirements for fundamental breach . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
a) Detriment to the other party resulting in substantial deprivation . . . . . . 10
b) Foreseeability. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
3. Examples of fundamental breach . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
a) Non-performance and anticipatory repudiation . . . . . . . . . . . . . . . . . . . . . . . . . 28
b) Late performance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
c) Deficient goods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
d) Ancillary contractual obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
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Article 25 1–4 Part III. Sale of Goods

e) Documentary transactions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
f) Relationship to ability to cure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47

1 Art. 25 is the first of the so-called “General Provisions.” It sets forth a definition of
“fundamental breach,” a crucial concept in that it dictates what remedies are available
to an injured party under the CISG. The remedy of avoidance – of the injured party’s
right to terminate the contract, thereby cancelling any remaining obligations under the
contract, and to seek appropriate remedies from the breaching party – hinges on the
existence of a fundamental breach.1 The decision that a breach is fundamental affects
the buyer’s entitlement to arrange for substitute delivery and the question of who carries
the risk in the case of delivery of defective goods.2 Failures in performance that do not
rise to the level of fundamental breach will permit an injured party to seek only more
limited remedies, such as an action for damages.3

2 Art. 25 sets a deliberately high threshold for what constitutes a fundamental breach
that will excuse performance under the contract. It gives primacy to performance for
philosophical and practical reasons. Philosophically, the drafters of the CISG were
influenced by the civil law’s preference for performance.4 Practically, Art. 25 recognises
the likelihood that in cases where shipment of goods has already occurred, unwinding
the transaction will make the entire transaction more expensive.5 It is a departure from
the perfect-tender rule of Anglo-American law, which permits a buyer to reject goods
on the basis of any non-conformity, and also sets a higher standard than the old, and to
a lesser extent the new, German civil code.6
3 Either the buyer or the seller can declare a fundamental breach, but the remedy is likely
to be used more often by the seller than by the buyer. The most likely breach committed by
the buyer will be a failure to pay for the performance the seller has already delivered.7
Nonetheless, in appropriate circumstances the seller retains the ability to avoid the contract.
4 The legal consequences of a fundamental breach are derived from other CISG
provisions. Art. 25 can only be applied in conjunction with those other provisions that
are triggered by the existence of a fundamental breach.8
1See commentary to Arts 49(1) and 64(1), infra.

2Ferrari, Fundamental Breach Under the UN Sales Convention: 25 Years of Article 25 CISG, 25
Journal of Law and Commerce (2005–06) 489 (490).
3 Every breach, no matter how minor, will support a claim for compensation in damages, Honold,
Uniform Law (2009), Art. 25 para. 181.2.

4 Ferrari, Fundamental Breach Under the UN Sales Convention: 25 Years of Article 25 CISG, 25
Journal of Law and Commerce (2005–06) 489 (490 et seq., 496 fn. 56).
5 Schlechtriem, Subsequent Performance and Delivery Deadlines- Avoidance of CISG Sales Contracts
Due to Non-conformity of the Goods, 18 Pace Int’l Law Review (2006) 82 (83 et seq.) (Pace). Professor
Schlechtriem questioned how often this rationale holds true in practice (93 et seq.). Accord Honnold,
Uniform Law (2009), Art. 25 para. 181.2.
6 Schlechtriem, Subsequent Performance and Delivery Deadlines- Avoidance of CISG Sales Contracts
Due to Non-conformity of the Goods, 18 Pace Int’l Law Review (2006) 82 (83 et seq.) (Pace).
7 Karambelas, United Nations Convention on the International Sale of Goods: An International Law as
Domestic Law, Washington Lawyer (April 2009) 27 (32).

Journal of Law and Commerce (2005–06) 489 (490); Kritzer, Guide to Practical Applications of the
338 Björklund
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Chapter I. General Provisions 5–7 Article 25

If a party is entitled to refuse to perform, then there is no fundamental breach.9 A 5
fundamental breach might also be excused if one of the exemptions under Art. 79
applies to the contract. In the case of a change of circumstances, an injured party cannot
rely on a fundamental breach but must accept a reasonable change of terms.10
1. Departure from domestic laws

The principle of fundamental breach is not drawn from any domestic laws.11 Al- 6
though English law contains a principle entitled “fundamental breach,” its sphere of
application is different and it cannot be used to interpret the CISG provision.12 Art. 25
must be interpreted in light of its international character.13 This admonition has not
stopped national courts from issuing decisions influenced by their respective tradi-
tions.14 German courts have been particularly reluctant to find that conduct amounts to
fundamental breach.15 French, Austrian, and U.S. courts have been more prone to
finding a fundamental breach that justifies avoidance of the contract.16
The requirement that a breach be fundamental in order to permit avoidance of the 7
contract by the injured party is one of the more controversial CISG rules in the view of
common lawyers.17 In the context of the sale of goods, Anglo-American law developed
the “perfect-tender rule” in the latter part of the nineteenth century.18 It is analogous to
a condition precedent to the duty to perform: “the buyer’s obligation to accept and pay
for the goods is subject to a condition precedent that the seller must have made a perfect
United Nations Convention on Contracts for the International Sale of Goods (1989) pp. 200 seq. In
addition to Arts 49(1) and 64(1), other linked provisions include Arts 51(2), 64(1)(a), 70, 72(1), 73(1) and
(2), and 46(2). See generally Koch, The Concept of Fundamental Breach under the United Nations
Convention on Contracts for the International Sale of Goods, Review of the Convention on Contracts for
the International Sale of Goods (CISG) (1998) 177 (300 et seq.).
10 Schwenzer/Hachem, The CISG – Successes and Pitfalls, 57 American Journal of Comparative Law
(2009) 457 (475).


Journal of Law and Commerce (2005–06) 489 (490 et seq.); Honnold, Uniform Law (2009), Art. 25
para. 181.1. The doctrine of fundamental breach in English law acts to overcome contractual provisions
restricting a buyer’s right to recover for defective goods.
13 Gabriel, Contracts for the Sale of Goods: A Comparison of US and International Law (2009) p. 108.
14 See, e.g., Supreme Court of Justice Ontario (Canada) 6 October 2003 (Vacuum panel insulation),
Diversitel Communications Inc. v Glacier Bay, Inc., CISG-Online 1436 (Pace) (holding that the common
law standard for “material breach” is the same as the CISG’s “fundamental breach” and then erroneously
applying the common law); Arbitral Award, Tribunal of International Commercial Arbitration at the
Russian Federation Chamber of Commerce and Industry 21/2005, 18 October 2005 (Varnish and paint
machine), CISG-Online 1457 (Pace) (assessing fundamental breach by reference to the quality of the
goods required by the Russian Civil Code). The confusion in national courts is understandable. The idea
of material breach is drawn from the doctrine of conditions: one party’s failure to perform a condition
under the contract excuses the other party from performing its own duties. Restatement of the Law
(Second) of Contracts (1981), s. 237. It has been replaced by the perfect tender rule in the sale of goods
context.
15 Schlechtriem, Subsequent Performance and Delivery Deadlines – Avoidance of CISG Sales Contracts
Due to Non-conformity of the Goods, 18 Pace Int’l Law Review (2006) 82 (93) (Pace).
17 Mullis, Avoidance for breach under the Vienna Convention; a critical analysis of some of the early
cases, in: Andreas/Jarborg (eds), Anglo-Swedish Studies in Law (1998), p. 326 (pp. 333 et seq.) (Pace).
18 Reiley, International Sales Contracts: The UN Convention and Related Transnational Law (2008),
p. 99. Systems based on Roman law knew a similar rule. Schlechtriem, Basic Structures and General
Concepts of the CISG as Models for a Harmonisation of the Law of Obligations, 10 Juridica International
(2005) 27 (31).
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tender.”19 It was incorporated into the UCC in the U.S. Thus, if goods deviate in any
way from the contractual specifications in a contract governed by the UCC, the buyer
has the right to refuse delivery and to claim breach.20 The purpose of the perfect-tender
rule is to protect the buyer. The buyer does not have to guess what might amount to a
material breach, and the buyer does not have to disclose proprietary information in the
course of arguing why some small departure from the specifications is important.21
English law is to similar effect.22
8 The perfect-tender rule in the UCC applies prior to acceptance; once a buyer has
accepted the goods, he or she must prove that a later-discovered non-conformity
“substantially impairs” the value of the goods.23 The perfect-tender rule is limited in
other ways as well. If the non-conforming goods are delivered before the period for
performance has expired, the seller has a right to cure.24 Even if there is no time left for
performance, the seller might be able to cure if he reasonably believed the goods were
acceptable.25 In addition, the perfect-tender rule does not apply to instalment contracts.
Rather, the question in instalment contracts is: does the non-conformity “substantially
impair” the value of the instalment and can it be cured?26 English law also places some
limits on the perfect tender rule if, for example, “the breach is so slight that it would be
unreasonable for [the buyer] to reject them.”27 Thus, even though the perfect-tender
rule is more pro-buyer than the fundamental breach rule of the CISG, it is not without
limits.28
2. Requirements for fundamental breach

9 The definition of fundamental breach in Art. 25 is less than precise. Indeed, it has
been said that the rule “is open to criticism on the ground that it is likely to lead to
uncertainty since the open-textured nature of the definition in Art. 25 makes it hard to
predict just when a breach will be regarded as ‘fundamental.’”29 Determinations are
fact-specific, and it is possible only to make general predictions as to what types of
behaviour will be found to result in a fundamental breach.30 The fundamental breach
inquiry has two components: substantial deprivation and foreseeability.
10 a) Detriment to the other party resulting in substantial deprivation. The CISG does
not define “detriment” or “substantial deprivation.” The UNCITRAL Secretariat’s official
p. 99.
20 UCC § 2–601.
21 Honnold/Reitz, Sales Transactions: Domestic and International Law (2001) p. 390.
cases, in: Andreas/Jarborg (eds), Anglo-Swedish Studies in Law (1998), p. 326 (p. 330 et seq.) (Pace).
23 UCC § 2–608(1).
24 UCC § 2–508(1).
25 UCC § 2–508(2).
26 UCC § 2–612(2). It is not clear why different rules apply to instalment contracts and single-sale
contracts. Reiley, International Sales Contracts: The UN Convention and Related Transnational Law
(2008), p. 101 note 26. The most likely explanation is that an instalment contract has a long period for
performance and the assumption is that any imperfection can be cured before performance is finally due.
27 S. 15A Sale of Goods Act 1979(1)(b). This rule applies when the buyer is not a consumer, and a
buyer might still have an action under breach of warranty.

28 Rustad, Understanding Sales, Leases, and Licenses in a Global Perspective (2008) pp. 284, 305.
29 Treitel, in: Guest, Benjamin’s Sale of Goods (1997) paras 18–116. See also Schwenzer/Hachem, The
CISG – Successes and Pitfalls, 57 American Journal of Comparative Law (2009) 457 (468); Graffi, Case
Law on the Concept of “Fundamental Breach” in the Vienna Sales Convention, 3 Revue de droit des
affaires internationales (2003) 337 (337) (Pace).
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commentary on the 1978 draft said that “The determination whether the [detriment] is
substantial must be made in the light of the circumstances of each case, e. g., the monetary
value of the contract, the monetary harm caused by the breach, or the extent to which the
breach interferes with other activities of the injured party.”31
The idea of “detriment” has been described as a filter for those cases in which breach 11
of a fundamental obligation has occurred but has caused no injury.32 Such cases will
presumably be rare; in most cases, the focus of the inquiry will be on whether there has
been a substantial deprivation of what the injured party expected to receive under the
contract. If there has been such a deprivation, the injured party will have incurred a
detriment.33 Cumulative violations of various contractual obligations might make the
finding of a fundamental breach more probable, but do not automatically amount to a
fundamental breach.34
It is clear that the standard for fundamentality is high: “[a] breach of contract is 12
fundamental when the purpose of the contract is endangered so seriously that, for the
concerned party to the contract, interest in the fulfillment of the contract ceases to exist
as a consequence of the breach of contract.”35 For a breach to be fundamental, it must
“concern the essential content of the contract, the goods, or the payment of the price
concerned, and it must lead to serious consequences to the economic goal pursued by
the parties.”36 Though monetary harm is one component to be considered in establish-
ing a breach, this does not mean either that significant monetary harm always equates
to a fundamental breach, or that significant monetary harm is necessary for there to be
a fundamental breach. Rather, the question is whether the impairment suppressed the
damaged party’s interest in performance of the contract, or whether that party cannot
be expected to be satisfied with damages that fall short of termination.37 The injuring
party must know that the injured party considered performance of the breached
contractual clause “so essential that he would have refused the contract if he had known
of such future breach.”38
Factors such as loss of the injured party’s reputation are relevant.39 One important 13
question is whether the interests of the non-breaching party can be satisfied by the
payment of damages, rather than by the last resort of termination.40
The language of the provision occasioned a good deal of discussion among the 14
delegates at the Convention.41 The general consensus was that it contained both subjective
31Secretariat Commentary on 1978 Draft, Art. 23 (now Art. 25) para. 3.

32Koch, in: Felemegas (ed), An International Approach to the Interpretation of the United Nations
Convention on Contracts for the International Sale of Goods (1980) as Uniform Sales Law (2007), p. 126;
Will, in: Bianca/Bonell, Commentary (1987), Art. 25 para. 2.1.1.2.
33 Huber, in: Huber/Mullis, The CISG (2007), p. 214.
34 Bundesgerichtshof (Germany) 3 April 1996 (Cobalt sulfate), CISG-Online 135 (Pace).
35 Oberlandesgericht Frankfurt (Germany) 17 September 1991 (Shoes), CISG-Online 28 (Pace).
36 Bundesgericht (Switzerland) 15 September 2000 (Egyptian cotton), FCF S. A. v Adriafil Commerciale

Journal of Law and Commerce (2005–06) 489 (495 et seq.).


39 Whittington, Reconsidering Domestic Sale of Goods Remedies in Light of The CISG, 37 Victoria
University of Wellington Law Review (2006) 421 (435).

40 Koch, The Concept of Fundamental Breach of Contract under the United Nations Convention on
Contracts for the International Sale of Goods, Review of the Convention on Contracts for the Interna-
tional Sale of Goods (CISG) (1998) 177 (350).
tional Sale of Goods (CISG) (1998) 177 (271 et seq.).
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and objective components, but opinions on whether there was too much of one or the
other varied.42 The emphasis on the expectations of the injured party was generally
viewed as the key factor.43 Thus, what is substantial is based on the expectation of the
injured party. Those expectations are not entirely subjective; they may involve the injured
party’s hopes or inner expectations but they must be borne out by the terms of the
contract.44 The most important question is what the parties themselves have made
important in their contract.45
15 Fault or negligence on the part of the breaching party is not required to establish a
fundamental breach.46 Even the presence of actual fault or negligence will not establish a
fundamental breach; the question will still be whether the malicious behaviour impaired
an important interest of the innocent party, or whether it so affected the relationship of
trust between the parties that they cannot be expected to continue their contractual
relationship.47 The effect on the buyer will control the fundamental breach decision,
rather than the degree to which the seller engaged in bad behaviour.48
16 The first step in establishing whether or not there is a fundamental breach is
identifying the scope of the contractual obligation that the breaching party is alleged
not to have met. It is an elementary point, but if there is no breach at all then the alleged
failure to perform can hardly be fundamental.49 The breach may arise from a violation
of the terms of the contract itself, the practice established between the parties, or trade
usage.50
17 The interpretation of the parties’ intentions is easiest when they have made clear,
preferably expressly, what kinds of breaches they would regard as fundamental under
42 Kritzer, Guide to Practical Applications of the United Nations Convention on Contracts for the
International Sale of Goods (1989) pp. 205 seq.; Will, in: Bianca/Bonell, Commentary (1987), Art. 25
paras 2.1.2.1 seq; Schlechtriem/Butler, CISG (2009), para. 111 (emphasizing the subjective component
based on the breach’s effect on the buyer, rather than on the value of the contract).
International Sale of Goods (1989) p. 206; Huber, in: Huber/Mullis, The CISG (2007), p. 214.
44 Will, in: Bianca/Bonell, Commentary (1987), Art. 25 para. 2.1.2.2; Koch, The Concept of Funda-
mental Breach of Contract under the United Nations Convention on Contracts for the International Sale
of Goods, Review of the Convention on Contracts for the International Sale of Goods (CISG) (1998) 177
(292).
45 Magnus, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), pp. 321 seq.
46 Magnus, The Remedy of Avoidance of Contract Under CISG – General Remarks and Special Cases,
25 Journal of Law and Commerce (2005–06) 423 (426).

Journal of Law and Commerce (2005–06) 489 (507); Koch, The Concept of Fundamental Breach of
Contract under the United Nations Convention on Contracts for the International Sale of Goods, Review
of the Convention on Contracts for the International Sale of Goods (CISG) (1998) 177 (224 seq.)
48 Huber, in: Huber/Mullis, The CISG (2007), pp. 214 seq.
tional Sale of Goods (CISG) (1998) 177 (216); Oberlandesgericht München (Germany) 2 March 1994
(Coke), CISG-Online 108 (Pace). A Swedish seller had sold coke to a German buyer and had delivered it
to a Yugoslavian company, as directed by the contract. The German company had difficulty recovering it
from the Yugoslavian enterprise, but the court held that did not constitute a breach by the Swedish seller.
In obiter dicta, the court suggested that even if one conceived of the transaction between the Swedish
seller and the Yugoslav company as a direct sale in contravention of the original agreement, the Swedish
seller’s actions would still not constitute a fundamental breach because the German buyer would have its
own claim for payment of the purchase price against the Yugoslav company.
Journal of Law and Commerce (2005–06) 489 (493); Babiak, Defining “Fundamental Breach” Under the
United Nations Convention on Contracts for the International Sale of Goods, 6 Temple International and
Comparative Law Journal (1992) 113 (120 seq.); Tribunal cantonal Valais (Switzerland) 21 February 2005
(CNC-Machine), CISG-Online 1193 (Pace) (by specifying in the contract that machine be “as-good-as-
new”, buyers indicated their assumption that it would be functional).
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the contract.51 Parties should try to avoid using boilerplate language but should explain
why a certain obligation is deemed fundamental to avoid giving the impression that the
operative language was not intended to have a particular meaning as between them-
selves.52 Thus, parties can, to some extent, control the likelihood that a breach will be
deemed fundamental by including express terms akin to conditions in their contracts.53
For example, a German court found important in its decision that a breach was not
fundamental, notwithstanding significant departures from the contractual provisions,
that the parties had not explicitly stated in the contract that they considered either
product origin or quality to be fundamental.54
Avoidance requires terminating the contract and involves restoring any unused 18
goods. Thus, one question relevant in determining whether there has been a funda-
mental breach is whether the buyer or the seller is in a better position to dispose of the
remaining goods.55 This has been termed a “remedy-oriented approach.”56
The burden of proving substantial deprivation lies on the party claiming to have been 19
harmed.57 Once he has established substantial deprivation, the burden will shift, as
described below, to the breaching party to show that the extent of the harm was not
foreseeable.58 This will channel some of the inquiry to the time at which the breach
occurred, rather than focusing on the expectations of the parties at the time of the
contract’s conclusion.
b) Foreseeability. To qualify as fundamental, the results of the breach must have 20
been foreseeable to the defaulting party or “to a reasonable party of the same kind in the
same circumstances.” The question of foreseeability was at the core of Art. 10 ULIS
(Uniform Law on the International Sale of Goods), the fundamental breach provision,
but it was considered too subjective.59 Art. 10 ULIS defined fundamental breach in
terms of a question put to the breaching party: at the time he entered into the contract,
would he have predicted that the other party would have entered into the contract could
the injured party have foreseen the breach and its effects?60 While the question of
foreseeability was not abandoned in Art. 25 CISG, the emphasis changed to the degree

Journal of Law and Commerce (2005–06) 489 (498). This is especially important if the transaction is
occurring in the context of a fast-moving market where cover is likely to be difficult. Bridge, The CISG
and the UNIDROIT Principles of International Commercial Contracts, 29 Uniform Law Review (2014)
623 (634).
53 Huber, in: Huber/Mullis, The CISG (2007), p. 214; Whittington, Reconsidering Domestic Sale of
Goods Remedies in Light of the CISG, 37 Victoria University of Wellington Law Review (2006) 421 (437).
The idea of making clear in the contract what performance is fundamental for CISG purposes is very
similar to inserting a condition in a contract, the violation of which would lead to a material breach.
Gabriel, Contracts for the Sale of Goods: A Comparison of US and International Law (2009) p. 111.
54 Bundesegrichtshof (Germany) 3 April 1996 (Cobalt sulfate), CISG-Online 135 (Pace); Lookofsky,
Understanding the CISG (2008), p. 117.

55 Honnold, Uniform Law (2009), Art. 25 para. 181.2; CISG-AC Opinion no 5, para. 4.6.
tional Sale of Goods (CISG) (1998) 177 (243 et seq.).
57 Gabriel, Contracts for the Sale of Goods: A Comparison of US and International Law (2009) p. 109;
Tribunal cantonal Valais (Switzerland) 21 February 2005 (CNC-Machine), CISG-Online 1193 (Pace).
International Sale of Goods (1989) p. 205; Garro, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond
(2003), p. 364.
60 Honnold, Uniform Law (2009), Art. 25 para. 182.
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of detriment attributable to the breach.61 Detriment is then limited by the question of

foreseeability – was the detriment caused by circumstances peculiar to the injured party,
and should the breaching party have foreseen them?62 The foreseeability requirement in
Art. 25 is similar to the foreseeability requirement with respect to damages found in
Art. 74.63
21 Some suggest that foreseeability is a cumulative question; a defaulting party must
both subjectively and objectively have predicted the result of the breach.64 Others
emphasize the objective component.65 The latter approach is the more persuasive. The
objective component is designed to be a safeguard against the defence that a breaching
party did not actually foresee the damage; only if a reasonable person in the same
circumstances would not have foreseen the results is the defence for lack of foresee-
ability available.66
22 The question is thus whether the defaulting party should have foreseen the con-
sequences of a breach, or whether a reasonable person in the same circumstances would
have foreseen detrimental effects. In practice, as the CISG is limited to commercial sales,
this means a reasonable merchant in the same circumstances.67 Ordinarily this will
mean merchants with a reasonable degree of knowledge and experience in their trade,
including knowledge of the relevant market conditions, whether regional or global.68
23 In practice, the question of foreseeability should only arise if the parties have not
adequately specified in their contract what issues are essential to them in the course of
performance.69
24 The burden of proving that the detriment was not foreseen, or foreseeable, lies on the
breaching party.70 This is demonstrated by the use of the words “unless the party in
breach did not foresee” the breach.71

62 Honnold, Uniform Law (2009), Art. 25 para. 183; cf. Schroeter, in: Schlechtriem/Schwenzer, Com-
mentary (2016), Art. 25 paras 26, 27, 36 (criticizing the idea of foreseeability as an excuse, and suggesting
it should be viewed as part and parcel of the substantive inquiry as to the fundamentality of the breach).
63 Huber, in Huber/Mullis, The CISG (2007), p. 216; Koch, The Concept of Fundamental Breach of
Contract under the United Nations Convention on Contracts for the International Sale of Goods, Review
of the Convention on Contracts for the International Sale of Goods (CISG) (1998) 177 (322).

65 Magnus, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), pp. 321 seq.
66 Huber, in: Huber/Mullis, The CISG (2007), p. 214 (“The party in breach therefore will only be able to
rely on the foreseeability requirement if it neither foresaw nor should have foreseen that result.”); Will, in:
Bianca/Bonell, Commentary (1987), Art. 25 para. 2.2.2.1. (noting that “[a]nyone who has committed a
breach of contract giving rise to major problems will hardly admit that he foresaw those problems”).
67 Babiak, Defining “Fundamental Breach” Under the United Nations Convention on Contracts for the
International Sale of Goods, 6 Temple International and Comparative Law Journal (1992) 113 (122); Will,
in: Bianca/Bonell, Commentary (1987), Art. 25 para. 2.2.2.2.1.
68 Babiak, Defining “Fundamental Breach” Under the United Nations Convention on Contracts for the
International Sale of Goods, 6 Temple International and Comparative Law Journal (1992) 113 (122). A
party’s relative lack of experience in the trade or lack of sophistication might affect the assessment of
subjective knowledge.
70 Honnold, Uniform Law (2009), Art. 25 para. 183; cf. Gabriel, Contracts for the Sale of Goods: A
Comparison of US and International Law (2009) p. 109 (noting a split in common law authority as to
whether the element of foreseeability is an element of the offense or a defence to the allegation of breach);
Bundesgerichtshof (Germany) 3 April 1996 (Cobalt sulfate), CISG-Online 135 (Pace).
71 Honnold, Uniform Law (2009), Art. 25 para. 183; Magnus, in: Ferrari/Flechtner/Brand, Draft Digest
and Beyond (2003), p. 325; Huber, in: Huber/Mullis, The CISG (2007), p. 215; cf. Schroeter, in:
Schlechtriem/Schwenzer, Commentary (2016), Art. 25 para. 31 (suggesting the burden lies on the
promisee to show the promisor did not foresee the damage if the matter was not objectively foreseeable);
Court of Appeal of Nancy (France) 6 November 2013 (Tractors), O v. P, CISG-Online 2549 (Pace) (it was
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A controversial question has been the time at which foreseeability should be assessed. 25
Must the consequences of the breach have been evident to the party at the time of the
contracting, or should he take into account information acquired later in assessing the
degree to which a breach would be fundamental? Art. 25 does not answer the question
directly: it asks what the party expects “under the contract”. The drafting history
suggests that the delegates deliberately left the time frame open.72 “The Commission,
after deliberation, did not consider it necessary to specify at what moment the party in
breach should have foreseen or had reason to foresee the consequences of the breach.”73
The predominant line of thought is that the appropriate question is what was foresee-
able at the time the contract was concluded.74 Some commentators have, however,
suggested that information received subsequent to the time of the contract’s conclusion,
but prior to shipment, should be taken into account in assessing whether the seller
should have had reason to foresee that the breach would substantially deprive the buyer
of what he had reason to expect under the contract.75 Information received only after
performance should never be given effect.76
The better interpretation is that foreseeability must be gauged at the time the contract 26
is concluded, as the allocation of liability among the parties will depend on the
information conveyed prior to the conclusion of the contract.77 This is also consistent
with the assessment of fundamental breach depending on the legitimate expectations
“under the contract.”
3. Examples of fundamental breach

Art. 25 itself does not distinguish between different types of breach or establish 27
particular breaches – e. g., non-delivery or non-payment – as per se fundamental
breaches. Whether a particular breach is fundamental depends on the circumstances of
the contract at issue. “The reference to the expectation ‘under the contract’ makes clear
that the yardstick for breach of contract is first and foremost to be found in the express
and implied terms of the contract itself.”78
a) Non-performance and anticipatory repudiation. The most evident fundamental 28
breach is a party’s failure to perform entirely its obligations under the contract. Those
incumbent on the buyer and not the seller to provide evidence of lack of conformity in the case of
unconditional acceptance of goods).
72 Honnold, Uniform Law (2009), Art. 25 para. 183; Huber, in: Huber/Mullis, The CISG (2007), p. 216;
Bridge, Avoidance for Fundamental Breach under the CISG, 59 ICLQ (2010), 911 (925 seq.).
73 Honnold, Documentary History (1989), p. 324.
74 Gabriel, Contracts for the Sale of Goods: A Comparison of US and International Law (2009) pp. 108
seq.; Magnus, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 324; Schroeter, in: Schlech-
75 Honnold, Uniform Law (2009), Art. 25 para. 183; Ferrari, Fundamental Breach Under the UN Sales
Convention: 25 Years of Article 25 CISG, 25 Journal of Law and Commerce (2005–06) 489 (500).
77 Huber, in: Huber/Mullis, The CISG (2007), p. 216.; Magnus, in: Ferrari/Flechtner/Brand, Draft Digest
and Beyond (2003), pp. 324 seq. (one-sided statements made after the bargain is struck should not be
given effect); Schlechtriem/Butler, CISG (2009), para. 112. Post-contractual language conveyed prior to the
commencement of performance, and which does not alter the allocation of risk bargained before between
the parties, might be permitted on an exceptional basis. Will, in: Bianca/Bonell, Commentary (1987),
Art. 25 para. 2.2.2.2.5; cf. Honnold, Uniform Law (2009), Art. 25 para. 183 (suggesting that foreseeability
should extend to the time the party in breach could take steps to avoid substantial detriment).
tional Sale of Goods (CISG) (1998) 177 (263 seq.). See also CISG-AC Opinion no 5, para. 4.2; Schroeter,
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instances are unlikely to be controversial. Occasions that are likely to be more difficult to
interpret will involve the inability to perform or the apparent unwillingness to perform.79
29 An example of the former is illustrated by a case involving a company’s insolvency.
In an Australian case the court held that the appointment of an administrator by the
buyer constituted a fundamental breach because it represented an acknowledgement by
the Board of Directors that the company was insolvent, or likely to become so. In the
circumstances of the case, it “resulted in such detriment to Roder as substantially to
deprive it of what it was entitled to expect under the contract.”80
30 The quintessential example of the second occasion is that of anticipatory breach.
Anticipatory breach is not foreclosed by the doctrine of fundamental breach. A final
refusal of performance will amount to a fundamental breach, even if that performance is
due in future.81 Thus, a buyer’s statement that it would not accept any shipments under
an instalment contract until July, even though shipments were to be made in April and
in May/June, constituted a fundamental breach that permitted the seller to avoid the
contract because it deprived him of what he was entitled to expect under the contract.82
31 b) Late performance. The most common kind of late performance is the delayed
delivery of goods by the seller, but it is clear that late delivery is not a per se fundamental
breach.83 A “reasonable” delay under the parties’ or the industry’s definition of reason-
able is usually not sufficient to constitute a fundamental breach.84 Parties can take two
routes to make timeliness be of an essential character such that tardiness will amount to
fundamental breach.
32 First, by setting a nachfrist period – an additional period of time for performance – a
party can effectively make time be “of the essence” so that the failure to perform within
the additional period is a fundamental breach.85 “The nachfrist remedy is particularly
useful when the buyer or the seller has certain doubts about whether the breach of the
other party constitutes a fundamental breach […]”86
33 Second, the parties can, at the time of contracting, make clear that failure to deliver in a
timely manner would be a fundamental breach. A delay in delivery can be sufficient to
establish a fundamental breach without the buyer setting a supplementary period for
performance if it is sufficiently clear from the contractual terms that timing is an essential
element of the contract.87 One way to do this is by making clear to the delivering party
that downstream buyers would be depending on timely delivery.88 “Timely delivery must
tional Sale of Goods (CISG) (1998) 177 (223 seq.).
80 Federal Court, South Australian District, Adelaide (Australia) 28 April 1995 (Tent hall structures), Roder
Zeltund Hallenkonstruktionen GmbH v Rosedown Park Pty Ltd et al., CISG-Online 218 (Pace), para. 58.
81 Rowley, in: Hunter, Modern Law of Contracts (2007), para. 23:36.
82 Arbitral Award, ICC 10 274/1999 (Poultry feed) (Pace).
83 Oberlandesgericht München (Germany) 1 July 2002 (Shoes), CISG-Online 656 (Pace).
84 US District Court, District of New Jersey (U.S.) 4 April 2006 (Naphtha), Valero Marketing & Supply
Co. v Greeni Oy, CISG-Online 1216 (Pace).

cases, in: Andreas/Jarborg (eds), Anglo-Swedish Studies in Law (1998), p. 326 (pp. 332 et seq.) (Pace);
Magnus, in: Flechtner/Brand/Walter, Drafting Contracts (2007), p. 459 (462); See the commentary to Arts
49(2) and 64(2).
86 Perales Viscasillas, The Nachfrist Remedy, in: Celebrating Success: 25 Years United Nations
Convention on Contracts for the International Sale of Goods (2005), p. 91


88 DiMatteo et al., International Sales Law: A Critical Analysis of CISG Jurisprudence (2005) p. 126;
Lookofsky, Understanding the CISG (2008), pp. 117 et seq.
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be of such interest to the buyer that he prefers not to receive the goods at all rather than
to receive them late and this particular interest in timeliness must be recognizable to the
seller at the conclusion of the contract.”89
It is possible that trade usage90 or other circumstances, such as the seasonal nature of 34
the goods being traded,91 would suffice to make a failure to deliver in a timely manner
into a fundamental breach. In one arbitration proceeding, the tribunal suggested that in
order to rely on temporal flexibility in industry practice, the party seeking to rely on the
flexibility bore the burden of proving specific temporal parameters, rather than merely
the existence of a “general latitude.”92
Boilerplate provisions that time is of the essence or delivery terms such as CIF 35
are possible but unreliable means of inserting a timeliness provision into a contract.93
Prudent traders should make clear in their contract that they consider timely
performance to be an essential feature of the contract, and they should explain why.
Most late performance claims emanate from buyers. A mere delay in payment usually 36
does not constitute a fundamental breach under Art. 25.94 The parties can in their
contract make it plain that delay in payment would constitute a fundamental breach.95
This might be particularly advisable when currency fluctuations are especially volatile.96
The failure to take delivery also will fail to constitute a fundamental breach unless the
seller has a particular interest in the timely receipt of the goods or the buyer refuses
absolutely to take them.97 In particular circumstances, such as when the goods are
perishable and/or the storage costs would be particularly high, failure to take delivery
could amount to a fundamental breach.98
c) Deficient goods. Deficiency in the goods provided will support a claim of 37
fundamental breach, but the buyer must be substantially deprived of what he was
entitled to expect under the contract. In some cases the fact of non-conformity will be
relatively straightforward. In a case involving the sale of shoes, for example, the buyer
claimed the jewellery ornamentation on the shoes was not straight, the straps on both
the inside and the outside of the shoes were too long such that the shoes would not stay
on the feet, the sole was not affixed properly, and the strips on the heels were
backstitched too narrowly. The court held that the lack of conformity of the goods
89 Oberlandesgericht Düsseldorf (Germany) 24 April 1997 (Shoes), CISG-Online 385 (Pace) (the sale of
fashionable children’s shoes did not qualify as an exceptional circumstance “such that the setting of an
additional period would have been an unreasonable burden.”).
91 Corte di Appello de Milano (Italy) 20 March 1998 (Knitwear), Italdecor s. a. s. v Yiu’s Industries
(H.K.) Limited, CISG-Online 348 (Pace) (late delivery of the spring sales collection amounted to
a fundamental breach); Arbitral Award, ICC 8786/1997, January 1997 (Clothing), (Pace); cf. Oberlan-
desgericht Düsseldorf (Germany) 24 April 1997 (Shoes), CISG-Online 385 (Pace) (parties had not
specified that time was of the essence in their contract; moreover, the buyer had accepted some late
shipments).
92 Arbitral Award, AAA 50181T 0 036 406, 23 October 2007 (Frozen chicken parts), Macromex Srl. v

Journal of Law and Commerce (2005–06) 489 (504 et seq.). Cf. Oberlandesgericht Hamburg (Germany)
28 February 1997 (Iron molybdenum), CISG-Online 261 (Pace) (holding that CIF qualifies the transac-
tion as a transaction in which the date is essential).

95 Magnus, in: Flechtner/Brand/Walter, Drafting Contracts (2007), p. 459 (467).

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constituted a fundamental breach.99 Selling “impermeable” tiles that were easily stained
by commonly used household products was a fundamental breach.100 Yet in many cases,
so long as there is some use for the goods, it is possible that there will be no
fundamental breach.101 This is true particularly if the buyer can resell the goods without
going outside her usual market.102 Requiring a buyer to go outside her regular market to
dispose of non-conforming goods would in itself substantially deprive her of her
expectations under the contract, and that deprivation ought to be foreseeable to the
seller.103
38 Frequently a certain percentage of the goods is defective, while others conform to
specifications. These cases have been handled in varying ways. One response has looked
at the alternatives for use or disposal of the defective goods. If the buyer can dispose of
them in the ordinary course of business, then he has had to do so.104 Other courts have,
however, placed a great deal of emphasis on the proportion of defective goods, and if a
substantial proportion (nearly all) is defective, then the seller is in fundamental
breach.105 In a case involving deficient air conditioners sold by a U.S. company to an
Italian buyer, a U.S. court permitted avoidance of the contract because 93 percent of the
air conditioners were defective, and attempts to cure the non-conformity failed.106 In a
case involving shipments of vacuum-packed fresh lamb, only a small percentage of the
meat was past its sell-by date, but the entire shipment was seized by the authorities due
to erroneous labelling thus depriving the buyer of its goods. The buyer was entitled to
avoid.107
39 Failure to deliver goods suitable for a buyer’s purpose can result in a fundamental
breach so long as the seller is aware of the buyer’s needs.108 Absent that notice, the
buyer cannot necessarily assume the seller will be aware of conditions prevailing in his
99 Landgericht Berlin (Germany) 15 September 1994 (Shoes), CISG-Online 399 (Pace). The delivery of
poor-quality wine that could not be sold, even at a reduced price, was a fundamental breach. Tribunale de
Foggia (Italy), 21 June 2013 (Wine), Samuel Smith, The Old Brewery v. Vini San Barbato, snc, CISG-
Online 2674 (Pace).
100 Landgericht Saarbrücken (Germany) 2 July 2002 (Tiles), CISG-Online 713 (Pace).
101 Oberlandesgericht Frankfurt (Germany) 18 January 1994 (Shoes), CISG-Online 123 (Pace); Bundes-
gericht (Switzerland) 3 April 1996 (Cobalt sulphate), CISG-Online 135 (Pace) (holding that there was no
fundamental breach even though the product was of a different origin than specified in the contract and
was of inferior quality; the goods could have been marketed to buyers in Germany); Bundesgericht
(Switzerland) 28 October 1998 (Frozen meat), CISG-Online 413 (Pace) (deviation of quality in meat in
which there was an excessive proportion of fat and too much moisture did not constitute fundamental
breach; buyer could have disposed of the meat at a lower price as part of its own business in Egypt).
102 Lookofsky, Understanding the CISG (2008), p. 116 note 69.
103 Lookofsky, Understanding the CISG (2008), p. 116 note 69; Schwenzer, Avoidance of the Contract in
Case of Non-Conforming Goods (Article 49(1)(A) CISG), 25 Journal of Law and Commerce (2005–06)
437 (438).
104 Graffi, Case Law on the Concept of “Fundamental Breach” in the Vienna Sales Convention, 3 Revue
de droit des affaires internationales (2003) 337 (342) (Pace).

de droit des affaires internationales (2003) 337 (342) (Pace).

106 US Court of Appeals (2nd Circuit,) (U.S.) 6 December 1995 (Compressors for air conditioners),
Delchi Carrier, S. p. A. v Rotorex Corp., CISG-Online 140 (Pace); Landesgericht Landshut (Germany)
5 April 1995 (Clothes), CISG-Online 193 (Pace) (entire delivery of sportswear shrunk after being
washed); cf. Oberlandesgericht Hamm (Germany) 22 September 1992 (Pork bacon), CISG-Online 57
(Pace) (420 kilos of defective goods out of total delivery of 22 tons insufficient to constitute total breach).
107 Cour de Cassation (France) 17 December 2013 (Lamb meat), Socinter v. Wallace, CISG-Online
2478.
108 Gabriel, Contracts for the Sale of Goods: A Comparison of US and International Law (2009) p. 108;
Oberster Gerichtshof (Austria) 21 June 2005 (Software), CISG-Online 1047 (Pace) (if it was well-known
that software was to be sold in Austria, then any detriment resulting from goods’ inability to be used in
Austria was obvious and foreseeable).
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country. Thus, New Zealand mussels were sold to a German buyer, but they contained a
level of cadmium in excess of that recommended by the German health authority. Yet
the German Supreme Court declined to find a fundamental breach. It held that the
cadmium standard was not legally binding, but was merely a recommendation.109
Moreover, it was incumbent upon the New Zealand seller to know of the regulations
prevalent in the German market.110 By contrast, an Italian seller of wine in France
committed a fundamental breach by adding sugar to wine in contravention of French
wine regulations.111 Delivery of goods not fit for sale in any country, as was the case
with wheat to which potassium bromide had been added, even though it was not a
permitted food additive under the Codex Alimentarius, was a fundamental breach.112 A
spice seller was deemed to be operating in a sector where safety concerns were
paramount, given EU regulations on permissible levels of contamination and general
concerns in the industry about safety threats from contaminated colourants.113 In order
to ensure the ability to avoid, it is essential that a buyer include in the contract a
requirement that the goods meet the specifications of the country in which the buyer
plans to sell the goods.
A frequent occurrence involves only the partial delivery of an expected shipment of 40
goods. This is dealt with specifically by Art. 51.114 The general rule is that a buyer can
declare avoidance only as to the unperformed portion of the contract, but that in certain
circumstances the failure to deliver the whole amount will amount to a fundamental
breach of the contract.115 A related question is whether the failure to deliver one or
more shipments under an instalment contract amounts to a fundamental breach. This
question is controlled by Art. 73.116 The decision will depend on context, but a buyer’s
failure to open the requisite letter of credit and announcement that it would not accept
any shipments on previously scheduled dates has amounted to a fundamental breach.117
The variety of cases, and the variety of outcomes, show that what constitutes 41
deficiency is variable and context-dependant. Again it is essential that the contracting
parties make clear what features of the goods are essential in the course of their
bargaining.118
109 Bundesgerichtshof (Germany) 8 March 1995 (Mussels), CISG-Online 144 (Pace). It appeared that
the mussels would not have violated New Zealand standards.

110 Bundesgerichtshof (Germany) 8 March 1995 (Mussels), CISG-Online 144 (Pace). The court left open
the question whether this might change in the event that the seller had a branch in the buyer’s country or
had been doing business there repeatedly for a period of time.
111 Cour de Cassation (France) 23 January 1996 (Wine), Sacovini/M. Marrazza v Les fils de Henri
Ramel, CISG-Online 159 (Pace).

112 Gerechtshof Gravenhage (the Netherlands) 23 April 2003 (Wheat flour), Rynpoort Trading &
Transport N. V. et al. v Meneba Meel Wormerveer B. V. et al., CISG-Online 903 (Pace).

113 Murcia Provincial High Court (Spain) 25 May 2012 (Red pepper powder), CISG-Online 2463
(Paee).
114 See the commentary to Art. 51 CISG, infra paras 1 et seq., 9 et seq., for a full exploration of this
issue.
115 In another case, the lower court stated that when a buyer refuses to perform a residual part of the
contract, it could amount to a fundamental breach because the parties attached importance to the
“package as a whole.” Oberlandesgericht Graz (Austria) 29 July 2004 (Construction equipment), CISG-
Online 1627 (Pace).
116 See the commentary to Art. 73 CISG, infra paras 8 et seq. and Art. 51, infra paras 4 et seq., for a full
exploration of this issue.

117 Arbitral Award, ICC 10 274/1999 (Poultry feed) (Pace).
118 Schwenzer, Avoidance of the Contract in Case of Non-Conforming Goods (Article 49(1)(A) CISG),
25 Journal of Law and Commerce (2005–06) 437 (437 et seq.); Oberlandesgericht Innsbruck (Austria)
1 July 1994 (Garden flowers), CISG-Online 107 (Pace) (delivery of flowers that failed to bloom all
summer as the buyer had expected did not qualify as fundamental breach because the buyer could not
establish that those expectations were included in the contract); Cour de cassation (France) 26 May 1999
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42 d) Ancillary contractual obligations. The breach of any provision in a contract can
prove to be fundamental. The CISG does not distinguish between principal and ancillary
obligations.119 Provisions regarding exclusivity are an example. One Italian shoe manufac-
turer displayed at a trade fair shoes made for a German buyer, and bearing a trademark for
which the German buyer was a licensee. The court held that this amounted to a
fundamental breach in violation of a contractual exclusivity provision.120 In another case
involving an alleged violation of an exclusivity agreement, the buyer initially declared
avoidance of the contract, but after the goods were removed from the offerings of the
competing retailer (5 weeks later), the buyer proposed instead to maintain the contract
with a 50-percent price reduction. The seller did not accept. The Supreme Court of Austria
found avoidance unjustified. Avoidance was a remedy of last resort, and assessing its
application requires weighing the interests of the parties. Here the goods had been
delivered to a competing retailer in only one of two cities where the buyer had its
department store and had been sold for only a short time. Moreover, the buyer, by offering
to maintain the contract, had demonstrated that performance of the contract was not
unreasonable.121 Violating a contractual prohibition on the re-importation of goods has
also been held to be a fundamental breach.122 Yet the burden of proving that an ancillary
contractual obligation is in fact fundamental will lie, often heavily, on the injured party.123
43 e) Documentary transactions. Though the CISG does not contain a perfect-tender rule
for goods, it is probable that at least some documents relating to goods, such as those
required to satisfy the conditions in a letter of credit, are subject to what might be termed a
perfect-tender rule.124 The CISG does not govern letters of credit per se; that is up to the
contract between the parties and any applicable municipal laws.125 Payment of a letter of
credit usually requires strict compliance with the terms of the letter of credit, and does not
involve an enquiry into the quality of the goods underlying the documents.
44 Non-letter-of-credit documents have been treated differently, and some courts have
been reluctant to regard the provision of inadequate or faulty documents as a funda-
mental breach. Rather, they have looked together at the performance underlying the
documents and at the documents themselves.126 The obligation of the buyer to open a
letter of credit, and his failure to do so in a timely way, has generally not been held to
amount to a fundamental breach.127
(Rolled sheet metal), Société Karl Schreiber GmbH v Société Thermo Dynamique Service et al., CISG-
Online 487 (Pace) (delivery of un-laminated sheet metal by a Germany company qualified as a
fundamental breach when the French buyer specifically needed laminated steel to sell to its domestic
purchasers).
Journal of Law and Commerce (2005–06) 489 (495 et seq.); Schroeter, in: Schlechtriem/Schwenzer,
Commentary (2016), Art. 25 paras 24, 71 seq.
120 Oberlandesgericht Frankfurt (Germany) 17 September 1991 (Shoes), CISG-Online 28 (Pace).
121 Oberster Gerichstof (Austria) 15 November 2012 (Fashion), CISG-Online 2399.
122 Cour d’Appel Grenoble (France) 22 February 1995 (Jeans), BRI Production “Bonaventure” v Pan
African Export, CISG-Online 151 (Pace).

p. 102; Schwenzer, Avoidance of the Contract in Case of Non-Conforming Goods (Article 49(1)(A)
CISG), 25 Journal of Law and Commerce (2005–06) 437 (441).
125 Schlechtriem, Interpretation, Gap-Filling and Further Developments of the U. N. Sales Convention,
16 Pace International Law Review (2004) 279 (305 et seq.).

cases, in: Andreas/Jarborg (eds), Anglo-Swedish Studies in Law (1998), p. 326 (344 et seq.) (Pace).
127 Supreme Court of Queensland (Australia) 17 November 2000 (Scrap steel), Downs Investments Pty Ltd v
Perwaja Steel, CISG-Online 587 (and 859) (Pace); Arbitral Award, ICC 7585/1992 (Foamed board machinery)
(Pace); Arbitral Award, ICC 7197/1992 (Goods not specified; case involved a letter of credit) (Pace).
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It has even been suggested that if a buyer can obtain the correct documents, the 45
seller’s failure to provide them cannot amount to a fundamental breach.128 Yet this
imposes too great an obligation on the buyer, and some courts have recognized that.129
In one case, the tribunal held that requiring the buyer to fix an additional time for
performance before claiming fundamental breach would have been overly formalistic.
The seller knew that its documents were non-conforming, and despite repeated contact
between the buyer and the seller, the seller made no offer to correct the defective
documents.130 Further, at least sometimes, even faulty documents not involving letters
of credit could impose independent obligations on the provider and a failure to abide by
those could in themselves amount to a fundamental breach.131
Though some have suggested that any documentary fault should amount to a 46
fundamental breach in the international sales context,132 this author suggests that a per
se rule is going too far. Rather, the circumstances should be taken into account as to
whether the failure to provide proper documentation amounts to a breach.133 Explicit-
ness and clarity in the contractual obligations of the parties should be of help in
clarifying those situations when it does.
f) Relationship to ability to cure. The issue of fundamental breach is closely linked to 47
the ability to cure.134 One German court recognized the primacy of the buyer’s right to
avoid the contract under Art. 48, but held that an offer to cure, if it did not cause the
buyer great inconvenience, could mean that even a grave defect would not amount to a
fundamental breach.135 The dividing line between great inconvenience and permitted
inconvenience is unclear. In one case in which the cost of sorting out defects would have
amounted to one-third of the purchase price, an arbitral tribunal permitted the buyer to
avoid the contract.136 An injured party cannot by his conduct prevent cure and then rely
on the fundamentality of the breach.137
The effect of the possibility of cure has not been definitively resolved. Does an offer to 48
cure alleviate an otherwise fundamental breach, or does it prevent the fundamental
breach from occurring, at least until an extended period for performance has elapsed
without the seller having followed through on the offer to cure?138 Need there even be
an offer to cure, so long as the breach remains curable? Because Art. 48 permits cure
128 Landgericht Heidelberg (Germany) 3 July 1992 (Computer components), CISG-Online 38 (Pace);
Oberlandesgericht Düsseldorf (Germany) 10 February 1994 (Fabrics), CISG-Online 115 (Pace).

129 Arbitral Award, ICC 7531/1994 (Scaffold fittings) (Pace); Landgericht Baden-Baden (Germany)
14 August 1991 (Wall tiles), CISG-Online 24 (Pace).

130 Arbitral Award, ICC 7645/1995, March 1995 (Crude metal) (Pace).
133 CISG-AC Opinion no 5, paras 4.11 et seq.
cases, in: Andreas/Jarborg (eds), Anglo-Swedish Studies in Law (1998), p. 326 (p. 341 et seq.) (Pace);
Honnold, Uniform Law (2009), Art. 25 para. 184.
135 Oberlandesgericht Koblenz (Germany) 31 January 1997 (Acrylic blankets), CISG-Online 256 (Pace).
Not all cases have gone in that direction. Landgericht Baden-Baden (Germany) 14 August 1991 (Wall
tiles), CISG-Online 24 (Pace).
136 Arbitral Award, ICC 7531/1994 (Scaffold fittings) (Pace).
137 US District Court, District of New Jersey (U.S.) 4 April 2006 (Naphtha), Valero Marketing & Supply
Co. v Greeni Oy, CISG-Online 1216 (Pace).

cases, in: Andreas/Jarborg (eds), Anglo-Swedish Studies in Law (1998), p. 326 (p. 342 et seq.) (Pace);
Schwenzer, Avoidance of the Contract in Case of Non-Conforming Goods (Article 49(1)(A) CISG), 25
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even after the date of delivery, some have argued that the ability to cure extends after
the date of performance. Thus, if the seller delivers defective goods but repairs or
replaces defective parts quickly such that substantial detriment is prevented, the action
would prevent a fundamental breach from occurring.139 This has been described as a
“vicious circle”: “no right to cure if the breach is fundamental, but no fundamental
breach if the defect is curable.”140
49 One response is to permit the seller to cure unless the specific interests of the buyer
dictate otherwise.141 This is a workable solution if the time for performance has not yet
come due. Otherwise, it might be less than desirable, and, indeed, opinions are mixed
as to whether cure even after the time performance has come due should be
permitted.142 One criticism is that it does not lead to predictable results.143 Also, it
does not take into account Art. 49, which permits a buyer to avoid notwithstanding the
potential for cure, and to which Art. 48(1) is subordinated.144 Yet it is consistent with
the general approach that contract termination should be a last remedy. The reference
to Art. 49 essentially shifts the interpretation to that provision.145 If the buyer has a
special interest in terminating the contract immediately, he should be able to do so,
even if cure would be possible. If, on the other hand, curing the defects would not harm
a fundamental interest of the buyer, then the cure should be permitted.146 Again, by
making clear in the contract that timely delivery is essential to the buyer, the parties
can avoid uncertainty with respect to interpretation of their contract and their
intentions.

50 The PICC contain a notion similar to fundamental breach, but the terminology they
use can lead to confusion. “Termination” is used in lieu of “avoidance” such that the
effect of termination under the PICC is the same as the effect of avoidance under the
139 Honnold, Uniform Law (2009), Art. 25 para. 184; Oberlandesgericht Koblenz (Germany) 31 January
1997 (Acrylic blankets), CISG-Online 256 (Pace).

140 Magnus, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 323.
de droit des affaires internationales (2003) 337 (343) (Pace); Huber, in: Huber/Mullis, The CISG (2007),
pp. 222 seq.
cases, in: Andreas/Jarborg (eds), Anglo-Swedish Studies in Law (1998), p. 326 (342 et seq.) (Pace); Graffi,
Case Law on the Concept of “Fundamental Breach” in the Vienna Sales Convention, 3 Revue de droit des
affaires internationales (2003) 337 (343 seq.) (Pace); Koch, in: Felemegas, An International Approach to
(1980) as Uniform Sales Law (2007), pp. 131 et seq.; Pretura circondariale di Parma (Italy) 24 November
1989 (Knapsacks, bags, wallets), CISG-Online 316 (Pace); Oberlandesgericht Frankfurt (Germany)
17 September 1991 (Shoes), CISG-Online 28 (Pace); Oberlandesgericht Oldenburg (Germany) 1 February
1995 (Furniture), CISG-Online 253 (Pace); Arbitral Award, ICC 7531/1994 (Scaffold fittings) (Pace). Cf.
Schwenzer, Avoidance of the Contract in Case of Non-Conforming Goods (Article 49(1)(A) CISG), 25
Journal of Law and Commerce (2005–06) 437 (439) (suggesting that in most cases if timely delivery is of
the essence the delay will result in fundamental breach); but see Bridge, The CISG and the UNIDROIT
Principles of International Commercial Contracts, 29 Uniform Law Review (2014) 623 (634) (suggesting
that “of essence” provisions are “contradictory” to the test of fundamental breach in Article 25 because
the only question is the actual consequences of breach in a given case).
144 Koch, in: Felemegas, An International Approach to the Interpretation of the United Nations
Convention on Contracts for the International Sale of Goods (1980) as Uniform Sales Law (2007), p. 131.
146 Huber, in: Huber/Mullis, The CISG (2007), pp. 222 seq.; CISG-AC Opinion no 5, para. 4.4;
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CISG.147 The CISG adopted the usage found in ULIS, even though avoidance under the
CISG differs significantly from avoidance under the ULIS.148 By contrast, avoidance
under the PICC is concerned with defences to the formation of a contract, and not with
performance.149
Art. 7.3.1(1) PICC states that “[a] party may terminate the contract where the failure 51
of the other party to perform an obligation under the contracts amounts to a funda-
mental non-performance.”150 Non-performance is defined as “failure by a party to
perform any of its obligations under the contract, including defective performance or
late performance.”151 Fundamental non-performance is to be assessed by looking at
whether
(a) the non-performance substantially deprives the aggrieved party of what it was
entitled to expect under the contract unless the other party did not foresee and
could not reasonably have foreseen such result;
(b) strict compliance with the obligation which has not been performed is of essence
under the contract;
(c) the non-performance is intentional or reckless;
(d) the non-performance gives the aggrieved party reason to believe that it cannot rely
on the other party’s future performance;
(e) the non-performing party will suffer disproportionate loss as a result of the
preparation or performance if the contract is terminated.152
Much of this terminology is consistent with Art. 25 CISG. The factors include the 52
assessment of the injured party’s expectations under the contract and the foreseeability
of the resulting injury from both subjective and objective points of view. The PICC
recognise the primacy of the contractual provisions in assessing the preceding question.
The final three factors have no clear analogues in Art. 25 CISG, although they have 53
been raised in commentary and to a lesser extent in cases. Whether the non-perfor-
mance is unintentional or reckless has usually been held not to be a factor in assessing
the fundamental nature of the breach.153 Similarly, the question of future reliability has
not been addressed significantly in the CISG context, although some have suggested that
it should be a factor.154 The weighing criterion is also not in Art. 25 CISG. Although
weighing is implicitly a factor in the courts’ assessment of whether the buyer should be
required to rectify any breach by marketing the goods himself, the analysis is different
from that in the PICC. Under Art. 25 CISG the question of mitigating harm goes to
whether a breach is fundamental; under Art. 7.3.1.2(e) PICC the weighing question goes
to whether avoidance is permitted, notwithstanding the existence of a fundamental
breach.155
147Arts 7.3.5 seq. PICC.

148Secretariat Commentary to 1978 Draft, Art. 45 (now Art. 49) para. 2 (noting the narrowing of the
usage of avoidance to eliminate the ipso facto avoidance available under ULIS); Will, in: Biana/Bonell,
Commentary (1987), Art. 49 paras 1.2.1 et seq.
149 Arts 3.4 et seq. PICC.
150 Art. 7.3.1(1) PICC.
151 Art. 7.1.1. PICC.
152 Art. 7.3.1(2) PICC.
p. 130. See para. 15, supra.
154 See paras. 28 et seq., supra.
p. 130. Professor Bridge suggests that the deficiencies of Article 25 would be remedied were it possible to
refer to factors besides factual deprivation of benefit, including “whether the non-performance is
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54 The PICC also contain a nachfrist provision. “In the case of delay the aggrieved party
may also terminate the contract if the other party fails to perform before the time
allowed it under Article 7.1.5 has expired.”156
55 The PECL also address “fundamental non-performance.” “A non-performance of an
obligation is fundamental to the contract if: (a) strict compliance with the obligation is
of the essence of the contract; or (b) the non-performance substantially deprives the
aggrieved party of what it was entitled to expect under the contract, unless the other
party did not foresee and could not reasonably have foreseen that result; or (c) the non-
performance is intentional and gives the aggrieved party reason to believe that it cannot
rely on the other party’s future performance.”157
56 The first two provisions are consistent with Art. 25 CISG. If the parties make clear in
their contract that certain provisions are essential to their interests under the contract, a
failure to abide by those provisions will result in a fundamental breach. The third
provision is consistent with the PICC, but not with the CISG, which does not focus on
the fault or intention of the breaching party.158
57 The PECL have a provision that addresses cure: “A party whose tender of perfor-
mance is not accepted by the other party because it does not conform to the contract
may make a new and conforming tender where the time for performance has not yet
arrived or the delay would not be such as to constitute a fundamental non-perfor-
mance.”159 As suggested above, the first phrase is consistent with Art. 25 CISG. The
latter phrase would permit cure even after the time for performance has elapsed so long
as the delay does not constitute fundamental non-performance. This solution has also
been offered with respect to Art. 25 CISG;160 the PECL make clear that it is permitted.
58 The PECL adopt a nachfrist solution to the question of late performance. Thus, an
aggrieved party may set an additional time for performance, and may suspend its own
performance during the additional period.161 At the end of the nachfrist period the
aggrieved party may terminate the contract.162
59 The DCFR also refers to termination “if the debtor’s non-performance of a contrac-
tual obligation is fundamental.”163 What constitutes “fundamental” non-performance is
further described in terms very similar to those in Art. 25 CISG: non-performance is
fundamental if “it substantially deprives the creditor of what the creditor was entitled to
expect under the contract, as applied to the whole or relevant part of the performance,
unless at the time of conclusion of the contract the debtor did not foresee and could not
reasonably be expected to have foreseen that result.”164 The DCFR provision makes
explicit the time at which foreseeability should be measured – it is the time of the
conclusion of the contract.
intentional or reckless, the degree of detriment that the non-performer would suffer if the contract were
terminated, and whether strict compliance is ‘of essence’ under the contract.” Bridge, The CISG and the
UNIDROIT Principles of International Commercial Contracts, 29 Uniform Law Review (2014) 623 (634).
156 Art. 7.3.1(3) PICC.
157 Art. 8:103 PECL.
158 Professor Bridge suggests that rules on misrepresentation could in fact “undermine the doctrine of
fundamental breach with its philosophy of contractual continuance.” Bridge, The CISG and the
UNIDROIT Principles of International Commercial Contracts, 29 Uniform Law Review (2014) 623 (638
& n. 58).
159 Art. 8:104 PECL.
160 See paras 47 et seq., supra.
161 Art. 8:106(1),(2) PECL.
162 Art. 8:106(3) PECL.
163 Art. III – 3:502(1) DCFR.
164 Art. III – 3:502(2)(a) DCFR.
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Chapter I. General Provisions 60 Article 25

Unlike the CISG, but like the PECL and the PICC, the DCFR also adds a fault 60
provision: non-performance is fundamental if “it is intentional or reckless and gives the
creditor reason to believe that the debtor’s future performance cannot be relied on.”165
165 Art. III – 3:502(2)(b) DCFR.
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Article 26
A declaration of avoidance of the contract is effective only if made by notice to the
other party.
Bibliography: Butler, A Practical Guide to the CISG: Negotiations Through Litigation (2007); Ferrari,
Brief Remarks on the Conclusion of Contract on the Internet and the United Nations Convention on
Contracts for the International Sale of Goods (CISG), 5 European Legal Forum (2000/2001) 301; Jacobs,
Notice of Avoidance Under the CISG: A Practical Examination of Substance and Form Considerations,
the Validity of Implicit Notice, and the Question of Revocability, 64 University of Pittsburgh Law
Review (2003) 407; Magnus, The Remedy of Avoidance of Contract under CISG – General Remarks
and Specific Cases, 25 The Journal of Law and Commerce (2005–06) 423; Schlechtriem, Basic Structures
and General Concepts of the CISG as Models for a Harmonisation of the Law of Obligations, 10
Juridica International (2005) 27; Ziegel, Comment on Roder Zelt-und Hallenkonstruktionen GmbH v
Rosedown Park Pty Ltd. Review of the Convention on Contracts for the International Sale of Goods
(CISG) (1998) 53.
Outline
1. Form of notice. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2. The possibility of implicit notice. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
3. Time period for notice to be given . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
4. Risk of non-delivery of notice. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

1 Art. 26 makes clear that a party entitled to terminate a contract must give notice of
avoidance to the breaching party. This distinguishes it from its predecessor, the ULIS,
which provided for automatic termination of a contract.1 Requiring that notice be
given avoids the problem of determining the date on which the termination is effective
once there has been a breach.2 It also distinguishes CISG practice from that found in
systems based on the French Civil Code, which does not permit unilateral notice of
termination by an aggrieved party but requires that avoidance be declared by court
decision.3 Permitting the aggrieved party to give notice of avoidance allows the
contracting parties to clarify the status of their relationship without engaging in
litigation, unless of course the non-avoiding party disputes the avoiding party’s right
to terminate the contract.4
1 Magnus, The Remedy of Avoidance of Contract under CISG – General Remarks and Specific Cases,
25 The Journal of Law and Commerce (2005–06) 423 (426). See also Arts 49 (“buyer may declare the
contract avoided”) and 64 (“seller may declare the contract avoided”).
25 The Journal of Law and Commerce (2005–06) 423 (426).

3 Schlechtriem, Basic Structures and General Concepts of the CISG as Models for a Harmonisation of
the Law of Obligations, 10 Juridica International (2005) 27 (32).

4 Schlechtriem, Basic Structures and General Concepts of the CISG as Models for a Harmonisation of
the Law of Obligations, 10 Juridica International (2005) 27 (32).
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Art. 26 does not specify what form notice must take, nor does it clarify whether 2
notice need be explicit or implicit. It also says nothing about the time period in which
notice needs to be given. These are the issues that have given rise to the greatest
controversy under the provision.
1. Form of notice
Art. 26 imposes no specific requirements as to the form that notice must take. Notice 3
of avoidance must be communicated to the other party by appropriate means, which
can include either written or oral notification.5 Electronic communications will suffice,
provided that the addressee has expressly or impliedly consented to receive electronic
messages of that type, in that format, at that address.6 Thus, notice of avoidance can
come by email in appropriate circumstances.7 The most important factor is that the
information be conveyed to the addressee, rather than that it be conveyed in a particular
form.8 Telephonic notice is acceptable.9 Several courts and commentators have sug-
gested that the burden of proof will lie on the party giving notice to prove that the
telephone call occurred, notwithstanding Art. 27’s allocation of the responsibility for a
delay or error in the transmission at the door of the breaching party.10 Thus, written
notice, whether electronic or in the form of paper, is desirable from an evidentiary
standpoint.11
The communication need not contain the word “avoidance,” but it must make clear 4
that the injured party is no longer prepared to perform its duties under the contract as a
result of the other party’s breach.12 For example, in one German case the notice from
5Oberster Gerichtshof (Austria) 6 February 1996 (Propane gas), CISG-Online 224 (Pace).
6CISG – AC Opinion no 1, Art. 26.
25 The Journal of Law and Commerce (2005–06) 423 (426). See also Ferrari, Brief Remarks on the
Conclusion of Contract on the Internet and the United Nations Convention on Contracts for the
International Sale of Goods (CISG), 5 European Legal Forum (2000/2001) 301 (307); Gabriel, General
Provisions, Obligations of the Seller, and Remedies for Breach of Contract by the Seller, in: Ferrari/
Flechtner/Brand, Draft Digest and Beyond (2003), pp. 341 et seq.
8 CISG – AC Opinion no 1, para. 26.1.
9 Oberster Gerichtshof (Austria) 29 June 1999 (Plates), CISG-Online 483 (Pace); Landesgericht Frank-
furt (Germany) 9 December 1992 (Shoes), CISG-Online 184 (Pace). If, however, a party’s principal place
of business is in a state that has taken a reservation under Art. 96, the notice might have to be in writing.
Gabriel, Contracts for the Sale of Goods: A Comparison of US and International Law (2009) p. 112;
Honnold, Uniform Law (2009), Art. 26 para. 187.2.
10 See, e. g., Landgericht Kassel (Germany) 22 June 1995 (Clothes), CISG-Online 370 (Pace); Land-
gericht Frankfurt (Germany) 13 July 1994 (Shoes), CISG-Online 118 (Pace); Jacobs, Notice of Avoidance
Under the CISG: A Practical Examination of Substance and Form Considerations, the Validity of Implicit
Notice, and the Question of Revocability, 64 University of Pittsburgh Law Review (2003) 407 (411–12);
11 The parties to a contract can specify the means of communication by which notice of avoidance
should be conveyed to the other party. Schlechtriem, 25 Years of the CISG: An International lingua franca
for Drafting Uniform Laws, Legal Principles, Domestic Legislation and Transnational Contracts, in:
Flechtner/Brand/Walter, Drafting Contracts (2007), p. 182.
12 See, e.g., Huber, in: Huber/Mullis, The CISG, p. 210, Fountoulakis, in: Schlechtriem/Schwenzer,
Commentary (2016), Art. 26 paras 6 et seq.; Oberster Gerichtshof (Austria) 5 July 2001 (Intel Pentium
II/300 Processors), CISG-Online 652 (Pace); Oberster Gerichtshof (Austria) 6 February 1996 (Propane
gas), CISG-Online 224 (Pace); Oberlandesgericht Köln (Germany) 14 October 2002 (Designer clothes),
CISG-Online 709 (Pace); Oberlandesgericht Karlsruhe (Germany) 19 December 2002 (Machine), CISG-
Online 817 (Pace).
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the buyer informed the seller that the goods were “immediately and totally” at his
disposal, requested repayment of the price, and refused any further deliveries.13 The
German court held these terms to have provided sufficient notice of avoidance.14 Court
decisions stress that a “notice of avoidance under Art. 26 CISG must satisfy a high
standard of clarity and precision”15 and “must be unambiguous in that the [aggrieved
party] does not want to keep the contract on foot.”16 Notwithstanding these high
standards, the parties’ declarations should be interpreted in conformity with what a
reasonable person would have understood in those same circumstances.17 Thus, if a
reasonable person would view the communication as clearly expressing the aggrieved
party’s wish to avoid the contract as a result of the particular breach, notice of
avoidance will have been given.
5 Once a party has avoided the contract, its subsequent conduct will not rescind the
notice. In one case, a buyer’s offer to return non-conforming goods served as notice of
avoidance in a case involving the sale of defective shoes.18 This notice was not undone
by the buyer’s subsequent letter informing the seller that the buyer would try to sell the
shoes; the latter action was simply an attempt by the buyer to mitigate damages.19
6 A party’s right to avoid a contract will frequently be linked to the expiry of an
additional period of time granted for performance under the nachfrist principle. Once
the extended period of time has elapsed, the aggrieved party must actually exercise its
right to avoid; the passage of time alone will not be sufficient to serve as a notice of
avoidance.20 Although one court has suggested in obiter dicta that it might be possible
to declare an anticipatory notice of avoidance at the same time as a party sets the extra
time period, the better and more commonly taken view is that specific notice must be
given once the additional period has elapsed.21 Indeed, most tribunals have suggested
that the setting of an additional period of time for performance is not compatible with
automatic termination upon the expiry of that time period.22 This is because the ability
13 Oberlandesgericht Köln (Germany) 14 October 2002 (Designer clothes), CISG-Online 709 (Pace).
14 Oberlandesgericht Köln (Germany) 14 October 2002 (Designer clothes), CISG-Online 709 (Pace).
15 Arbitral Award, ICC 9978/1999, March 1999 (Goods not specified) (Pace).
16 Oberster Gerichtshof (Austria) 28 April 2000 (Jewelry), CISG-Online 581 (Pace).
17 See Jacobs, Notice of Avoidance Under the CISG: A Practical Examination of Substance and Form
Considerations, the Validity of Implicit Notice, and the Question of Revocability, 64 University of
Pittsburgh Law Review (2003) 407 (409); Arbitral Award, ICC 8128/1995 (Chemical fertilizer) (Pace);
Arbitral Award, ICC 7645/1995, March 1995 (Crude metal) (Pace) (buyer’s statement that it would not
take shipment because cargo was loaded after the shipping date and after the expiry of the letter of credit
was sufficient to constitute notice of avoidance).
18 Landgericht Berlin (Germany) 15 September 1994 (Shoes), CISG-Online 399 (Pace).
19 For discussion as to the possibility of rescinding notice, see the commentary to Art. 27 infra, paras 15
et seq.
20 Oberlandesgericht Graz (Austria) 29 July 2004 (Construction equipment), CISG-Online 1627 (Pace);
Vrhovno sodisce (Slovenia) 13 September 2011 (Water and oil pumps), CISG-Online 2329 (Pace) (unclear
whether notice had been given upon expiry of the Nachfrist period; Supreme Court remanded for factual
findings on that question).
21 Oberlandesgericht Graz (Austria) 29 July 2004 (Construction equipment), CISG-Online 1627 (Pace).
The Austrian court suggested the possibility of dual-purpose notice found in the seller’s statement –
“Should you fail to make payment and collect the identified machinery until [sic] 10 July 2002, we will
rely on claims for damages because of non-performance or avoid the contract.” – insufficient. The buyer,
however, had responded by requesting cancellation of the contract, which in itself amounted to a notice
of avoidance, and the court held that the seller was thus not obligated to provide any further declaration.
The court did not explain why the seller’s initial declaration had been inadequate, although the most
likely reason is that it provided alternatives and thereby created ambiguity. The DCFR provides that
setting the nachfrist period can serve as automatic notice of avoidance on its expiration. See para. 16,
infra.
22 Arbitral Award, ICC 11 849/2003 (Fashion products) (Pace). A seller who wrote a letter to a buyer
giving it an additional 20 days to open a letter of credit and providing that the contract would be
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to terminate is triggered only by the elapse of the additional period of time set by the
first notification. The latter view is preferred as it provides more certainty and avoids
ambiguity about the status when the late-performing party performs, or partially
performs, during the additional period of time.
2. The possibility of implicit notice

The biggest controversy under Art. 26 has been whether implicit notice is permis- 7
sible. The bulk of authority suggests that the intention to avoid can be implied rather
than express, but the implication must be very strong.23 A buyer who does not provide
explicit notice of intent to avoid in a market in which prices are increasing sharply has
not fulfilled the obligations in Art. 26.24 Yet in one case a Swiss court held that it could
give juridical effect to the inaction of the parties after the late delivery of (non-
conforming) goods: “This common inactivity of parties must be analyzed as the
reciprocal manifestation of a tacit will to renounce the performance of the contract.”25
In another case, the buyer was excused from its failure to expressly avoid the contract
due to the seller’s having “seriously and conclusively refused to perform its contractual
obligations by disputing the existence of a binding contract.”26 These conclusions will
likely be fairly fact-specific. In the first case, the court held that the time period for
delivery was an essential part of the contract such that late delivery was a fundamental
breach; the goods eventually delivered were late and there had been ample correspon-
dence between the parties about the importance to the buyer of timely delivery of the
product – Egyptian cotton – due to its commitments to subsequent purchasers.27 The
second raised a question of estoppel.
Filing a claim in local court has been held adequate to constitute notice of avoid- 8
ance.28 An Australian company failed to pay in full for tent hall structures it purchased
from a German company, and ultimately filed for insolvency. After negotiation failed to
terminated at the end of the period of time had not given notice of avoidance under Art. 26. According to
the tribunal, termination would have required a second, specific notice after the elapse of the additional
period of time.
25 The Journal of Law and Commerce (2005–06) 423 (427 note 13) (collecting authorities for and
against); Fountoulakis, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 26 paras 7 et seq.; Andersen,
Selected Notice Requirements under CISG, PECL, and UNIDROIT Principles: CISG Arts 39 & 26;
UNIDROIT Principles, Arts 1.9, 3.14, 7.3.2; PECL Arts 1.303, 3.304, 4.112, 9.303, 13.104 (November
2004) (Pace); Jacobs, Notice of Avoidance Under the CISG: A Practical Examination of Substance and
Form Considerations, the Validity of Implicit Notice, and the Question of Revocability, 64 University of
Pittsburgh Law Review (2003) 407 (413); Butler, A Practical Guide to the CISG: Negotiations Through
Litigation (2007) para. 6.05[A] (notice must be “recognizable and realizable to the other party”).
24 Arbitral Award, AAA 50181T 0 036 406, 12 December 2007 (Frozen chicken parts), Macromex Srl. v


26 Oberlandesgericht München (Germany) 15 September 2004 (Leather for furniture), CISG-Online
1013 (Pace).
27 Oberlandesgericht München (Germany) 15 September 2004 (Leather for furniture), CISG-Online
1013 (Pace); Oberlandesgericht Hamburg (Germany) 28 February 1997 (Iron molybdenum), CISG-Online
261 (Pace) (holding that an explicit declaration of notice was unnecessary because the seller had refused
to deliver).
28 Federal Court Adelaide (Australia) 28 April 1995 (Tent hall structures), Roder Zelt- und Hallenkon-
struktionen GmbH v Rosedown Park Pty Ltd et al., CISG-Online 218 (Pace), para. 48. The German seller
retained title to the goods pending payment in full. According to the commentary on the case, the Court
erred in treating it as a sale of goods; rather, performance on the part of the seller was complete, and the
seller’s retention of title served a security function and should have been treated under the applicable
domestic law on security interests. Ziegel, Comment on Roder Zelt-und Hallenkonstruktionen GmbH v
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resolve the dispute between the parties, the seller filed a statement of claim in court in
which it asked for leave to take possession of the goods; the Federal Court in Adelaide
held that the filing of the statement of claim sufficed as a declaration of avoidance.29
One commentator questioned this assumption on the grounds that the filing of a writ
would, in some circumstances, be “too blunt an instrument for giving notice of
avoidance.”30 This might be the case, for example, when a buyer initiates proceedings
to avoid a contract because the goods were defective. Thus, scholars have taken the
position that commencing court proceedings does not deprive a seller of the option to
cure.31 Again, the lesson for the avoiding party is to provide clear notice of intent to
avoid so as to circumvent later problems.
9 Avoidance under Art. 26 is also linked to the ability of the wronged party to “cover” by
engaging in a substitute transaction. According to one Spanish court, a buyer cannot
recover the difference in the price paid in the substitute transactions and the contract price,
as provided for in Art. 75, before notice of avoidance is given to the seller.32 Yet according
to another court, scholarly opinion is that “the party relying on a breach of contract may
demand a claim for the price difference even without a formal act of contract avoidance by
executing the cover transaction and thereby abdicating any further execution of the
contract.”33 Implicit in this holding is that the breaching party have notice of the cover
transaction and sufficient knowledge of the situation to understand its implications. Acts
such as the return of goods without further explanation will tend not to equate to notice as
the receiving party might interpret the act to be something other than notice of avoidance.34
10 The key factor is the avoidance of ambiguity. The CISG included an explicit notice
provision to avoid many of the problems that had arisen under the ULIS, which permitted
ipso facto avoidance – i. e., avoidance without notice to the breaching party.35 Because of
the consequences of avoidance – likely a claim for damages and/or restitution on the part
of the parties – the declaration of avoidance should be clear and precise.36
Rosedown Park Pty Ltd., Review of the Convention on Contracts for the International Sale of Goods
(CISG) (1998) 53 (56–57) (Pace).
29 Federal Court Adelaide (Australia), 28 April 1995 (Tent hall structures), Roder Zelt- und Hallenkon-
strucktionen GmbH v Rosedown Park Pty Ltd et al., CISG-Online 218 (Pace), para. 59. The appointment
of an administrator also did not excuse Roder Zelt from notifying avoidance of the contract; while the
Australian Companies Law prevented Roder Zelt from repossessing the goods while they were in
administration, it did not prevent its filing a notice of avoidance.
30 Ziegel, Comment on Roder Zelt-und Hallenkonstruktionen GmbH v Rosedown Park Pty Ltd Review
of the Convention on Contracts for the International Sale of Goods (CISG) (1998) 53 (60) (Pace); see also
Gabriel, General Provisions, Obligations of the Seller, and Remedies for Breach of Contract by the Seller,
in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 339 (suggesting this would be a
dangerous general proposition).
31 Ziegel, Comment on Roder Zelt-und Hallenkonstruktionen GmbH v Rosedown Park Pty Ltd Review
of the Convention on Contracts for the International Sale of Goods (CISG) (1998) 53 (60 note 23) (Pace).
32 Audiencia Provincial de Valencia (Spain) 31 March 2005 (Oranges), Frischaff Produktions GmbH v
Guillem Export S. L, CISG-Online 1369 (Pace).

33 Oberlandesgericht Graz (Austria) 29 July 2004 (Construction equipment), CISG-Online 1627 (Pace).
What is not clear is whether when the aggrieved party is aware of the cover transaction, that conduct
could amount to adequate notice for purposes of Art. 26. Cf. Oberlandesgericht Düsseldorf (Germany)
22 July 2004 (Shoes), CISG-Online 916 (Pace) (there was no indication that the buyer knew the seller
intended to avoid the contract, even though the seller engaged in substitute transactions).
34 See, e.g., Butler, A Practical Guide to the CISG: Negotiations Through Litigation (2007)
para. 6.05[A].
35 Jacobs, Notice of Avoidance Under the CISG: A Practical Examination of Substance and Form
Pittsburgh Law Review (2003) 407 (417).
36 See, e. g., Schlechtriem/Butler, CISG (2009), pp. 94 seq.; Kritzer, Guide to Practical Application of the
United Nations Convention on Contracts for the International Sale of Goods (1989) p. 209.
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It is difficult to distinguish between notices to avoid the contract in its entirety and 11
notices regarding non-conformity of goods that are designed to elicit repair or
replacement. Art. 25, which permits a contract to be avoided only in the case of
fundamental breach, is helpful here. The suggestion is that parties should not be
allowed to avoid their contracts for anything less than a significant breach; similarly, a
notice of dissatisfaction that does not make clear the injured party regards the breach
as fundamental also favours construing unclear notices restrictively. A variation of this
scenario occurs when a party declares a contract avoided and characterizes the breach
as fundamental even though the conduct about which it complains does not in fact
amount to a fundamental breach and thus it is not entitled to declare the contract
avoided. Notice in that case might have been given but is not effective to create a
fundamental breach.37 As a practical matter, it is good to have the notice of avoidance
explain the reason for the avoidance, in addition to including a clear expression of
avoidance.38 This also helps to avoid any ambiguity that might result from a letter that
expresses only frustration with contract performance but does not explain the reason
for it.
3. Time period for notice to be given

Art. 26 says nothing about the time period in which the notice of avoidance must be 12
made. When the parties have performed their central obligations under the contract
(e. g., the seller has already delivered the goods, or the buyer has paid the price but has
violated another obligation, thereby committing a fundamental breach), Arts 49(2)
and 64(2) require that declarations be made within a reasonable period of time.39
Aside from these provisions, the Convention contains no general time limit on a
party’s exercise of its right of avoidance.40 One court has stated that “it was accepted
in the case law that a period of two years was reasonable [sic]”.41 One possibility is
that either the four-year period in the UN Limitation Convention42 or the limitations
period under applicable national law should fill the void.43 Another option would be
to tie the time period to the date the breach is discovered: “it seems appropriate to
impose a reasonable period of time within which avoidance must be declared also in
cases without explicit time limits. The period runs from the date at which the non-
breaching party knows or ought to know of its right of avoidance.”44 This requirement
would help to alleviate the potential for one party to speculate during a period of
37 See Flambouras, When Bullets Penetrate Bullet-Proof Vests: Conformity of the Bullet-Proof Material
to the Contract of Sale and Concurrent Remedies (A note on the judgment of the multi-member court of
first instance of Athens 4505/2009), (2010–2011) 29:1 Journal of International Law and Commerce 171
(195). Ambiguity can arise if the notice declares avoidance but describes conduct that clearly does not
amount to a fundamental breach. ibid. (195 n. 83)
38 Jacobs, Notice of Avoidance Under the CISG: A Practical Examination of Substance and Form
Pittsburgh Law Review (2003) 407 (409). Providing the reason for avoidance is especially useful when it
is required in other cases, such as when a buyer seeks to reject non-conforming goods under Art. 39.
39 See the Commentary, infra, Art. 49 paras 62 et seq. and Art. 64 para. 17.
25 The Journal of Law and Commerce (2005–06) 423 (428–29).

41 Court of Appeal of Douai (France), 6 February 2014 (Press brake), Getec v. Bystronic, CISG-Online
2548 (CLOUT 1504).

42 U. N. Convention on the Limitation Period in the International Sale of Goods, as amended.

44 Fountoulakis, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 26 para. 17.
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fluctuating market prices – a problem that was recognized but not addressed during
the negotiation of the Convention.45
13 Referring to the limitations period in the Limitation Convention as a default rule has
several advantages. First, the scope of application of the Limitation Convention
corresponds to that of the CISG. Second, using the Limitation Convention to establish
the limitations period would lead to a uniform result, whereas reference to municipal
law could well lead to disparate results given the variety of limitations periods used by
different countries.46 Third, and relatedly, using the limitations period of the Limitation
Convention would lead to greater predictability of result given potential uncertainty
about applicable law.
14 Using the Limitations Convention as a default rule does not mean that a party could
always wait four years before giving its notice of avoidance. A party that has led the
other to believe that it would not exercise its right to avoid the contract would be
precluded from doing so under principles of estoppel.47
4. Risk of non-delivery of notice

15 The risk of non-delivery of notice under Art. 26 is governed by Art. 27. Thus, so long
as the notice is delivered by appropriate means, the avoiding party can rely on the
declaration even if there is an error or delay in its transmission.48

16 Requiring that the aggrieved party give notice is consistent with practice under the
PICC49 as well as the PECL50 and the DCFR.51 All three provide that notice by any
appropriate means is sufficient.52 All three are somewhat ambiguous with respect to the
timing of the notice. According to the PICC, “If performance has been offered late or
otherwise does not conform to the contract the aggrieved party will lose its right to
terminate the contract unless it gives notice to the other party within a reasonable time
after it has or ought to have become aware of the offer or of the non-conforming
performance.”53 This provision is similar to Arts 49(2) and 64(2) CISG, and does not
answer what the limitation period should be in the case of a breach falling outside those
provisions. Art. 9:303(2) of the PECL provides that notice should be given within a
45 Fountoulakis, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 26 para. 17; Honnold, Uniform
Law (2009), Art. 26 para. 187.1.

46 Flambouras, When Bullets Penetrate Bullet-Proof Vests: Conformity of the Bullet-Proof Material to
the Contract of Sale and Concurrent Remedies (A note on the judgment of the multi-member court of
first instance of Athens 4505/2009), (2010–2011) 29:1 Journal of International Law and Commerce 171
(216 et seq.)

48 Huber/Mullis, The CISG (2007), p. 211; Fountoulakis, in: Schlechtriem/Schwenzer, Commentary
(2016), Art. 26 para. 13. For further analysis of the effect of this risk allocation provision, see the
commentary to Art. 27 infra at paras 7 et seq.
49 Art. 7.3.2(1) PICC.
50 Art. 9:303(1) PECL.
51 Art. III – 3.507(1) DCFR.
52 Art. 1.10(1) PICC (“Where notice is required it may be given by any means appropriate to the
circumstances.”); Art. 1.303(1) PECL (“Any notice may be given by any means, whether in writing or
otherwise, appropriate to the circumstances.”); Art. I-1:109 DCFR (“The notice may be given by any
means appropriate to the circumstances.”).
53 Art. 7.3.2(2) PICC. It thus aligns itself with Professor Fountoulakis’s suggestion that the notice
period be limited.
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reasonable time: “The aggrieved party loses its right to terminate the contract unless it
gives notice within a reasonable time after it has or ought to have become aware of the
non-performance.” The DCFR provides that a creditor will lose its right to terminate
“unless the notice of termination is given within a reasonable time.”54 The DCFR differs
from the CISG significantly in providing explicitly that a nachfrist notice can provide
for automatic termination in the event of non-performance after the expiry of the
nachfrist period.55 Further notice need not be given.
54 Art. III-3:508(1) DCFR.
55 Art. III-3:507(2) DCFR.
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Article 27
Unless otherwise expressly provided in this Part of the Convention, if any notice,
request or other communication is given or made by a party in accordance with this
Part and by means appropriate in the circumstances, a delay or error in the
transmission of the communication or its failure to arrive does not deprive that party
of the right to rely on the communication.
Bibliography: Jacobs, Notice of Avoidance under the CISG: A Practical Examination of Substance and
Pittsburgh Law Review (2003) 407; Schlechtriem, Effectiveness and Binding Nature of Declarations
(Notices, Requests or Other Communications) under Part II and Part III of the CISG, Cornell Review of
the Convention on Contracts for the International Sale of Goods (1995) 95; CISG-AC Opinion no 1,
Electronic Communications under CISG, 15 August 2003. Rapporteur: Professor Christina Ramberg,
Gothenburg, Sweden (at http://www.cisg-ac.org.).
Outline
1. Dispatch rule and allocation of risk . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
2. Effect of dispatch of notice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
3. Proof of dispatch . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
4. Applicability to telephonic communications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
5. Applicability to email communications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
6. Derogating from Art. 27 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
a) Derogation in the CISG . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
b) Derogation by usage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
c) Derogation by the terms of the contract . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
7. Appropriateness of the means of communication. . . . . . . . . . . . . . . . . . . . . . . . . . 27

1 This article sets forth the general rule on the allocation of risk with respect to
communications made under Part III (Arts 25–88). It is applicable when one party must
give notice to another for any of the myriad purposes notice can serve under Part III, such
as notice of defectiveness and notice of avoidance, unless a particular article provides
otherwise. It applies once a contract has been concluded and, usually, after there has been
a breach.1 The rationale behind Art. 27 is to place the risk of non-receipt on the breaching
party so long as the notifying party has attempted to communicate by reasonable means.
2 Giving effect to the sending of a communication is often referred to as a “dispatch”
rule – the communicating party is protected immediately upon dispatch of the
communication. Art. 27 stands in contrast to the rule of contract formation set forth
in Part II, under which an acceptance becomes effective only upon receipt. Art. 27
applies to Part III generally because it was deemed desirable to have “one rule governing
the hazards of transmission.”2
1 Gabriel, in Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 341 (noting three exceptions:
Arts 32(1), 67(2) and 88).

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Art. 27 is a default rule. It does not apply when the specific Art. provides otherwise 3
(Arts 47(2), 48(4), 63(2), 65(1) and (2), and 79(4)), when the parties have agreed
otherwise,3 or if there is usage to the contrary, whether that usage developed due to the
parties’ course of dealings or whether it is usage regularly observed by parties in the
particular trade concerned.4
The method of notice has to be reasonable in the circumstances. This means that the 4
communicating party must use a means of communication likely to reach the counter-
party, and those means could vary from case to case.

Art. 27 is a deceptively simple provision. The clearest role played by Art. 27 is that of 5
allocating the risk of loss of a communication. A notifying party can protect himself and
his ability to rely on other provisions of the CISG by notifying the breaching party of
the breach; should that notice go astray the injured party can still claim the protection
of the Convention.
Less clear by its terms is the extent to which Art. 27 establishes a substantive rule 6
regarding the effective date of the dispatched notice. In other words, does Art. 27 mean
a buyer’s notice, whether of avoidance or of defective goods, becomes effective
immediately he sends it, or is it only effective when the seller receives it? If it is the
former, does the buyer lose his ability to revoke the notice prior to the seller’s receipt of
it? These questions and others will be addressed below.
1. Dispatch rule and allocation of risk

Art. 27 is a “dispatch rule” and is often analogized to the “mailbox rule” familiar to 7
common lawyers. The rule that a contract is formed when the offeree places her
acceptance in the mail is often traced to the nineteenth-century English case Adams v
Lindsell.5 Its primary advantage is in establishing a bright-line rule as to the time when
the contract is formed. Otherwise, an acceptance could take effect “when it is actually
communicated to the offeror, when it arrives at his address, when it would in the
ordinary course of post have reached him, or when it is posted.”6
The mailbox rule plays a more limited role in Anglo-American practice than is often 8
appreciated. It governs acceptance in the context of contract formation. Almost all other
communications are effective only upon receipt.7
The decision to adopt a dispatch rule in the CISG was a “close question.”8 A 9
significant factor was concern about protecting the injured party’s ability to rely on a
communication he is required to make under the Convention.9 For example, absent a
buyer’s notice to the seller that goods are defective, a buyer must pay the seller the full
price for the goods. Providing that notice protects the buyer.
Art. 27 usually applies after there has been a breach, and it places the risk of non- 10
receipt on the breaching party so long as the notifying party has attempted to
3 Jacobs, Notice of Avoidance under the CISG: A Practical Examination of Substance and Form
Pittsburgh Law Review (2003) 407 (411).
4 Art. 9 CISG; Huber, Huber/Mullis, The CISG (2007), p. 40.
5 Adams v Lindsell (1818) 1 B. & Ald. 681.
6 Chitty on Contracts, Vol. 1 (29th edition 2004), para. 2–046.
7 Perillo, Corbin on Contracts, Vol. 1 (1993), sect. 3.24.
8 Honnold, Uniform Law (2009), Art. 27 para 189.
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communicate by reasonable means. The requirement that the notifying party use a
circumstantially appropriate method of communication serves to provide some protec-
tion to the receiving party.10
11 Although Art. 27 is usually applicable in post-breach situations, it also applies to
other communications, some of which also involve the transfer of risk from the
notifying party to the party receiving the notice. It applies, for example, when a seller
informs a buyer that certain goods are identified to the contract under Art. 67(1).11
12 The general allocation-of-risk function of Art. 27 had no exact counterpart in the
ULIS, although ULIS Art. 39(3) applied a similar rule regarding notice of non-con-
formity of goods.
2. Effect of dispatch of notice

13 By its terms, Art. 27 simply allocates the risk when properly dispatched notice goes
astray. Yet Art. 27 can also be interpreted as having a substantive effect by making the
date of dispatch significant for ascertaining the rights of the parties. This commentary
takes the position that the latter position is the better interpretation.
14 A few commentators favour limiting Art. 27 to serving a risk-allocation function.12
This interpretation would presumably mean that the notice would be operative only
upon receipt, or on the date receipt ought to have occurred absent the communication’s
having gone astray, since the dispatch notion is found only in Art. 27.13 The problem
with this interpretation is that it seems to undermine the protection the Convention
drafters attempted to confer on the notifying party. It also is inconsistent with the
structure of the Convention: many articles specify that notice is effective only upon
receipt, and those provisions would have been unnecessary were Art. 27 to be read as
incorporating a notice-on-receipt default rule. Furthermore, the Secretariat Commen-
tary makes clear that it considered notices to be effective upon dispatch because
acceptance of a generalized receipt theory would have required greater elaboration of
procedural rules in support of receipt “since legal systems which operated on the theory
that notices were effective on dispatch often did not contain such supporting rules.”14
The exceptions to those occasions were specified in the specific articles of Part III when
notice on receipt was deemed more desirable.15
15 The operative date of the notice is important in many different situations. For
example, a declaration of avoidance releases both parties from any further obligations
they may have under the contract.16 Is that release effective as of dispatch, or as of
receipt? Deciding that it is effective as of dispatch frees the notifying party to act secure
in the knowledge that he has avoided the contract, without waiting for whatever time
would be necessary for receipt. Thus, the better answer is dispatch.17 In principle a
buyer must be able to make restitution of goods in order to avoid a contract (Art. 82),

11 Lookofsky, Understanding the CISG (2008) p. 103.
12 See, e.g., Jacobs, Notice of Avoidance under the CISG: A Practical Examination of Substance and
Pittsburgh Law Review (2003) 407 (423); Neumayer/Ming, Conventien de Vienne (1993), pp. 223 et seq.
13 Jacobs, Notice of Avoidance under the CISG: A Practical Examination of Substance and Form
Pittsburgh Law Review (2003) 407 (423); Schlechtriem/Butler, CISG (2009), para. 109.
14 Secretariat Commentary on 1978 Draft, Art. 25 (now Art. 27) para. 4; see also Schlechtriem/Butler,
CISG (2009), para. 109.

16 Huber, in Huber/Mullis, The CISG (2007), p. 243.
17 Huber, in Huber/Mullis, The CISG (2007), p. 243.
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and whether a buyer is able to make restitution has to be determined at the time the
buyer declares the contract avoided.18 Again the better answer is that the assessment of
restitution is done at the time of dispatch.19 Notice of defect must be given in a timely
manner under Art. 38(1); the posting of notice within the time limit will qualify as
timely.20
The time of effectiveness is especially important for revocation of notice of avoidance 16
of a contract. The CISG is silent as to whether a party can revoke its notice of avoidance
prior to the time it reaches the breaching party – what is known as an overtaking
revocation. If the notice is effective upon dispatch, would this mean that it could not be
withdrawn, either before or after it reaches the breaching party? Taking the strictest
view of the effect of the declaration, the answer would be that it could not be
withdrawn.21 The declaration becomes effective at the time it is sent. The arguments
against permitting revocation are: (1) it would be inconsistent with the principle of
certainty to permit the dispatching party to rescind the declaration of notice; (2) the
dispatching party is the one protected by the allocation of risk, and it would be unfair to
permit it to take advantage of a change of circumstances making revocation of the
notice of avoidance desirable.
These arguments are not persuasive. Although the common law mailbox rule has 17
adopted a strict reading of the effectiveness of dispatch such that revocation is
impermissible after that point, this result is neither dictated by a dispatch rule nor
consistent with common sense.22 Prior to the breaching party’s receipt of the notice, he
could not have relied upon it. Thus, permitting revocation offers no unfairness to him.23
As for the possibility that the giver of notice will take advantage of a change in market
conditions to revoke the notice, the response is two-fold. First, he is the injured party,
and permitting revocation of notice simply permits him to insist on an already agreed-
upon contractual obligation. Second, this view is consistent with the overall goal of the
CISG, which is to encourage performance and to limit the ability of parties to avoid
their contractual obligations. Thus, there is no unfairness to it in permitting revocation
of the notice prior to the time of receipt, and possibly even later.
This leads to the question of whether revocation of a notice of avoidance should be 18
permitted if it arrives even after the notice. It has been suggested that revocation should
be possible until the receiving party has actually relied on the notice.24 Yet it is desirable
to have greater certainty with respect to the time after which revocation is no longer
permissible. Thus, absent extraordinary circumstances, Art. 27 should be read to permit
an overtaking revocation. Once notice of avoidance is received, however, it would no
18Huber, in Huber/Mullis, The CISG (2007), p. 211.

19“According to the principle underlying Art. 27 CISG, this must be the moment when he dispatches it
in an appropriate way.” Huber, in Huber/Mullis, The CISG (2007), p. 211.
20 Oberlandesgericht Graz (Austria) 11 March 1998 (Wood), CISG-Online 670 (Pace).
21 This is the view taken in Anglo-American jurisprudence. It has been widely criticized as an
unnecessarily strict rule that often limits the ability of parties to alter their contracts even when doing
so would be desirable.
22 Perillo, Corbin on Contracts, Vol. 1 (1993), sec. 3.24; cf. Chitty on Contracts, Vol. 1 (29th ed. 2004),
para. 2–052.
23 Professor Schlechtriem argued vigorously that separating the effectiveness of the notice from its
irrevocability is permitted by the Convention. Schlechtriem, Effectiveness and Binding Nature of

Declarations (Notices, Requests or Other Communications) under Part II and Part III of the CISG,
Cornell Review of the Convention on Contracts for the International Sale of Goods (1995) 95 (105 et seq.)
(Pace).
24 Schlechtriem, Effectiveness and Binding Nature of Declarations (Notices, Requests or Other Com-
munications) under Part II and Part III of the CISG, Cornell Review of the Convention on Contracts for
the International Sale of Goods (1995) 95 (107 seq.) (Pace).
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longer be permitted, unless the parties specifically agree to alter the current state of their
relationship, or in rare circumstances in which the equities dictated such a result.25 A
Danish case is an illustrative example in which the court permitted revocation of the
notice of avoidance long after it was received because of the conduct of the recipient of
the notice, who refused to accept the notice of avoidance, and later refused to permit it
to be revoked in order to benefit from the mitigating steps taken by the buyer.26
3. Proof of dispatch
19 The burden of proving that a communication was sent lies on the sending party.27
Once that fact is proved, the notice is deemed effective, whether or not it was ever
received.28 The power of the rule, and the importance of proof of dispatch, is evidenced
by a case in which a court dismissed a buyer’s claim that it had never received a
reminding letter from the seller’s attorney. Receipt was not at issue; rather, the buyer
did not claim the letter had never been sent, which was the key question.29
4. Applicability to telephonic communications

20 The wording of Art. 27 suggests that it is applicable only between absentees.30 Yet
there is no question that notice can be given orally, so long as oral communication is
appropriate in the circumstances.31 Oral statements need to be carried out audibly and
in a manner that is understandable to the other party. Telephonic communications are
usually likened to in-person communications in that it is relatively easy for the
communicating party to ascertain whether the listening party has heard him.32 One of
the significant drawbacks to a telephonic communication is the difficulty in proving that
it was made, and that the appropriate information was conveyed to the appropriate
25 Professor Schlechtriem suggested that the burden of proving lack of reliance would be on the party
seeking to revoke the notice. Yet that party is unlikely to have access to such factual information. Jacobs,
Notice of Avoidance under the CISG: A Practical Examination of Substance and Form Considerations,
the Validity of Implicit Notice, and the Question of Revocability, 64 University of Pittsburgh Law Review
(2003) 407 (426 et seq.).
26 After receiving the buyer’s notice of avoidance, the seller refused to acknowledge its fundamental
breach. In an attempt to mitigate its damages during the on-going litigation, the buyer repaired and used
the machine. The seller resisted the buyer’s attempt to rescind its notice of avoidance and sought
restitution of the machine. The Danish Supreme Court permitted the revocation of the notice of
avoidance, apparently on a theory of estoppel. Højesteret (Denmark) 3 May 2006 (Block machine and
mould), CISG-Online 2630 (Pace); Schlechtriem, Effectiveness and Binding Nature of Declarations
(Notices, Requests or Other Communications) under Part II and Part III of the CISG, Cornell Review of
the Convention on Contracts for the International Sale of Goods (1995) 95 (100) (Pace); Liu, in
Felemegas, An International Approach to the Interpretation of the United Nations Convention on
Contracts for the International Sale of Goods (1980) as Uniform Sales Law (2007), p. 138 (143 note 28).
27 Oberster Gerichtshof (Austria) 30 June 1998 (Pineapple), CISG-Online 410 (Pace); Oberlandesgericht
Naumburg (Germany) 27 April 1999 (Automobile), CISG-Online 512 (Pace).

28 Oberster Gerichtshof (Austria) 24 May 2005 (Grinding stock), CISG-Online 1046 (Pace).
29 Oberlandesgericht Düsseldorf (Germany) 22 July 2004 (Shoes), CISG-Online 916 (Pace).
30 Oberlandesgericht Graz (Austria) 11 March 1998 (Wood), CISG-Online 670 (Pace); Schwenzer/
Fountoulakis, International Sales Law (2007), p. 188; Schroeter, in: Schlechtriem/Schwenzer, Commentary
(2016), Art. 27 para. 5.
31 Liu, in Felemegas, An International Approach to the Interpretation of the United Nations Conven-
tion on Contracts for the International Sale of Goods (1980) as Uniform Sales Law (2007), p. 138 (139).
Several states have made declarations under Art. 96 CISG rejecting provisions allowing notice in any form
other than writing.
32 Perillo, Corbin on Contracts, Vol. 1 (1993), s. 3.25; Chitty on Contracts, Vol. 1 (29th ed. 2004),
para. 2–049; Schroeter, in Schlechtriem/Schwenzer, Commentary (2016), Art. 27 para. 5.
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person.33 One is thus wise to email, fax, or write whenever important information needs
to be conveyed and proof of its transmission might be at issue.
5. Applicability to email communications

Advisory Opinion no 1 makes clear that notices can be given by electronic means, 21
whenever the addressee has explicitly or impliedly consented to receive such messages.34
The communication must be sent to the address specified, but “the important factor is
that the information be conveyed to the other party, not in what form it is conveyed.”35
With respect to effectiveness of the notice given, the Advisory Opinion refers to the
Advisory’s Opinion’s comments with respect to Art. 15.36 The commentary to Art. 15,
which deals with contract formation and requires an offer to “reach” an offeree,
provides that an email message reaches the offeree when it reaches the offeree’s server,
so long as it is properly addressed and the offeree has consented to receive commu-
nications by such means.37
This reference to Art. 15 is inconsistent with the conclusion reached above – that 22
communications under Art. 27 are effective upon dispatch, unless otherwise specified.
In practice, given the speed with which electronic communications are usually effected,
this difference might not matter very frequently. Also, the Advisory Council Opinion
suggests that problems with the offeree’s server are within the sphere of influence of the
offeree and thus cannot be invoked by the offeree to argue non-receipt of an offer.38
With respect, it would be more consistent with the CISG to create a separate rule for
Art. 27 that is consistent with the separate treatment of notice between Parts II and III.
6. Derogating from Art. 27

Art. 27 is a default rule. Thus, it only applies absent other specification. 23
a) Derogation in the CISG. The rule in Art. 27 is specifically excluded by several 24
specific provisions in Part III. Arts 47(2), 48(4), 63(2), 65(1) and (2), and 79(4) all
provide that notice is effective only on receipt.39 A number of these provisions involve
communications by the breaching party, and the receipt rule was introduced in order to
place the burden of ensuring receipt on the breaching party, rather than on the injured
party.40 Thus, Art. 79(4) requires a seller who cannot perform due to impossibility, force
majeure, or the like, to give notice to the buyer. If the notice is not received by the buyer
within a reasonable period of time after the seller knew, or should have known, of the
33Amtsgericht Kehl (Germany) 6 October 1995 (Knitwear), CISG-Online 162 (Pace).

34CISG-AC Opinion no 1, Art. 27.
37 CISG-AC Opinion no 1, Art. 15.
38 CISG-AC Opinion no 1, para. 15.3. Professor Gabriel predicts future problems with electronic
communications because of differing national practices respecting what constitutes dispatch and receipt.
Gabriel, in Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 342.
39 Art. 47(2) applies when a seller notifies a buyer that the seller will not perform within the additional
time period specified by the buyer; Art 48(4) provides for a seller’s notice of the intent to cure; Art. 63(2)
requires the seller not to resort to the remedy for breach of contract during the additional time period
provided for performance; Art. 65(1) provides for the seller to supply missing information; Art. 65(2)
requires the seller to give notice to the buyer of missing terms and fixes an additional time for the buyer
to correct the supplied terms; and Art. 79(4) requires a party who fails to perform to give notice of any
impediment and its effect on the ability to perform.
40 Honnold, Uniform Law (2010), Art. 27 para. 190; Gabriel, in Ferrari/Flechtner/Brand, Draft Digest
and Beyond (2003), p. 341
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impediment to its performance, the seller will be liable for damages resulting from the
lack of notice to the buyer.41
25 b) Derogation by usage. Usage, by virtue of Art. 9(1), might serve to vary the
provisions of Art. 27.42 This could also hold true for practices as between the parties,
but the evidence that the parties intended to vary the allocation of risk under Art. 27
would have to be very strong.43
26 c) Derogation by the terms of the contract. The parties are free to derogate from the
default rule in Art. 27 by providing that their communications are effective only on
receipt, and by specifying the acceptable means of communication. The burden is on the
recipient, however, to establish that the parties adopted a different rule to govern their
relationship.44 Moreover, it appears that actual notice will be sufficient even if that
notice that does not comport with the terms of the contract.45
7. Appropriateness of the means of communication

27 The sender is protected under Art. 27 so long as the means of communication were
appropriate in the circumstances. More than one means of communication might be
appropriate; in such a case, the sender can select the means most convenient for him or
her to use.46 Providing that communications be made by means appropriate in the
circumstances is consistent with, but more generous than, ULIS Art. 14 and ULF
Art. 12(2). Each provided that communications be made by means “usual” in the
circumstances. The CISG substituted “appropriate” for “usual”, which suggests a party
has a broader choice of methods to employ in sending notice.47
28 The circumstances of an individual case play an important role in assessing the
appropriateness of the means of notice. While communication by airmail might usually
be acceptable, a situation in which speed is of the essence might require communication
by facsimile or email. For example, if fresh fruit or some other perishable food were the
product in question, notice of defect must be sent in a manner commensurate with
speed.48 If postal service is unreliable, then it would more appropriate to use another
means of communication.49 Art. 27 is likely to be interpreted by reference to other
provisions of the CISG, to trade usage, or to practice that has arisen between the parties.
29 As discussed above, electronic communications are acceptable, so long as the recipient
has either expressly or implicitly consented to communication on that basis.50

42 Schroeter, in Schlechtriem/Schwenzer, Commentary (2016), Art. 27 para. 7.
43 Schroeter, in Schlechtriem/Schwenzer, Commentary (2016), Art. 27 para. 8. Professor Schroeter
further suggests that such a derogation would have to be specially negotiated; adhesive terms would be
insufficient to effect such a change.
44 Landgericht Stuttgart (Germany) 13 August 1991 (Textiles), CISG-Online 33 (Pace).
45 Arbitral Award, ICC 11 849/2003 (Fashion products) (Pace). In this case, communications between
the parties were to be made in the language of the recipient. A letter sent to the buyer in New York was
drafted in Italian when it should have been drafted in English and was not addressed to the correct
recipient (though it was sent to the correct address). An officer of the company, however, actually
received the letter and one of the principals spoke Italian. The notice was thus deemed sufficient
notwithstanding its departure from the contractual language. See also Schroeter, in Schlechtriem/
48 Oberster Gerichtshof (Austria) 30 June 1998 (Pineapple), CISG-Online 410 (Pace).
50 Garro, in Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 371.
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The language of the communication has also been an issue. Generally the commu- 30
nication must be made in the language of the underlying agreement or of the parties’
practice.51 If notice is received in a language unknown to the recipient, however, the
recipient cannot simply ignore it. One court has suggested that the appropriate response
for the recipient is to seek clarification from the sender.52
It is up to each party to apprise the other of any changes in address in order to ensure 31
a smooth business relationship. A buyer who sends notice of defects to the seller’s last
known address will be deemed to have provided adequate notice.53 In a similar vein, a
party dealing in a perishable good, such as fresh fruit, must ensure that he can be
reached on short notice, including during the weekend.54
Notice to a third party, such as a self-employed broker, is not necessarily an 32
appropriate means of communication even if the broker effected the sale between the
parties.55 Notice via a third party is not necessarily foreclosed, but the communicating
party would have to point out to his messenger the role the messenger was supposed to
play, and the function and meaning of the message.56
Actual notice, even if conveyed by otherwise-inappropriate means, will suffice under 33
Art. 27.57 The risk-allocation provision operates in cases of non-notice, and the reason-
ableness of the means provision is included simply to determine whether the sending
party can take advantage of the protections accorded it under Art. 27.

The PICC have adopted the receipt principle of notice. They provide that, when 34
notice is required, “it is effective when it reaches the person to whom it is given.”58
Moreover, they explicitly place the risk of non-receipt with the sender: “An error
occurring in the expression or transmission of a declaration is considered to be a
mistake of the person from whom the declaration emanated.”59
The DCFR also provides that notice for any purpose becomes effective when it 35
reaches the addressee, unless the notice provides for a delayed effect.60 Notice “may be
given by any means appropriate to the circumstances.”61
The PECL have adopted a position somewhat closer to the CISG, at least with respect 36
to communications from an aggrieved party to a breaching party. In the PECL, the
general rule is that notice is effective on receipt, but there are exceptions.62 Art. 1.303(4)
states that notices given because of the other party’s non-performance (or because of the
51 Gabriel, in Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 341; Art. 9 CISG; Oberlan-
desgericht Hamm (Germany) 8 February 1995 (Socks), CISG-Online 141 (Pace).

52 Oberlandesgericht Hamm (Germany) 8 February 1995 (Socks), CISG-Online 141 (Pace).
53 Oberlandesgericht München (Germany) 17 November 2006 (Dust ventilator), CISG-Online 1395
(Pace). This was particularly true as the seller had sent invoices printed with the previous address several
months after the effective date of its move.
54 Oberster Gerichtshof (Austria) 30 June 1998 (Pineapple), CISG-Online 410 (Pace).
55 Landgericht Kassel (Germany) 15 February 1996 (Marble steps), CISG-Online 191 (Pace).
56 Landgericht Kassel (Germany) 15 February 1996 (Marble steps), CISG-Online 191 (Pace). The buyer
had justified his chosen means of communication due to speech impediments inhibiting telephonic
communication on the part of the seller. Given the possibility of communication by telefax, however, this
argument proved unavailing.
57 Landgericht Kassel (Germany) 15 February 1996 (Marble steps), CISG-Online 191 (Pace).
58 Art. 1.10(2) PICC.
59 Art 3.6 PICC.
60 Art. I-1:109(3) DCFR.
61 Art. I-1:109(2) DCFR.
62 Art. 1:303(2) PECL.
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Article 27 36 Part III. Sale of Goods
reasonable apprehension of forthcoming non-performance), if dispatched properly,

shall have effect as if they had arrived in ordinary circumstances.63 This is generally
interpreted as falling short of an effectiveness on dispatch rule.64 A lost or delayed
communication is deemed effective as of the date it should have arrived.65 Though oral
notice is permissible, the PECL provide that “[f]or notices of major importance written
form may be appropriate.”66
63 Art. 1:303(4) PECL.
66 Art. 1:303, comment B PECL.
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Article 28
If, in accordance with the provisions of this Convention, one party is entitled
to require performance of any obligation by the other party, a court is not bound to
enter a judgement for specific performance unless the court would do so under its
own law in respect of similar contracts of sale not governed by this Convention.
Bibliography: Bejesky, The Evolution in and International Convergence of the Doctrine of Specific
Performance in Three Types of States, 13 Indiana International and Comparative Law Review (2003)
353; Boghossian, A Comparative Study of Specific Performance Provisions in the United Nations
Convention on Contracts for the International Sale of Goods, Review of the Convention on Contracts
for the International Sale of Goods (CISG) (1999–2000) 3; Dawson, Specific Performance in France and
Germany, 57 Michigan Law Review (1959) 495; Flechtner, Buyers’ Remedies in General and Buyers’
Performance-Oriented Remedies, 25 Journal of Law and Commerce (2005–06) 339; Kastely, The Right
to Require Performance in International Sales: Towards an International Interpretation of the Vienna
Convention, 64 Washington Law Review (1988) 607; Kastely, Unification and Community: A Rheto-
rical Analysis of the United Nations Sales Convention, 8 Northwestern Journal of International Law
and Business (1988) 574; Lookofsky, The 1980 United Nations Convention on Contracts for
the International Sale of Goods, Art. 28, Specific Performance, in: Herbots/Blanpain (eds), International
Encyclopaedia of Laws – Contracts, Supplement 29 (2000), p. 81; Whittington, Reconsidering
Domestic Sale of Goods Remedies in Light of the CISG, 37 Victoria University Wellington Law Review
(2006) 421.
Outline
1. Specific performance under municipal law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
a) Civil law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
b) Common law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
2. The provisions of the Convention . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
a) The court’s “own law” . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
b) Court versus tribunal. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
c) The court “is not bound” to enter (or to refuse) a judgement for
specific performance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
d) “Similar contracts of sale” . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
3. Derogation from Art. 28 and party autonomy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
4. Seller’s right to require payment of the price. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

Art. 28 is a compromise position between the common law’s preference for money 1
damages in the event of a breach of contract and the civil law’s preference for
performance. Art. 62(1) expressly recognizes the seller’s right to claim performance
from the buyer, while Art. 46(1) specifies that the buyer has the right to claim
performance from the seller. In this respect, the Convention reflects the civil law’s
preference for performance over damages. Yet both of those articles are subject to
Art. 28, which says a court need not order specific performance of a contract unless
such a remedy would be available under its own law. This compromise was necessary
as the Convention is enforced by decentralized national courts whose willingness to
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use their coercive powers in a given situation will vary.1 The same issue was resolved
in a very similar fashion in Art. 16 ULIS, which provided that a domestic court would
not be bound “to enter or enforce a judgment for specific performance except in cases
in which it would do so under its law in respect of similar contracts of sale not
governed by the Uniform Law.”
2 Art. 28 has generated a good bit of scholarly attention but has been the topic of very
little practical controversy.2 Only one case has addressed it in detail.3 Fears that it would
give rise to forum shopping by disgruntled parties4 appear to have been unfounded.
There are several possible explanations for this. First, in numerous cases the courts to
which parties have made application have ordered performance in a manner that has
not sparked commentary.5 Those circumstances in which parties would prefer the
remedy of performance might well be those occasions on which even common law
courts would grant such a remedy.6 Second, Art. 28 is only implicated if performance is
available under the Convention.7 The limiting provisions in the Convention mean that
specific performance is not available in every situation.8 Third, parties to a contract
themselves very often prefer damages, so they do not necessarily demand performance
even if it would be available to them.9

3 Art. 28’s explicit reversion to the preference of the municipal law of the forum seems
to run counter to the general preference in the CISG to give priority to the international
1 Torsello, Remedies for Breach of Contract Under the 1980 Convention on Contracts for the
International Sale of Goods (CISG), in: Ferrari (ed), Quo Vadis CISG: Celebrating the 25th Anniversary
of the United Nations Convention on Contracts for the International Sale of Goods (2005), pp. 45 seq.
3 US District Court, Northern District of Illinois (U.S.) 7 December 1999 (Steel bars), Magellan
International Corp. v Salzgitter Handel GmbH, CISG-Online 439 (Pace). A few cases have concluded it
was not relevant to the case at hand. Handelsgericht Bern (Switzerland) 22 December 2004 (Watches),
CISG-Online 1192 (Pace); Cámara Nacional de Apelaciones en lo Comercial de Buenos Aires (Argentina)
21 July 2002 (Barley), Cervecerı́a y Malteria Paysandú S. A. v Cervecerı́a Argentina S. A., CISG-Online
803 (Pace); Arbitral Tribunal, ZHK 273/95, 31 May 1996 (Aluminium), Soinco v NKAP, CISG-Online
1291 (Pace).
4 See, e.g., Kastely, Unification and Community: A Rhetorical Analysis of the United Nations Sales
Convention, 8 Northwestern Journal of International Law and Business (1988) 574 (615); Ferrari, in:
Flechtner/Brand/Walter, Drafting Contracts (2007), p. 138.
5 See e.g., Zeller, CISG and the Unification of International Trade Law (2006) pp. 60 seq.
6 Flechtner, Buyers’ Remedies in General and Buyers’ Performance-Oriented Remedies, 25 Journal of
Law and Commerce (2005–06) 339 (344) (Pace); Boghossian, A Comparative Study of Specific Perfor-
mance Provisions in the United Nations Convention on Contracts for the International Sale of Goods,
Review of the Convention on Contracts for the International Sale of Goods (CISG) (1999–2000) 3 (28)
(Pace); Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 28 para. 4.
7 Reiley, International Sales Contracts (2008) p. 229.
8 Zeller, CISG and the Unification of International Trade Law (2006) p. 63; Gabriel, Contracts for the
Sale of Goods: A Comparison of US and International Law (2009) pp. 118 seq.; Honnold, Uniform Law
(2009), Art. 28 paras 192 seq.; Boghossian, A Comparative Study of Specific Performance Provisions in the
United Nations Convention on Contracts for the International Sale of Goods, Review of the Convention
on Contracts for the International Sale of Goods (CISG) (1999–2000) 3 (19 seq.) (Pace); Lookofsky,
Understanding the CISG (2008), p. 111.
9 Flechtner, Buyers’ Remedies in General and Buyers’ Performance-Oriented Remedies, 25 Journal of
Law and Commerce (2005–06) 339 (342 et seq.) (Pace); Bergsten, Commentary on Article 28 by Senior
Legal Officer, International Trade Law Branch, United Nations, in: Kritzer (ed), Guide to Practical
Applications of the United Nations Convention on Contracts for the International Sale of Goods (1989),
p. 215; Garro, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 368; Honnold, Uniform
Law (2009), Art. 28 para. 199.
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nature of the convention10 and to seek a uniform application and harmonization in case
outcomes.11 It also appears to run counter to the CISG’s general approach of prioritizing
claims for performance over money damages.12 In practice, however, differences
between the common law and civil law might be more philosophical than practical.13
Most claimants seek money damages.14 This tempers the potentially divisive effect of
Art. 28.
1. Specific performance under municipal law

A short overview of the differing approaches of the common law and the civil law 4
towards contract enforcement is essential to understanding the reasons why the
compromise in Art. 28 was necessary. The concept of performance is much more
limited in Anglo-American law; it refers to an order by a court to an individual
directing that he perform a contract.15 In civil law systems, it means any process by
which an injured party can get what he bargained for, including having defects cured at
the expense of the breaching party.16
a) Civil law. It is taken for granted in civil legal systems that an aggrieved party is 5
entitled to demand performance. This derives from the principle pacta sunt servanda –
contracts are to be honoured. There is a moral underpinning to this position: “the
binding nature of the performance is of the utmost importance to the civil law, and the
courts accordingly bind people to their promises.”17 This does not mean that perfor-
mance is always available. Some categories of performance are excluded from the ambit
of the performance preference: personal obligations are not enforceable, for example.18
Still, there is a baseline assumption that an order for performance will usually be
available if the aggrieved party desires it.19
10Schwenzer/Fountoulakis, International Sales Law (2007), p. 193.

11Zeller, CISG and the Unification of International Trade Law (2006) p. 55; Boghossian, A Compara-
tive Study of Specific Performance Provisions in the United Nations Convention on Contracts for the
International Sale of Goods, Review of the Convention on Contracts for the International Sale of Goods
(CISG) (1999–2000) 3 (28) (Pace).
12 Huber, in: Huber/Mullis, The CISG (2007), p. 186; Reiley, International Sales Contracts (2008)
p. 224. See the commentary, supra, Art. 46 paras 9 et seq. and Art. 62 paras 4 et seq.
13 See, e.g., Kritzer, Guide to Practical Applications of the United Nations Convention on Contracts for
the International Sale of Goods (1989) p. 219 (“despite differences in the rhetoric of their sales codes,
parties from [Western civil law jurisdictions], for economic reasons, do not resort to [performance] more
frequently than parties from common law jurisdictions.”); Spanogle/Malloy/Del Duca/Rowley/Bjorklund,
Global Issues in Contract Law (2007) p. 85; Honnold, Uniform Law (2009), Art. 28 para. 192.
14 Klimas, Comparative Contract Law: A Transystemic Approach With an Emphasis on the Continen-
tal Law (2005) p. 276; Felemegas, The right to require specific performance: comparison between the
provisions of the CISG (Arts. 28, 46, and 62) and counterpart provisions of the UNIDROIT Principles
(Arts. 7.2.1–7.2.5), in: Felemegas (ed), An International Approach to the Interpretation of the United
Nations Convention on Contracts for the International Sale of Goods (1980) as Uniform Sales Law
(2007), p. 145 note 8.
15 Treitel, Remedies for Breach of Contract (1988) p. 46.
16 Treitel, Remedies for Breach of Contract (1988) p. 46. A plaintiff’s acting at the expense of the
defendant is possible in English law, but only after an order for specific performance has been entered by
the court.
17 Curran, Comparative Law: An Introduction (2002) pp. 24 seq.; see also Bejesky, The Evolution in and
International Convergence of the Doctrine of Specific Performance in Three Types of States, 13 Indiana
International and Comparative Law Review (2003) 353 (375 et seq.).
tal Law (2005) pp. 276 seq.

19 Spanogle/Malloy/Del Duca/Rowley/Bjorklund, Global Issues in Contract Law (2007) pp. 85 et seq.
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6 Thus, in Germany, specific performance is the preferred remedy and is excluded only
if, for some reason, performance is not possible.20 Even though a damages remedy is
sought in a high percentage of cases, the fact that performance is available should
the claimant desire it affects the conduct of the parties and the functioning of the
legal system.21 German courts do not assert a discretionary power to refuse an order
of performance, although in certain cases “where performance is impossible, would
involve disproportionate cost, would introduce compulsion into close personal relation-
ships or compel the expression of special forms of artistic or intellectual creativity” a
German court will not order performance.22
7 Performance is also the preferred remedy under French law, and in the many legal
systems that follow the French Civil Code. A French court has no discretion to deny a
request for performance if circumstances exist to support the claim.23 Performance is
not, however, always available. French law distinguishes between obligations to “give,”
which are subject to an order for performance, and obligations to “do or not do,” which
are theoretically subject only to an award for damages.24 The theory behind this
distinction is that the personal liberty of the individual should not be compromised.
Yet there are many ways to get round the distinction so that an aggrieved party can
obtain performance. One remedy is for the court to order an astreinte – a fine payable
by the breaching party to the injured party for every day the obligation is not fulfilled.25
In practice in France, “a judgment for [specific performance] will be given in respect of
all obligations except those positive obligations which require personal performance and
those negative obligations the enforcement of which would result in such an inter-
ference with personal liberty as would be offensive to current morality.”26
8 b) Common law. The preference for the award of damages over specific performance
in the common law is to some degree the result of historical accident. Common law
courts in England had only limited authority. People would resort to courts of equity,
which were controlled directly by the King through his Chancellor, when the powers of
the common law courts did not extend to granting effective relief. These became known
as chancery or equity courts. In the area of remedies, common law courts could only
order the payment of money damages. Equity courts, on the contrary, had the authority
to issue in personam decrees – effectively, to order specific performance.27 Thus, specific
performance became available when the remedy at common law was inadequate and the
equities dictated that the chancery court use its discretion to grant relief.28 Eventually
the functions of the two courts were merged, but those remained the criteria governing
the availability of specific performance. This historical accident was reinforced by a
philosophy placing great faith in a market economy in which substitute transactions
were readily available. The U.S. Restatement provides: “Specific performance or an
injunction will not be ordered if damages would be adequate to protect the expectation
interest of the injured party.”29 If the payment of monetary damages could put the
injured party in the position he would have occupied absent the breach, for example by
20 § 275(1) BGB; see also Schwenzer/Fountoulakis, International Sales Law (2007), p. 191.
21 Dawson, Specific Performance in France and Germany, 57 Michigan Law Review (1959) 495 (529 seq.).
22 Dawson, Specific Performance in France and Germany, 57 Michigan Law Review (1959) 495 (529 seq.).
tal Law (2005) p. 275.

24 French Civil Code Art. 1142.
25 Treitel, Remedies for Breach of Contract (1988) pp. 60 seq.
26 Nicholas, The French Law of Contract (1992) pp. 218 seq.
29 Restatement (Second) of the Law of Contracts (1981), § 359(1).
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reimbursing him for any additional expenses incurred as a result of entering into a
substitute transaction, then specific performance would not be available.
In England, under the Sale of Goods Act, specific performance is possible when 9
circumstances permit: “In any action for breach of contract to deliver specific or
ascertained goods the court may, if it thinks fit, on the plaintiff’s application, by its
judgement or decree direct that the contract shall be performed specifically, without
giving the defendant the option of retaining the goods on payment of damages.”30 In the
United States, the UCC is similar: “Specific performance may be decreed where the
goods are unique or in other proper circumstances.”31 “Unique” is usually used to
describe goods without any possible substitute because of their rarity or idiosyncratic
value, such as family heirlooms.32
In determining whether or not to order performance, the first question a common 10
law court will ask is whether damages at law are adequate.33 A significant factor in
assessing the answer is whether cover – purchasing the goods from an alternate supplier
– is readily available. If it is, specific performance will almost never be an option.34 If
cover is not an option, the possibility of obtaining specific performance is much greater.
Other factors will also influence the court’s decision. In the case of a long-term
requirements contract, a substitute transaction might be difficult to arrange. Yet the
length of time and difficulty a court will have in supervising the performance might lead
it to decline to order performance. A court will also not order performance that
interferes with the personal freedom of the defendant, a situation not often at issue
with the sale of goods in commercial quantities.35 If, however, the performance
requested is to repair defective goods, the defendant’s freedom of action might in fact
be at issue. Because the matter is within the court’s discretion, it can be difficult to
predict the outcome.36
At common law, the availability of specific performance is not subject to the dictates 11
of party autonomy. Contracting parties can agree in their contract that specific
performance would be an appropriate remedy should their relationship go awry, but
the court need not give effect to that preference in the United States. Proposed revisions
to the UCC would have placed greater emphasis on the parties’ agreement: “[I]n a
contract other than a consumer contract, specific performance may be decreed if the
parties have agreed to that remedy.”37 Even under this revised formulation, however, the
court would not be obligated to order performance.
This is a marked contrast to the CISG, in which the parties have the ability to select 12
which remedies they prefer in the event of partial or fundamental breach. A party may
30Sale of Goods Act 1979, sec. 52.

31UCC § 2–716(1).
32 Reiley, International Sales Contracts (2008) pp. 222 et seq.
34 The exception will be if the goods have some idiosyncratic value such that replacement goods, even if
functionally equivalent, will not suffice to put the claimant in the position he would have occupied absent
the breach. This situation rarely arises when one is talking about commercial goods.
35 Boghossian, A Comparative Study of Specific Performance Provisions in the United Nations
for the International Sale of Goods (CISG) (1999–2000) 3 (39) (Pace).
for the International Sale of Goods (CISG) (1999–2000) 3 (39 seq.) (Pace); cf. Treitel, Remedies for Breach
of Contract (1988) p. 66 (suggesting discretion is not unfettered, but noting the significant number of
factors and exceptions that make the remedy discretionary).
37 UCC Amended Version (2003), § 2–716(1). The proposed revisions have been withdrawn.
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foreclose its ability to seek specific performance by pursuing inconsistent remedies, but
that choice is within its power.38
2. The provisions of the Convention

13 Like the other general provisions, Art. 28 can only be read in conjunction with other
substantive CISG articles. To the extent that it applies, it restricts the ability of the
parties to demand performance. It might, therefore, restrict the right of the buyer to
demand delivery of the goods or documents under Art. 30, to demand repair or
replacement of defective goods under Art. 46, or to demand other performance-related
obligations.39
14 Even though the Convention gives a preference to performance, whether in the
original manner contracted for by the parties or in altered form to take into account
intervening events,40 the right of a disputing party to demand performance under the
CISG is not unlimited.41 The rules in Arts 46(1) and 62(1) do not apply if the party has
engaged in conduct inconsistent with the remedy of performance.42 If third-party rights
are at stake, for example in a bankruptcy proceeding filed by the buyer or the seller,
specific performance might not be available.43 Finally, the ability to demand perfor-
mance is limited by the principle of good faith.44 Art. 46(2) requires that there be a
fundamental breach before a buyer is entitled to request substitute goods. Art. 46(3)
permits a buyer to request repair “provided it is not unreasonable.”
15 a) The court’s “own law”. Art. 28 provides that a court is not bound to order specific
performance unless it would do so under its “own law.” This phrase is designed to take
into account the variable nature of performance available even among courts that share
a tradition, whether within the common law or civil law. In other words, the availability
of specific performance varies as between England and Scotland, and even as between
France and Germany.45 It would have been too vague to refer to performance under
“the civil law” or even under the “Anglo-American” common law.46
16 A second question is the breadth of the phrase “own law” – does it refer to the
“whole law” of the forum, which would encompass its private international law (conflict
of laws) rules, or does it refer only to the forum’s substantive remedies law? The most
straightforward, and most convincing, interpretation of this phrase is that it refers to the
forum’s municipal law on remedies. The forum’s private international law rules might
point to the laws of a different jurisdiction, which would require the court to assess

of the United Nations Convention on Contracts for the International Sale of Goods (2005), p. 70
(suggesting that the remedial scheme is designed to limit the collateral costs incurred in remedying the
breach by setting forth varied solutions suitable in different contexts).
41 Zeller, CISG and the Unification of International Trade Law (2006) p. 58.
42 Felemegas, The right to require specific performance: comparison between the provisions of the
CISG (Arts 28, 46, and 62) and counterpart provisions of the UNIDROIT Principles (Arts. 7.2.1–7.2.5),
in: Felemegas (ed), An International Approach to the Interpretation of the United Nations Convention on
Contracts for the International Sale of Goods (1980) as Uniform Sales Law (2007), p. 151.
44 Zeller, CISG and the Unification of International Trade Law (2006) pp. 58 seq.; Boghossian, A
Comparative Study of Specific Performance Provisions in the United Nations Convention on Contracts
for the International Sale of Goods, Review of the Convention on Contracts for the International Sale of
Goods (CISG) (1999–2000) 3 (68 seq.) (Pace); Honnold, Uniform Law (2009), Art. 28 para. 199.
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whether or not specific performance would be available under that state’s law. Because
the purpose of the article is to permit a court not to order specific performance when
doing so would be against its own rules, the latter interpretation is preferred.47 This was
the approach adopted by the only court decision to have addressed Art. 28.48 In
Magellan v Salzgitter, a U.S. buyer of steel sought specific performance of specially
manufactured steel because it alleged it was unable to engage in a substitute transaction.
The U.S. District Court construed Art. 28 as directing it to look to the UCC to
determine whether such relief would be available.49 Since inability to cover is one of
the “appropriate circumstances” in which a buyer can seek specific relief, the court
allowed the case, which was at a preliminary stage, to go forward.
b) Court versus tribunal. Art. 28 refers to “court,” although many international 17
disputes are resolved by arbitral tribunals. Thus, the question arises what, if any, effect
Art. 28 has on disputes heard by arbitral tribunals. The most reasonable approach is to
apply Art. 28 equally to arbitral tribunals and to courts.50 This is also consistent with the
usage in the Secretariat’s commentary to the predecessor to Art. 46: “Although the
buyer has a right to the assistance of a court or arbitral tribunal to enforce the seller’s
obligation to perform the contract, [Art. 28 CISG] limits that right to a certain
degree.”51
This solution gives rise to further questions. Art. 28 refers to the “own law” of the 18
court. In the case of an arbitral tribunal, its “own law” would be the agreement between
the parties, the applicable arbitral rules, the CISG, and the law of the place of
arbitration (lex arbitri). The ability of arbitral tribunals to order specific performance
will depend on the lex arbitri and the precise nature of the relief sought.52 The question
of the appropriateness of the remedy is likely to arise again if the party ordered to
perform balks, and the prevailing party must go to a court to enforce the award. In
states party to the New York Convention on the Recognition and Enforcement of
Foreign Arbitral Awards enforcement should not, by the terms of the Convention, be
precluded because the arbitral tribunal awarded specific performance.53 One can
imagine common law courts proving reluctant to enforce such orders. In practice this
47 Reiley, International Sales Contracts (2008) p. 227; Ferrari, in: Flechtner/Brand/Walter, Drafting
Contracts (2007), pp. 137 seq.; Torsello, Remedies for Breach of Contract Under the 1980 Convention on
Contracts for the International Sale of Goods (CISG), in: Ferrari (ed), Quo Vadis CISG: Celebrating the
25th Anniversary of the United Nations Convention on Contracts for the International Sale of Goods
(2005), pp. 68 seq.; Garro, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 369; Honnold,
Uniform Law (2009), Art. 28 para. 195; Huber, in: Huber/Mullis, The CISG (2007), pp. 187 seq.; Müller-
Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 28 para. 9.
48 US District Court, Northern District of Illinois (U.S.) 7 December 1999 (Steel bars), Magellan
International Corp. v Salzgitter Handel GmbH, CISG Online 439 (Pace).

49 US District Court, Northern District of Illinois (USA) 7 December 1999 (Steel bars), Magellan
International Corp. v Salzgitter Handel GmbH, CISG-Online 439 (Pace).

50 Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 28 para. 8; Lookofsky, Under-
standing the CISG (2008), pp. 112, 146; Felemegas, The right to require specific performance: comparison
between the provisions of the CISG (Arts 28, 46, and 62) and counterpart provisions of the UNIDROIT
Principles (Arts. 7.2.1–7.2.5), in: Felemegas (ed), An International Approach to the Interpretation of the
Law (2007), p. 149 (suggesting that Art. 1.10 PICC, which defines court to include an arbitral tribunal, be
used to support this conclusion).
52 Gabriel, in: Flechtner/Brand/Walter, Drafting Contracts (2007), p. 530. The enforceability of the
award, if made in a New York Convention state, will depend on the “rules of procedure of the territory
where the award is relied upon, under the conditions laid down in the following articles.” Convention on
the Recognition and Enforcement of Foreign Arbitral Awards, 10 June 1058, 330 UNTS 38.
53 Gillette/Walt, The UN Convention on Contracts for the International Sale of Goods (2016) 376 seq.
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is not likely to be a significant issue, as the dominant type of relief sought is the
payment of monetary damages.54
19 c) The court “is not bound” to enter (or to refuse) a judgement for specific
performance. A change to the words during the negotiation of Art. 28 has given rise
to uncertainty as to the degree of discretion afforded municipal courts by the Conven-
tion. The initial draft read that a court need not order specific performance unless it
“could” do so, whereas the final version reads “would” do so.55 The fear expressed by
the delegates to the Vienna conference was that if a court could grant specific
performance it would have to grant it in an action governed by the CISG.56 The word
“would” seems to give a court more leeway to decline to order specific performance;
indeed, it could be read to limit its ability to order performance unless it actually would
do so under its own law.57 The usual and better interpretation of the language, however,
is that the court’s discretion is limited only in that it cannot deny an order of
performance if that is the order it would give under its own laws.58 This is not to say
that a common law court should give the same remedy a civil law court would give, as
some have suggested.59 Rather, if the remedy is a possibility under the forum’s own law,
the forum has the discretion to order it, and should take into account the circumstances
of the case, including its international aspects, in reaching its decision.60
20 The ability of a court to enforce an order for performance will depend on its
procedural laws. Placing the matter within the discretion of the forum allows the court
to consider the circumstances of the case and its ability to effectuate an order of
performance.61 This does not mean that the court should import the forum’s entire
substantive law on specific performance. This would negate the provisions of the CISG,
which are paramount.62
21 d) “Similar contracts of sale”. There is a comparative aspect to Art. 28 – a court need
not order specific performance unless it would do so with respect to “similar contracts
of sale” under its own law. One problem is that domestic sales contracts will often differ
54 Gabriel, in: Flechtner/Brand/Walter, Drafting Contracts (2007), p. 531.

55 Reiley, International Sales Contracts (2008) p. 226. The initial “could do so” language was directed
towards courts in legal systems that did not have the procedural mechanisms to order specific
performance.
International Sale of Goods (1989) p. 213; Kastely, The Right to Require Performance in International
Sales: Towards an International Interpretation of the Vienna Convention, 64 Washington Law Review
(1988) p. 607 (626) (Pace).
of the United Nations Convention on Contracts for the International Sale of Goods (2005), p. 68; Garro,
in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), pp. 368 seq.
58 Reiley, International Sales Contracts (2008) p. 229; Ferrari, in: Flechtner/Brand/Walter, Drafting
Contracts (2007), p. 136 seq.

59 Garro, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), pp. 368 seq; Kastely, The Right
to Require Performance in International Sales: Towards an International Interpretation of the Vienna

Convention, 64 Washington Law Review (1988) p. 607 (pp. 637 seq.) (Pace).
60 Honnold, Uniform Law (2009), Art. 28 para. 195; Huber, in: Huber/Mullis, The CISG (2007), p. 190;
Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 28 para. 22.

61 Zeller, CISG and the Unification of International Trade Law (2006) p. 59; Boghossian, A Compara-
tive Study of Specific Performance Provisions in the United Nations Convention on Contracts for the
International Sale of Goods, Review of the Convention on Contracts for the International Sale of Goods
(CISG) (1999–2000) 3 (27 seq.) (Pace); Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016),
Art. 28 para. 10.
62 Huber, in: Huber/Mullis, The CISG (2007), pp. 188 seq.; Müller-Chen, in: Schlechtriem/Schwenzer,
Commentary (2016), Art. 28 paras 9 et seq.
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from international sales contracts in significant respects, such as the distance the
shipment must travel and the uncertainties faced in the journey.63 Assumptions about
the ready availability of substitute performance might also be inapt. The possibility of
cover is often taken for granted in a market economy, but might be less available in
developing countries or non-market economies, for example.64 Burdensome govern-
ment regulations might make arranging an alternate performance more difficult.65 Thus,
in the context of an international sale, specific performance might be more appropriate
than it would be in the domestic context. It is reasonable to suggest that courts take into
account the international features, and the peculiarities attendant on the individual
contract of sale, in assessing whether specific performance would be an appropriate
remedy.
3. Derogation from Art. 28 and party autonomy

Art. 6 authorizes the parties to “derogate from or vary the effect of the Convention” 22
without any limitation except for that found in Art. 12. Yet it is generally agreed that
parties cannot exclude Art. 28’s application to their contract.66 In common law courts,
whether or not to grant specific relief is a remedy within the discretion of the court, not
within the discretion of the parties.67 Permitting the parties to derogate from Art. 28
would undercut the force of the exception provided therein. Thus, the availability of
performance, and the effectiveness of the parties’ inclusion in their contract of
preference for performance in the event of a breach, will depend on the law of the
forum hearing any dispute.68 In practice, parties can control the degree to which
performance is readily available in the event of a dispute by including in their contract
a forum selection clause pointing to a jurisdiction that favours performance.69
A related question is whether the parties can make their own law with respect to 23
remedies. The purpose of Arts. 46 and 62, where not otherwise limited, was to “have
the effect of changing the remedy of obtaining an order by a court that a party
perform the contract from a limited remedy which in many circumstances was
available only at the discretion of the court, to a remedy available at the discretion of
the other party.”70 There is nothing to stop parties from including their preferred
remedy in their contracts.71 This could take two guises: one limiting the availability of
the remedy of performance, or one requiring it. The first approach is likely to be
enforceable as a permissible calibration of the remedial scheme available under the
63Reiley, International Sales Contracts (2008) p. 227.

64Boghossian, A Comparative Study of Specific Performance Provisions in the United Nations
for the International Sale of Goods (CISG) (1999–2000) 3 (21 et seq.) (Pace).
for the International Sale of Goods (CISG) (1999–2000) 3 (65) (Pace).
66 Reiley, International Sales Contracts (2008) p. 228; Huber, in: Huber/Mullis, The CISG (2007),
p. 190; Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 28 para. 24.

67 See Section 1.2, supra.
68 Bridge, in: Flechtner/Brand/Walter, Drafting Contracts (2007), p. 95.
69 Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 28 para. 24.
71 Torsello suggests that requiring parties to include provisions respecting their preferred remedies in
their contracts is inefficient as many will prefer not to incur the transaction costs associated with
negotiating about matters that might never have any effect. Torsello, Remedies for Breach of Contract
Under the 1980 Convention on Contracts for the International Sale of Goods (CISG), in: Ferrari (ed),
Quo Vadis CISG: Celebrating the 25th Anniversary of the United Nations Convention on Contracts for
the International Sale of Goods (2005), p. 49.
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Convention.72 The second approach is likely to be effective only insofar as the

enforcing court is willing to give it effect.73 Again one might assume it would be
more likely to be given effect in a civil law court rather than in a common law court,
thus making essential the forum selection clause of the contract. In practice, however,
the circumstances of the case and the feasibility of ordering performance will have an
effect on the forum’s decision.
4. Seller’s right to require payment of the price

24 One area of debate has been whether Art. 28 CISG will have an effect on the right of a
seller to require payment from the buyer in an action for the price under Art. 62.
Certainly requiring that a buyer pay the price of the goods that he has bought can be
viewed as specific performance; he is giving what he would have given under the
contract.74 Common law jurisdictions do not, however, view it as such. In New Zealand,
for example, an action for the price is an action in debt rather than in contract. It is thus
not subject to rules “relating to recovery of damages including proof, remoteness, and
mitigation of loss.”75 A similar view prevails in England’s Sale of Goods Act.76 Under
the UCC in the United States, a buyer is entitled to recover the price only when the
buyer has accepted the goods or when the goods are damaged or lost after the risk of
loss has passed to the buyer, or when the goods have been identified to the contract and
the seller is unable to re-sell them at a reasonable price (or the circumstances indicate
that such an effort would be fruitless).77 This is viewed as an action in damages. In no
case is it viewed as specific performance.78
25 An action for the price under Art. 62 is more reasonably viewed as performance; the
Convention ought not to be interpreted in accordance with domestic law categories.79 In
common law courts, then, a claimant might be better advised to seek a remedy in
damages under Arts 74 to 77.80

26 Neither the PICC, nor the PECL, nor the DCFR contains a provision equivalent to
Art. 28 CISG. They are thus not helpful in shedding light on the proper interpretation
of Art. 28. All give creditors the right to demand performance, subject to certain
72 Torsello, Remedies for Breach of Contract Under the 1980 Convention on Contracts for
the International Sale of Goods (CISG), in: Ferrari (ed), Quo Vadis CISG: Celebrating the 25th
Anniversary of the United Nations Convention on Contracts for the International Sale of Goods
(2005), pp. 75 et seq.
of the United Nations Convention on Contracts for the International Sale of Goods (2005), p. 77.
75 Whittington, Reconsidering Domestic Sale of Goods Remedies in Light of the CISG, 37 Victoria
University Wellington Law Review (2006) 421 (439).

76 Sale of Goods Act 1979 s. 52.
77 UCC § 2–709.
for the International Sale of Goods (CISG) (1999–2000) 3 (24) (Pace); Treitel, Remedies for Breach of
Contract (1988) p. 45.
79 See the commentary to Art. 62 CISG infra paras 4 et seq.
80 Lookofsky, The 1980 United Nations Convention on Contracts for the International Sale of Goods,
Art. 28, Specific Performance, in: Herbots/Blanpain (eds), International Encyclopaedia of Laws –
Contracts, Supplement 29 (2000), p. 81 (Pace).
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exceptions.81 The PICC, the PECL, and the DCFR require that an aggrieved party seek
specific performance within a reasonable time after he has become aware of the non-
performance; otherwise, he loses that option.82 The PICC also give parties the option of
opting out of specific performance as a potential remedy.83 Absent those limiting
factors, however, the PICC suggest a court does not have the discretion to refuse
performance.84
81 Art. 7.2.2 PICC; Art. 9:102 PECL; Art. III-3:302 DCFR. These provisions are discussed thoroughly in
the commentary to Arts 46(1) paras 9 et seq. and 62 para. 10, infra.
82 Art. 7.2.2(e) PICC; Art. 9:102(3) PECL; Art. III-3:302(4).
83 Art. 7.2.5 PICC. This exercise in party autonomy could be limited by the laws of the state in which
enforcement is sought, in much the same way that Art. 28 CISG limits that remedy, if the jurisdiction
views its laws as non-derogable mandatory laws or as court rules not subject to alteration by the parties.
See, e. g., Gabriel, Contracts for the Sale of Goods: A Comparison of US and International Law (2009)
p. 120; Supreme Court (U.S.) 25 March 2008, Hall Street Associates, LLC v Mattel, Inc., 552 U.S. 576
(holding that parties could not alter the standard of review accorded by courts to arbitral awards under
the Federal Arbitration Act).
84 Felemegas, The right to require specific performance: comparison between the provisions of the
CISG (Arts 28, 46, and 62) and counterpart provisions of the UNIDROIT Principles (Arts. 7.2.1–7.2.5),
in: Felemegas (ed), An International Approach to the Interpretation of the United Nations Convention on
Contracts for the International Sale of Goods (1980) as Uniform Sales Law (2007), pp. 155 seq.
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Article 29
(1) A contract may be modified or terminated by the mere agreement of the
parties.
(2) A contract in writing which contains a provision requiring any modification or
termination by agreement to be in writing may not be otherwise modified or
terminated by agreement. However, a party may be precluded by his conduct from
asserting such a provision to the extent that the other party has relied on that
conduct.
Bibliography: Hillman, Article 29(2) of the United Nations Convention on Contracts for the Interna-
tional Sale of Goods: A New Effort at Clarifying the Legal Effect of “No Oral Modification” Clauses, 20
Cornell International Law Journal (1988) 449; Perales Viscasillas, Modification and Termination of the
Contract (Art. 29 CISG), 25 Journal of Law and Commerce (2005–06) 167.
Outline
1. Contract modification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2. The “pre-existing duty rule” at common law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
3. No-oral-modification clauses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

1 Art. 29 had no counterpart in the ULIS or in the ULF. During the Vienna
Conference it provoked debate, primarily because Para. 1 is a significant departure
from the common law, although a similar provision is in the UCC of the U.S.1 Para. 1
makes clear that the common law doctrine of consideration plays no role in questions
of modification under the Convention. It thus adopts a position closer to that of the
civil law, in which “an agreement between the parties to modify the contract is
effective if there is sufficient cause even if the modification relates to the obligations
of only one of the parties.”2 Para. 2 provides that parties can themselves agree to
limit their ability to modify a contract orally, but if they act inconsistently with
that agreement, they cannot then invoke the protections of their contractual no-oral-
modification clause.
1Schlechtriem/Butler, CISG (2009), para. 96.

2Secretariat Commentary on 1978 Draft, Art. 27 (now Art. 29) para. 2. See also Eiselen, Modification or
termination of contract and formalities: Remarks on the manner in which the UNIDROIT Principles of
International Commercial Contracts may be used to interpret or supplement Article 29 of the CISG, in:
Felemegas (ed), An International Approach to the Interpretation of the United Nations Convention on
Contracts for the International Sale of Goods (1980) as Uniform Sales Law (2007), pp. 163 seq.; Gabriel,
Contracts for the Sale of Goods (2009) p. 121; Mullis, in: Huber/Mullis, The CISG (2007), pp. 102 seq.
Professor Mullis cautions against permitting consideration to enter into the interpretation of the CISG as
a rule of validity. One CISG case decided by a German court appears to have taken that route.
Oberlandesgericht Hamburg (Germany) 5 October 1998 (Electronic parts), CISG-Online 473 (Pace). See
also Perales Viscasillas, Modification and Termination of the Contract (Art. 29 CISG), 25 Journal of Law
and Commerce (2005–06) 167 (169 note 9).
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On its face, Art. 29 appears uncontroversial. Permitting parties to modify or terminate 2
their contracts is consistent with the principle of party autonomy. Some parties will choose
to limit their ability to modify their contract orally in order to provide greater certainty
concerning issues related to proof. If they proceed to act inconsistently with their no-oral-
modification agreement, principles of estoppel will ensure that one party cannot unfairly
insist on hewing to the letter of the contract at the expense of the other party.
1. Contract modification
Art. 29(1) reflects the realities of modern international contracting. Many of the 3
modifications that fall under Art. 29(1) will likely be small, technical changes that arise
in the course of the parties’ performance under the contract. Art. 29(1) also permits
modifications that inure only to the benefit of one party.3
Modification is closely linked to contract formation under Arts 18 and 19. Many 4
disputes will involve an additional term added in an invoice accompanying shipment,
and the outcome will often depend on whether the parties had concluded an agreement
prior to shipment, in which case the question becomes whether the additional term is
permitted to modify the existing agreement, or whether the agreement is formed by
acceptance of the goods.4 The prior case implicates Art. 29, yet the question of whether
a party agrees to the modification by conduct, including a failure to protest, has not
been decided uniformly.
Art. 29(1) permits such a modification provided that the parties have agreed to it.5 5
Determining whether they have in fact agreed can be difficult. Art. 29 contains no
definition of what constitutes agreement, and the cases generally have looked to the
CISG provisions on contract formation for guidance. One commentator has suggested
that this is a sensible result so long as courts do not import all of the contract formation
provisions in Part II in the course of assessing whether or not there has been agreement
for purposes of Art. 29.6 Limiting the reference to Part II is important for the structure
of the Convention, as Art. 29 was deliberately put in Part III to make it applicable even
if the State Parties to the CISG had reserved as to Part II.7 Others, however, have said
that Arts 8 and 14–24 apply to modification or termination of the contract.8 Given the
potential importance of modifications to a contract, requiring the party relying on such
a modification to prove an actual agreement with respect to the modification seems
reasonable. Ordinarily silence or inaction will not amount to agreement to contract
modification or termination, but in exceptional circumstances it might do so.9
4The Secretariat Commentary suggests that this is an appropriate distinction: “A proposal to modify
the terms of an existing contract by including additional or different terms in a confirmation or invoice
should be distinguished from a reply to an offer which purports to be an acceptance but which contains
additional or different terms. The latter situation is governed by Article 17.” Secretariat Commentary on
1978 Draft, Art. 27 (now Art. 29) para. 3.
5 Secretariat Commentary on 1978 Draft, Art. 27 (now Art. 29) para. 4. See the commentary under
Art. 19 CISG, supra, for further discussion of what constitutes agreement by the parties.
6 Gabriel, Contracts for the Sale of Goods (2009) p. 122.
7 Schwenzer/Fountoulakis, International Sales Law (2007), p. 198.
8 See, e. g., Schlechtriem/Butler, CISG (2009), para. 97; Perales Viscasillas, Modification and Termina-
tion of the Contract (Art. 29 CISG), 25 Journal of Law and Commerce (2005–06) 167 (171).
9 Perales Viscasillas, Modification and Termination of the Contract (Art. 29 CISG), 25 Journal of Law
and Commerce (2005–06) 167 (172).
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6 The most straightforward way to change an agreement would be to accept the

modification by letter. The letter could be a response to an offer to modify or could be
a written confirmation of an agreement arrived at orally. Written confirmations of oral
agreements are one area in which a recipient might well have a duty to read and object
if there is an error in the confirmation.10 This duty might be derived from principles of
good faith or from the provisions of Art. 9, which make the contract subject to usages
that the parties have created between themselves and to any usage in the parties’
particular field of trade.11
7 Whether or not circumstances warrant an implication of agreement by inaction or
silence is a highly fact-specific inquiry. One dispute raising the issue was dealt with
successively by a U.S. and a Canadian court, which appeared to come to conflicting
conclusions. The question was whether one party could be said to have implicitly agreed
to the other party’s unilateral attempts to alter an agreement by failing to object to the
addition of a forum selection clause in the invoices dispatched by the seller with delivery
of the goods in question. A U.S. Court held that they could not: “Nothing in the
Convention suggests that the failure to object to a party’s unilateral attempt to alter
materially the terms of an otherwise valid agreement is an ‘agreement’ within the terms
of Article 29.”12 The Canadian court took a more nuanced position after the U.S. court
had dismissed the case on grounds of forum non conveniens.13 There the Ontario
Superior Court decided that delivery of the product accompanied by the first invoice
could not amount to a modification of the contract, but that the outcome might differ
with respect to subsequent deliveries after the buyer was on notice of the terms of the
invoice and did not object to them.14 There is some suggestion that courts are
particularly reluctant to find oral modifications to forum selection agreements, or to
conclude that an oral modification itself has selected a forum.15
10 Bezirksgericht Sissach (Switzerland) 5 November 1998 (Summer clothes collection), CISG-Online
1466 (Pace); Perales Viscasillas, Modification and Termination of the Contract (Art. 29 CISG), 25 Journal
of Law and Commerceu (2005–06) 167 (173).
11 See the commentary to Art. 9 CISG, supra paras 8 et seq.; Perales Viscasillas, Modification and
Termination of the Contract (Art. 29 CISG), 25 Journal of Law and Commerce (2005–06) 167 (173) seq.
12 U.S. Court of Appeals for the Ninth Circuit (U.S.) 5 May 2003 (Wine corks), Chateau des Charmes
Wines Ltd. v Sabaté USA, CISG-Online 767 (Pace). Sabaté had asked the U.S. court to honour the forum
selection clause contained in the invoices it had repeatedly shipped to Château des Charmes, which
specified that any dispute should be heard in France. The trial court held that the forum selection clause
was valid, but the appellate court reversed on the grounds that the party had come to an oral agreement
for the purchase of the corks, which were to be shipped in 11 separate batches, prior to the time the first
lot of corks was shipped. The forum selection clauses in the invoices accompanying the subsequent
shipments were thus not valid, and no inference could be drawn from Château des Charmes’ failure to
object to the terms in the invoices. The trial court in a different U.S. case involving a similar issue –
whether the limitation of liability contained in an invoice sent with the shipment of goods became part of
the contract – did not consider whether the contract had been formed prior to shipment, thus making the
terms an attempted modification, or whether the contract was formed upon the recipient’s acceptance of
the goods without a rejection of the terms. The Ninth Circuit remanded with instructions for the trial
court to consider those issues. U.S. Court of Appeals for the Ninth Circuit (U.S.) 8 November 2007
(Raspberry roots), Barbara Berry S. A. de C. V. v Ken M. Spooner Farms, Inc., CISG-Online 1835 (Pace).
See also Perales Viscasillas, Modification and Termination of the Contract (Art. 29 CISG), 25 Journal of
Law and Commerce (2005–06) 167 (172).
13 Superior Court of Justice, Ontario (Canada) 28 October 2005 (Wine corks), Chateau des Charmes
Wines Ltd. v Sabate, USA, Inc., CISG-Online 1139 (Pace).

14 Superior Court of Justice, Ontario (Canada) 28 October 2005 (Wine corks), Chateau des Charmes
Wines Ltd. v Sabate, USA, Inc., CISG-Online 1139 (Pace). The court did not, however, dismiss the case
because it was not possible to distinguish the damage caused by corks shipped under the initial contract
from that caused by those shipped under later contracts, and it would be undesirable to have duplicative
proceedings.
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Modification of a contract can be proved by the behaviour of the parties themselves.16 8
A buyer who acquiesced in a shipment delay, “albeit while pressing for action to be
taken and status information provided by Seller,” was deemed to have modified the
delivery date in the contract.17 In a German case, a buyer notified the seller of defects in
a delivery of wood, and the seller responded by indicating her decision to come to
Germany to take the wood and find someone else to market it for her.18 The seller later
argued that she had intended only to assist in the marketing, but the court refused to
give credit to this argument. The buyer had been entitled to rely on the seller’s
announced intentions, and the buyer’s failure to respond to the seller’s letters permitted
the court to infer that the buyer acquiesced to the termination of the agreement.19
Agreeing to modify the contract, as opposed to fixing an additional time for perfor- 9
mance, can affect the ability of a party to claim damages. In Valero Marketing & Supply
Co. v Greeni Oy, a U.S. appellate court found that a party had agreed to modify the
contract to receive delivery of the goods at a later date than under the original contract,
notwithstanding the argument of the buyer that it was “coerced” into agreeing to the
extension of time.20 The court also rejected the argument that the agreement was an
extension of time to perform (as had the trial court) because it contained an additional
remedy in the form of a reduction of price, as prohibited by Art. 47.21 Yet the case
illustrates how an agreement to extend time pursuant to Art. 47, under which a buyer
would retain the right to claim damages for harm caused by the delay, might possibly be
construed as an agreement to modify the contract, which would preclude any such claim.
Art. 29(1) deals with the termination of a contract, in addition to modification, but it 10
does not specify the appropriate effect of a termination agreement.22 One German court
has held that if the parties agree to terminate a contract and to excuse any remaining
performance on either side, each party may claim restitution of what has been per-
16 Arbitral Award, AAA 50181T 0 036 406, 23 October 2007, (Frozen chicken parts), Macromex Srl. v
Globex International Inc., CISG-Online 1645 (Pace) (quoting Hof van Beroep Gent (Belgium) 15 May
2002 (Pace)) (“‘[f]ollowing arts. 29(1) and 11 CISG, any agreement, regardless of the form in which it
came about, can in principle be changed or ended by the mere agreement of the parties, which may be
proved by any means, including the behaviour of the parties themselves.’”).
17 Arbitral Award, AAA 50181T 0 036 406, 23 October 2007 (Frozen chicken parts), Macromex Srl. v
Globex International Inc., CISG-Online 1645 (Pace); Pontevedra Provincial High Court (Section 6)
(Spain), 6 October 2014 (Frozen fish), Hoogendik Import/Export B.V. v. Blue Marine Fish International,
S.L., CISG-Online 2576 (Pace). In Hoogendik, multiple emails suggesting modifications to which no
response was made, coupled with acceptance of goods under the modified terms, amount to tacit
acceptance of the new agreement.
18 Oberlandesgericht Köln (Germany) 22 February 1994 (Wood), CISG-Online 127 (Pace).
19 Oberlandesgericht Köln (Germany) 22 February 1994 (Wood), CISG-Online 127 (Pace). In a case
involving the sale of textiles, a German court concluded that a party’s acceptance of a bill of exchange in
payment for goods postponed the date on which payment was due until the maturity date in the bill of
exchange. Landgericht Hamburg (Germany) 26 September 1990 (Fashion textiles), CISG-Online 21
(Pace).
20 U.S. Court of Appeals for the Third Circuit (U.S.) 19 July 2007 (Naphtha), Valero Marketing &
Supply Co. v Greeni Trading Oy, CISG-Online 1510 (Pace). In a similar case, an extension of the period
of time for payment granted prior to the time payment was due was deemed a modification of the terms
of the contract; the seller was then estopped from seeking payment as of the date of delivery. Tribunale di
Padova (Italy) 31 March 2004 (Pizza boxes), Scatolificio La Perla S. n. c. de Aldrigo Stefano e Giuliano v
Martin Frischdienst GmbH, CISG-Online 823 (Pace).
21 U.S. Court of Appeals for the Third Circuit (USA) 19 July 2007 (Naphtha), Valero Marketing &
Supply Co. v Greeni Trading Oy, CISG-Online 1510 (Pace).

22 In particular, Art. 29 does not distinguish between termination and termination followed by
novation. Perales Viscasillas, Modification and Termination of the Contract (Art. 29 CISG), 25 Journal
of Law and Commerce (2005–06) 167 (175).
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formed under the contract in accordance with Art. 81(2) first sentence.23 This result is a
reasonable way to ensure that termination inures to the benefit of both parties.
2. The “pre-existing duty rule” at common law

11 The doctrine of consideration requires that there be a “bargained-for exchange” of
something of value to support the formation of a contract.24 In common law countries,
consideration also plays a role in the issue of contract modification. Altering a contract
in favour of one party only, while the other party’s obligations remain unchanged, is
unenforceable because the new agreement lacks consideration – the second party
renders only the performance he was already obligated to deliver. This is usually
referred to as the pre-existing duty rule.25 The modified agreement is thus said to lack
consideration and is unenforceable.
12 One of the primary motivations for this employment of the consideration doctrine is
to permit courts to “police” the bargain between the parties by ensuring that one party
was not coerced into agreeing to a modification of the original agreement because of
untoward pressure brought by the other contracting party.26 Because the bargaining
power between the parties can change significantly between the time of the original
formation of the contract and the time when the obligation to perform draws near, an
abuse of the contracting relationship is possible.27 Yet the pre-existing duty rule can also
prevent reasonable modifications to a contract.28
13 The pre-existing duty rule is less important than it used to be. First, clever contracting
parties can cloak the contract modification in a veneer of consideration by adding some
new but trivial obligation to the duties of the party seeking to change the contract.29
Because courts historically do not measure the adequacy of consideration, a fairly
cosmetic change will suffice to make the change pass the hurdle posed by the pre-
existing duty rule.30 Second, common law courts are increasingly likely to be more
straightforward in assessing simply whether the changed agreement was the product of
duress or undue influence.31 In England doctrines such as forbearance in equity can also
serve to capture instances of abuse of the pre-existing duty rule.32
14 This trend away from the pre-existing duty rule is reflected most evidently in the
UCC in the U.S. UCC § 2–209(1) permits the modification of an existing contract
without payment of consideration. The doctrines of good faith and duress still permit
courts to monitor those modifications that are unfairly induced.33
23 Oberlandesgericht Düsseldorf (Germany) 28 May 2004 (Television sets), CISG-Online 850 (Pace).
24 Restatement of the Law (Second) of Contracts (1981), § 71; Chitty on Contracts (29th ed. 2004),
secs. 3-004–3-007.
25 Perillo, Corbin on Contracts Vol. 2 (1995) sec. 7.1; Chitty on Contracts (29th ed. 2004), ss 3–076
et seq.
26 See, e.g., White/Summers, Uniform Commercial Code (2000) pp. 57 et seq.; Perillo, Corbin on
Contracts Vol. 2 (1995) sec. 7.1; Restatement of the Law (Second) of Contracts (1981), 73, cmt. a.
27 See, e. g., White/Summers, Uniform Commercial Code (2000) p. 57 seq. (describing possibilities for
extortion as time for performance draws near).

28 Perillo, Corbin on Contracts Vol. 2 (1995) s. 7.5.
29 Perillo, Corbin on Contracts Vol. 2 (1995) ss 7.5 seq., 7.20; Chitty on Contracts (29th ed. 2004), ss 3–
079 et seq.; Restatement of the Law (Second) of Contracts (1981), s. 71, s. 73 ill. c.
30 Perillo, Corbin on Contracts Vol. 2 (1995) ss 7.6., 7.20; Chitty on Contracts (29th ed. 2004), s. 3–014.
31 Perillo, Corbin on Contracts Vol. 2 (1995) s. 7.6. Professor Schroeter suggests that domestic law, such
as German law on unlawful threats, can supplement the CISG in appropriate cases. Schroeter, in:
32 Chitty on Contracts (29th ed. 2004), ss 3–085 et seq.
33 Perillo, Corbin on Contracts Vol. 2 (1995) ss 7.14, 7.21; White/Summers, Uniform Commercial Code
(2000) pp. 57 seq. The good faith requirement demands that any change be honest in fact and
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3. No-oral-modification clauses
Art. 29(2) addresses what happens when parties have agreed in writing to modify 15
their contract only in writing – a so-called “no-oral-modification clause.” Para. 2
comports with the principle of party autonomy by allowing the parties to impose
greater limits on their ability to modify or terminate a contract than would otherwise
be required under the CISG.34 The explicit no-oral-modification provision is consistent
with the manner in which Art. 11 has been construed. Although Art. 11 provides that a
contract of sale need not be evidenced by writing, the parties can modify that provision
to add such a requirement as between themselves.35
No-oral-modification clauses present a conundrum: if parties can agree to amend 16
their previous agreement, it seems they could agree to amend the no-oral-modification
clause.36 This is something of an Alice-in-Wonderland question – to what degree does
party autonomy permit the limitation of party autonomy?
No-oral-modification clauses are often accompanied by “merger” or “integration” 17
clauses in which parties stipulate that their entire agreement is encompassed by their
written contract and that extrinsic (a. k. a. parol) evidence should not be allowed to vary
or expand the terms of the agreement. This, too, is consistent with the principle of party
autonomy, although it seems inimical to Art. 8, which permits an agreement to be
proved by any means.37 It appears, however, that merger clauses might be overturned by
conduct or an agreement of the parties suggesting the merger clause did not truly reflect
the parties’ agreement, notwithstanding its inclusion in the written contract.38 The same
would hold true for a change to the “no-oral-modification” clause in Art. 29(2), but the
burden of proof might be higher.39
Nothing in Art. 29(2) specifies that the no-oral-modification agreement itself has to 18
be in writing, although some have suggested that it should be.40 This is an esoteric
commercially reasonable. UCC s. 2.209 official cmt., Gillette/Walt, The UN Convention on Contracts for
the International Sale of Goods (2016) 112.
34 CISG Art. 6 permits the parties to vary their agreement. See the commentary to Art. 6, supra paras 7
et seq., for fuller discussion of party autonomy.

35 Eiselen, Modification or termination of contract and formalities: Remarks on the manner in which
the UNIDROIT Principles of International Commercial Contracts may be used to interpret or supple-
ment Article 29 of the CISG, in: Felemegas (ed), An International Approach to the Interpretation of the
Law (2007), p. 164.
36 Hillman, Article 29(2) of the United Nations Convention on Contracts for the International Sale of
Goods: A New Effort at Clarifying the Legal Effect of “No Oral Modification” Clauses, 20 Cornell
International Law Journal (1988) 449 (451); cf. Schroeter, in: Schlechtriem/Schwenzer, Commentary
(2016), Art. 29 para. 23 (discussing instances in which the agreement as to form serves only the function
of proving an agreement; in such cases the modification itself might not be in writing) and para. 24
(suggesting any agreement to discontinue the effect of a no-oral-modification clause must be in writing).
37 Rustad, Understanding Sales, Leases, and Licenses in a Global Perspective (2008) p. 114.
38 See, e. g., U.S. District Court for the Southern District of New York (U.S.) 23 August 2006 (Packaging
system), TeeVee Toons, Inc. et al. v Gerhard Schubert GmbH, CISG-Online 1272 (Pace).
39 Schlechtriem/Butler, CISG (2009), paras 98 seq. In one Russian Arbitration, the tribunal suggested
that oral modification of the no-oral-modification clause would not be permitted. Arbitral Award,
Tribunal of International Commercial Arbitration at the Russian Federation Chamber of Commerce
and Industry 107/2002, 16 February 2004 (Goods not specified), CISG-Online 1181 (Pace).
Law (2007), p. 165.
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conundrum; parties concerned with limiting their ability to modify a contract orally are
unlikely to agree to such an important limitation without putting that agreement in
writing. An oral agreement to limit oral modification would raise significant evidentiary
questions, and anyone truly concerned with imposing such a limitation on their
freedom of contract should do so in writing. Assuming there is a requirement that a
no-oral-modification clause be in writing, commentators suggest that this encompasses
modern electronic communications, such as email, fax, and Internet communication, in
addition to telexes, telegrams, and letters.41 This result seems correct, and should extend
to communications with respect to modification of the agreement as well.42
19 The difficulty presented by no-oral-modification clauses is that parties can and often
do ignore this provision in their contract and make subsequent oral changes.43 On one
view the clause could absolutely bar any reliance on those oral changes.44 Yet such a result
would not be consistent with actual practice or with fundamental fairness. This problem
is addressed by the estoppel provision – a party who agrees to amend the contract is
precluded from invoking the provision as a defence if the other party has relied on the
agreement. “The rule is based on principles contained in the so-called Mißbrauchsein-
wand of German law, the nemo suum venire contra factum proprium principle of Roman
law, [and] the doctrine of waiver and estoppel of Anglo-American law.”45
20 Art. 29(2) provides that a party’s “conduct” might preclude invocation of the clause,
but it does not further elaborate on the kind of conduct that would justify reliance. This
lack of precision might be necessary given the likely variations in party conduct that
could give rise to estoppel, yet it also introduces an element of uncertainty that might
undercut the effectiveness of the no-oral-modification clause.46 Indeed, the existence of
the estoppel provision itself might be held to undermine the certainty and guarding
against false claims that no-oral-modification clauses are meant to provide.47
21 The extent to which a no-oral-modification provision can itself be modified by the
conduct of the parties was addressed in an ICC arbitration. There the tribunal held that
the no-oral-modification clause would act as a bar to finding an amendment to the
contract based on general commercial practice, or on the behavioural practice as between
Law (2007), p. 165.
43 See, e. g., Reiley, International Sales Contracts: The UN Convention and Related Transnational Law
(2008) p. 123; Hillman, Article 29(2) of the United Nations Convention on Contracts for the Interna-
tional Sale of Goods: A New Effort at Clarifying the Legal Effect of “No Oral Modification” Clauses, 20
Cornell International Law Journal (1988) 449 (451).
ment Article 29 of the CISG, in: Felemegas (ed.), An International Approach to the Interpretation of the
Law (2007), p. 165.
46 Hillman, Article 29(2) of the United Nations Convention on Contracts for the International Sale of
Goods: A New Effort at Clarifying the Legal Effect of “No Oral Modification” Clauses, 20 Cornell
International Law Journal (1988) 449 (460 seq.); Gillette/Walt, The UN Convention on Contracts for the
International Sale of Goods (2016) 114 et seq.
47 Gabriel, Contracts for the Sale of Goods (2009) p. 104; Schlechtriem/Butler, CISG (2009), para. 99.
390 Björklund
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the parties.48 “[T]he explicit integration clause and the written modification clause, as
contained in the Contract, operate as a bar against the assumption that a certain behavior
or practice could reach the level of becoming legally binding between the Parties.”49
The CISG says nothing explicit about whether the reliance needs to be reasonable. It 22
would seem, however, to be tacitly assumed, whether as a sub voce requirement of the
estoppel doctrine or under the principle of good faith.50 Furthermore, the estoppel is limited
to the extent of the reliance; the party should be able to insist on the original provisions not
addressed by the oral modification.51 Finally, it appears that the estoppel provision cannot
itself be overridden by the parties, although this conclusion limits the freedom of contract
conferred on the parties by Art. 6. Because it acts as a safety valve to protect against abuse
of the no-oral-modification provision, parties cannot derogate from it.52
It is useful to note here that setting a nachfrist period – setting an extended time for 23
performance – is not viewed as a modification to the contract. Thus, even if the contract
contains a no-oral-modification clause, the notice giving additional time for perfor-
mance need not be in writing.53
Art. 29(2) addresses only written modification; it does not address what should 24
happen in the event the parties try to limit their freedom to modify the contract by
adding further formalities such as signatures or notarization. The principle of party
autonomy would permit them to do so; most have concluded that such limitations
should be upheld, subject to the estoppel principle also found in Art. 29(2).54
The CISG also does not explicitly address the interplay between Art. 29(2) and the 25
reservations some states have taken under Arts 12 and 96 to permit contracts to be
evidenced only by writing. Does the estoppel provision apply even in those cases?
Though arguments have been made in both directions, the better answer seems to be
48Arbitral Award, ICC 9117, March 1998 (Goods not specified), CISG-Online 777.
49Arbitral Award ICC 9117, March 1998 (Goods not specified), CISG-Online 777. The tribunal also
found there was in any event no particular commercial practice between the parties. See also Gillette/
Walt, The UN Convention on Contracts for the International Sale of Goods (2016) 117 (suggesting
reluctance to investigate potential conduct that might trigger exceptions based on conduct).
50 See, e. g., Eiselen, Modification or termination of contract and formalities: Remarks on the manner in
which the UNIDROIT Principles of International Commercial Contracts may be used to interpret or
supplement Article 29 of the CISG, in: Felemegas (ed), An International Approach to the Interpretation
Sales Law (2007), p. 166; Hillman, Article 29(2) of the United Nations Convention on Contracts for the
International Sale of Goods: A New Effort at Clarifying the Legal Effect of “No Oral Modification”
Clauses, 20 Cornell International Law Journal (1988) 449 (458).
52 Honnold, Uniform Law (2009), Art. 29 para. 204; Hillman, Article 29(2) of the United Nations
Convention on Contracts for the International Sale of Goods: A New Effort at Clarifying the Legal Effect
of “No Oral Modification” Clauses, 20 Cornell International Law Journal (1988) 449 (462); Gillette/Walt,
The UN Convention on Contracts for the International Sale of Goods (2016) 117 seq.
(but noting that there could be difficulty distinguishing between the granting of additional time under
Art. 47 and modifying a contract under Art. 29).
54 See Eiselen, Modification or termination of contract and formalities: Remarks on the manner in
supplement Article 29 of the CISG, in: Felemegas (ed), An International Approach to the Interpretation
Sales Law (2007), p. 166.
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that it should not. Permitting reliance to undermine the requirement of writing would
effectively negate the Art. 96 reservation.55

26 Art. 2.1.18 PICC is similar to Art. 29(2) CISG. It also provides for a no-oral-modifica-
tion clause and prevents a party from relying on the clause if, by its conduct, it has
reasonably induced reliance by the other party.56 The PECL also permit parties to agree to
limit their ability to alter their contracts orally, but would permit estoppel in the event of
inconsistent conduct or statements.57 The DCFR contains a similar provision.58
27 The CISG departs in two respects from the PECL and the DCFR. First, it does not
explicitly refer to estoppel based on statements, but only to estoppel based on conduct.59
A reasonable interpretation is that “conduct” encompasses statements.60 Written or
telephonic assertions about the intention of the party would seem to be the most likely
kinds of conduct to induce reliance and subsequent estoppel. The second difference is
that both the PECL and the DCFR appear to limit the force of the “no-oral-modifica-
tion” agreement by saying that such a clause (or “term” in the DCFR) establishes only a
presumption that an oral statement is not intended to be legally binding.61 The CISG
language does not contain such a caveat; nor do the PICC.62
55 Schroeter, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 29 para. 40; Hillman, Article 29(2)
of the United Nations Convention on Contracts for the International Sale of Goods: A New Effort at
Clarifying the Legal Effect of “No Oral Modification” Clauses, 20 Cornell International Law Journal
(1988) 449 (460–61). A U.S. court implicitly held that China’s now-withdrawn Art. 96 reservation
extended to modification as well. U.S. District Court for the Southern District of Florida (U.S.), 19 May
2008 (Polyester dyed fabric), Zheijiang Shaoxing Yonghi Printing and Dyeing Co. Ltd. V. Microflock
Textile Group Corp., CISG-Online 1771 (Pace).
56 Art. 2.1.18 PICC.
57 Art. 2.106 PECL states: “(1) A clause in a written contract requiring any modification or ending by
agreement to be made in writing establishes only a presumption that an agreement to modify or end the
contract is not intended to be legally binding unless it is in writing. (2) A party may by its statements or
conduct be precluded from asserting such a clause to the extent that the other party has reasonably relied
on them.”
58 Art. II – 4:105 DCFR.
59 The PICC also do not refer to “statements.” Art. 2.1.18 PICC.
60 Perales Viscasillas, Modification and Termination of the Contract (Art. 29 CISG), 25 Journal of Law
and Commerce (2005–06) 167 (178).

61 Art. 2.106(1) PECL; Art. II-4:105(1) DCFR.
62 Art. 2.1.18 PICC.
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Chapter II
Obligations of the Seller
Article 30
The seller must deliver the goods, hand over any documents relating to them and
transfer the property in the goods, as required by the contract and this Convention.
Bibliography: Basedow, Die Incoterms und der Container, RabelsZ (1979) 116; Benedick, Die Informa-
tionspflichten im UN-Kaufrecht (CISG) und ihre Verletzung (2008); Dauner-Lieb/Quecke, in: Schulze/
von Bar/Schulte-Nölke (eds), Der akademische Entwurf für einen Gemeinsamen Referenzrahmen (2008),
p. 135; Derains/Ghestin, La Convention de Vienne sur la vente internationale et les incoterms (1990);
Grüske, Ratgeber INCOTERMS 2010 (2011); Huber, Modellregeln für ein Europäisches Kaufrecht, ZEuP
(2008) 708; Piltz/Bredow, Incoterms (2016); Piltz, Incoterms 2010, IHR (2011) 1; Ramberg, ICC Guide to
Incoterms 2010 (2011); Renck, Der Einfluß der INCOTERMS 1990 auf das UN-Kaufrecht (1995);
Schackmar, Die Lieferpflicht des Verkäufers in internationalen Kaufverträgen (2001), p. 78; Schwenzer/
Hachem/Kee, Global Sales and Contract Law (2012); Siehr, Internationales Sachenrecht, ZVglRWiss
(2005) 145; Schulze (ed.), Common European Sales Law (CESL) (2012); Vanheusden, Leveringsvoorwaar-
den in international overeenkomsten, Incoterms anders bekeken (2013).
Outline
1. Subject matter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
2. Primary obligations of the seller . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
3. National laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
4. Vienna Conference . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
1. Seller’s obligation to deliver . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
2. Seller’s obligation to transfer property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
a) Essential Function . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
b) Obligation to Transfer Property. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
c) The transfer of property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
3. Seller’s obligation to hand over documents. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
4. Party autonomy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
1. Incoterms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
a) Structure of the Incoterms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
aa) E-group . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
bb) F-group . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
cc) C-group. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
dd) D-group . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
b) Legal nature of the Incoterms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
c) The rules of interpretation of the Incoterms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
2. PICC and PECL. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
3. DCFR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47

1. Subject matter
Art. 30 summarizes the obligations of the seller which arise out of a contract of sale of 1
goods. It serves as an introduction to Chapter II “Obligations of the seller” and as
counterpart to Art. 53 which summarizes the obligations of the buyer. However, Art. 30
governs only the primary obligations, not the secondary obligations of the seller which
Piltz 393
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Article 30 2–7 Part III. Chapter II. Obligations of the Seller
result from his failure to perform the primary obligations properly. The secondary
obligations of the seller are regulated by Arts 45 et seq.
2 Typical and characteristic of a contract of sale of goods governed by the CISG is the
seller’s obligation to transfer the property in the goods1. Regularly – but not necessarily
in all cases2 – the seller is also obliged to deliver the goods subject to the contract of sale.
The obligation to hand over documents relating to the goods as well as other obligations
of the seller is, however, not equally characteristic to a contract of sale governed by the
CISG and arises only under certain circumstances.
3 The provisions governing the obligations of the seller are only applicable if the
contract is a contract of sale within the CISG’s scope of application. However, these
provisions can also be applied in situations where the contract goes beyond a simple sale
of goods as long as the transaction pursuant to Art. 3 falls within the CISG’s scope of
application. Art. 92(1) provides every Contracting State with the option to declare that
it will not be bound by Part III of the CISG and hence will not be obliged to apply Arts
30 et seq. Since no Contracting State has exercised this reservation so far, Art. 30
regulates the seller’s obligations in every contract of sale for which the CISG is
applicable.
4 Obligations of the seller can only derive from a contract of sale governed by the CISG
if this contract has been effectively concluded. The conclusion of the contract of sale, its
modification, amendment or termination as well as the requirements concerning the
form are regulated by Arts 14 et seq., 11, 29. The validity of the contract or any of its
provisions is governed by the subsidiarily applicable national law (see Art. 4(a)).
2. Primary obligations of the seller

5 Art. 30 does not regulate the obligations of the seller completely and conclusively.
Rather, Art. 30 has to be considered as a provision outlining the main primary
obligations of the seller arising out of an international contract of sale.
6 The primary obligations of the seller to deliver the goods and to hand over the
documents relating to them as mentioned in Art. 30 are defined in greater detail in Arts
31 et seq. Solely the obligation to transfer the property in the goods is exclusively
regulated in Art. 30. Further obligations of the seller can be found in other articles of the
CISG, namely the obligation to inform the buyer about the details of a specification to
the goods made by the seller (Art. 65(2)), the obligation to preserve the goods (Art. 85),
the obligation to give notice of any suspension of performance, (Art. 71(3)), and the
obligation to give notice of impediments which affect the ability to perform (Art. 79(4)).
7 Art. 30 explicitly instructs the seller to perform his obligations “as required by the
contract”. The primary obligations which have to be fulfilled and the content of these
obligations have to be evaluated primarily by examining the parties’ agreements and any
applicable usages and practices established between the parties (Arts 6 and 9). Party
autonomy prevails over the provisions of the CISG, even if the obligations are stipulated
in model contracts or in General Terms and Conditions3. Party autonomy is of special
significance with regard to the obligations of the seller mentioned in Art. 30. According
to experience, both parties generally put much more effort in negotiating and in
specifically stipulating the primary obligations of the seller and the buyer, whereas the
parties usually do not spend the same effort on the negotiation and stipulation of legal
1 See supra Art. 1 para. 25. See also Art. IV.-A.-1:202 DCFR. Misleading Secretariat Commentary on
1978 Draft, Art. 29 (now Art. 30) para. 1 (“seller’s primary obligation is to deliver the goods”).
2 See infra Art. 31 paras 8 et seq.
3 For more details see Fernández de la Gándara, in: Dı́ez-Picazo, Comentario (1998), p. 242.
394 Piltz
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Chapter II. Obligations of the Seller 8–10 Article 30

remedies for situations where one party fails to perform its contractual obligations.
Since the agreement between the parties and the circumstances surrounding the
contract are of primary and paramount significance, Art. 30 only plays a supplementary
role. It only gains significance to the extent that the seller’s obligations cannot be
determined by looking at the contract and its circumstances4.
Modifications or supplementations to the articles of the CISG in international 8
commercial contracts are often implemented by agreeing upon the Incoterms5. Apart
from the Incoterms which were especially designed for international sales transactions
and which apply irrespectively of a certain industry or a certain mode of transport, there
are numerous other bodies of rules and regulations for certain business areas6, most
frequently excluding the application of the CISG7, or certain transport modes8 and
general commercial rules. “COD” (cash on delivery)9, “CAD” (cash against docu-
ments)10, “free delivery” or “franko”11 by way of example are, like the Incoterms, not
reserved for a certain business area or transport mode. However, in contrast to the
Incoterms no autonomous interpretation rules exist for these terms12.
3. National laws
Recourse to national bodies of law can only be made insofar as the CISG does not 9
require its application to a certain legal question. Even though the CISG does not
expressly formulate all imaginable obligations, the obligations of the seller are consid-
ered to be regulated comprehensively by the CISG regarding their extent and content.
Legal provisions outside the CISG regarding the primary obligations of the seller can
therefore only be relevant, if the parties have agreed on that (Art. 6), if other interna-
tional agreements are relevant and applicable (Art. 90) or if there exists a well-founded
possibility to argue that the CISG’s applicability is limited in that respect.
4. Vienna Conference
Art. 30 corresponds almost literally with Art. 18 ULIS. During the Vienna conference, 10
Art. 30 was not controversial and was agreed on without major discussion13.
4 Magnus, in: Staudinger Kommentar (2013), Art. 30 para. 1, Art. 31 para. 6; Bernstein/Lookofsky,
Understanding the CISG (2003), p. 72; Lando, in: Bianca/Bonell, Commentary (1987), Art. 31 para. 2.4.
5 See infra paras 30 et seq.
6 For example s. 32 et seq. of the Geschäftsbedingungen des Waren-Vereins der Hamburger Börse e. V.;
s. 64 et seq. of the Einheitsbedingungen im Deutschen Getreidehandel; the Rules Relating to Contracts of

The Refined Sugar Association; the rules laid down in the GAFTA (Grain and Feed Trade Association)
and in the FOSFA (Federation of Oils, Seeds and Fats Association) contracts and many others.
7 The statement in these rules that the CISG does not apply does not necessarily mean that such
exclusion is valid, for more details see Piltz, Internationales Kaufrecht (2008), para 2–113.
8 For example Trappe, Überseekaufvertrag und “maritime terms”, IHR (2008) 157 et seq.
9 Cf. Lebuhn, Zur Bedeutung der Klausel “c.o. d.”, IPRax (1986) 19.
10 For more details see Zwitser, CAD, waar we het zoeken moeten, Nederlands Tijdschrift voor
Handelsrecht (2008) 181 et seq. and Oberlandesgericht Dresden (Germany) 9 July 1998, IHR (2001) 18
seq.
11 Cf. Hof’s-Hertogenbosch (Netherlands) 26 July 2011, CISG-Online 2384; Højesteret (Denmark)
15 February 2001, CISG-Online 601; Hof van Beroep te Gent (Belgium) 29 March 2000 (Pace); Hooge
Raad (Netherlands) 21 May 1999, CISG-Online 1809; Ramberg, ICC Guide to Incoterms 2010 (2011),
p. 60; Fogt, Die Vereinbarung und Auslegung von FRANCO-Lieferklauseln beim CISG-Kauf, European
Legal Forum (2003) 61 et seq. and Lebuhn, Zur Frage der Auslegung der in einem überseeischen
Getreidehandelsgeschäft verwendeten Klausel “frei Lager … Bestimmungsort”, IPRax (1985) 10 et seq.
12 See infra paras 31 and 42.
13 Magnus, in: Staudinger Kommentar (2013), Art. 30 para. 2; Fernández de la Gándara, in: Dı́ez-
Picazo, Comentario (1998), p. 244.
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1. Seller’s obligation to deliver
11 Art. 30 obliges the seller to deliver the goods. The further modalities of this obliga-
tion, namely the kind of act which the seller has to perform, the place and the time of
delivery, the notice of consignment, the carriage and the insurance of the goods are
governed by Arts 31–33, so reference is made to the respective commentaries. Depend-
ing on the circumstances, it is possible that the seller has no obligation to deliver the
goods or this obligation has been replaced by other agreements between the parties14.
Even in this case the nature of the contract, being a contract of sale of goods regulated
by the CISG, is generally not affected.
2. Seller’s obligation to transfer property

12 By virtue of Art. 30 the seller is also obliged to transfer the property in the goods sold.
This particular obligation characterizes every contract of sale and can be considered to
be its core content15. Other than the seller’s obligation to deliver the goods and to hand
over the documents relating to them the obligation to transfer the property is not
regulated in any other article of the CISG. The sole basis for the obligation to transfer
the property in the goods is Art. 30.
13 a) Essential Function. The obligation to transfer the property in the goods is essential
for any contract to be qualified as a contract of sale16. If an obligation of the seller to
transfer the property in the goods sold cannot be established, the respective contract is
usually not considered a contract of sale of goods regulated by the CISG. This results in
the inapplicability of the CISG17. For instance there is no contract of sale if only rights
of use with regard to the goods are granted to the other party18. However, it is irrelevant
when and under which conditions the transfer of property is to be conducted. There-
fore, a contract of sale that stipulates a reservation of title is nonetheless considered a
contract of sale according to the CISG19. It does not conflict with the qualification as a
contract of sale if the goods sold are encumbered with rights of a third party or rights
that serve to protect intellectual property of a third party20. However, there is usually no
contract of sale in the terms of the CISG if the seller is not obliged vis-à-vis the buyer to
transfer the property in the goods sold.
14 b) Obligation to Transfer Property. The CISG does not govern the effect which the
contract of sale may have on the property in the goods sold21 (Art. 4(b)). Therefore,
Art. 30 only contains an abstract obligation of the seller to take all necessary actions and

15 Fernández de la Gándara, in: Dı́ez-Picazo, Comentario (1998), p. 245.
16 Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 30 para. 2; Magnus, in:

17 See supra Art. 1; Piltz, Internationales Kaufrecht (2008), paras 2–27.
18 Cf. Bertrams/Kruisinga, Overeenkomsten in het international privaatrecht en het Weens Koopver-
drag (2010) pp. 183 seq.; Achilles, in: Ensthaler (ed.), Gemeinschaftskommentar zum Handelsgesetzbuch
mit UN-Kaufrecht (2007), Art. 1 para. 4.
19 Cf. Saenger, in: Ferrari et al., Internationales Vertragsrecht (2011), Art. 4 para. 8.
20 Green/Saidov, Software as Goods, Journal of Business Law (2007) 161 (176) (Pace).
21 Obviously in contrast regarding the moment the title passes Arbitral Award, Federal Arbitration
Court for the Northwestern Circuit (Russia) 3 June 2003, CISG-Online 947.
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measures in order to transfer property22. The CISG does not provide for any specifica-
tions on the necessary actions and measures to be taken23. It is also irrelevant whether
the seller or a third person is the proprietor or whether the seller has to transfer
property to the buyer or to a third person. Nevertheless, the seller has to take all
necessary actions and measures to transfer property in the goods sold and thus fulfil the
obligations he has entered into by concluding the contract of sale with the buyer.
The CISG does not contain any specifications as to where and when the seller has to 15
fulfil his obligation to transfer property. Unless otherwise stipulated or indicated by the
circumstances, the provisions regarding the seller’s delivery obligation can be applied
accordingly24. The rights of the seller to cure according to Arts 37 and 48 are applicable
to the seller’s obligation to transfer property likewise.
The parties are free to agree that regardless of the delivery of the goods, property in 16
goods shall only be transferred after the price for the goods has been paid in full. It has to
be judged by the rules of the CISG whether or not such an agreement regarding a
reservation of title is concluded with a legally binding effect25. The CISG also provides
whether the seller is at all, on what specific conditions and with which contractual
consequences entitled to declare the contract avoided in case the buyer fails to pay the
price properly26. In contrast, the CISG does not govern under which conditions a reserva-
tion of title can have a legal impact on a third party and the specific nature and extent of
such an impact. According to Art. 4(b) this question is dealt with by the respective national
law. The applicable national law is determined by the relevant private international law27.
Opinions differ on whether or not the seller is entitled to unilaterally declare a 17
reservation of title after the contract of sale has been concluded, i. e. when no reserva-
tion of title has been contractually agreed upon by the parties28. If property has not yet
passed to the buyer according to the applicable national law indicated by the relevant
private international law and the seller by virtue of Art. 58(1) second sentence is entitled
to make unilaterally payment of the goods sold a condition for handing them over, then
the seller is also entitled to unilaterally reserve the title in the goods sold without
breaching his contractual obligation to transfer the property in the goods29. However,
this applies only to a simple reservation of title, i. e. the reservation of title which aims to
22 Magnus, in: Staudinger Kommentar (2013), Art. 30 para. 10; Herber/Czerwenka, Kommentar (1991),
Art. 30 para. 8. Rejecting a primary obligation of the seller to transfer the property in the goods Bucher,
Überblick über die Neuerungen des Wiener Kaufrechts; dessen Verhältnis zu Kaufrechtstraditionen und
zum nationalen Recht, in: Bucher (ed.), Wiener Kaufrecht (1991), p. 13 (52).
24 See infra Arts 31 and 33.
25 Hof’s-Hertogenbosch (Netherlands) 29 May 2007, CISG-Online 1550; Schlechtriem/Schroeter, Internatio-
nales UN-Kaufrecht (2013), para. 177; Schwenzer/Fountoulakis, International Sales Law (2012), p. 207.
26 Critical Gabriel, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 336 (347).
27 Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 30 para. 11; US District
Court, Northern District of Illinois, Eastern Division (U.S.) 28 March 2002, Industeel vs. Steel Products
Inc., CISG-Online 696 and Federal Court, South Australian District (Australia) 28 April 1995, Roder Zelt-
und Hallenkonstruktionen GmbH vs. Rosedown Park Party Ltd., CISG-Online 218.
28 In favour Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 30 para. 11;
Magnus, in: Staudinger Kommentar (2013), Art. 30 para. 12; Benicke, in: MünchKommHGB (2013),
Art. 30 CISG para. 3; Saenger, in: Bamberger/Roth (eds), Kommentar zum Bürgerlichen Gesetzbuch
(2012), Art. 30 CISG para. 4 a; Fernández de la Gándara, in: Dı́ez-Picazo, Comentario (1998), p. 249 and
Ernst/Lauko, in: Honsell, Kommentar (2010), Art. 30 para. 15. In contrast Witz/Salger/Lorenz, Kommen-
tar (2016), Art. 30 para. 16; Verweyen/Foerster/Toufar, Handbuch des Internationalen Warenkaufs UN-
Kaufrecht (2008), p. 143; Soergel/Lüderitz/Schüßler-Langeheine, Kommentar zum Bürgerlichen Gesetz-
buch (2000), Art. 30 CISG para. 7; Karollus, UN-Kaufrecht (1991), p. 113.
29 Cf. Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 30 para. 11; Gruber, in:
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ensure only the payment of the price for the goods sold subject to the contract in
question. There is no possibility for the seller to unilaterally impose an enlarged30 or an
extended31 reservation of title.
18 In case of improper performance of the seller’s obligation to transfer property, the
buyer enjoys the legal remedies regulated in Arts 45 et seq.32, namely the remedies for
delivery of goods with defective title (Arts 41 and 42). Generally, the seller owes the
buyer the duty to deliver goods free from any right or claim of a third party33. If the
passing of property does not succeed due to circumstances which pursuant to Art. 4(b)
are not governed by the CISG, the seller has not fulfilled his obligation to transfer
property imposed upon him by Art. 30. However, if the transfer of property cannot be
achieved due to a lack of cooperation by the buyer, the seller is protected by Art. 80.
19 c) The transfer of property. When the transfer of property in the goods sold is not to
be operated by handing over the relevant negotiable documents34, one has to turn to the
relevant private international law to determine, which actions or measures have to be
taken to achieve the transfer of property and for the seller to fulfil his obligations imposed
by Art. 3035. In general, every state decides autonomously how to design its private
international law. Since only a few specific constellations regarding the transfer of
property are governed by international treaties, it is most often necessary to resort to the
private international law of the respective state. As a general rule, the transfer of property
in movables is governed by the national law of the state where the goods are situated (lex
rei sitae)36. Although there are some exceptions to this rule, it is practically accepted as a
general principle around the world37. Taking into account that the legal position of third
parties can be affected by the transfer of property, there is virtually no alternative to this
principle. Specific rules of interest in connection with contracts of sale exist to protect
cultural assets (lex originis)38.
20 Looking at the existing national laws regarding the transfer of property, there are three
different basic mechanisms or principles in national laws on how the transfer of property in
movables operates. Without going too much into detail these can be described as follows39.
30 An enlarged reservation of title (“erweiterter Eigentumsvorbehalt”) means that the title of the goods
remains with the seller until all debts of the purchaser including those resulting from other contracts with
the seller have been paid.
31 An extended reservation of title (“verlängerter Eigentumsvorbehalt”) means that the title of the
goods remains with the seller until the debts of the purchaser with the seller have been paid while the
purchaser is entitled to sell or otherwise dispose of the goods in the ordinary course of business. To serve
the security interests of the seller all claims of the purchaser against his customers arising out of the sale
or processing of the goods are automatically transferred to the seller. Usually the seller authorizes the
purchaser to collect those funds in his own name but on account of the seller to whom the purchaser shall
forward all those funds immediately upon collection.
32 Ernst/Lauko, in: Honsell, Kommentar (2010), Art. 30 para. 12.
33 In contrast Witz/Salger/Lorenz, Kommentar (2016), Art. 30 para. 11.
34 See infra Art. 34 para. 14.
35 See supra para. 14.
36 Magnus, in: Staudinger Kommentar (2013), Art. 30 para. 11; Schlechtriem/Butler, CISG (2009),
para. 121.
37 Cf. Kropholler, Internationales Privatrecht (2006), p. 554; Siehr, Internationales Sachenrecht,
ZVglRWiss (2005) 145 et seq.

38 Cf. Wendenburg, Kulturgüterschutz im Gemeinschaftsrecht, ZEuP (2008) 577 et seq.; Siehr, Inter-
nationaler Rechtsschutz von Kulturgütern, Schweizerische Zeitschrift für Internationales und Europä-
isches Recht (2005) 53 et seq.; Siehr, Internationales Sachenrecht, ZVglRWiss (2005) 145 (151); Kienle/
Weller, Die Vindikation gestohlener Kulturgüter im IPR, IPRax (2004) 290 et seq.
39 Cf. Martiny, in: Reithmann/Marrtiny, Internationales Vertragsrecht (2015) para. 6.143; Faber/Lurger,
Rules for the Transfer of Movables (2008); Ziegler/Ronøe/Debattista/Plégat-Kerrault, Transfer of Owner-

ship in International Trade (1999); Röthlisberger, Traditionsprinzip und Konsensprinzip bei der Mobi-
liarübereignung (1982); Wacke, Eigentumserwerb des Käufers durch schlichten Konsens oder erst mit
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The principle of consensus: The very conclusion of the contract of sale principally 21
leads to the transfer of property in the goods sold. This principle is applied in Australia,
Belgium, Bolivia, Canada, Denmark, England, France, Italy, Mexico, New Zealand,
Portugal, Sweden, the U.S. and in Venezuela.
The principle of tradition: In addition to the mere contract of sale the factual 22
handing-over of the goods sold or of a surrogate for the handing-over of the goods is
necessary in order to transfer property. This principle is in particular applied in
Argentina, Austria, Brazil, Chile, China, Colombia, Cuba, Honduras, the Netherlands,
Norway, Paraguay, Peru, Russia, Spain, South Africa, Switzerland and in Uruguay.
The principle of separation: An additional collateral agreement on the transfer of 23
property, which is legally independent from the contract of sale, is required as well as
the handing-over of the goods sold or a surrogate for the handing-over of the goods.
This principle is applied in Germany and in a modified form in Japan.
Considering their dogmatic origin these principles hardly seem to be compatible with 24
each other. In practice however, the principle of tradition and the principle of separa-
tion are relativized by allowing arrangements to substitute the handing-over of the
goods. The pure principle of consensus is subject to modifications especially in
commercial transactions and because of the need to specify unascertained goods as
well as in specific constellations with regard to possession.
If according to the applicable national law the handing-over of the goods is a 25
prerequisite for the transfer of property, this handing-over must – even if it factually
coincides with delivery – be considered as legally independent from the delivery40. On
the other hand, the seller is not released from his obligation to deliver the goods merely
because the transfer of property has already been achieved by concluding the contract
(principle of consensus). Moreover, it cannot be concluded from the seller’s obligation
to deliver the goods that under the CISG the transfer of property is linked with the
handing-over of the goods sold41. Due to the fact that the CISG does not govern the
effect which the contract of sale may have on the property in the goods sold (Art. 4(b)),
the seller’s obligation to deliver the goods on one side and the actions and measures
necessary pursuant to the applicable national law for the transfer of property on the
other side have to be considered separately and independently from each other.
3. Seller’s obligation to hand over documents

Finally, Art. 30 also obliges the seller to hand over any documents relating to the 26
goods. Details of this obligation are subject of Art. 34, so reference is made to the
respective commentary. If an obligation to hand over documents cannot be established,
it generally does not affect the characterization of the contract as a contract of sale
according to the CISG.
4. Party autonomy
In addition to the seller’s obligations to deliver the goods42, to transfer property in the 27
goods43 and to hand over the documents relating to them44, Art. 30 expressly stipulates
Übergabe? Unterschiede im Rezeptionsprozess und ihre mögliche Überwindung, ZEuP (2000) 254 et seq.;
Ferrari, Vom Abstraktionsprinzip und Konsensualprinzip zum Traditionsprinzip, ZEuP (1993) 52 et seq.
40 Ernst/Lauko, in: Honsell, Kommentar (2010), Art. 30 para. 14; Witz/Salger/Lorenz, Kommentar
(2016), Art. 30 para. 7.

41 In contrast Fernández de la Gándara, in: Dı́ez-Picazo, Comentario (1998), p. 247.
43 See supra paras 12 et seq.
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that the seller has to fulfil his obligations “as required by the contract”. This means that
the agreement of the contracting parties and all other relevant circumstances concern-
ing the contract always have to be taken into consideration, especially regarding the
interpretation of the contract’s content and the proper performance of the obligations to
deliver the goods, to transfer property and to hand over the documents45. Furthermore,
like Arts 6 and 9, this passage in Art. 30 is the basis for the binding character of all other
obligations imposed on the seller which are not addressed explicitly in Art. 3046 and not
described in other articles of the CISG.
28 In practice, the agreement on a clause of the Incoterms and thus the particular
obligations of the seller arising out of the Incoterms rules for that clause are of particular
relevance47. Yet without an agreement on Incoterms the seller may be committed to
comply with further obligations not expressly regulated by the CISG. In particular these
can regard the packaging and labelling of the goods sold48, the procurement of necessary
licenses and permissions49 and the provision of customs declarations and the payment of
tariffs50. If additional obligations of the seller can be established, either by agreement on
Incoterms clauses or by other circumstances, these obligations are generally governed by
the CISG as well51. The CISG namely governs the agreement on such further obligations
and the consequences of a poor or non-performance of these obligations52. With due
consideration, reasonable flexibility and dependant on the kind of obligation as well as the
relevant circumstances, other provisions of the CISG can be applicable too, in particular
the rights to cure according to Arts 37 and 4853.
29 It is quite controversial to what extent a general obligation of the seller to cooperate
can be established and what the specific content of such a general obligation to
cooperate could be54. For instance a seller was held responsible for not having clarified
to the buyer that the goods were not suitable for the purpose he expected55. The legal
basis of such an obligation should be seen primarily in Art. 7 and not in Art. 3056.
Regarding the seller’s obligations, the text of Art. 30 is not exhaustive57. Nevertheless,
one still has to be cautious in developing further obligations of the seller referring to
Art. 758. The CISG is characterized by the principle of party autonomy. Then, author-
itative for the seller’s obligations is primarily the agreement between the parties (Art. 6),

47 For more details see infra paras 30 et seq.

52 Benicke, in: MünchKommHGB (2013), Art. 30 CISG para. 2; Magnus, in: Staudinger Kommentar
(2013), Art. 30 para. 19.

53 Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 48 para. 3; Benicke, in: Münch-
KommHGB (2013), Art. 48 CISG para. 2.

54 Cf. Gruber, in: MünchKommBGB (2016), Art. 30 para. 8; Witz/Salger/Lorenz, Kommentar (2016),
Art. 30 para. 23; Dimsey, in: Brunner, Kommentar (2014), Art. 30 para. 21; Magnus, in: Staudinger
Kommentar (2013), Art. 7 para. 47, Art. 30 para. 15; Ernst/Lauko, in: Honsell, Kommentar (2010),
Art. 30 para. 18; Kock, Nebenpflichten im UN-Kaufrecht (1995), p. 32.
55 Oberlandesgericht Koblenz (Germany) 24 February 2011, CISG-Online 2301.
56 Witz/Salger/Lorenz, Kommentar (2016), Art. 30 para. 23; Magnus, in: Staudinger Kommentar (2013),
Art. 30 para. 15.

58 Pointing into the same direction Schroeter, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 25
para. 17; Benedick, Die Informationspflichten im UN-Kaufrecht (CISG) und ihre Verletzung (2008),
para. 254.
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the relevant usages and the practices that have been established between them (Art. 9),
and only subsidiarily the provisions of the CISG (Art. 30). If according to this scheme
no obligations of the seller can be established, the seller does not have to be concerned
that further obligations are constructed to his detriment. Still, in the process of
interpreting the parties’ agreement reference can be made to Art. 7. That provision
cannot, however, be referred to in order to constitute obligations which have no solid
foundation in Arts 6 and 9 or in any other provision of the CISG.
1. Incoterms
In international trade, standardized abbreviations have been used for a long time59 to 30
denote the obligations of the buyer and the seller which are typical in the export and
import of goods. Probably the most commonly applied abbreviations are the Incoterms
(International Commercial Terms)60 set up by the International Chamber of Commerce
(ICC) situated in Paris with the intention to provide internationally uniform rules for
the interpretation of specific clauses. Drafted as a set of rules independent of a particular
area of trade or mode of transport, the Incoterms were designed for cross-border sales
of goods in general and thus address situations governed by the CISG. However, the
Incoterms rules do not regulate the conclusion of the contract of sale, the exemption
from a party’s obligation to perform or the consequences of improper performance61.
Therefore, the Incoterms rules cannot supersede the CISG altogether. Instead the
Incoterms rules concentrate on specific aspects of the primary obligations of the seller
and the buyer. In doing so, the Incoterms supersede and modify the corresponding
articles of the CISG62. Moreover, just like the CISG63 the Incoterms do not regulate the
transfer of property64.
a) Structure of the Incoterms. The Incoterms 201065 entered into force on 1 January 31
2011 and consist of eleven different clauses which are each coded by a three-letter-
combination. The ICC has laid down interpretation rules for every clause, always using
59 For more information cf. Ramberg, CISG and INCOTERMS 2000 in Connection with International
Commercial Transactions, FS Kritzer (2008), pp. 394 et seq.; Renck, Der Einfluß der INCOTERMS 1990
auf das UN-Kaufrecht (1995), pp. 5 et seq.
60 For more details see Piltz/Bredow, Incoterms (2016); Magnus/Piltz, in: DiMatteo/Janssen/Magnus/
Schulze, International Sales Law (2016), p. 267; O’Connor (eds), Incoterms 2010 Q&A (2013); Vanheus-
den, Leveringsvoorwaarden in international overeenkomsten, Incoterms anders bekeken (2013); Graf von
Bernstorff, Incoterms 2010 (2012); Piltz, Incoterms 2010, Europen Journal of Commercial Contract Law
(2011) 1 et seq.; Grüske, Ratgeber INCOTERMS 2010 (2011); Bergami, Incoterms 2000 as a risk
management tool for importer, Vindobona Journal of International Commercial Law and Arbitration
(2006) 273 et seq.; Wertenbruch, Die Incoterms – Vertragsklauseln für den internationalen Kauf,
Zeitschrift für das gesamte Schuldrecht (2005) 136 et seq.; Gabriel, International Chamber of Commerce
Incoterms 2000: A Guide to their Terms and Usage, The Vindobona Journal of International Commercial
Law and Arbitration (2001) 41 et seq.; Piltz, INCOTERMS 2000, Revista del Derecho Comercial
(Argentina) (2000) 263 et seq.; Bredow/Seiffert, INCOTERMS 2000 (2000) and Ramberg, ICC Guide to
Incoterms 2000 (1999), ICC publication No 620.
61 Piltz/Bredow, Incoterms (2016) paras A-240 and 249; Ramberg, ICC Guide to Incoterms 2010 (2011),
ICC publication No 720, 17.

62 Piltz/Bredow, Incoterms (2016) paras A-240 et seq.; see supra paras 7 seq. and Magnus/Lüsing, CISG
und INCOTERMS, Leistungsverzug und Fixgeschäfte, IHR (2007) 1 (5).

64 Arbitral Award, ICC 3779/1981, Yearbook of Commercial Arbitration (1984) 124 (125); Fernández
de la Gándara, in: Dı́ez-Picazo, Comentario (1998), p. 246.

65 ICC, Incoterms 2010, ICC publication No 715 ED (2010).
Piltz 401
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ten invariable headings66 in order to establish a foundation for an internationally

coordinated, uniform application.
32 The Incoterms are divided into four main categories identified by the initial letter of
their English version, namely the E-, the F-, the C- and the D-group. Every group
distinguishes itself in that the assignment of the transportation of the goods and the
absorption of the costs and risks within that particular group follow an identical
principle, whereas the clauses of the other groups comply with a different principle
concerning these issues. The obligations of the seller keep increasing from the E- to the
F- and the C- and finally to the D-group, while the responsibility of the buyer decreases
accordingly.
aa) E-group
33 – EXW – ex work/a l’usine/ab Werk/franco fabrica/en fabrica
The E-group consists of only a single clause. The seller is only obliged to place the
packed and labelled goods at the buyer’s disposal for pick up at the seller’s premises or
another named place (i. e. factory, warehouse, etc.). The seller has no obligation to load
the goods or to take care of export clearance. For the seller, this term represents the
minimum obligation.
bb) F-group
34 – FCA – free carrier/franco transporteur/frei Frachtführer/franco vettore/franco trans-
portista
– FAS – free alongside ship/franco le long du navire/frei Längsseite Seeschiff/franco
lungo bordo/franco al costado del buque
– FOB – free on board/franco bord/frei an Bord/franco a bordo/franco a bordo
According to the three clauses of the F-group, the buyer remains fully responsible for
the main transport of the goods. Unlike the Incoterm clause EXW, the clauses of the F-
group oblige the seller to transport the goods at his own expense and risk to the named
place of delivery where the main transport commences (e. g. “FOB Hamburg”) and to
clear the goods for export at his expense. The buyer has to take delivery of the goods at
the named place of delivery and bears the costs and responsibility for the following
main transport, the transit through third countries as well as the import into the
country of destination. The Incoterms clauses FAS and FOB are solely suitable for
transportation by ship67, whereas the Incoterm clause FCA is designed for any mode of
transportation including transportation by ship and multimodal transport. FCA re-
placed the clause FOT which existed until 1990 and in particular is provided for
containerized shipments for which FOB68 and FAS69 should not be used, because
containers are usually handed over to the carrier at an earlier stage before being made
available alongside or on board the vessel.
cc) C-group
35 – CFR (cost and freight/cout et fret/Kosten und Fracht/costo e nolo/costo y flete)
– CIF (cost, insurance and freight/cout, assurance et fret/Kosten, Versicherung und
Fracht/costo, assicurazione e nolo/costo, seguro y flete)
66See infra para. 42.

67Disregarded by Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 31
para. 19.
68 Piltz/Bredow, Incoterms (2016) para. A-404; Graf von Bernstorff, Incoterms 2010 (2012) para. 582;
Bredow/Seiffert, Incoterms 2000 (2000), pp. 45, 66.

Bredow/Seiffert, Incoterms 2000 (2000), p. 62.
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Chapter II. Obligations of the Seller –37 Article 30

CFR and CIF are only designed for transportation by ship, i. e. sea and inland
waterway transportation, and require that the seller has access to the vessel.
– CPT (carriage paid to/port paye jusqu’a/frachtfrei/trasporto pagato fino a/transporte
pagado hasta)
– CIP (carriage and insurance paid to/port paye, assurance comprise, jusqu’a/frachtfrei
versichert/trasporto e assicurazione pagati fino a/transporte y seguro pagados hasta)
On the contrary, the other two clauses (CPT and CIP) can be applied for all modes of
transportation, including transportation by ship, and should be used for containerized
shipments instead of CFR and CIF. CFR and CIF are inappropriate for containerized
shipments, because containers are usually handed over to the carrier before being
loaded on board the vessel. The common characteristic of all clauses of the C-group is
the seller’s obligation to conduct the export clearance and – different from the F-group
– to conclude the contract of the main transport to the named place of destination (e. g.
“CIF Buenos Aires”) at his own expense. Unlike the F-clauses, the buyer has to take
delivery of the goods only at the named place of destination. However, the risk is –
equally to the F-group and despite the more extensive bearing of costs – transferred to
the buyer as early as the moment in which the goods are delivered by handing them
over to the carrier of the main transport. Therefore, when using a C-clause of the
Incoterms no date of arrival should be stipulated70. The place of destination for the
carriage can usually be derived from the agreement itself or its circumstances. In case of
doubt, the transportation has to be directed to the buyer’s place of business or a port
nearby. Contracts of sale with a C-clause of the Incoterms are contracts involving
carriage of the goods in the meaning of Art. 31(a)71. In containerized shipments CFR
and CIF lead to the same problems as using FOB72.
dd) D-group
– DAT – delivered at terminal/rendu au terminal/geliefert Terminal/reso al terminal/ 36
entregada en terminal
– DAP – delivered at place/rendu au lieu de destination/geliefert benannter Ort/reso al
luogo di destinazione/entregada en lugar,
– DDP – delivered duty paid/rendu droits acquittes/eliefert verzollt/reso sdoganato/entre-
gada derechos pagados)
The typical characteristic of all D-group clauses is the seller’s obligation to bear all
costs and – different from the C-group Incoterms – also all risks up to the moment in
which the goods arrive at the named place of delivery (e. g. “DAT Hong Kong”). The
buyer has to take delivery of the goods at the named place of delivery. Therefore, the D-
clauses constitute to a large extent a reversed regulation of the F-clauses. The import
clearance remains the buyer’s obligation. Only when using the clause DDP, the exporter
has to take care of the import clearance as well. Thus, the DDP clause can be used as the
counterpart to the Incoterms clause EXW when applied accordingly.
b) Legal nature of the Incoterms. Although the Incoterms clauses have been applied 37
for decades, there is still no generally acknowledged legal opinion as to their legal nature
and the basis for their operation73. The Incoterms are a private set of rules. Therefore
70 Cf. Arbitral Award, Hamburger freundschaftliche Arbitrage (Germany) 12 February 1985, RIW 1985,
328.
71 See infra Art. 31 paras 59 et seq. and Piltz, UN-Kaufrecht und internationaler Gütertransport, in:
Czerwenka/Paschke (eds), Ad multos annos: Seehandelsrecht und internationales Kaufrecht, Festgabe für
Prof. Herber (2010), p. 7 (18).
Ramberg, ICC Guide to Incoterms 2010 (2011), ICC publication No 720, p. 22.
73 Cf. Piltz/Bredow, Incoterms (2016) paras A-300 et seq.
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they have a binding effect only if the parties have referred to them. Consequently,
starting points to assess their legal nature and the basis for their operation have been
and are still being looked for somewhere among74 standard business conditions75,
customary law76, usages77, objective rules for interpretation78, soft law79 and lex merca-
toria80. The Incoterms rules supersede and modify the corresponding articles of the
CISG81. This possibility to alter and supplement the provisions of the CISG is
principally provided for by Arts 6 and 9. Therefore, within the scope of application of
the CISG, these articles constitute the starting point of the issue of the operation of the
Incoterms rules.
38 The Incoterms clause by itself, i. e. the three-letter-combination in conjunction with
the respective denomination of the place of delivery (e. g. “FOB Hamburg”) or destina-
tion (e. g. “CIF Buenos Aires”) which is used in a contract, is most often subject to an
agreement between the parties pursuant to Art. 6.
39 If the parties make use of one of the three-letter-combinations of the Incoterms
including an explicit reference to “Incoterms 2010”82, the rules of interpretation estab-
lished by the ICC are applicable in order to further determine the seller’s obligations,
which are connected to the Incoterms clause in question. The use of the reference
“Incoterms 2010” is recommended in particular when contracting with parties in the
Near and the Middle East due to the fact that the codes of commercial law of a number of
Arab states contain statutory provisions concerning clauses of international trade which do
not conform entirely with the interpretation rules of the Incoterms. The same applies
regarding Denmark, as the Danish sales law regulates the meaning of clauses like FOB and
CIF not always completely in line with the Incoterms rules83. However, if the parties refer
explicitly to “Incoterms 2010” they have made clear that the three-letter-combination is to
be understood according to the ICC’s rules of interpretation. Since the parties to the
contract of sale generally lack concrete perceptions of the details of the rules of interpreta-
tion set up by the ICC and the text of these rules is normally not exchanged between the
parties nor attached to the contract, an individual agreement about the full content of the
particular rules of interpretation is usually out of question even when the reference
“Incoterms 2010” is used. In lieu, the recourse to the ICC’s rules of interpretation for the
respective Incoterms clause has to be qualified as a usage in the meaning of Art. 9(1) CISG,
which the parties agreed on by phrasing the explicit reference to “Incoterms 2010” in the
74 Cf. Renck, Der Einfluß der INCOTERMS 1990 auf das UN-Kaufrecht (1995), pp. 15 et seq. and
Basedow, Die Incoterms und der Container, RabelsZ (1979) 116 (125 et seq.).
75 Schroeter, in: Schlechtriem/Schwenzer, Commentary (2016), Intro to Arts. 14–24 para. 5; Graf von
Bernstorff, Incoterms 2010 (2012) paras 70 et seq.; Verweyen/Foerster/Toufar, Handbuch des Internatio-
nalen Warenkaufs UN-Kaufrecht (2008), p. 115;. In contrast Renck, Der Einfluß der INCOTERMS 1990
auf das UN-Kaufrecht (1995), pp. 28 (31).
76 Basedow, Die Incoterms und der Container, RabelsZ (1979) 116 (125). In contrast Renck, Der
Einfluß der INCOTERMS 1990 auf das UN-Kaufrecht (1995), p. 21.

77 Heuzé, Vente International (2000), pp. 229 seq. and Oberlandesgericht Karlsruhe (Germany)
30 March 1979, RIW (1979) 642 seq. In contrast Renck, Der Einfluß der INCOTERMS 1990 auf das
UN-Kaufrecht (1995), p. 26.
78 Renck, Der Einfluß der INCOTERMS 1990 auf das UN-Kaufrecht (1995), pp. 32, 35; Oberlandesger-
icht München (Germany) 19 December 1957, NJW (1958) p. 426.

79 Schneider, Incoterms 1990, RIW (1991) 91 (93).
80 Kappus, “conflict avoidance” durch “lex mercatoria” und UN-Kaufrecht 1980, RIW (1990) 788 (790).
82 For example “FCA Hamburg – INCOTERMS 2010”.
83 Cf. Steinrücke, in: Graf von Westphalen (ed.), Handbuch des Kaufvertragsrechts in den EG-Staaten
(1992), p. 151.
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contract84. As a consequence of this approach, however, other contractual agreements
including General Terms and Conditions being made part of a contract prevail over the
interpretation rules of the Incoterms.
If one of the three-letter-combinations of the Incoterms is used, but a reference to the 40
interpretation rules drafted by the ICC is yet neither directly nor indirectly distinguish-
able, a recourse to the Incoterms rules of interpretation might still come into considera-
tion. However, it is then necessary that the application of the rules of interpretation of
the Incoterms constitutes a common usage which the parties knew or ought to have
known and which is moreover widely known and regularly observed in comparable
situations of international trade85 (Art. 9(2) CISG). However, the application of the
rules of the Incoterms is not at all certain. The interpretation of the contract can arrive
at a different conclusion, for instance at the application of the US-American Foreign
Trade Definitions86. Invoking Art. 9(2), the usage, which has to be argued and where
required proven by the party who advocates the application of the rules of interpreta-
tion of the Incoterms, does not necessarily have to comprise in detail the obligations of
the seller and buyer in the way they are laid down in the rules of interpretation for the
specific clause in question. In fact, it is sufficient to establish that there is a usage to
generally resort to the ICC’s rules of interpretation of the clause referred to by the three-
letter-combination in order to interpret the clause87.
The Incoterms 2010 are applicable to both international and domestic contracts of 41
sale. Different to the Incoterms 2010 which are silent in this respect, the Incoterms 2000
did not consider software to be a good88. However, this restraint did not exclude their
use in sales regarding computer software as long as the parties agreed on one of the
three-letter-combinations established by the Incoterms and their rules of interpretation
apply. Furthermore, the regulative content of the respective clause is in no way
imperative and can be modified by the parties according to their intentions89. Further-
more, different regulations in General Terms and Conditions will generally prevail over
the interpretation rules of the Incoterms90.
84 Piltz/Bredow, Incoterms (2016) para. A-304; Magnus, in: Staudinger Kommentar (2013), Art. 9
para. 8; Melis, in: Honsell, Kommentar (2010), Art. 9 para. 7; Honnold/Flechtner, Uniform Law (2009),
Art. 9 para. 114. Cf. Vogenauer, in: Vogenauer/Kleinheisterkamp (eds), UNIDROIT Commentary (2008),
Art. 1.9 para. 10.
85 Bundesgerichtshof (Germany) 7 November 2012, CISG-Online 2374 (IHR (2013) 15 et seq.); Juzgado
Comercial no. 26 (Argentina) 2 July 2003, CISG-Online 2623; US Court of Appeals for the 5th Circuit (U.S.)
11 June 2003, BP Oil International Ltd. and BP Exploration & Oil Inc vs. Empresa Estatal Petroleos de
Ecuador, CISG-Online 730; US District Court, Southern District of New York (U.S.) 26 March 2002, CISG-
Online 615. Cf. Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 30 para. 5; Piltz/
Bredow, Incoterms (2016) paras. A-306 seq.; Witz/Salger/Lorenz, Kommentar (2016), Art. 9 para. 14;. Cf.
Vogenauer, in: Vogenauer/Kleinheisterkamp, UNIDROIT Commentary (2008), Art. 1.9 para. 11.
86 Cf. Oberlandesgericht Koblenz (Germany) 16 October 2003, RIW (2004) 302 (305). Regarding the
differences of the Incoterm “FOB” compared with the US-American foreign trade definition “F.O. B.” see
Schackmar, Die Lieferpflicht des Verkäufers in internationalen Kaufverträgen (2001), pp. 69 et seq. Cf.
Spanogle, The International Lawyer (1997), pp. 111 et seq.; O’Hara, in: Hancock (ed.), Guide to the
International Sale of Goods Convention (1993), chapter 107. The intended elimination of the correspond-
ing sections of the Uniform Commercial Code was withdrawn.
87 Piltz/Bredow, Incoterms (2016) para. A-306; Cf. US Court of Appeals for the 5th Circuit (U.S.) 11 June
2003, BP Oil International Ltd. and BP Exploration & Oil Inc v. Empresa Estatal Petroleos de Ecuador,
CISG-Online 730.
88 ICC, Incoterms 2000, ICC publication No 560 ED (1999), pp. 5, 133.
89 ICC, Incoterms 2010, ICC publication No 715 ED (2010), pp. 12, 136.
90 See supra para. 39 and Nienaber, in: Center for Transnational Law, Law and Practice of Export Trade
(2001), 131 (137). In contrast Bredow, TranspR-IHR (1999) 45 (47). See for example § 34 of Geschäfts-
bedingungen des Waren-Vereins Hamburger Börse e. V., which modifies the Incoterm FOB.
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42 c) The rules of interpretation of the Incoterms. In order to promote an internation-
ally coordinated, uniform application of the Incoterms, the rules of interpretation
provide which rights and obligations result from the specific agreement for each and
every of the eleven clauses under ten always repeated and invariable, consecutively from
one to ten numbered headings. The seller’s obligations are always denoted with the
letter “A”, the buyer’s obligations with the letter “B”:
– A1 – B1: General obligations of the seller/buyer
– A2 – B2: Licences, authorizations, security clearances and other formalities
– A3 – B3: Contracts of carriage and insurance
– A4 – B4: Delivery and taking delivery
– A5 – B5: Transfer of risks
– A6 – B6: Allocation of costs
– A7 – B7: Notices to the buyer/seller
– A8 – B8: Delivery document/Proof of delivery
– A9 – B9: Checking – packaging – marking/Inspection of the goods
– A10 – B10: Assistance with information and related costs
43 According to section A1 of the rules of interpretation of all clauses, the “seller must
provide the goods … in conformity with the contract of sale …”. This statement is not
to be understood to constitute the seller’s obligation to deliver. It rather repeats the
seller’s obligation already resulting from the contract of sale91. If the seller does not
deliver at all or delivers goods not conforming with the contract or in some other way
fails to comply with his obligation to deliver according to the contract, the conse-
quences are derived from the applicable law92. Furthermore, A1/B1 of the rules of
interpretation of the Incoterms 2010 give electronic communication the same effect as
traditional correspondence if so agreed by the parties or customarily established.
44 According to section A1 of the rules of interpretation of each clause the seller must
also provide a commercial invoice. Even though the CISG does not explicitly impose
such an obligation on the seller it is common ground supported by bookkeeping and tax
purposes that in contracts of sale governed by the CISG the buyer is entitled to get a
commercial invoice93. Section A1 of the rules of interpretation of the Incoterms
confirms this understanding and therefore reiterates the seller’s obligation already
founded when concluding the contract of sale, rather than creating such an obligation.
Regardless of the buyer’s entitlement to an invoice, the presentation of the invoice is not
a prerequisite for the payment of the purchase price94 (cf. Art. 59 CISG).
45 The explanations given by the rules of interpretation of the Incoterms under the
headings A2-B2 until A10-B10 will be commented in connection with the articles of the
CISG with which they are related95.
2. PICC and PECL

46 Neither the PICC (UNIDROIT Principles of International Commercial Contracts)
nor the PECL (Principles of European Contract Law) contain provisions regulating
91 Piltz/Bredow, Incoterms (2016) para. F-106; Ramberg, ICC Guide to Incoterms 2010 (2011), ICC
publication No 720, p. 64.

92 Piltz/Bredow, Incoterms (2016) para. F-107; Renck, Der Einfluß der INCOTERMS 1990 auf das UN-
Kaufrecht (1995), pp. 88 seq.

93 For more details see Art. 31 para. 56 and Piltz, Internationales Kaufrecht (2008), paras 4–148.
94 Supreme Court (Slovakia) 3 April 2008, CISG-Online 1763 (Pace); Piltz, Internationales Kaufrecht
(2008), paras 4–148. In contrast Huber, in: MünchKommBGB (2008), Art. 59 para. 3; Saenger, in:
Bamberger/Roth (eds), Kommentar zum Bürgerlichen Gesetzbuch (2012), Art. 59 CISG para. 2.
95 See infra Art. 31 paras 58 et seq., Art. 32 paras 29 et seq., Art. 33 paras 34 et seq., Art. 34 paras 29 et
seq. and Art. 67 paras 25 et seq.
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specific types of contracts. In practice, the contract of sale holds a rather prominent
position and thus repeated reference was made to situations typical of a contract of
sale when drafting the PICC and the PECL96. However, no rules regarding the rights
and obligations which specifically arise out of a contract of sale were established, so
that the regulatory content of Art. 30 does not find a counterpart in the PICC or in
the PECL.
3. DCFR
The DCFR (Draft Common Frame of Reference) dedicates Book IV to specific 47
contracts and the rights and obligations arising from them. Part A of Book IV deals
with contracts of sale97. The rules set up by the DCFR regarding consumer contracts of
sale will not be commented here as Art. 2(a) CISG excludes consumer contracts from its
sphere of application. Just like the CISG, the DCFR only regulates the sale of goods and
does not apply to contracts for the sale of immovable property (Art. IV.A.-1:101(3)
DCFR). But even further, the sales law of the DCFR is to a large extent influenced by the
techniques and principles underlying the CISG98. Although several other provisions
which are part of the CISG are not regulated in Book IV Part A of the DCFR but
elsewhere in the text, one can directly resort to the parallel provision of IV. A.-2:101
DCFR as regards the seller’s primary obligations summarized in Art. 30 CISG.
According to Art. IV.A.-2:101 DCFR the seller must transfer the ownership of the goods, 48
deliver them and transfer the documents required by the contract. If there is no obligation
to transfer ownership of the goods, there is no contract of sale99 (cf. Art. IV.A.-1:202
DCFR). On the other hand part A of Book IV DCFR just like the CISG100 does not regulate
when, where and which actions and measures have to be taken by the seller to conduct the
transfer of property and to discharge his obligation101. The interim outline edition of the
DCFR did not contain any rules in this respect at all. The acquisition and loss of ownership
of goods form the content of Book VIII DCFR and were published only in the outline
edition of the DCFR in December 2008. Further obligations of the seller to deliver the goods
and to transfer the documents are commented in the corresponding context102.
According to Art. IV.A.-2:101(d) DCFR the seller must also ensure that the goods 49
conform to the contract103. The corresponding rule in the CISG is not Art. 30, but
Art. 35(1).
96See the numerous examples in the explanatory notes and commentaries.

97For more details see Huber, Modellregeln für ein Europäisches Kaufrecht, ZEuP (2008) 708 et seq.;
Hondius/Heutger/Jeloschek/Sivesand/Wiewiorowska, Principles of European Law – Sales (PELS) (2008);
Dauner-Lieb/Quecke, in: Schulze/von Bar/Schulte-Nölke (eds), Der akademische Entwurf für einen Gemein-
samen Referenzrahmen (2008), pp. 135 et seq. and Heutger, Ein gemeineuropäisches Kaufrecht (2007).
98 Dauner-Lieb/Quecke, in: Schulze/von Bar/Schulte-Nölke (eds), Der akademische Entwurf für einen
Gemeinsamen Referenzrahmen (2008), p. 137.

99 Hondius/Heutger/Jeloschek/Sivesand/Wiewiorowska, Principles of European Law – Sales (PELS)
(2008) pp. 159 seq.

101 Principles, Definitions and Model Rules of European Private Law, Draft Common Frame of
Reference (DCFR), Full Edition (2009), Comment B to Art. IV.A.-2:101.

102 See infra Art. 31 paras 77 et seq., Art. 32 para. 43, Art. 33 paras 38 et seq. and Art. 34 paras 36 et seq.
103 Cf. Huber, Modellregeln für ein Europäisches Kaufrecht, ZEuP (2008) 708 (note 41) and Dauner-
Lieb/Quecke, in: Schulze/von Bar/Schulte-Nölke (eds), Der akademische Entwurf für einen Gemeinsamen
Referenzrahmen (2008), p. 135 (pp. 138 seq.).
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Article 30 50 Part III. Chapter II. Obligations of the Seller
50 Just like the corresponding articles of the CISG104, the rules laid down in the DCFR
regarding sales contracts are to a large extent default rules105. The agreement between
the parties and the circumstances surrounding the contract are of primary and
paramount significance.
104
See supra para. 7.
105
Principles, Definitions and Model Rules of European Private Law, Draft Common Frame of
Reference (DCFR), Full Edition (2009), Comment G to Art. IV.A.-1:101. Cf. Huber, Modellregeln für
ein Europäisches Kaufrecht, ZEuP (2008) 708 (710 seq.).
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Section I
Delivery the goods and handing over of documents
Article 31
If the seller is not bound to deliver the goods at any other particular place, his
obligation to deliver consists:
(a) if the contract of sale involves carriage of the goods – in handing the goods
over to the first carrier for transmission to the buyer;
(b) if, in cases not within the preceding subparagraph, the contract relates to
specific goods, or unidentified goods to be drawn from a specific stock or to
be manufactured or produced, and at the time of the conclusion of the
contract the parties knew that the goods were at, or were to be manufactured
or produced at, a particular place – in placing the goods at the buyer’s
disposal at that place;
(c) in other cases – in placing the goods at the buyer’s disposal at the place where
the seller had his place of business at the time of the conclusion of the
contract.
Bibliography: DiMatteo/Janssen/Magnus/Schulze, International Sales Law (2016); Kock, Nebenpflichten

im UN-Kaufrecht (1995); Kromer, Der Begriff der Lieferung im Haager einheitlichen Kaufrecht (1987)
p. 245; Piltz/Bredow, Incoterms (2016); Piltz, Der Lieferort im Außenhandel, Außenwirtschaftliche Praxis
(2001) 273; Ramberg, ICC Guide to Incoterms 2010 (2011); Renck, Der Einfluß der INCOTERMS 1990
auf das UN-Kaufrecht (1995) p. 108; Schackmar, Die Lieferpflicht des Verkäufers in internationalen
Kaufverträgen (2001) p. 136; Schulze (ed.), Common European Sales Law (CESL) (2012); Vanheusden,
Leveringsvoorwaarden in international overeenkomsten, Incoterms anders bekeken (2013).
Outline
1. Subject matter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
2. Breach of contract . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
3. Further context. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
4. National laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
1. Obligation to deliver . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
2. Sales involving carriage of the goods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
3. Kinds of acts of delivery. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
a) Party autonomy. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
b) Handing over the goods to a carrier . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
c) Placing the goods at disposal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
d) Not handing over to the buyer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
e) Goods delivered. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
4. Place of delivery. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
a) Party autonomy. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
b) Default rule . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
c) Allocation of responsibilities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
5. Further obligations of the seller. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
a) Application of the CISG . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
b) Typical further obligations. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
aa) Packaging of the goods. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
bb) Costs of delivery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
Piltz 409
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cc) Clearance of the goods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
dd) Invoice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
c) Further obligations stipulated. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
1. Incoterms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
a) Contracts involving carriage of the goods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
b) Kinds of acts of delivery. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
c) Place of delivery. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
d) Packaging of the goods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
e) Costs of delivery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
f) Export/import clearance of the goods. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
g) Security clearance of the goods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
2. PICC and PECL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
3. DCFR. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77

1. Subject matter
1 Art. 31 specifies the place of delivery and the kind of act the seller has to perform in
order to fulfil his obligation to deliver the goods. Thus, Art. 31 regulates the local
coordinate and the modalities of the obligation to deliver addressed in Art. 30. Conse-
quently, Art. 31 has to be observed only in case Art. 30 is applicable1. Just like Art. 302,
Art. 31 plays only a supplementary role and gains significance merely to the extent that
the seller’s obligation to deliver cannot be determined by looking at the contract and its
circumstances alone3. Art. 31 does not regulate at what time delivery has to be
performed. The aspects regarding delivery time are governed by Art. 33. Furthermore,
the rules of Art. 31 are complemented by those in Art. 32.
2 Art. 31 determines the place where the seller has to perform the act he is required to
undertake in order to deliver. The place where the buyer has to take over the goods or
the destination of a further transportation is of no relevance for Art. 31. In particular, if
the contract of sale involves carriage of the goods, Art. 31(a) only regulates the place of
performance for the seller’s act of delivery but not the place where the goods are to be
handed over to the buyer. If the seller performs the act he is required to undertake in
order to deliver at the relevant place pursuant to Art. 31, but violates the relevant
delivery time according to Art. 33, he has performed at the wrong time and is therefore
in breach of Art. 33. The seller, however, cannot be reproached with having delivered at
the wrong place and thereby having breached Art. 31.
3 The seller has to perform the act he is required to undertake in order to deliver
pursuant to Art. 31. Unlike many national bodies of law which lack respective distinc-
tions and often provide an obligation of the seller to hand over the goods to the buyer4,
Art. 31 requests the seller either to place the goods at the buyer’s disposal or to hand
them over to the first carrier5. Whether the goods do conform with the contract and are
free from rights or claims of third parties is of no relevance with regard to the fulfilment
of the seller’s obligation to deliver established by Art. 30. If the seller performs the act he
is required to undertake in order to deliver pursuant to Art. 31, he has fulfilled his
obligation to deliver, even if he has delivered only parts of the goods sold or goods that
1See supra Art. 30 paras 3 et seq.

2See supra Art. 30 para. 7.
3 Ernst/Lauko, in: Honsell, Kommentar (2010), Art. 31 para. 3; Neumayer/Ming, Convention de Vienne
(1993), p. 239; Lando, in: Bianca/Bonell, Commentary (1987), Art. 31 para. 2.2.
5 Cf. Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 30 para. 3.
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Section I. Delivery the goods and handing over of documents 4–7 Article 31
do not conform with the contract6. The same applies if goods with a defective title are
delivered. The consequences of a delivery of non-conforming goods or goods with a
defective title are regulated by Arts 35 et seq. and Arts 45 et seq.
2. Breach of contract
The seller breaches his obligations arising out of Art. 31 if he fails to deliver at all, if 4
instead of handing over the goods to the carrier he only places them at the carrier’s
disposal or if he performs the act he is required to do to deliver at a place different from
the one determined as place of delivery according to Art. 31. The consequences of such
a breach result directly from Art. 45 et seq. without any need for the buyer to give notice
to the seller of the breach of contract. Art. 39 is only applicable if the seller has delivered
and the goods delivered do not conform with the contract7. Art. 39 is, however, not
relevant if the seller fails to deliver at all, fails to perform the act he is required to
undertake in order to deliver or delivers at a place different from the place of delivery
established by Art. 31.
3. Further context
Although Art. 31 addresses only the obligation of the seller to deliver the goods, the 5
provisions in Art. 31 also give an indication with regard to the place where the seller has
to perform other duties resulting from the contract of sale, in particular the duty to
transfer property in the goods8.
4. National laws
Rules regarding the place of delivery in national bodies of law cannot be applied 6
within the reach of the CISG, since the CISG governs the place of delivery conclusively9.
The same is true for the act the seller is required to undertake in order to deliver. In
particular, national law rules such as for instance § 433 BGB (German Civil Code),
Art. 1476 Codice Civile (Italian Civil Code), Art. 1.462 Código Civil (Spanish Civil
Code) and Art. 184 Obligationenrecht (Swiss Code of Obligations) obliging the seller to
hand over the goods sold to the buyer are without any relevance if the CISG applies.
Unlike these national sales laws, Art. 31 does not require the seller to hand over the
goods to the buyer.
Art. 31 corresponds to Art. 15 of the “Sales” draft of 197710. The tying of delivery to 7
the conformity of the goods, as provided in Art. 19(1) ULIS, was abandoned11. A
proposal to include an amendment in Art. 31(a) did not obtain the necessary support
at the Vienna conference12.

7Tribunal Supremo (Spain) 9 July 2014, CISG-Online 2578.
10 Ernst/Lauko, in: Honsell, Kommentar (2010), Art. 31 para. 4; Honnold, Documentary History (1989),
p. 328.
11 For more details see Honnold/Flechtner, Uniform Law (2009), pp. 314 seq.; Lando, in: Bianca/Bonell,
Commentary (1987), Art. 30 para. 1.2. and Kromer, Der Begriff der Lieferung im Haager einheitlichen
Kaufrecht (1987), p. 245.
12 Magnus, in: Staudinger Kommentar (2013), Art. 31 para. 5; Ernst/Lauko, in: Honsell, Kommentar
(2010), Art. 31 para. 4.
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1. Obligation to deliver
8 Art. 30 obliges the seller to deliver the goods. Art. 31 regulates details of this
obligation, namely the kind and the place of the act the seller is required to undertake
in order to deliver. However, depending on the circumstances, it is possible that a
delivery obligation does not exist. Yet, this does not affect the contract’s character being
a contract of sale according to the CISG13.
9 If the buyer has taken possession of the goods sold before the established delivery
time and the parties agree that the buyer with the exclusion of the seller’s ownership
shall be the sole owner from this moment on, the seller’s delivery obligation becomes
obsolete14. Examples for such a constellation are the conclusion of a contract of
sale after the goods have already been handed over to the buyer for use, in consign-
ment or in commission or for any other reason the goods are already in the buyer’s
possession at the moment the contract of sale is concluded. The party who relies
on such a situation where delivery of the goods is superfluous bears the burden of
proving it.
10 On the other hand, the parties are free to agree that the goods sold are to remain in
the possession of the seller and that the seller exercises the possession acknowledging
the buyer’s proprietary rights. This situation may, for instance, arise if a sale-and-lease-
back agreement or an agreement regarding custody or lease is concluded15. In such cases
no delivery is needed either. The party relying on such a situation where delivery of the
goods is superfluous bears the burden of proof.
11 The seller’s obligation to deliver must be considered irrespectively of the transfer of
property in the goods16. Therefore, any reservation in title is irrelevant for the delivery
obligation pursuant to Art. 3117 and the seller is not released from the obligation to
deliver if property has already been transferred to the buyer.
2. Sales involving carriage of the goods

12 The subsections of Art. 31 correlate to each other in order of priority. Art. 31(c)
governs all “other cases” and therefore constitutes a subordinate gap rule18. Art. 31(b) is
applicable only to cases not within the scope of Art. 31(a). Consequently, Art. 31(a) is
authoritative in the first place. However, this provision requires that the contract of sale
involves carriage of the goods.
13 Piltz, UN-Kaufrecht (2008), para. 4-13; Herber/Czerwenka, Kommentar (1991), Art. 30 para. 5.
14 Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 30 para. 7; Witz/Salger/
Lorenz, Kommentar (2016), Art. 30 para. 8; Fernández de la Gándara, in: Dı́ez-Picazo, Comentario
(1998), p. 243; Enderlein/Maskow/Strohbach, Internationales Kaufrecht (1991), Art. 30 para. 3.
15 Witz/Salger/Lorenz, Kommentar (2016), Art. 30 para. 8; Fernández de la Gándara, in: Dı́ez-Picazo,
Comentario (1998), p. 243; Cf. Kromer, Der Begriff der Lieferung im Haager einheitlichen Kaufrecht
(1987), p. 254.
17 Secretariat Commentary on 1978 Draft, Art. 29 para. 18.
18 Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 31 paras 2 and 42;
Benicke, in: MünchKommHGB (2013), Art. 31 para. 3; Chengwei Liu, Place of performance: Comparative
analysis of Articles 31 and 57 of the CISG and counterpart provisions in Article 7:101 of the PECL, in:
Contracts for the International Sale of Goods (1980) as Uniform Sales Law (2007), p. 346 (359); Magnus,
in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 618.
412 Piltz
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Art. 31(b),(c) regulate that the buyer has to collect the goods and thus the buyer has 13
to take care of their transportation19 (“Holschuld”). In contrast, Art. 31(a) governs
sales which involve carriage of the goods, but still does not state an obligation of the
seller to transport the goods in his own responsibility and at his own expenses like in
such cases where the delivery obligation must be performed at the buyer’s place
of business (“Bringschuld”). In cases where the sale involves carriage of the goods
the seller is only obliged to conclude the contract necessary for the carriage of the
goods, Art. 32(2). But it is the buyer who has to bear the costs of the carriage20 and the
risk already passes to him at the moment the goods are handed over to the carrier and
not at the moment the goods are handed over to him, Art. 67(1). Considering these
provisions, it becomes obvious that a sale which involves carriage of the goods as
addressed in Art. 31(a) cannot comprise any possible constellation in which – this
being typical in international contracts of sale – goods are transported21. Corroborated
by Art. 31(b),(c), a transaction which includes the collection of the goods by the
buyer (“Holsschuld”) evidently is not a sale which involves carriage of the goods even
if the buyer should transport the goods subsequently22. On the other hand, taking
into account the provisions regarding the bearing of costs and the passing of risk in a
sale which involves carriage of the goods, such a sale cannot be qualified – as if it were
the counterpart to the constellation of collecting the goods by the buyer regulated
in Art. 31(b),(c) – as a contract where the seller must transport the goods or have
them transported by a third party at his own expenses and risk to the place of business
of the buyer (“Bringschuld”)23. Therefore, for a sale which involves carriage of the
goods addressed by Art. 31(a) the constellation that remains is that neither the buyer
has to collect the goods and take delivery at the seller’s place of business
(“Holschuld”) nor the seller has to deliver at the buyer’s place of business (“Bring-
schuld”)24.
The common characteristics of those constellations where the delivery and the taking 14
of delivery is to be performed either at the seller’s (“Holschuld”) or at the buyer’s place
of business (“Bringschuld”), is that the place where the seller delivers and the place
where the buyer takes delivery coincide. In contrast, if the seller has to perform the act
he is required to undertake in order to deliver at a place different from the one where
the buyer takes over the goods, the characteristics for a sale which involves carriage of
the goods are at hand: the place of delivery and the one of taking delivery diverge25. If
the place of delivery and the place of taking delivery are not identical, carriage of the
goods must be arranged from the place where the seller has to perform the act he is
required to undertake in order to deliver to the place where the buyer has to take over
the goods. The need to bridge the geographical distance between the place of delivery
and the place of taking delivery justifies calling this constellation a sale which involves
19 Cf. Gruber, in: MünchKommBGB (2016), Art. 31 para. 5; Fernández de la Gándara, in: Dı́ez-Picazo,
Comentario (1998), p. 265.

Art. 31 para. 30; Benicke, in: MünchKommHGB (2013), Art. 31 para. 32.
21 Obviously in contrast Grunewald, Kaufrecht (2006), § 5 para. 26; Sierralta Rios/Baptista, Aspectos
Jurı́dicos del Comercio Internacional (1992), p. 102.

22 Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 31 para. 11.
24 Cf. Brunner/Dimsey, Kommentar (2014), Art. 31 paras 6 and 8; Magnus, in: Staudinger Kommentar
(2013), Art. 31 para. 13; Ferrari, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 38 para. 21;
Mullis, in: Huber/Mullis, The CISG (2007), p. 113; Fernández de la Gándara, in: Dı́ez-Picazo, Comentario
(1998), pp. 256 seq.
25 Cf. Bundesgerichtshof (Germany) 7 November 2012, CISG-Online 2374 (no. 16); Witz/Salger/Lorenz,
Kommentar (2016), Art. 60 para. 7; Benicke, in: MünchKommHGB (2013), Art. 31 para. 4.
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carriage of the goods26. Like many national laws27 in this situation, Art. 31(a) obliges the
seller to cause the transmission of the goods to the buyer. This rule is appropriate since
the seller is generally closer to the goods. However, it must be noted that the carriage as
such is not a contractual obligation of the seller; he only has to arrange the carriage of
the goods to the place where delivery has to be taken.
15 The parties are free to agree that the buyer takes care of the transportation. It is irrelevant
for the qualification as a sale involving carriage of the goods which party has to arrange the
carriage28. The seller’s obligation to arrange the transmission of the goods to the buyer as
addressed in Arts 31(a) and 32(2) is a dispositive consequence and not a prerequisite for a
sale which involves carriage of the goods29. Furthermore, it is irrelevant for the qualification
as a sale involving carriage of the goods whether a third independent entity is entrusted
with the carriage of the goods30 and which party bears the costs31. The only requirement for
a sale which involves carriage of the goods is the fact that the place of delivery and the place
of taking delivery are not identical, taking into account the agreement between the parties
and the relevant usages and practices established between them32.
16 There is no sale which involves carriage of the goods if the seller, pursuant to an
agreement or other relevant circumstances, is obliged to perform the act he is required
to undertake in order to deliver at the buyer’s place of business and the buyer must take
over the goods only there33. There is neither a sale which can be qualified as a sale
which involves carriage of the goods if the buyer, pursuant to an agreement or other
relevant circumstances, is obliged to take delivery of the goods at the seller’s place of
business34. This latter constellation will frequently – but not in all cases35 – apply if the
buyer orders the carrier and concludes the contract for carriage36. In this constellation
26 View shared by Kiene, in: DiMatteo/Janssen/Magnus/Schulze, Internat Sales Law, 2016, paras 9
and 42.
27 For example s. 32 Sale of Goods Act (England), Art. 1510 Codice Civile (Italian Civil Code), § 2–504
UCC (USA). Cf. § 447 BGB (German Civil Code), S. 524 Greek Civil Code, Art. 544 ZGB (Polish Civil
Code). Cf. Art. 189(1) OR (Swiss Code of Obligations).
28 Witz/Salger/Lorenz, Kommentar (2016), Art. 31 para. 12; Brunner/Dimsey, Kommentar (2014),
Art. 31 para. 6; Magnus, in: Staudinger Kommentar (2013), Art. 31 para. 16; Soergel/Lüderitz/Schüßler-
Langeheine, Kommentar zum Bürgerlichen Gesetzbuch (2000), Art. 31 para. 14; Fernández de la Gán-
dara, in: Dı́ez-Picazo, Comentario (1998), p. 256. In contrast Widmer Lüchinger, in: Schlechtriem/
Schwenzer, Commentary (2016), Art. 31 para. 11; Eckert/Maifeld/Matthiesen, Handbuch des Kaufrechts
(2014), para. 525; Saenger, in: Bamberger/Roth (eds), Kommentar zum Bürgerlichen Gesetzbuch (2012),
Art. 31 para. 4; Mullis, in: Huber/Mullis, The CISG (2007), p. 111.
29 Obviously misapprehended by Renck, Der Einfluß der INCOTERMS 1990 auf das UN-Kaufrecht
(1995), p. 108.
30 Piltz, UN-Kaufrecht und internationaler Gütertransport, FS Rolf Herber (2010) p. 7 (12); Ernst/
Lauko, in: Honsell, Kommentar (2010), Art. 31 para. 7. In contrast Oberlandesgericht Koblenz (Germany)
30 September 2008, IHR 2011 p. 145 (148); Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary
(2016), Art. 31 para. 17; Brunner/Dimsey, Kommentar (2014), Art. 31 para. 6; Magnus, in: Staudinger
Kommentar (2013), Art. 31 para. 13; Ferrari, in: Ferrari et al., Internationales Vertragsrecht (2012),
Art. 38 para. 21.
31 Brunner/Dimsey, Kommentar (2014), Art. 31 para. 6; Magnus, in: Staudinger Kommentar (2013),
33 Cf. Bundesgerichtshof (Germany) 7 November 2012, CISG-Online 2374; Obergericht Zurich (Switzer-
land) 6 February 2009, CISG-Online 2000; Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary
(2016), Art. 31 para. 17. In contrast Kritzer/Vanto/Vanto/Eiselen, International Contract Manual, Vol. 4,
§ 88:18 para. 5.
34 Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 31 para. 11. Not clear

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the place of delivery will be the seller’s place of business. The buyer has to take over the
goods at this place. In both cases the place where the seller – either by himself or
through an authorized person – has to perform the act he is required to undertake in
order to deliver (place of delivery) and the place where the buyer – either by himself or
through an authorized person – has to take delivery of the goods (place of taking
delivery) coincide. In this context it is irrelevant whether or not the authorized person is
an independent third entity37. However, it is decisive that the place of delivery and the
place of taking delivery are identical and therefore no carriage of the goods is necessary
in order to fulfil the contract of sale.
In case of doubt, it can be assumed that in an international delivery transaction the 17
place of delivery and the place of taking delivery diverge because of the geographical
distance between the seller’s place of business on the one hand and the buyer’s place
of business on the other hand38 and absent a general provision obliging the buyer to
collect the goods at the place of business of the seller. Such obligation only arises if
Art. 31(a) does not apply39, Art. 31(b),(c). Therefore, in case of doubt, delivery
transactions governed by the CISG are sales which involve carriage of the goods
pursuant to Art. 31(a)40. This assumption may, however, be disproved if the contrac-
tual agreement or other relevant circumstances indicate that the seller has to perform
the act he is required to undertake in order to deliver at the same place where the
buyer has to take delivery of the goods41. However, the seller’s obligation to pay for
the carriage does not in itself shift the place of delivery to the place of destination42.
The party relying on such circumstances claiming that the sale at hand is not a sale
which involves carriage of the goods bears the burden of proving it. Otherwise, the
rule of Art. 31(a) applies.
For the qualification of a sale being a sale involving carriage of the goods it is 18
irrelevant whether the delivery of the goods has to be performed at the seller’s place of
business or at a different place or whether the place of taking delivery is identical with
the buyer’s place of business or not. If the seller is obliged to perform the act he is
required to undertake in order to deliver at a particular place agreed upon by the
parties, this does not mean that a sale which involves carriage of the goods pursuant to
Art. 31(a) is out of the question43. The introductory sentence of Art. 3144 only relates to
a differing determination of the place of delivery but not to the further delivery
modalities regulated in Art. 31. Underlined by Art. 67(1), a sale which involves carriage
of the goods does not exclude that the seller has to deliver the goods at a third place
37 Cf. Ernst/Lauko, in: Honsell, Kommentar (2010), Art. 31 para. 7. Not unambiguously clear Oberger-
icht Kanton Zug (Switzerland) 5 March 2013, CISG-Online 2471.

40 Landgericht Bamberg (Germany) 23 October 2006, CISG-Online 1400; Landgericht Flensburg
(Germany) 24 March 1999, CISG-Online 719; Widmer Lüchinger, in: Schlechtriem/Schwenzer, Com-
mentary (2016), Art. 31 para. 14; Benicke, in: MünchKommHGB (2013), Art. 31 paras 4 and 38; Saen-
ger, in: Bamberger/Roth (eds), Kommentar zum Bürgerlichen Gesetzbuch (2012), Art. 31 para. 5;
Ernst/Lauko, in: Honsell, Kommentar (2010), Art. 31 paras 6 and 11; Achilles, in: Ensthaler (ed.),
Gemeinschaftskommentar zum Handelsgesetzbuch mit UN-Kaufrecht (2007), Art. 31 para. 3; Neu-
mayer/Ming, Convention de Vienne (1993), p. 241. In contrast Gruber, in: MünchKommBGB (2016),
Art. 31 para. 2 and 37; Magnus, in: Staudinger Kommentar (2013), Art. 31 paras 8 and 29.
41 Cf. Benicke, in: MünchKommHGB (2013), Art. 69 paras 6 seq. In contrast Widmer Lüchinger, in:

42 Ramberg, ICC Guide to Incoterms 2010 (2011), ICC publication No 720, p. 48.
43 In contrast Magnus, in: Staudinger Kommentar (2013), Art. 31 para. 13; Neumayer/Ming, Conven-
tion de Vienne (1993), p. 244.

44 “If the seller is not bound to deliver the goods at any particular place…”
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different from its own place of business45 and/or that for the taking over of the goods a
place different from the buyer’s place of business has been stipulated46. If the agreed
upon place of delivery is situated somewhere between the seller’s and the buyer’s place
of business, a thorough examination has to be undertaken whether according to the
contract of sale and the relevant circumstances the buyer is obliged to take delivery of
the goods at the same place or if the buyer does not have to take delivery of the goods at
the agreed upon place of delivery. Only in the latter case the sale is a sale which involves
carriage of the goods.
3. Kinds of acts of delivery

19 Apart from the place of delivery47, Art. 31 also regulates the kind of act the seller is
required to undertake in order to deliver. The CISG does not contain a general
definition of delivery48. The term “delivery” is more of a collective term which
comprises different kinds of delivery acts, ranging from a mostly passive placing at
disposal of the goods on the one hand to an active handing over of the goods meaning
the buyer gaining actual control over them on the other hand49. Art. 31 obliges the seller
only in certain situations to place the goods at the buyer’s disposal (Art. 31(b),(c)).
Regarding sales which involve carriage of the goods, the seller has to do more than only
placing the goods at the buyer’s disposal. In sales which involve carriage of the goods
the seller is obliged to hand over the goods to the first carrier for transmission to the
buyer, Art. 31(a). On the other hand, there is no situation where the CISG provides an
obligation of the seller to hand over the goods to the buyer50. Delivery does not involve
receipt or taking possession of the goods by the buyer.51
20 a) Party autonomy. The parties are free to stipulate their own rules with respect to
the kind of delivery act the seller is obliged to perform. Thus, irrespectively of the
alternatives provided by Art. 31, the parties may agree upon an obligation of the seller
to hand over the goods directly to the buyer or to a person authorized by the buyer.
Likewise, the parties may contract a keeping ready of the goods by the seller or other
modalities or mixed constellations52. If the parties agree on a clause of the Incoterms53,
they have also determined the act the seller is required to undertake in order to
deliver54. As far as other clauses apart from Incoterms are used, it depends on the
circumstances which act of delivery the seller is obligated to undertake55. Applicable
usages or established practices can become relevant in determining the act the seller is
required to undertake in order to deliver as well. However, as far as specific clauses,
agreements, usages or practices do not exist or cannot be proven by the party relying on
45 Cf. Fernández de la Gándara, in: Dı́ez-Picazo, Comentario (1998), p. 261; Ernst/Lauko, in: Honsell,

46 Cf. Ernst/Lauko, in: Honsell, Kommentar (2010), Art. 31 para. 24.
48 In contrast Art. 19 ULIS.
49 Comparing different legal systems Kromer, Der Begriff der Lieferung im Haager einheitlichen
Kaufrecht (1987); cf. Witz/Salger/Lorenz, Kommentar (2016), Art. 30 para. 6; not unambiguously clear
Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 30 para. 3.
51 Gillette/Walt, The UN Convention on Contracts for the International Sale of Goods (2016), p. 157.
52 Cf. Ernst/Lauko, in: Honsell, Kommentar (2010), Art. 31 paras 16 seq.
53 See supra Art. 30 paras 30 et seq.
54 Magnus, in: Staudinger Kommentar (2013), Art. 31 para. 6. See infra para. 62.
55 In contrast regarding the term “Frei Haus” (free buyers adress) Widmer Lüchinger, in: Schlechtriem/
Schwenzer, Commentary (2016), Art. 31 para. 72; Benicke, in: MünchKommHGB (2013), Art. 31 para. 30.
Cf. Witz/Salger/Lorenz, Kommentar (2016), Art. 31 paras 4 and 23.
416 Piltz
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such, Art. 31 regulates the act the seller is required to undertake in order to deliver
depending on whether the sale in question is a sale which involves carriage of the
goods56 or not. Contrary to the somewhat misleading wording of Art. 31, this distinc-
tion has also to be made if the parties have agreed on a place of delivery but have not
determined the specific kind of act the seller is required to perform in order to deliver57.
b) Handing over the goods to a carrier. With respect to a sale which involves carriage 21
of the goods58, the seller’s act of delivery consists of the handing over of the goods to the
first carrier for transmission to the buyer59 (Art. 31(a)). This rule applies unless otherwise
provided for by agreements, usages or practices for which the party who invokes such
circumstances has the burden of proof. Handing over of the goods requires that the
carrier takes direct possession of the goods60 and therefore presupposes his involvement.
The mere placing at his disposal is not sufficient. Since in contracts of sale which involve
carriage of the goods it is much more difficult for the buyer to protect the goods and
safeguard his interest than for the seller61, the seller must ensure that the carrier takes
possession of the goods62. Hence, the transportation to the first carrier as well as the
handing over including the professional loading of the goods into or onto the means of
transportation provided by the carrier are obligations and responsibilities of the seller63.
The handing over is completed once the goods are stored independently of the loading
device on or in the means of transportation. However, it is not part of the seller’s
obligation to hand over the goods that the goods are fastened in or on the means of
transport in order to comply with traffic safety requirements64. The seller does not
necessarily have to perform the handing over obligations in person but may act through
a third party e. g. a sub-supplier. As long as the handing over of the goods to the carrier
has not been performed and the goods are still in possession of the seller or a party
attributable to him, the delivery of the goods has not yet been performed. This rule
applies all the more in constellations where the seller transports the goods using his own
personnel65 since possible claims by the buyer for loss or damages during transportation
would be very hard to enforce against the seller’s personnel.
In addition to the physical handing over of the goods to the carrier, in a sale which 22
involves carriage of the goods the seller has to instruct the carrier to transmit the goods to
56See supra paras 12 et seq.

57Gruber, in: MünchKommBGB (2016), Art. 31 para. 23; Saenger, in: Bamberger/Roth (eds), Kom-
mentar zum Bürgerlichen Gesetzbuch (2012), Art. 31 para. 19; Ernst/Lauko, in: Honsell, Kommentar
(2010), Art. 31 para. 51; Secretariat Commentary on 1978 Draft, Art. 29 para. 6.
60 Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 31 para. 25; Benicke, in:
MünchKommHGB (2012), Art. 31 para. 8; Mullis, in: Huber/Mullis, The CISG (2007), p. 112.
62 Similarly Achilles, in: Ensthaler (ed.), Gemeinschaftskommentar zum Handelsgesetzbuch mit UN-
Kaufrecht (2007), Art. 31 para. 5; Soergel/Lüderitz/Schüßler-Langeheine, Kommentar zum Bürgerlichen

63 Landgericht Bamberg (Germany) 23 October 2006, CISG-Online 1400; Widmer Lüchinger, in:
Schlechtriem/Schwenzer, Commentary (2016), Art. 31 para. 25; Witz/Salger/Lorenz, Kommentar (2016),

Art. 31 para. 25; Magnus, in: Staudinger Kommentar (2013), Art. 31 para. 21; Benicke, in: Münch-
KommHGB (2012), Art. 31 para. 8; Achilles, in: Ensthaler (ed.), Gemeinschaftskommentar zum Handels-
gesetzbuch mit UN-Kaufrecht (2007), Art. 31 para. 5.
64 Cf. Piltz/Bredow, Incoterms (2016) para. F-143. In contrast Hennecke, Gefahrtragung beim Rücktran-
sport mangelhafter Ware, IHR (2003) 268 (273).

MünchKommHGB (2012), Art. 31 para. 10; Soergel/Lüderitz/Schüßler-Langeheine, Kommentar zum

Bürgerlichen Gesetzbuch (2000), Art. 31 para. 16; Renck, Der Einfluß der INCOTERMS 1990 auf das
UN-Kaufrecht (1995), p. 120. In contrast Ernst/Lauko, in: Honsell, Kommentar (2010), Art. 31 para. 27.
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the buyer and to conclude such contracts that are essential for carriage66 and additionally,
if containers are handed over to the carrier for maritime transport the seller has to
provide their “Verified Gross Mass” (VGM)67. Moreover, if necessary the seller has to give
the buyer notice of consignment according to Art. 32(1). Furthermore, the seller has to
transfer to the buyer any document needed by the buyer to take over the goods from the
carrier holding the goods68. If several carriers are employed subsequently, the seller can
either conclude the necessary contracts for every section of the transport himself or he
can oblige the first carrier to take care of the transmission to the buyer. In case of doubt,
the destination with regard to the transmission to the buyer is the buyer’s place of
business69. Unless the parties have agreed otherwise the seller has not fulfilled his delivery
obligation in sales involving carriage of the goods as long as he has not concluded the
contracts necessary for transmission of the goods to the buyer70. The same applies if the
seller handing over the goods to the carrier gives him a completely incorrect address of
the buyer and the goods therefore cannot be transmitted to the buyer71.
23 Carrier as referred to in Art. 31(a) is only an autonomous72 carrier business, which is
legally independent from the seller, for instance freight carriers, postal services, railway
companies, shipping companies, etc. The forwarding agent usually does not transport
the goods himself but only arranges their transportation. The forwarding agent who
does not take over the goods can therefore generally not be considered a carrier
according to Art. 31(a)73. Ultimately, the kind of task he is assigned with is essential
and not the labelling as a forwarding agent. If the forwarding agent does not only
arrange the transportation but takes over the goods74 or if he has obligated himself vis-
à-vis the seller to undertake the carriage either himself or through a subcontracting
carrier75, then the forwarding agent can be considered a carrier according to Art. 31(a).
The same applies if the buyer instructs the seller to deliver the goods to a forwarding
agent or another third person instead of to a carrier76.
24 In a sale which involves carriage of the goods the seller has fulfilled his obligation to
deliver according to Art. 31(a) if he has handed over the goods to a carrier in terms of
Art. 31(a) and has concluded the contracts necessary for their transmission to the buyer77.
The costs of further carriage have to be borne by the buyer78. The seller does not bear any
66 Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 31 para. 26. Less strictly
Witz/Salger/Lorenz, Kommentar (2016), Art. 31 para. 19. See infra Art. 32 paras 17 et seq.
67 For more details see Piltz, Container weights in maritime trade, EJCCL (2016) p. 59.
69 Benicke, in: MünchKommHGB (2012), Art. 31 para. 13; Ernst/Lauko, in: Honsell, Kommentar
(2010), Art. 31 para. 24.

70 Cf. Magnus, in: Staudinger Kommentar (2013), Art. 31 para. 22.
71 Cf. Benicke, in: MünchKommHGB (2012), Art. 31 para. 13; Achilles, in: Ensthaler (ed.), Ge-
meinschaftskommentar zum Handelsgesetzbuch mit UN-Kaufrecht (2007), Art. 31 para. 7.

72 For more details see Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 31
paras 15 et seq.
74 Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 31 para. 24; Gruber, in:
MünchKommBGB (2016), Art. 31 para. 18; Benicke, in: MünchKommHGB (2012), Art. 31 para. 12;
Ernst/Lauko, in: Honsell, Kommentar (2010), Art. 31 para. 25. In contrast Mullis, in: Huber/Mullis, The
CISG (2007), p. 115.
75 Witz/Salger/Lorenz, Kommentar (2016), Art. 31 para. 18; Magnus, in: Staudinger Kommentar (2013),
Art. 31 para. 18.

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Section I. Delivery the goods and handing over of documents 25 Article 31

responsibility for mistakes or inappropriate or even illegal behaviour of the carrier79
resulting e. g. in the damaging of the goods despite adequate packaging, in delaying the
transport or in handing over the goods to the wrong recipient or in dispatching them to a
wrong destination80. The passing of risk is regulated in Art. 67. If more than one carrier is
employed, the handing over to the first carrier is sufficient81 (Art. 31(a)). Handing over of
the goods to the first carrier is also sufficient if the first carrier undertakes only a local
transport, for instance the transport from the seller’s premises to the railway station82.
c) Placing the goods at disposal. Insofar as a sale involving carriage of the goods83 is 25
not at hand and no differing agreements, usages or practices can be established, the act
the seller is required to undertake in order to deliver consists only of placing the goods
at the buyer’s disposal at the relevant place of delivery (Art. 31(b),(c)). A physical
handing over and therefore the need of the buyer’s cooperation84 – meaning the buyer
or a person authorized by the buyer gaining actual possession of the goods sold – is not
required85. On the contrary, the initiative to get possession of the goods rests on the
buyer86. The loading – or if the goods must be placed at the buyer’s disposal at a place
different from the one determined by Art. 31, the unloading87 – of the goods is, in case
of doubt, not an obligation of the seller88. The seller has performed the act he is required
to undertake in order to deliver when he has done everything to enable the buyer to take
possession of the goods89, to load – or if the goods must be placed at the buyer’s
disposal at a place different from the one determined by Art. 31 to unload – and to
transport them. The passing of risk is regulated in Art. 69 or if goods in transit are sold,
in Art. 68. If the parties have contractually agreed that the seller has to load the goods or
in cases where the delivery obligation must be performed at some other place than the
seller’s place of business has to unload them, such agreement constitutes an additional
obligation of the seller90. However, in case of doubt the fulfilment of this additional
obligation is not a prerequisite for the seller’s obligation to place the goods at disposal
and thus for fulfilling his delivery obligation arising out of Art. 31(b),(c)91. In case the
seller unilaterally links the taking over of the goods by the buyer to conditions which are
not provided for by the contract or by law (for instance that a payment obligation
arising out of a different contract has to be fulfilled first), the goods have not yet been
placed at the buyer’s disposal92.
79 Kantonsgericht Wallis (Switzerland) 19 August 2003, CISG-Online 895; Handelsgericht Zürich
(Switzerland) 10 February 1999, CISG-Online 488; Widmer Lüchinger, in: Schlechtriem/Schwenzer,

Commentary (2016), Art. 31 para. 28; Brunner/Dimsey, Kommentar (2014), Art. 31 para. 9.
MünchKommHGB (2013), Art. 31 para. 11; Ernst/Lauko, in: Honsell, Kommentar (2010), Art. 31
para. 20.
86 Lando, in: Bianca/Bonell, Commentary (1987), Art. 31 para. 2.5.
87 Cf. Witz/Salger/Lorenz, Kommentar (2016), Art. 31 para. 22.
88 Oberlandesgericht Karlsruhe (Germany) 19 December 2002, CISG-Online 817. Widmer Lüchinger, in:
Schlechtriem/Schwenzer, Commentary (2016), Art. 31 para. 51; Saenger, in: Ferrari et al., Internationales
Vertragsrecht (2011), Art. 31 para. 14; Mankowski, in: Ferrari et al., Internationales Vertragsrecht (2011),
Art. 69 para. 9; Mullis, in: Huber/Mullis, The CISG (2007), p. 117.

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26 In some situations the seller will only be able to take possession of the goods sold if
they have been set aside and if they have been marked or labelled93. However,
segregation of the goods may not be necessary if the allocation can be done easily
when the buyer takes them over94. This is namely the case with bulk material or goods
on stock. Depending on the circumstances, it may also be indispensable that the seller
informs the buyer of the goods being placed at his disposal. However, this information
is not a requisite in cases in which a date for the collection of the goods is agreed upon
or the buyer can assume that the goods have been placed at his disposal relying on other
circumstances95.
27 If the goods are in the possession of a third person such as a warehouseman or a
carrier, the seller can perform the act he is required to undertake in order to deliver
pursuant to Art. 31(b) by instructing the third person to release the goods to the buyer96
and/or to exercise the right of ownership for the buyer from this moment on97. The
seller can also assign his claim against the third person to hand over the goods to the
buyer98 and thus perform the act he is required to undertake in order to deliver
provided that the fulfilment of this claim by the third person is ensured without further
prerequisites. In case of a sale of goods in transit (rolling, flying or swimming goods) at
the moment of the conclusion of the contract, the seller must enable the buyer to take
over the goods at the destination of the transport99. To achieve this, the seller can
instruct the carrier accordingly or hand over to the buyer the documents authorizing to
take over the goods.
28 d) Not handing over to the buyer. Different from provisions in many national
laws100, Art. 31 does not oblige the seller to hand over the goods directly to the buyer.
Even if the delivery has to be performed at the buyer’s place of business (“Bring-
schuld”), it cannot be concluded offhand that the seller is obliged to hand over the
goods to the buyer101. However, due to differing agreements, relevant usages or
established practices, Arts 6 and 9, which have to be proven by the party relying on
them, the seller may be obliged to hand over the goods directly to the buyer or a person
authorized by him. In such a case the transportation to the place of delivery determined
for the handing over of the goods, the actual handing over to the buyer as well as the
appropriate loading of the goods onto or into a means of transportation provided by the
buyer are generally the seller’s obligations and responsibilities. Different from the cases
which require only a placing at the disposal of the buyer, the seller has performed the

MünchKommBGB (2016), Art. 31 para. 8; Saenger, in: Bamberger/Roth (eds), Kommentar zum Bürger-
lichen Gesetzbuch (2012), Art. 31 para. 14.
95 Cf. Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 31 para. 49; Saenger,
in: Bamberger/Roth (eds), Kommentar zum Bürgerlichen Gesetzbuch (2012), Art. 31 para. 14; Fernández
de la Gándara, in: Dı́ez-Picazo, Comentario (1998), pp. 265 seq.

100 See for example § 1061 ABGB (Austrian Civil Code), § 433(1) BGB (German Civil Code), Art. 1476
Codice Civile (Italian Civil Code), Art. 7.9 BW (Dutch Civil Code), Art. 1.462 Código Civil (Spanish Civil
Code), Art. 184 OR (Swiss Code of Obligations).
101 Gruber, in: MünchKommBGB (2016), Art. 31 para. 23; Saenger, in: Bamberger/Roth (eds), Kom-
mentar zum Bürgerlichen Gesetzbuch (2012), Art. 31 para. 19; Ernst/Lauko, in: Honsell, Kommentar
(2011), Art. 31 para. 51; Secretariat Commentary on 1978 Draft, Art. 29 para. 6. In contrast Widmer
Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 31 para. 75.
420 Piltz
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act he is required to undertake in order to deliver only if the buyer has taken possession
of the goods. If the buyer fails to cooperate the way he is supposed to and therefore the
seller is unable to pass the ownership to the buyer and as a consequence cannot deliver
in the agreed upon manner, the seller can invoke Art. 80.
e) Goods delivered. Subject of the seller’s act of delivery are the goods sold from the 29
seller to the buyer. The kind, the quality and the quantity of the goods to be delivered can
usually be established by referring to the agreement between the parties or from the relevant
usages or practices, especially since the determinability of the subject matter of the contract
is a general requisite for a valid offer to conclude a contract102. Yet, the parties to a contract
of sale may commit the determination of the goods to be delivered to a third person or
leave it to one of the parties. If the buyer has to specify the features of the goods to be
delivered pursuant to the contract of sale, Art. 65 contains further details for situations in
which the buyer fails to cooperate the way he should. In all other cases the seller is usually
entitled within the contractual or otherwise relevant guidelines to specify the goods sold103.
Pursuant to Arts 35, 41, 42, the seller is generally obliged to deliver goods which 30
conform with the contract and are free from rights or claims of third parties. However, if
the goods sold are delivered in the way demanded by Art. 31, but do not conform with
the contract, are not packaged appropriately or are encumbered with rights or claims of
third parties, the seller has nevertheless performed the act he is required to undertake in
order to deliver104. The buyer may then rely on legal remedies for non-conformity of the
goods or for a defective title, but he cannot argue that the seller has failed to perform
delivery altogether only because the goods he received do not conform with the contract
or are incomplete. Referring to the history of the CISG, it can be shown that contrary to
the Secretariat Commentary105 no differentiation between delivery of wrong goods (aliud)
and delivery of faulty goods (peius) was intended106. The delivery of goods which differ
from the agreed upon kind, even the delivery of a completely different kind of goods
(aliud), does not mean that the delivery has not been performed by the seller107. This
applies for the delivery of a lesser quantity, Art. 35(1), and for the delivery of a greater
quantity than agreed upon in the contract, Art. 52(2), accordingly.
For the delivery in terms of Art. 30 it is only essential that the seller delivers goods to 31
the buyer in order to fulfil a certain contract of sale. Objectively judging from the buyer’s
perspective, there must be reason to assume that the seller has performed the delivery
obligation in order to satisfy a certain contract of sale108. Insofar as the goods do not
conform with the contract regarding kind, quality or quantity of the goods or regarding
their packaging or if they are encumbered with rights or claims of third parties, the buyer
may resort to the remedies of Arts 45 et seq. Since the seller has delivered even if the
goods do not conform with the contract or are under defective title, the buyer must give
103Enderlein/Maskow/Strohbach, Internationales Kaufrecht (1991), Art. 65 para. 2.
104 Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 31 paras 29 and 60;
Gruber, in: MünchKommBGB (2016), Art. 30 para. 3; Brunner/Dimsey, Kommentar (2014), Art. 30
paras. 3; Magnus, in: Staudinger Kommentar (2013), Art. 30 para. 5; Saenger, in: Ferrari et al., Inter-
nationales Vertragsrecht (2012), Art. 30 para. 2; Secretariat Commentary on 1978 Draft, Art. 33 paras 2 et
seq. Not unambigiously clear regarding packaging Widmer Lüchinger, in: Schlechtriem/Schwenzer,
106 Kromer, Der Begriff der Lieferung im Haager einheitlichen Kaufrecht (1987), pp. 273 et seq.
107 Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 31 para. 30; Schlechtriem/
Butler, CISG (2009), para. 123; Gruber, in: MünchKommBGB (2016), Art. 30 para. 3.In contrast Kritzer/
Vanto/Vanto/Eiselen, International Contract Manual, Vol. 4, § 88:18 para. 3.
108 Cf. Ernst/Lauko, in: Honsell, Kommentar (2010), Art. 30 para. 10 and Oberlandesgericht Hamburg
(Germany) 26 January 2000, CISG-Online 509.
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notice to the seller according to Arts 39 and 43 in order not to risk his remedies. If the
goods delivered differ blatantly from what was agreed upon, the seller may not rely on the
buyer’s obligation to give notice because in such cases the seller is usually aware of the
non-conformity of the goods or could not have been unaware (Art. 40).
4. Place of delivery
32 The act the seller is required to undertake in order to deliver109 must be performed at
the place stipulated by the contract or regulated by law. Art. 31 determines at which
place the seller has to perform the act he is required to undertake in order to deliver and
thereby determines the place of delivery or place of performance. Transportation to the
place of delivery is part of the seller’s delivery obligation.110. Sometimes the term “place
of fulfilment” (“Erfüllungsort”) is used111. In any case reference is made to the place
which marks the locally final point regarding the seller’s obligations112. The place where
the goods are taken over by the buyer or the place of destination with respect to
transportation of the goods is not addressed by Art. 31. However, it may coincide with
the place of delivery113. Since the place of delivery marks the locally final point
regarding the seller’s obligations, it is also suitable for defining the borderline between
the seller’s area of responsibility on one side and the buyer’s on the other.
33 a) Party autonomy. Art. 31 operates as a default provision and gains significance
only to the extent that the place of delivery cannot be determined by looking at the
contract and its circumstances114. Apart from an explicit agreement on the place of
delivery, the use of a clause of the Incoterms115 or another trade term which stipulates a
place of delivery116 is particularly common in practice. Both an explicit agreement as
well as an agreement to use one of the clauses of the Incoterms117 supersede the place of
delivery provided by Art. 31 even if the place of delivery agreed upon corresponds to
Art. 31118. Art. 31 functions as a gap-filling provision and is only needed absent a
contractual provision119. Even if no agreement of the parties can be established, the
place of delivery sometimes can be derived from the circumstances of the contract at
hand (“any other particular place”)120. The party relying on a place of delivery not
determined by Art. 31 has the burden of proving the relevant circumstances121. How-
ever, if no agreement or circumstances regarding the place of delivery can be estab-
lished, Art. 31 applies.
110 Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 31 para. 73. Cf. Piltz/
Bredow, Incoterms (2016) para. D-325.
111 Cf. Witz/Salger/Lorenz, Kommentar (2016), Art. 31 para. 9; Magnus, in: Staudinger Kommentar
(2013), Art. 31 para. 24.

112 Piltz, Internationales Kaufrecht (2008), para. 4-36. Cf. Magnus, in: Staudinger Kommentar (2013),
Art. 31 para. 30; Herber/Czerwenka, Kommentar (1991), Art. 31 para. 2. See infra paras 41 et seq.
114 See supra Art. 31 para. 1; Gabriel, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003),
p. 347; Neumayer/Ming, Convention de Vienne (1993), p. 239.

117 Magnus, in: Staudinger Kommentar (2013), Art. 31 para. 6. See supra Art. 30 para. 38.
118 In contrast Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 31 para. 68.
119 Brunner/Dimsey, Kommentar (2014), Art. 30 para. 2; Magnus, in: Staudinger Kommentar (2013),
Art. 30 para. 1; Lookofsky, Convention on Contracts for the International Sale of Goods (2012) para. 151;
Ernst/Lauko, in: Honsell, Kommentar (2010), Art. 30 para. 5; Fernández de la Gándara, in: Dı́ez-Picazo,
Comentario (1998), p. 242.
121 Amtsgericht Duisburg (Germany) 13 April 2000, CISG-Online 659.
422 Piltz
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If the parties use other trade terms outside the standardized catalogue of the 34
Incoterms122, it cannot always be determined with certainty whether the parties only
wanted to stipulate the passing of risk or the bearing of costs or also the place of
delivery123. In particular, the agreed payment modalities and those regarding the costs of
transportation124 do not always justify conclusions with regard to the place of deliv-
ery125. Therefore, in most cases, court rulings do not consider clauses such as “free …”
or “franco …” as a determination of the place of delivery126. Also the specification of a
“place of fulfilment” does not necessarily determine the place of delivery127. If the
parties wish to set a specific place of delivery, this place should be expressly denomi-
nated as such. If the buyer and the seller have fixed a specific address for delivery, this
can be considered as the place of delivery agreed upon by the parties irrespective of
whether the seller transports the goods to this place himself or employs a carrier128.
Art. 31 is only relevant if the seller is not bound to deliver the goods at a particular place. 35
Even if no trade terms and no agreements between the parties with regard to the place of
delivery exist129, other circumstances of the contract like for instance arrangements assign-
ing the costs of transportation130 may still indicate a place of delivery which prevails over
the rule contained in Art. 31131. A contract of sale regarding a machine which obligates the
seller not only to deliver the machine but also to assemble it, to set up operation and to
instruct the buyer’s personnel, may according to the specific contractual arrangements
justify the assumption that delivery, just like the other obligations of the seller, have to be
performed at the buyer’s place of business132. However, the situation is different if the seller
has to attach a control unit and give respective instructions at the buyer’s place of business,
but the buyer has already taken over the machine at the seller’s place of business, loaded

123Cf. Piltz, Der Lieferort im Außenhandel, Außenwirtschaftliche Praxis (2001) 273.
125 Witz/Salger/Lorenz, Kommentar (2016), Art. 31 para. 9; Brunner/Dimsey, Kommentar (2014),
Art. 31 para. 3;. See further supra para. 17 and infra Art. 32 para. 20.
126 Cf. Hof van Beroep te Gent (Belgium) 29 March 2000 (Pace); Højesteret (Denmark) 15 February
2001, CISG-Online 601; Oberlandesgericht München (Germany) 14 January 2009, CISG-Online 2011;
Oberlandesgericht Koblenz (Germany) 30 September 2008, IHR (2011) 145 (148); Landgericht Bamberg
(Germany) 23 October 2006, CISG-Online 1400; OLG Koblenz (Germany) 4 October 2002, CISG-Online
716; OLG Köln (Germany) 16 July 2001, CISG-Online 609; Bundesgerichtshof (Germany) 11 December
1996, CISG-Online 225; Landgericht Oldenburg (Germany) 27 April 1994, CISG-Online 359; Cour de
Cassation (France) 22 March 2011, CISG-Online 2246; Hooge Raad (Netherlands) 21 May 1999, CISG-
Online 1809; Kantonsgericht Zug (Switzerland) 11 December 2003, CISG-Online 958. In contrast
Oberlandesgericht Düsseldorf (Germany) 21 November 2008, CISG-Online 2173; Landgericht München
II (Germany) 23 March 2004, CISG-Online 998; Oberlandesgericht Köln (Germany) 8 January 1997,
CISG-Online 217; Oberlandesgericht Karlsruhe (Germany) 20 November 1992, CISG-Online 54; Cour
d’Appel d’Orleans (France) 29 March 2001, CISG-Online 611. Cf. Widmer Lüchinger, in: Schlechtriem/
Schwenzer, Commentary (2016), Art. 31 para. 72; Brunner/Dimsey, Kommentar (2014), Art. 31 para. 3;
Ernst/Lauko, in: Honsell, Kommentar (2010), Art. 31 para. 55; Fogt, Die Vereinbarung und Auslegung
von FRANCO-Lieferklauseln beim CISG-Kauf, The European Legal Forum (2003) 61; Lebuhn, Zur Frage
der in einem überseeischen Getreidehandelsgeschäft verwendeten Klausel “frei Lager …. Bestimmung-
sort”, IPRax (1985) 10.
128 Hof’s-Gravenhage (Netherlands) 29 September 2006, CISG-Online 1808.
130 Oberlandesgericht Stuttgart (Germany) 18 April 2011, CISG-Online 2226. Cf. Witz/Salger/Lorenz,

131 Oberlandesgericht Wien (Austria) 1 June 2004, CISG-Online 954.
132 Cf. Oberlandesgericht Köln (Germany) 21 December 2005, CISG-Online 1201; Oberlandesgericht
München (Germany) 3 December 1999, CISG-Online 585; Corte di Cassazione (Italy) 19 June 2000,
CISG-Online 1317; WidmerLüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 31 para. 78;
Benicke, in: MünchKommHGB (2013), Art. 31 para. 29.
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and carried it and assembled and put it into operation at the place of destination133. In
order to avoid uncertainties, in particular in more complex contracts, a specific place of
delivery or several places of performance regarding the relevant obligations should be
expressly stipulated. Nevertheless, it cannot be assumed automatically in a contract
designed as one unit that there are different places of performance just because the seller
faces different obligations (for instance delivery and instruction134). There need to be
sufficient indications that this is what the parties really wanted135.
36 b) Default rule. If neither the use of trade terms, or the contract itself, or any other
circumstances sufficiently indicate at which place the seller has to perform the act he is
required to undertake in order to deliver136, Art. 31 provides for distinctions. On a first
level it has to be distinguished whether or not the sale at hand is a sale, which involves
carriage of the goods. In case of doubt, a sale, which involves carriage of the goods is to
be assumed137. If no sale involving carriage of the goods can be established, it must be
distinguished on a second level whether or not the goods sold have already been
individualized or are to be drawn from a specific stock or whether or not they are to
be manufactured or produced at a particular place.
37 In sales which involve carriage of the goods138 the place of delivery is established at
the place where the seller hands over the goods to the first carrier139 (Art. 31(a)). The
CISG does not regulate where the seller has to hand over the goods to the carrier.
Hence, the seller is widely free in setting the place of delivery in sales which involve
carriage of the goods140. Therefore, Art. 31(a) is especially suitable for drop shipments
(string sales). However, it must be ensured that the seller’s selection of the place of
delivery does not lead to a delay in transport or to easily avoidable costs or other
unreasonable disadvantages for the buyer141. Consequently, the place of delivery will be
in the environments of the seller’s place of business unless there are other indications.
Different from cases where the buyer has to take delivery at the seller’s place of business
(“Holschuld”), in sales involving carriage of the goods the seller has to arrange the
transport of the goods and instruct the carrier to transmit them to the buyer142.
Moreover, delivery is performed when the goods are handed over to the carrier for
transmission to the buyer143. Thus, the place of delivery and at the same time the locally
final point of the seller’s obligations144 is where this obligation is fulfilled145 and not
where the carrier hands over the goods to the buyer.
133Cf. Oberlandesgericht Köln (Germany) 30 April 2007, IHR 2007, p. 164.
134Cf. Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 31 para. 78.
135 See infra para. 48. Cf. Benicke, in: MünchKommHGB (2013), Art. 31 para. 29; Cour d’Appel de Paris
(France) 4 March 1998, CISG-Online 535; Gruber, in: MünchKommBGB (2016), Art. 31 para. 3 and
139 Magnus, in: Staudinger Kommentar (2013), Art. 31 para. 24; Ernst/Lauko, in: Honsell, Kommentar
(2010), Art. 31 para. 18; Fernández de la Gándara, in: Dı́ez-Picazo, Comentario (1998), p. 257. In contrast
Achilles, in: Ensthaler (ed.), Gemeinschaftskommentar zum Handelsgesetzbuch mit UN-Kaufrecht (2007),
Art. 31 para. 9.
Lorenz, Kommentar (2016), Art. 31 para. 17.

141 Cf. Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 27 para. 31; Witz/

145 Cf. Hondius/Heutger/Jeloschek/Sivesand/Wiewiorowska, Principles of European Law – Sales (2008),
Art. 2:104 para. 1.
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If the sale at hand is not a sale which involves carriage of the goods and the contract 38
relates to specific goods sold or goods to be drawn from a specific stock or to be
manufactured or produced at a specific place, delivery has to be performed at the
respective place of storage or manufacture146 (Art. 31(b)). Art. 31(b) gains significance
when the goods are stored at the premises of a third party or are produced by a third
party or at a particular location147. However, a precondition for the relevance of the
respective place of storage or manufacture is that both parties know of this place at the
time of the conclusion of the contract of sale. It is not sufficient that one or the other
party ought to have such knowledge148 or receives this information at a later point in
time149. Especially for sales of goods in transit, meaning goods that are rolling,
swimming or flying at the time of the conclusion of the contract of sale, the place of
storage is authoritative pursuant to Art. 31(b)150. Therefore, the place of delivery in
these cases is not the destination of the transport, but the respective means of
transportation known to the parties, meaning the ship, the wagon, the airplane, etc., in
or on which the goods are located151. The actual geographical position of the means of
transportation is irrelevant.
In all other cases the place of delivery is the seller’s place of business (Art. 31(c)). 39
Decisive is the moment at which the contract is concluded152 (Art. 23), so even if the
seller’s place of business is relocated later on, the original place of delivery is principally
still applicable153. If the seller has several places of business, Art. 10(a) applies.
There is no provision in Art. 31 which provides that the buyer’s place of business is 40
the place of delivery154. Different from the buyer who in case of doubt pursuant to
Art. 57 has to pay at the seller’s place of business, the seller is in case of doubt not
obligated to perform the act he is required to undertake in order to deliver at the buyer’s
place of business155. In order to set the place of delivery at the buyer’s place of business,
respective trade terms, agreements between the parties or other sufficiently clear
indications are required, for which the party relying on them bears the burden of proof.
c) Allocation of responsibilities. The place of delivery being the locally final point of 41
the seller’s obligations does not only fix the place at which the actual act of delivery has
to be performed, but also marks the point at which the responsibility for the goods
passes from the seller to the buyer in a wider sense. In foreign trade transactions larger
distances have to be overcome as compared in domestic ones, more than one legal
146Cf. Benicke, in: MünchKommHGB (2013), Art. 31 para. 21.

147Oberlandesgericht Brandenburg (Germany) 3 July 2014, CISG-Online 2543; Ernst/Lauko, in: Hon-
sell, Kommentar (2010), Art. 31 para. 33.
148 Secretariat Commentary on 1978 Draft, Art. 29 para. 13; Magnus, in: Staudinger Kommentar (2013),
Art. 31 para. 26.

Art. 31 para. 24; Magnus, in: Staudinger Kommentar (2013), Art. 31 para. 28; Benicke, in: Münch-
KommHGB (2013), Art. 31 para. 28; Schlechtriem/Schroeter, Internationales UN-Kaufrecht (2013),
para. 347. In contrast Achilles, in: Ensthaler (ed.), Gemeinschaftskommentar zum Handelsgesetzbuch
mit UN-Kaufrecht (2007), Art. 31 para. 12; Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary
(2016), Art. 31 para. 75; Brunner/Dimsey, Kommentar (2014), Art. 31 para. 11.
151 Ernst/Lauko, in: Honsell, Kommentar (2010), Art. 31 para. 37; Secretariat Commentary on 1978
Draft, Art. 29 (now Art. 31) para. 12.


153 Reinhart, UN-Kaufrecht (1990), Art. 31 para. 8.
Art. 31 paras 8 and 31; Ernst/Lauko, in: Honsell, Kommentar (2010), Art. 31 para. 50.
Piltz 425
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system apply and further questions and risks arise – all of which are unknown in
domestic affairs. Regarding the relationship between seller and buyer, these questions
and risks have to be allocated between the exporter and the importer. Unless otherwise
provided for by agreements, usages or practices (Arts 6, 9), the place of delivery is
suitable in particular for allocating the costs incurred by performing an international
contract of sale156 and as a starting point for determining which party has to provide the
necessary export or import licenses or other permissions needed for the performance of
the contract of sale157. The place of delivery also gives an orientation as to which party
has to provide for customs and security clearance and bear customs duties, tariffs and
taxes which are applicable to the specific contract of sale158 and quite often constitutes
the point of reference regarding the law applicable in case of acquisition in good faith
from a person having a defective or no title159.
42 On the other hand, those responsibilities in the relationship between seller and buyer
which are attributed to either the seller or the buyer and cannot be divided up between
them cannot be allocated by making reference to the place of delivery. Among those is
the responsibility for packaging the goods160, the risk regarding transmission of com-
munication (Art. 27), as well as the duty for pre-shipment-inspections ordered by public
authorities161. Neither is the place of delivery suitable for determining which party has
to bear taxes imposed not on a specific sale transaction but on an income as a whole.
For instance, some states provide a liability to pay income taxes for foreign exporters
which have no residence within that state but participate in the respective domestic
business through a domestic agent with authority to conclude contracts162 or maintain a
domestic consignment stock163. This liability to pay taxes as well as the obligation to file
the respective tax returns cannot be passed on to the buyer simply by determining the
place of delivery. For such a result, specific clauses shifting the liability to pay taxes and
to file the returns – if admissible – have to be agreed upon.
43 Beyond the responsibilities addressed supra in para. 41 which can generally be
divided up between the seller and the buyer and therefore can be subject to negotiation,
the place of delivery is of further significance164. Consequently, the contracting parties
are well advised to thoroughly reflect and ponder the legal consequences which may
arise before agreeing on a place of delivery.
44 Pursuant to Art. 13 EC Regulation 207/2009 on the Community Trade Mark165 and
Art. 15 Directive (EU) 2015/2436 of the European Parliament and of the Council166, the
protection provided by trademark law ends when the goods have been put on the
market either domestically or in a Member State of the European Union or the
European Economic Area (EEA)167. Considerations regarding the protection of a trade-
mark may urge parties to agree on a place of delivery outside of EEA if the goods are
intended for non-European customers and shall be prevented from re-import. This
applies all the more since the parties cannot vary the statement of Art. 13 EC Regulation

162 For instance see Art. 5(5) OECD Model Tax Convention on Income and on Capital.
163 However, see Art. 5(4) OECD Model Tax Convention on Income and on Capital.
164 Cf. Piltz, Der Lieferort im Außenhandel, Außenwirtschaftliche Praxis (2001) 273.
165 EC Official Journal, L 078, 24 March 2009.
166 EC Official Journal, L 336/1, 23 December 2015.
167 Cf. Bundesgerichtshof (Germany) 27 April 2006, RIW (2006) 769.
426 Piltz
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207/2009 and Art. 15 Directive (EU) 2015/2436 and therefore cannot agree that the
protection provided by trademark law shall not be exhausted when choosing a domestic
place for putting them on the market. However, protection by trademark law can be
ensured if the contracting parties agree upon a place of delivery outside of EEA.
European laws on value added tax generally apply the principle of the country of 45
destination168. Exports to foreign countries, in particular to countries outside the
European Union are generally exempted from paying value added tax169. However, a
prerequisite for these exemptions is always that the goods leave the country exempting
them from paying value added tax. If a domestic place of delivery applies, the exporter
loses control over the goods upon delivery and thus cannot provide the proof of
exportation needed for value added tax purposes without the cooperation of the buyer.
However, things are different if the place of delivery is abroad and it is therefore the
seller’s responsibility to take care of the export modalities.
Finally, with regard to possible legal disputes it has to be noted that the place of 46
performance generally constitutes a jurisdiction of the civil courts for claims arising out
of a contract170, see in particular Art. 7(1) Brussels Ia-Regulation (recast)171, Art. 5(1)
Brussels Convention172 and Art. 5(1) Lugano Convention (revised)173.
5. Further obligations of the seller

Depending on the circumstances of the individual contract, the seller may face 47
further obligations apart from the cardinal obligations pursuant to Art. 30, i. e. the
obligation to deliver, to hand over the relevant documents and to transfer property in
the goods sold. Aside from those obligations regulated in the CISG174, the basis for such
further obligations is, in particular, agreements between the parties as well as relevant
usages or practices established between them175. Further obligations which are especially
relevant with regard to delivery are addressed in Art. 32. Other additional obligations
can arise in particular as a result of agreeing on clauses of the Incoterms176.
a) Application of the CISG. Additional obligations of the seller are generally 48
governed by the CISG as well177. The CISG namely governs the agreement on such
further obligations and therefore the rules regarding the conclusion of a contract
according to Arts 14 et seq. apply. Moreover, the legal consequences of a failure to
properly perform these obligations are principally governed by Arts 45 et seq.178 With
due consideration and reasonable flexibility and dependant on the kind of obligation
and the relevant circumstances, other provisions of the CISG can also be applicable, in
168See recital 8 of EC Directive 92/12, EC Official Journal, L 076, 23 March 1992.

169Cf. § 4 para. 1 No. 1 b and § 6 Umsatzsteuergesetz (German Value Added Tax Act).
170 Cf. Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 31 paras 83 et seq.;
Brunner/Dimsey, Kommentar (2014), Art. 31 paras 16 et seq.; Wipping, Der europäische Gerichtsstand
des Erfüllungsortes – Art. 5 Nr. 1 EuGVVO (2008); Piltz, Jurisdiction of the place of performance in UN-
sales contracts, Nederlands Tijdschrift voor Handelsrecht (2007) 119; Klemm, Erfüllungsortvereinbarun-
gen im Europäischen Zivilverfahrensrecht (2005).
171 EC Official Journal, L 351/1, 20 December 2012.
172 EC Official Journal, C 189, 28 July 1990.
173 EC Official Journal, L 147, 5, 10 June 2009.
175 See supra Art. 30 paras 5 et seq., 27 seq.

MünchKommHGB (2013), Art. 30 para. 2; Magnus, in: Staudinger Kommentar (2013), Art. 30 para. 19.
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particular the rights to cure according to Art. 34 sentence 2, Arts 37 and 48179. In case of
doubt, such further obligations have to be performed at the relevant place of delivery180
(Art. 31), especially if they are connected with the seller’s obligation to deliver. For other
obligations not connected with the seller’s obligation to deliver an autonomous place of
performance independent from Art. 31 may be established181. Recurrence to national
law can only be made if a solution can neither be derived from the circumstances of the
contract or from the rules and regulations of the CISG or its basic principles (Art. 7(2)).
49 b) Typical further obligations. Due to the multiple forms and contents such addi-
tional obligations may have, a comprehensive compilation of these obligations is
impossible. In the following, some further obligations of the seller typical in interna-
tional trade will be addressed.
50 aa) Packaging of the goods. As part of his obligation to deliver, under the CISG as
well as under the Incoterms182, the seller generally owes the buyer an appropriate
packaging of the goods sold183. The seller faces this obligation irrespective of the kind
of act the seller is required to undertake in order to deliver184 and irrespective of the
relevant place of delivery185. The seller has to take care of an appropriate packaging in
cases where the seller has to hand over the goods and in cases where the goods have to
be placed at the buyer’s disposal, even if this happens at the seller’s place of business186.
Unless otherwise provided by agreements, usages or practices between the parties, the
requirement for and the kind of packaging is to be established taking into consideration
the kind of goods and thus the need for protection of the specific goods, the inherent
dangers of the goods, the means of transportation used, the route and the duration of
the transport187. If the means of transportation, the route or the duration of the
transport and the resulting packaging requirements are unknown to the seller and the
seller could not have been aware of them, standard packaging taking into consideration
that the goods are to be transported to the buyer is sufficient. In case the seller does not
provide for appropriate packaging and this results in damages to the goods or to other
objects, the seller has nevertheless performed the act he is required to undertake in
order to deliver pursuant to Art. 31. Yet, the buyer enjoys the legal remedies for a
delivery, which does not conform with the contract (Art. 35(2)(d)). An obligation of the
seller to take back packaging material for disposal purposes, for instance, cannot be
derived from the CISG even when the buyer is invoiced additionally for the packaging
material. Specific agreements, usages or practices are required between the parties to the
contract of sale to establish such an obligation.
179 Huber, in: MünchKommBGB (2016), Art. 48 para. 4; Benicke, in: MünchKommHGB (2013), Art. 48
para. 2.
181 See supra para. 35. Cf. Gruber, in: MünchKommBGB (2016), Art. 31 para. 3; Widmer Lüchinger, in:
Schlechtriem/Schwenzer, Commentary (2016), Art. 31 para. 78; Benicke, in: MünchKommHGB (2013),
Art. 31 para. 29.
183 Cf. Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 31 paras 32 and 50;
Magnus, in: Staudinger Kommentar (2005), Art. 31 para. 10 and Art. 35 para. 42; Neumayer/Ming,
Convention de Vienne (1993), p. 237.
186 Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 35 para. 32; Piltz, Internationales
Kaufrecht (2008), para. 4-107; Bianca, in: Bianca/Bonell, Commentary (1987), Art. 35 para. 2.7.
187 Cf. Cour de Cassation (France) 24 September 2003, CISG-Online 791; Arbitral Award, Compromex,
29 April 1996, CISG-Online 350.
428 Piltz
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bb) Costs of delivery. Even though the CISG does not establish explicit rules 51
regarding the costs of delivery, there is no need to resort to domestic law188. Generally,
the seller has to bear all expenses incurring until the act the seller is required to
undertake in order to deliver is performed at the relevant place of delivery189. Additional
expenses, especially such for further transportation from the place of delivery to a
different place of destination or acceptance or costs for security controls required for
such transportation190, are to be borne by the buyer unless otherwise provided by
agreements, usages or practices. Different to the Incoterms191, this rule also applies if the
seller has to arrange transportation in sales involving carriage of the goods192. If goods
in transit are sold, the costs for transportation to the place of destination have usually to
be borne by the seller unless otherwise provided for by other circumstances193. The
costs, which have to be usually borne by the seller, further include the expenses for
measuring, counting and weighing of the goods194 and for packaging195. If the seller is
obliged to insure the transport, these expenses follow the costs for transportation
notwithstanding other circumstances196.
cc) Clearance of the goods. The determination of who is responsible for providing 52
permissions, licences, registration requirements and other formalities required in the
course of performing the contract, namely with regard to the export, transit or import of
the goods, and who has to provide for customs and related security clearance and bear
customs duties, tariffs and taxes is, like the allocation of costs197, to be generally made by
considering the respective place of delivery198. Others prefer to allocate to the seller the
responsibilities for those foreign trade formalities and tariffs existing in his home
country and to the buyer those to be respected in the import country, but applying a
flexible approach ultimately arrive at quite comparable results199. Since the place of
188Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 31 para. 79.
189Gruber, in: MünchKommBGB (2016), Art. 31 para. 24; Brunner/Dimsey, Kommentar (2014), Art. 31
para. 20; Magnus, in: Staudinger Kommentar (2013), Art. 31 para. 30; Lando, in: Bianca/Bonell, Com-
mentary (1987), Art. 31 para. 1.1. Cf. Mullis, in: Huber/Mullis, The CISG (2007), p. 109.
190 Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 31 para. 79; Piltz, IHR
2013, 61 (62).
192 See supra para. 24; Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 31
para. 79; Gruber, in: MünchKommBGB (2016), Art. 31 para. 24; Benicke, in: MünchKommHGB (2012),
Art. 31 para. 32.
194 Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commetary (2016), Art. 31 para. 79.
195 Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commetary (2016), Art. 31 para. 79; Kock, Ne-
benpflichten im UN-Kaufrecht (1995), p. 150.

198 Gruber, in: MünchKommBGB (2016), Art. 31 para. 25; Brunner/Dimsey, Kommentar (2014), Art. 31
para. 20; Eckert/Maifeld/Matthiesen, Handbuch des Kaufrechts (2014), para. 609; Benicke, in: Münch-
KommHGB (2012), Art. 31 para. 33 and Art. 60 para. 4; Magnus, in: Staudinger Kommentar (2013),
Art. 31 para. 30 and Art. 60 paras 11 and 12; Ernst/Lauko, in: Honsell, Kommentar (2010), Art. 31
para. 54; Honnold/Flechtner, Uniform Law (2009), para. 211; Schackmar, Die Lieferpflicht des Verkäufers
in internationalen Kaufverträgen (2001), pp. 209, 213.
199 Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 31 paras 80 et seq.;
Hachem, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 66 para. 10; Mankowski, in: Ferrari
et al., Internationales Vertragsrecht (2012), Art. 60 paras 10 et seq.; Saenger, in: Bamberger/Roth (eds),
Kommentar zum Bürgerlichen Gesetzbuch (2012), Art. 41 para. 4 and Art. 60 para. 3; Soergel/Lüderitz/
Schüßler-Langeheine, Kommentar zum Bürgerlichen Gesetzbuch (2000), Art. 30 para. 3; Neumayer/Ming,
Convention de Vienne (1993), p. 237; Herber/Czerwenka, Kommentar (1991), Art. 30 para. 9. Cf.
Audiencia Provincial de Barcelona (Spain) 12 February 2002, CISG-Online 1324; Arbitral Award,
Piltz 429
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delivery marks the locally final point of the seller’s obligation to deliver200 and is
generally chosen by the parties also with regard to the allocation of costs and risks, the
approach linked to the place of delivery is to be preferred. In addition, this approach is
useful in allocating problems arising in connection with transit of the goods through a
third country. Furthermore, it widely ensures a parallel to the rules regarding the
passing of risk.
53 However, a direct orientation at the rules regarding the passing of risk would require
an array of exceptions – in particular with regard to Art. 68 – and therefore is not equally
suitable201, especially because the rules regarding the passing of risk, in contrast to the
approach based on the place of delivery, aim rather at a timed delimitation than at a
location-based one. As the place of delivery constitutes a local intersection of importance,
it is not convincing either to allocate foreign trade formalities and tariffs according to the
parties’ agreement on transportation costs without regard to the relevant place of
delivery202. The transportation costs are usually easy to calculate and in practice quite
often agreed upon without allocating them according to the place of delivery203. On the
other hand, the possible risks in connection with foreign trade formalities and related
security clearance are difficult to assess and thus cannot be automatically considered as
being covered by an agreement on transportation costs. If the absence of a required
permission, licence, registration or any other formality prevents the contract of sale or any
of its provisions from taking legal effect, Art. 4(a) may apply204.
54 Notwithstanding the application of Incoterms205 or any other agreements, usages or
practices206, the determination of who is responsible for providing permissions, licences,
registration requirements and other formalities needed in the course of the performance
of the contract and who has to provide for customs and related security clearance207 and
bear customs duties, tariffs and taxes, is to be made as follows according to the approach
connected with the place of delivery: in sales which involve carriage of the goods208 the
seller’s responsibility reaches beyond the place of delivery because he generally has to
arrange for the transmission of the goods to the buyer (Art. 31(a))209 For this reason,
even if the place of delivery is a domestic one, the seller in a sale involving carriage of
the goods is responsible for the export and related security clearance as well as for all
permissions, licences, registration requirements and for paying all duties to the extent
that from a domestic point of view compliance is a prerequisite for the export210. If, on
the other hand the buyer not only has to pay for the transportation but also has to
Industry, 23 January 2012, CISG-Online 2556.
201 Partialy in contrast Huber, in: MünchKommBGB (2016), Art. 66 para. 7; Witz/Salger/Lorenz,

202 Cf. Landgericht Essen (Germany) 5 February 1999, NJW-Rechtsprechungsreport Zivilrecht (2000)
503. Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 31 para. 80.
206 Cf. Audiencia Provincial de Barcelona (Spain) 12 February 2002, CISG-Online 1324.
207 Cf. Piltz, IHR 2013, 61.
210 Landgericht Ellwangen (Germany) 15 September 2006, BeckRS 2010, 06236; Widmer Lüchinger, in:
Schlechtriem/Schwenzer, Commentary (2016), Art. 31 para. 28; Brunner/Dimsey, Kommentar (2014),

Art. 31 para. 13; Benicke, in: MünchKommHGB (2012), Art. 31 para. 33; Ernst/Lauko, in: Honsell,
Kommentar (2010), Art. 31 para. 54; Achilles, in: Ensthaler (ed.), Gemeinschaftskommentar zum Han-
delsgesetzbuch mit UN-Kaufrecht (2007), Art. 31 para. 17; Renck, Der Einfluß der INCOTERMS 1990 auf
das UN-Kaufrecht (1995), pp. 193, 199; Lando, in: Bianca/Bonell, Commentary (1987), Art. 31 para. 2.4.
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organize it211, only the place of delivery is relevant. Moreover, in sales not involving
carriage of the goods, the allocation is made depending on where the place of delivery is
located, meaning the seller is responsible for all permissions, licences, registrations,
duties, etc. including customs related security clearance which are a prerequisite to
perform the act of delivery he is required to at the place of delivery212. The latter rule
requires, however, that the buyer is obligated to take over the goods at the same place of
delivery, thus the places of delivery and of acceptance coincide213.
In the relation between the buyer and the seller and irrespectively of legal norms 55
obligating the buyer to pay tariff duties when importing goods, the responsibility for the
payment of tariffs includes also punitive tariff duties which are imposed in accordance
with the World Trade Organisation (WTO) as a reaction to non-permitted unfair trade
practices214. Subject to the same treatment are taxes and other public duties, such as
stamp duties or anti-dumping-duties which are imposed on an individual contract of sale
and not with respect to certain revenues as a whole. Costs for pre-shipment-inspections
cannot be allocated according to the place of delivery, but are to be borne by the buyer to
the extent that they are a measure exclusively ordered by the import country215.
dd) Invoice. As a general rule, the seller will invoice the buyer the sale price. 56
Moreover, the buyer usually is entitled to claim that the seller issues an invoice which
displays the seller as the invoicing party, is addressed to the buyer216 and which is in
accordance with the applicable laws of the seller’s country217. The invoice can also be
contained in a confirmation of order or in a delivery note and must not necessarily have
to be issued as an independent form or paper. Unless otherwise provided, the invoice
does not have to be signed218. However, the issuing of an invoice is not a precondition
for the maturity of the purchase price219.
c) Further obligations stipulated. In addition to those issues addressed supra in 57
paras 50 et seq. and supra in Art. 30 para. 29, the parties sometimes enter into
agreements which stipulate further obligations of the seller that go beyond the typical
content of a contract of sale. In practice, such further obligations namely concern
transportation, loading and unloading220, filling with regard to bulk materials and
further distribution of the goods221. In connection with the delivery of technical
equipment the parties often agree upon further obligations concerning planning,
assembly, setting up of operation, instruction of personnel, maintenance and/or giving
Less clear Honnold/Flechtner, Uniform Law (2009), para. 211. In contrast Witz/Salger/Lorenz, Kommen-
tar (2016), Art. 31 para. 20.
212 Cf. Kantonsgericht St. Gallen (Switzerland) 12 August 1997, CISG-Online 330; Widmer Lüchinger,
in: Schlechtriem/Schwenzer, Commentary (2016), Art. 31 para. 81; Witz/Salger/Lorenz, Kommentar

(2016), Art. 31 paras 22 et seq.; Magnus, in: Staudinger Kommentar (2013), Art. 60 paras 11 seq.
214 Cf. Piltz, Wen treffen die Strafzölle auf us-amerikanische Produkte?, Außenwirtschaftliche Praxis
(2004) 180.
215 Cf. infra para. 71.
216 Cf. Arbitral Award, Compromex, 29 April 1996, CISG-Online 350; Benicke, in: MünchKommHGB
(2007), Art. 59 para. 1.

217 Comision para la Proteccion del Comercio Exterior (Mexico) 29 April 1996, CISG-Online 350. See
supra Art. 30 para. 44.

218 Cf. Art. 18(a)(4) UCP 600.
219 Supreme Court (Slowakia) 3 April 2008, CISG-Online 1763; Magnus, in: Staudinger Kommentar
(2013), Art. 59 para. 4; Piltz, Internationales Kaufrecht (2008), para. 4-148.

220 Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 31 para. 51. See supra
para. 25.
221 See e. g. Rechtbank Amsterdam (Netherlands) 19 August 2009, CISG-Online 2067.
Piltz 431
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further instructions222. Additional obligations can also result from other agreements, for
instance regarding the issuing of a certificate of compliance or a test certificate223, or
from other relevant usages or practices. With respect to the content of Art. 7(1),(2) and
anxious to ensure a uniform application of the CISG in the Contracting States, reference
to national laws in connection with such further obligations should only be made if the
legal questions arising in this context cannot be solved by applying the CISG’s
regulations or basic principles224. However, if such further obligations which are not
typical of a contract of sale are predominant, the contract in its entirety including its
sale elements does not fall into the CISG’s scope of application (Art. 3(2)).

1. Incoterms
58 The Incoterms225 contain rules of their own regarding all aspects referred to in
Art. 31 and commented above. If the parties to a contract of sale agree upon the
application of a clause of the Incoterms, the rules of interpretation of the Incoterms
regarding that clause supersede and modify Art. 31226.
59 a) Contracts involving carriage of the goods. According to the explanations under
headings A4 – B4 of the rules of interpretation of the Incoterms, the place of delivery
and the place of taking delivery are generally identical. This rule applies regarding the E-
and the D-clauses227 and is in particular true with regard to the F-clauses of the
Incoterms228. The buyer has to take delivery when the goods have been delivered229
and since the revision of the Incoterms of 1990 the seller has no obligation with regard
to the contract for carriage of the goods230. On the contrary, as a general rule it is the
buyer who has to take care of their carriage231. Even if it is commercial practice that the
seller contracts for carriage and the buyer does not object, the seller may still decline it.
However, if the respective conditions are met and the seller contracts for the carriage
(“additional service”), this option changes neither the place of delivery or the obligation
of the buyer to take delivery there. The buyer has to take delivery of the goods when
they are delivered at the named place of delivery or port of shipment notwithstanding
whether the seller takes care of the carriage or not232. Therefore, also under the F-clauses
of the Incoterms the place of delivery and the place of taking delivery are identical. Only
222 Achilles, in: Ensthaler (ed.), Gemeinschaftskommentar zum Handelsgesetzbuch mit UN-Kaufrecht
(2007), Art. 30 para. 5.

226 See supra Art. 30 paras 7 seq.; Piltz/Bredow, Incoterms (2016) paras A-240 et seq.
227 Bundesgerichtshof (Germany) 7 November 2012, CISG-Online 2374 (no. 16); Piltz/Bredow, Inco-
terms (2016) paras E-2 and D-2.

228 Piltz/Bredow, Incoterms (2016) para. F5; Kiene, in: DiMatteo/Janssen/Magnus/Schulze, International
Sales Law, 2016, para. 9. In contrast Secretariat Commentary on 1978 Draft, Art. 29 (now Art. 31) para. 5.
Cf. Gillette/Walt, The UN Convention on Contracts for the International Sale of Goods (2016), p. 158.
229 See the explanations under heading B4 of the rules of interpretation of the Incoterms.
230 See the explanations under heading A3 and B3 of the rules of interpretation of the Incoterms.
231 See the explanations under heading A3 and B3 of the rules of interpretation of the Incoterms. Piltz/
Bredow, Incoterms (2016) paras F-128, F-322 and F-524.

232 See the explanations under heading A4 and B4 of the rules of interpretation of the Incoterms. Piltz/
Bredow, Incoterms (2016) paras F-134, F-328 and F-530. Partially in contrast regarding the situation that
in a contract with the Incoterms clause FCA the seller concludes the contract of carriage Widmer
Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 31 para. 68.
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if a C-clause is agreed, the place of delivery and the place of taking delivery diverge,
leading to a sale involving carriage of the goods233.
If a C-clause is applied, the place of delivery and the place of taking delivery are not 60
identical. The delivery obligation of the seller is performed by handing over the goods to the
contracted carrier for shipment to the named place or by putting them on board a vessel for
shipment to the port of destination, whereas the buyer takes delivery just at the named
place or port of destination234. Risk passes to the buyer once the seller has complied with his
delivery obligation235. However, different to the other clauses of the Incoterms if a C-clause
applies the buyer has to take delivery not at the place of delivery, but at the named place or
port of destination236. Therefore, only if a C-clause is agreed upon, the place of delivery and
the place of taking delivery do not coincide and the situation characteristic for a sale
requiring carriage of the goods in the meaning of Art. 31(a)237 is given.
Those aspects of the delivery obligation of the seller such as the kind of act the seller is 61
required to perform in order to deliver238 and the place of delivery239 which are regulated
differently from other kinds of contracts of sale governed by the CISG if the sale involves
carriage of the goods, are ruled by the Incoterms autonomously. Therefore, regarding the
delivery obligations of the seller, whenever Incoterms are used there is no need to examine
in more detail and to determine precisely whether Art. 31(a) is applicable or not240.
b) Kinds of acts of delivery. When the parties agree upon the Incoterms clause 62
EXW or upon a D-clause, the act the seller is required to undertake in order to deliver
only consists of placing the goods at the buyer’s disposal241. A similar result occurs
when the contract of sale uses the Incoterms clause FAS242 or FCA, the latter one in
connection with a named place of delivery different from the seller’s place of
business243. Under FAS the seller has to place the goods alongside the ship named by
the buyer and under FCA in connection with a place of delivery different from the
seller’s place of business the seller has to place the goods at the disposal of the carrier
or another person nominated by the buyer244. In all remaining constellations, i. e.
using FCA in connection with the place of delivery at the seller’s premises, applying
FOB or agreeing upon a C-clause of the Incoterms, the seller is obligated to hand over
233 See the explanations under heading A4 and B4 of the rules of interpretation of the Incoterms. Cour
d’Appel de Paris (France) 19 November 2010, CISG-Online 2206; Piltz/Bredow, Incoterms (2016) paras
C-4 and C-145. Cf. supra Art. 30 para. 35; Benicke, in: MünchKommHGB (2013), Art. 31 para. 4. Partially
in contrast Oberlandesgericht Hamm (Germany) 12 November 2001, CISG-Online 1430; Huber, in:
MünchKommBGB (2016), Art. 67 paras 7 and 20; Magnus, in: Staudinger Kommentar (2013), Art. 38
para. 52; Verweyen/Foerster/Toufar, Handbuch des Internationalen Warenkaufs UN-Kaufrecht (2008),
pp. 114, 204; Achilles, in: Ensthaler (ed.), Gemeinschaftskommentar zum Handelsgesetzbuch mit UN-
Kaufrecht (2007), Art. 32 para. 2.
234 See the explanations under headings A4 and B4 of the rules of interpretation of the Incoterms. Piltz/
Bredow, Incoterms (2016) para. C-145.

235 See the explanations under headings A5 – B5 of the rules of interpretation of the Incoterms. Piltz/
Bredow, Incoterms (2016) para. C-2.

236 See the explanations under heading B4 of the rules of interpretation of the Incoterms. Piltz/Bredow,
Incoterms (2016) para. C-2.

240 Piltz, INCOTERMS und UN-Kaufrecht, in: Transport- und Vertriebsrecht 2000, Festgabe für Prof.
Herber (1999), p. 20 (pp. 23 seq.); cf. Lando, in: Bianca/Bonell, Commentary (1987), Art. 31 para. 2.4.
241 See the explanations under heading A4 of the rules of interpretation of the Incoterms. Cf. Tribunal
Supremo (Spain) 9 December 2008, CISG-Online 2100.

242 Piltz/Bredow, Incoterms (2016) para. F-335.
244 See the explanations under heading A4 of the rules of interpretation of the Incoterms.
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the goods so that the carrier, or another person nominated by the buyer when
applying FCA with the place of delivery at the seller’s premises, gets possession of
them245. The Incoterms 2010 state expressly that the seller is to deliver the goods by
“handing them over to the carrier”. The same applies regarding the clauses FOB, CFR
and CIF as the seller is required to place the goods on board the ship246. The term
“passed the ship’s rail” is not used any more in the Incoterms 2010. Once the seller
has handed over the goods to the carrier or they have been placed on board the ship,
the seller has fulfilled the act he is required to perform in order to deliver247. In order
to reflect the situations arising under drop shipments (string sales) in waterway
transports (FAS, FOB, CFR and CIF), according to the Incoterms 2010 the seller has
delivered as well if he procures goods delivered by being placed alongside the ship
(FAS) or on board (FOB, CFR and CIF). Just like in the CISG248, there is no situation
covered in the Incoterms, which would provide an obligation of the seller to hand over
the goods to the buyer.
63 Different to a mere placing at disposal, the seller who has to hand over the goods249 is
also responsible for their loading250 and additionally, if containers are handed over to
the carrier for maritime transport has to provide their “Verified Gross Mass” (VGM)251.
In contracts of sale using the clauses EXW or FAS252 of the Incoterms, the seller being
obliged only to place the goods at disposal is not responsible for their loading. With the
exception of the DAT-clause, if a D-clause of the Incoterms applies, the seller is not
responsible for the unloading of the goods after their arrival at the named destination,
he only has to present them “ready for unloading”253. The result is the same when using
the Incoterms rule FCA in connection with a named place of delivery different from the
seller’s place of business254. Using FCA in connection with the place of delivery at the
seller’s premises, applying FOB or agreeing upon CFR or CIF, the seller is obliged to
take care of putting the goods in or onto the means of transportation provided by the
carrier255. With regard to the clauses CPT and CIP, the issue of loading is not
highlighted expressly by the rules of interpretation of the Incoterms. But it results
from the structural principles, on which the C-clauses of the Incoterms are based256,
namely the obligation of the seller to hand over the goods257 and the allocation of
costs258 that the seller has to load them.
64 According to the introductory explanations to the Incoterms 2000, the expression
“placing the goods at the disposal of” was the equivalent to the phrase “handing over
245See the explanations under heading A4 of the rules of interpretation of the Incoterms.
246Renck, Der Einfluß der INCOTERMS 1990 auf das UN-Kaufrecht (1995), p. 80.
247 Cf. Ramberg, ICC Guide to Incoterms 2010 (2011), ICC publication No 720, p. 76; Arbitral Award,
Industry, 24 January 2002, CISG-Online 887 and Hof Arnhem (Netherlands) 21 August 2007 (Pace).
250 Cf. supra para. 21; Piltz/Bredow, Incoterms (2016) para. F-143.
251 For more details see Piltz, Container weights in maritime trade, EJCCL (2016) p. 59.
252 See the explanations under heading A4 of the rules of interpretation of the Incoterms 2010; Piltz/
Bredow, Incoterms (2016) para. E-132 seq. and para. F-335.

253 See the explanations under heading A4 of the rules of interpretation of the Incoterms. Piltz/Bredow,
Incoterms (2016) paras D-334 and D-512.

254 See the explanations under heading A4 of the rules of interpretation of the Incoterms. Piltz/Bredow,
Incoterms (2016) para. F-145.

255 See the explanations under heading A4 of the rules of interpretation of the Incoterms, cf. Piltz,
Incoterms 2010, IHR (2011) p. 1 (4).

258 See the explanations under heading A6 of the Incoterms rules of interpretation for the C-clauses.
434 Piltz
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the goods” used in the CISG259. This statement is an obvious error and discontinued in
the version of the Incoterms 2010. In particular, looking at the respective loading and
unloading obligations260 it becomes apparent that the two alternatives “placing the
goods at the disposal of” or “handing over the goods”, which are used to describe
different kinds of acts of delivery in the Incoterms and in the CISG, have almost the
same meaning in both the Incoterms and the CISG.
c) Place of delivery. Under heading A4 of the rules of interpretation, the Incoterms 65
provide for each individual clause the relevant place of delivery which supersedes the
rule established by Art. 31261. Under the E-clause (EXW), the place of delivery is the
named place, usually the seller’s place of business262. Applying an F-clause (FCA, FAS
and FOB), the place of delivery is established where the goods are delivered to the first
carrier or at the port of shipment. The place of delivery is regularly named in
connection with the three-letter-code263. Additionally, under the clauses FAS and FOB
the buyer has to nominate the ship. If the parties do not determine a specific place of
delivery but an area of delivery (e. g. “ARA” meaning Amsterdam-Rotterdam-Antwer-
pen), the buyer is entitled to specify the place of delivery since he is responsible for the
main transport according to the F-clauses. However, if the parties agree upon the clause
FCA without determining the place of delivery it should be determined by resorting to
Art. 31(b),(c)264. When using a C-clause (CFR, CIF, CPT and CIP) and unless the
parties have agreed on a specific point of delivery, the place of delivery usually is at the
port of shipment or the place where the goods are handed over to the first carrier as
well265. The difference with regard to the F-clauses cannot be seen in the determination
of the place of delivery, but mainly in the allocation of the responsibility for the
transport. Therefore, when using a C-clause, the place of delivery is not named, instead
it is the relevant place of destination of the main transport266. Under the D-Incoterms
the place of delivery is the one named as place of destination267. Furthermore, in
connection with the rules on the place of delivery, the Incoterms 2010 address explicitly
the specific point or terminal within the named place of delivery or destination where
the delivery and taking delivery is supposed to take place. If applying an F-clause no
259
ICC, Incoterms 2000, ICC publication No 560 ED (1999), pp. 11, 138.
260
See supra paras 21 and 25 and supra para. 63.
261 Bundesgerichtshof (Germany) 7 November 2012, CISG-Online 2374 (no. 16). See supra para. 33 and
Chengwei Liu, Place of performance: Comparative analysis of Articles 31 and 57 of the CISG and
counterpart provisions in Article 7:101 of the PECL, in: Felemegas (ed.), An International Approach to
(1980) as Uniform Sales Law (2007) 346 (349). In contrast Widmer Lüchinger, in: Schlechtriem/
Schwenzer, Commentary (2016), Art. 31 para. 68; Landgericht Köln (Germany) 29 March 2011, CISG-
Online 2534.
262 Ramberg, ICC Guide to Incoterms 2010 (2011), ICC publication No 720, p. 89; Piltz/Bredow,
Incoterms (2016) para.E-140.

263 For example “FCA railway station Nürnberg – Incoterms 2010”.
265 See the explanations under heading A3 a) of the rules of interpretation of the Incoterms; Piltz/
Bredow, Incoterms (2016) paras C-145 and C-446. Cf. Arbitral Award, Tribunal of International
Commercial Arbitration at the Russian Federation Chamber of Commerce and Industry, 11 April 1997
(Pace); Arbitral Award, Tribunal of International Commercial Arbitration at the Russian Federation
Chamber of Commerce and Industry, 24 January 2002, CISG-Online 887 and Hof Arnhem (Netherlands)
21 August 2007 (Pace).
266 For example “CIF New York – INCOTERMS 2010”. Disregarded by Verweyen/Foerster/Toufar,
Handbuch des Internationalen Warenkaufs UN-Kaufrecht (2008), p. 204.

267 For example “DDP Buenos Aires – Incoterms 2010”. Magnus, in: Staudinger Kommentar (2013),
Art. 31 para. 31; Rechtbank Rotterdam (Netherlands) 23 December 2009, CISG-Online 2071. In contrast
Landgericht Köln (Germany) 29 March 2011, CISG-Online 2534.
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specific point has been agreed, the buyer may indicate it268. Under the clauses CPT, CIP,
DAT and DAP a specific point determined by practice has to be respected269. Otherwise
under all clauses if no specific point is ascertainable and the buyer is not entitled to
determine the point of delivery, it is up to the seller to select it. Just like in the CISG270,
there is no provision in the Incoterms, which provides that the buyer’s place of business
is the place of delivery.
66 d) Packaging of the goods. According to the explanations under heading A9 of the
Incoterms rules of interpretation, regardless of the Incoterms clause applied and
irrespective of the kind of act the seller is required to undertake in order to deliver
and the place of delivery, the seller must provide packaging of the goods in a way
similar to the respective obligation under the CISG and mark it appropriately271.
However, the Incoterms 2010 introduced the possibility that the buyer may “notify”
the seller of specific packaging requirements. This notification needs to be consented by
the seller. A unilateral desire regarding the packaging does not seem to be sufficient.
The specific packaging requirements have to become part of the obligations assumed by
the seller when concluding the contract of sale or by amending it at a later stage. The
expenses related to any form of packaging are to be borne by the seller unless the parties
agree otherwise272.
67 e) Costs of delivery. According to the explanations under headings A2/B2, A3/B3,
A6/B6, A8/B8, A9/B9 and A10/B10 of the rules of interpretation of the Incoterms, as a
general rule the seller has to bear all costs and expenses incurred until the time when the
goods have been delivered273. The costs of export or import clearance are allocated
slightly differently and reflect the responsibility for the respective clearance274. Further-
more, applying a C-clause the seller has to bear those charges payable for transport
which are for his account according to the contract of transport. Whereas the Incoterms
are designed to specify only the primary obligations of the seller and the buyer275, the
rules on the allocation of costs also determine that the buyer has to pay additional costs
arising due to his failure to fulfil certain obligations imposed on him by the Incoterms
and specified in the respective clause.
68 If an F-clause is agreed upon, the expenses for the provision of a container the seller
has to deliver are to be borne by the seller. The subsequent terminal handling charges
rest on the buyer if the clause FCA is applied276. However, under FOB the terminal
handling charges and the costs of ascertaining the “Verified Gross Mass” (VGM)
required for transport of containers carrying cargo by vessel are for the seller’s
account277. If applying a C-clause or DAP or DDP the costs for unloading are for the
seller’s account according to the contract of carriage, the seller is bound to bear them
even though he is not responsible for unloading the goods278. The same applies in all C-
clauses regarding other costs and charges arising after delivery of the goods until their
268Piltz/Bredow, Incoterms (2016) para. F-155 and F-344.
269Piltz/Bredow, Incoterms (2016) para. C-147, C-313, D-122 and D-344.
271 See Piltz/Bredow, Incoterms (2016) paras F-201 et seq. and supra para. 50.
272 See the explanations under heading A9 of the rules of interpretation of the Incoterms; Piltz/Bredow,

277 Piltz/Bredow, Incoterms (2016) para. F-563 and Piltz, Container weights in maritime trade, EJCCL
(2016) p. 59.
278 Piltz/Bredow, Incoterms (2016) paras C-168, C-469, D-364 and D-516. See supra para. 63.
436 Piltz
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arrival at the place of destination279. Irrespective of the place of delivery, the costs to be
borne by the seller also include the expenses for checking quality, measuring, weighing
and counting of the goods and for packaging.
The general rule for the allocation of costs is almost the same as under the CISG280. 69
However, a significant difference to the CISG appears when using a C-clause of the
Incoterms. Whereas in a contract of sale requiring carriage of the goods governed by the
CISG the costs of transportation are to be borne by the buyer281, under a C-clause of the
Incoterms it is the seller who must bear the costs for their carriage and related
charges282. The allocation of costs according to the rules of interpretation of the
Incoterms may change if the parties modify the respective clause, e. g. obligate the seller
to deliver the goods “FOB stowed”283.
f) Export/import clearance of the goods. The customs clearance including the issues 70
of who has to provide for it and bear customs duties, tariffs and taxes and who is
responsible for the provision of licences, permissions or other formalities required for
the export or import of the goods sold is addressed under heading A2/B2 of the rules of
interpretation of the Incoterms. Using a C- or D-clause, the seller bears the responsi-
bility to clear the goods sold for export284. The same is true if the place of delivery and
the place of taking delivery are in the seller’s country and an F-clause of the Incoterms
is agreed upon. According to EXW, however, the seller does not have any responsibility
at all in this respect. The counterpart on the buyer’s side is the Incoterms clause DDP,
which places the entire responsibility on the exporter including also the clearance of the
goods for import into the buyer’s country. Under all other clauses of the Incoterms it is
always the buyer who is responsible for import clearance. Licences, permissions,
formalities and any other clearance issue, which arise in connection with the transit
through a third country, fall under the buyer’s responsibility except for cases which
involve D-clauses. However, the seller remains responsible as far as the transport of the
goods through any country prior to delivery is concerned285. Therefore, the result is
almost the same as under the CISG286. Nonetheless, if the place of delivery and the place
of taking delivery are in the seller’s country, the seller is responsible for the export
clearance if an F-Incoterm is agreed upon whereas under the CISG he has no obligation
in this respect287.
With the exception of the DDP-clause of the Incoterms, the responsibility for pre- 71
shipment inspections not mandated by the authorities of the country of export always
rests on the buyer288. If the inspections are ordered by the seller’s country and the clause
EXW is agreed upon, the buyer must pay the costs anyhow, whereas with regard to the
other clauses of the Incoterms no such obligation exists289. However, if the clause DDP
applies it is the seller who must bear the costs of any pre-shipment inspection
irrespectively whether ordered by the country of export or import290.
279Piltz/Bredow, Incoterms (2016) paras C-168 and C-469.

280See supra para. 51.
282 See the explanations under heading A3 and A6 of the Incoterms rules of interpretation for the C-
clauses and Piltz/Bredow, Incoterms (2016) paras C-123 and C-424.

283 See Bredow/Seiffert, Incoterms 2000 (2000), p. 69.
284 Cf. Arbitral Award, CIETAC, CISG/1998/01 (Pace).
285 Cf. Piltz/Bredow, Incoterms (2016) paras F-114 and C-114.
287 See supra para. 54; Piltz/Bredow, Incoterms (2016) paras F-117.
288 See the explanations under heading A9 and B9 of the Incoterms\R rules of interpretation.
289 See the explanations under heading B9 of the Incoterms rules\R of interpretation.
290 See the explanations under heading A9 of the Incoterms\R rules of interpretation.
Piltz 437
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72 The seller’s responsibility for the export clearance as regulated by the Incoterms does
not sufficiently consider the fact that in particular country-specific export restrictions or
embargoes are mainly implemented as a reaction to events in the respective country of
destination. Given this situation, the exporter should, especially in constellations when a
considerable period of time will pass between the conclusion of the contract and the
time of delivery, be concerned with excluding or limiting his liability for such cases
when at the time of delivery the export clearance cannot be effected due to circum-
stances not attributable to the exporter291. Otherwise, the exporter will eventually be
held responsible for those circumstances in the country of destination which caused the
export restrictions and all consequences thereof.
73 g) Security clearance of the goods. The Incoterms 2010 have additionally included the
term “security clearance” in the heading of A2/B2 in order to take account of the special
concern about security in the movements of goods292. The security clearance operated by
the customs authorities is regulated following the same principle underlying the respon-
sibility for licences or permissions or other formalities required for the export or import
of the goods293. However, if the security control is incumbent on the carrier it is the place
of delivery that assigns the responsibility for it either to the seller or to the buyer294.
2. PICC and PECL

74 Neither the PICC nor the PECL contain provisions explicitly regulating contracts of
sale295. Therefore, the regulatory content of Art. 31 CISG does not find a direct
counterpart in the PICC or in the PECL.
75 Neither the PICC nor the PECL expressly regulate any obligation of the seller to
deliver the goods sold. Consequently, they offer no definition of the kind of act the seller
is required to undertake in order to deliver296, do not explicitly obligate the seller to take
care of the packaging297 nor do they distinguish between contracts involving carriage of
the goods and other types of contracts of sale298. What they do regulate, in a very
general manner299 however, is the place300 and the costs301 of performance. According to
Art. 6.1.6 PICC and Art. 7:101 PECL, the place of performance for an obligation other
than to pay money is the debtor’s (seller’s) place of business at the time of conclusion of
the contract, unless another place is fixed by or determinable from the contract302.
According to Art. 6. 1. 11 PICC and Art. 7:112 PECL, the seller has to bear the costs
until the goods have been placed at the place of performance303. If the costs do not
291 Cf. Piltz/Bredow, Incoterms (2016) paras F-124 seq; Ramberg, ICC Guide to Incoterms 2010 (2011),
ICC publication No 720, p. 66.

292 See no. 7 of the introduction to the Incoterms 2010 and Piltz/Bredow, Incoterms (2016) paras F-122
seq.
294 Piltz IHR 2013, 61 et seq.
299 Atamer, in: Vogenauer/Kleinheisterkamp, UNIDROIT Commentary (2015), Art. 6.1.6 para. 20.
302 For more details see Atamer, in: Vogenauer/Kleinheisterkamp, UNIDROIT Commentary (2015),
Art. 6.1.6 paras 17 et seq. and Lando/Beale, Principles of European Contract Law, Parts I and II (2000),
pp. 329 et seq.
Art. 6. 1. 11 paras 1 et seq. and Lando/Beale, Principles of European Contract Law, Parts I and II (2000),
p. 329.
438 Piltz
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include the packaging needed for proper transportation304, the seller faces fewer
obligations than under the CISG305 or the Incoterms306. Just like the CISG and the
Incoterms, neither the PICC nor the PECL obligate the seller to hand over the goods
directly to the buyer or determine the buyer’s place of business as the place of
performance.
Neither the PICC nor the PECL explicitly address the issue of which of the parties to 76
a contract of sale is responsible for the export or import and customs clearance307. It
seems that the rules regarding the allocation of the costs of performance308 are applied
mutatis mutandis309. In special situations Art. 6. 1. 14 PICC may be relevant310.
3. DCFR
Unlike the situation according to the PICC and the PECL311, the regulatory content of 77
Art. 31 CISG has direct counterparts in the DCFR312. Yet, it has to be emphasized that
just like under the CISG313 these rules of the DCFR only apply to the extent that the
seller’s obligations cannot be determined otherwise314.
Just like the CISG315, the DCFR differentiates between contracts of sale involving 78
carriage of the goods and other contracts of sale, not involving carriage of the goods.
Art. IV.A.-2:204 DCFR regulates the consequences if the contract of sale involves
carriage of the goods316. Unfortunately, there is no specific rule in the DCFR offering a
definition what is to be understood as a contract of sale involving carriage of the goods.
As situations where the seller’s or buyer’s employees transport the goods are not
covered317 by this notion, it seems that no carriage is involved if the place of delivery
and the place of taking delivery are identical. Therefore, just like under the CISG318, it is
characteristic for a sale involving carriage of the goods that the seller has to perform the
act he is required to undertake in order to deliver at a place different from the one
where the buyer has to take over the goods. This finding is corroborated by the fact that
the carriage must be executed by “a third party”319. Therefore, the emphasis put on the
agreement on the carriage320 should not lead to the conclusion that special circum-
304See Atamer, in: Vogenauer/Kleinheisterkamp, UNIDROIT Commentary (2015), Art. 6.1.11, note 326.
307 See supra paras 52 et seq. and 70 et seq.
Art. 6.1.14 para. 4.

Reference (DCFR), Full Edition (2009), Comment A to Art. IV.A.-2:204 and Comment D to Art. IV.A.-
2:201 and Hondius/Heutger/Jeloschek/Sivesand/Wiewiorowska, Principles of European Law – Sales (PELS)
(2008) pp. 178, 168.
Reference (DCFR), Full Edition (2009), Comment A to Art. IV.A.-2:204 and Hondius/Heutger/Jeloschek/
Sivesand/Wiewiorowska, Principles of European Law – Sales (PELS) (2008), p. 178. Cf. Kritzer/Vanto/
Vanto/Eiselen, International Contract Manual, Vol. 4, § 88:22.
Reference (DCFR), Full Edition (2009), Comment B to Art. IV.A.-2:204 and Hondius/Heutger/Jeloschek/
Sivesand/Wiewiorowska, Principles of European Law – Sales (PELS) (2008), p. 178.
Piltz 439
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stances have to be proven in order to assume a contract involving carriage of the goods.
Just like Art. 31(a)321, in case of doubt the seller has to arrange for carriage of the goods.
79 Just like the CISG322, the DCFR does not offer a general definition of the term
delivery, but regulates two different kinds of acts the seller is required to undertake in
order to deliver. Unfortunately, the definition given for the term “delivery” in the
Annex of the Outline Edition of the DCFR is not clear at all. However, if the contract
involves carriage of the goods by a carrier, the seller has to hand over the goods to the
first carrier for transmission to the buyer, Art. IV.A.-2:201(2) DCFR. This concept of
delivery matches the one applied by Art. 31(a)323. Additionally, Art. IV.A.-2:201(2)
DCFR orders the seller to transfer to the buyer any document necessary for him to
take over the goods from the carrier. If no contract involving carriage of the goods is at
hand, the seller delivers by making the goods available to the buyer, Art. IV.A.-2:201(1)
DCFR. With this term, the DCFR covers different modes of delivery including the mere
placing at disposal324 as well as the handing over325. Moreover, just like the CISG326, the
DCFR does not obligate the seller to hand over the goods directly to the buyer.
80 Art. IV.A.-2:202(1) DCFR determines at which place the seller has to perform the act
he is required to undertake in order to deliver327 by referring to Art. III.-2:101 DCFR
(place of performance). Unlike the CISG328, Art. III.-2:101(1)(a) DCFR does not
distinguish different places of delivery and states that the place of performance of a
non-monetary obligation is the debtor’s place of business, thus leading to the seller’s
place of business being the place of delivery. According to Art. III.-2:101(3) DCFR, the
time at which the obligation to deliver is entered into is the moment when the place of
delivery is fixed. The concept of the place of delivery according to the DCFR is the one
addressed in Art. 31(c)329. Moreover, just like the CISG330, the DCFR does not deter-
mine the buyer’s place of business being the place of performance.
81 According to Art. IV.A.-2:301(b) DCFR, the goods do not conform with the contract
unless they are contained or packaged as required by the contract. The corresponding
rule in the CISG is Art. 35(2)(d). However, unlike the CISG331, the DCFR does not
generally obligate the seller to take care of an appropriate packaging of the goods sold
but rather refers to the contract.
82 According to Art. III.-2:113(1) DCFR, the seller has to bear all expenses incurring to
perform the obligations he is required to comply with at the relevant place of delivery.
Additional expenses are to be borne by the buyer. Taking into account the kind of act
the seller is required to undertake in order to deliver332 and that he is not obliged to
perform transportation, this rule also applies with regard to the costs of transportation
in sales involving carriage of the goods. As a result, the concept of division of costs used
in the DCFR matches the one applied in the CISG333.

Reference (DCFR), Full Edition (2009), Comment C to Art. IV.A.-2:201 and Hondius/Heutger/Jeloschek/
Sivesand/Wiewiorowska, Principles of European Law – Sales (PELS) (2008), pp. 167 seq.
440 Piltz
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Art. III.-2:113(2) DCFR regulates the responsibility for complying with formalities 83
regarding monetary obligations. On the other hand, with regard to the obligation of the
seller to deliver the goods to the buyer, the DCFR does not state explicitly who is
responsible for the export, import, security or customs clearance. For the reasons
explained when commenting on the CISG334, like the allocation of costs335, these issues
should generally be resolved by considering the respective place of delivery and applying
a special rule in contracts of sale involving carriage of the goods336.
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Article 32
(1) If the seller, in accordance with the contract or this Convention, hands the
goods over to a carrier and if the goods are not clearly identified to the contract by
markings on the goods, by shipping documents or otherwise, the seller must give the
buyer notice of the consignment specifying the goods.
(2) If the seller is bound to arrange for carriage of the goods, he must make such
contracts as are necessary for carriage to the place fixed by means of transportation
appropriate in the circumstances and according to the usual terms for such transpor-
tation.
(3) If the seller is not bound to effect insurance in respect of the carriage of the
goods, he must, at the buyer’s request, provide him with all available information
necessary to enable him to effect such insurance.
Bibliography: Benedick, Die Informationspflichten im UN-Kaufrecht (CISG) und ihre Verletzung (2008);
ICC, ICC Guide on Transport and the Incoterms 2010 Rules (2016) ICC Publication 775E; Kock,
Nebenpflichten im UN-Kaufrecht (1995); Piltz/Bredow, Incoterms (2016); Renck, Der Einfluß der
INCOTERMS 1990 auf das UN-Kaufrecht (1995); Thume, Versicherung des Transports – Einführung,
TranspR (2006) 1; Vanheusden, Leveringsvoorwaarden in international overeenkomsten, Incoterms
anders bekeken (2013).
Outline
1. Subject matter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
2. Breach of contract. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
3. Further context . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
4. National laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
5. Vienna Conference. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
1. Notice of consignment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
2. Carriage of the goods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
a) Seller’s obligation to arrange for carriage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
b) Contract ensuring carriage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
3. Information regarding insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
III. Comparable rules. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
1. Incoterms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
a) Obligation to give notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
b) Carriage of the goods. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
c) Obligations regarding insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
2. PICC and PECL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
3. DCFR. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43

1. Subject matter
1 Art. 32 serves the same purpose as Arts 31 and 33. It defines in greater detail the
seller’s obligation to deliver arising under Art. 30 and complements in particular
Art. 31. Consequently, Art. 32 has to be observed if Art. 30 is applicable1. Irrespective
of whether the seller or the buyer arranges the transportation, Art. 32(1) regulates the
1 See supra Art. 30 paras 3 and 4.
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seller’s obligation to give notice of the consignment to the buyer when handing over the
goods to the carrier if otherwise the goods sold could not be clearly identified to the
contract. Furthermore, Art. 31(2) obligates the seller, who has to arrange for the carriage
of the goods, to conclude the contracts necessary for the transportation of the goods.
Finally, the seller has to provide the buyer, at his request, with the necessary informa-
tion in order to enable him to take out the insurance of the goods (Art. 32(3)). Just like
Art. 302, Art. 32 merely plays a supplementary role and gains significance only to the
extent that the contract and its circumstances do not indicate otherwise3.
The failure to perform any of the seller’s obligations arising out of Art. 32 constitutes 2
a breach of contract and entitles the buyer to enjoy the remedies laid down in Art. 45 et
seq. However, the following distinctions have to be made.
As long as the notice of consignment, as required pursuant to Art. 32(1), has not been 3
given4 and the buyer has not taken over the goods, the risk does not pass to the buyer
(cf. Art. 67(2)). Furthermore, the breach of the obligation to give notice of the consign-
ment may entitle the buyer to the remedies applicable in case of non-delivery if due to
the missing notice the goods cannot be assigned to a specific contract of sale5. On the
other hand, the buyer is not entitled to claim damages arguing that because of the
missing notice he did not know about the dispatch of the goods and therefore suffered
losses6.
Since in sales which involve carriage of the goods the conclusion of a contract for the 4
transport of the goods is an integral part of the seller’s obligation to deliver7, the seller
has not performed the required act of delivery so long as the respective contract of
carriage addressed by Art. 32(2) has not been concluded8. On the other hand, as the
seller does not owe the transportation itself9, he is not responsible for mistakes or
inappropriate or even illegal behaviour of the carrier10. However, if the goods suffer
damage because the seller concluded a contract of carriage choosing an unsuitable
means of transportation or an unreasonable route, delivery has been performed but the
seller has committed a breach of contract. Regardless of whether the non-conformity of
the goods occurred only after the passing of risk, the non-conformity is nevertheless
attributable to the seller because he has breached an obligation in terms of Art. 36(2)11.
Nevertheless, the buyer has to give notice of the non-conformity pursuant to Art. 39 in

3Lando, in: Bianca/Bonell, Commentary (1987), Art. 32 para. 2.1.

5 Benicke, in: MünchKommHGB (2013), Art. 32 para. 9; Magnus, in: Staudinger Kommentar (2013),
Art. 32 para. 14. In contrast Fernández de la Gándara, in: Dı́ez-Picazo, Comentario (1998), p. 269 and
Ernst/Lauko, in: Honsell, Kommentar (2010), Art. 32 para. 2.
6 Benedick, Die Informationspflichten im UN-Kaufrecht (CISG) und ihre Verletzung (2008), para. 593.
In contrast Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 32 para. 14;
Saenger, in: Bamberger/Roth (eds), Kommentar zum Bürgerlichen Gesetzbuch (2007), Art. 32 para. 6.
8 Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 32 para. 33; Kock, Nebenp-
flichten im UN-Kaufrecht (1995), p. 125. In contrast Fernández de la Gándara, in: Dı́ez-Picazo,

Comentario (1998), p. 269. Cf. Ernst/Lauko, in: Honsell, Kommentar (2010), Art. 32 para. 2.

11 See infra Art. 36 para 13.
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order to sustain his remedies. Furthermore, the seller is liable for any other disadvantage
resulting from a contract of carriage which is not in compliance with “the usual terms”
of such transportation. However, the conclusion of a contract of carriage not complying
with the requirements established by Art. 32(2) does not amount to a non-delivery but
constitutes an improper performance even if due to the breach the goods do not arrive
at the designated destination12.
5 A breach of the obligation to provide the necessary information for the conclusion of a
contract of insurance does not affect the delivery obligation as such, but constitutes a breach
of contract by the seller. This breach of contract does not require a notice by the buyer
according to Arts 39 or 43 because the delivered goods cannot be considered to be non-
conforming with the contract or to have a deficiency in title due to the missing information
with regard to insurance issues. However, if the seller withholds such information necessary
to take out insurance, it can constitute a fundamental breach of contract pursuant to Art. 25
since the buyer cannot be expected to bear the risks in connection with the transportation
of the goods without the possibility to take out reasonable insurance13.
3. Further context
6 The obligations regulated in Art. 32 must be seen in context with Arts 31 and 33.
Therefore, Arts 31 and 33 also give indications with regard to the place where and the
time when the seller has to perform the duties imposed by Art. 32.
4. National laws
7 National law regulations regarding the notice of consignment, the contract of carriage
and the transport insurance are inapplicable within the CISG’s scope of application
since the CISG regulates these aspects conclusively14.
8 Art. 32 was formulated on the basis of Arts 19(3) and 54 ULIS15. During the Vienna
conference, Art. 32 was only slightly modified and accepted without further discussion16.

1. Notice of consignment
9 Art. 32(1) obliges the seller to give notice of the consignment if the goods handed
over by the seller to a carrier for transportation to the buyer could not be clearly
assigned to the corresponding contract of sale by other means. It is irrelevant whether
the seller or the buyer has to arrange the transportation or concludes the contract of
carriage17. However, if the seller’s act of delivery consists only in placing the goods at
12 Not unambiguously clear Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016),
Art. 32 para. 33 and Gruber, in: MünchKommBGB (2016), Art. 32 para. 13.
15 For more details see Lando, in: Bianca/Bonell, Commentary (1987), Art. 32 para. 1.
16 Magnus, in: Staudinger Kommentar (2013), Art. 32 paras 5 seq.; Fernández de la Gándara, in: Dı́ez-

17 Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 32 para. 5. Cf. supra
Art. 31 para. 15; Mullis, in: Huber/Mullis, The CISG (2007), p. 119; Fernández de la Gándara, in: Dı́ez-
Picazo, Comentario (1998), p. 270; Enderlein/Maskow/Strohbach, Internationales Kaufrecht (1991),
Art. 32 para. 4. In contrast Soergel/Lüderitz/Schüßler-Langeheine, Kommentar zum Bürgerlichen Gesetz-
buch (2000), Art. 32 para. 2.
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the buyer’s disposal18, notwithstanding other agreements or other relevant circum-
stances, Art. 32(1) is not applicable19.
Art. 32(1) is not applicable if the seller owes transportation to the place where the 10
buyer has to take over the goods, hence the place of delivery and the place of acceptance
are identical20, and the seller employs a carrier for the transportation to that place. By
handing over the goods to the carrier, the seller has not yet fulfilled his obligation to
deliver. There is no need to identify the goods at such a pre-delivery stage. Furthermore,
Art. 32(1) is not applicable if the seller hands over the goods to a carrier at the
respective place of delivery which is also the place of taking delivery and the carrier
takes over the goods on behalf of the buyer21 so that handing them over to the carrier
equals handing over the goods to the buyer22. In this situation, with the handing over
the goods to the carrier the buyer is taking delivery. There is no more need for further
identification of the goods. Consequently, Art. 32(1) only applies if the contract of sale
involves carriage of the goods23 and the seller’s act of delivery consists of the handing
over of the goods to a carrier for transmission to the buyer24.
The purpose of the notice of consignment as regulated in Art. 32(1) is to individualize 11
and to clearly identify the goods which are intended for the buyer25. Only if the goods
sold can be clearly assigned to a specific contract, does the seller fulfil his delivery
obligation by handing over the goods to a carrier26. A clear identification of the goods is
also a prerequisite for the passing of risk (Arts 67(2) and 69(3))27. Consequently, if the
goods handed over to the carrier for transmission to the buyer can already be attributed
to a certain contract of sale with the necessary unequivocal clearness28, the notice of
consignment regulated in Art. 32(1) is not required.
Such a clear and unambiguous assignment of the goods to a certain contract of sale is 12
ensured if the goods sold can be identified without any doubt as the goods of a
particular contract of sale. The wording of Art. 32(1) mentions the attribution of the
goods to a particular contract. Yet, it is sufficient that the goods can be attributed to a
particular buyer if by looking at the kind of the goods, the mode of transportation, the
delivery time or other circumstances it can be clearly derived which contract of sale is to
be fulfilled by handing over of the goods to the carrier. The details of how the
identification is conducted are irrelevant. For instance, the goods, the packaging or the
18See supra Art. 31 paras 25 et seq.

19Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 32 para. 5; Magnus, in:
Art. 32 para. 3.
21 Obergericht Kanton Zug (Switzerland) 5 March 2013, CISG-Online 2471; Gruber, in: Münch-
KommBGB (2016), Art. 32 para. 3; Magnus, in: Staudinger Kommentar (2013), Art. 32 para. 8; Saenger,
in: Bamberger/Roth (eds), Kommentar zum Bürgerlichen Gesetzbuch (2012), Art. 32 para. 3. In contrast
regarding FOB-, FAS- and FCA contracts WidmerLüchinger, in: Schlechtriem/Schwenzer, Commentary
22 Cf. supra Art. 30 para. 34, Art. 31 para. 59 and Piltz/Bredow, Incoterms (2016) paras. F-2 and F-5.
25 Gruber, in: MünchKommBGB (2016), Art. 32 para. 4; Benicke, in: MünchKommHGB (2013), Art. 32
para. 3; Ernst/Lauko, in: Honsell, Kommentar (2010), Art. 32 para. 5; Benedick, Die Informationspflichten
im UN-Kaufrecht (CISG) und ihre Verletzung (2008), para. 621;. Cf. Witz/Salger/Lorenz, Kommentar
(2016), Art. 32 para. 2. Further reaching Widmer Lüchinger, in: Schlechtriem/Schwentzer, Commentary
(2016), Art. 32 para. 2.
28 Cf. Witz/Salger/Lorenz, Kommentar (2016), Art. 32 para. 4.
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container can be attributed to the buyer by attaching special markings or the buyer’s
address. Without marking the object of transportation, it is also possible to identify the
buyer in the transportation documents by naming him as consignee or recipient
authorized to take delivery29, by attributing the container to a certain contract of sale
or by including other details. Apart from this, any other method of identifying the
goods is also imaginable as long as it is ensured that a reasonable third person knowing
the contract of sale at hand would attribute the goods handed over to the carrier to this
particular contract. However, no clear identification is achieved if the goods do not
allow for any attribution and the transportation documents are issued to the seller or a
forwarding agent authorized to take delivery of the goods30.
13 To the extent that an unambiguous identification of the goods to a specific contract is not
ensured, Art. 32(1) obligates the seller to give notice of the consignment to the buyer. The
sole purpose of such notice is to specify the goods which are handed over to the carrier31.
For instance, the seller may inform the buyer about the description of the packing pieces, the
containers handed over to a carrier or may individualize the means of transportation being
used for carrying the goods. The seller may also forward the transportation documents
regarding the particular contract to the buyer32. If collective transport is admissible and
goods of the same kind are intended for different buyers, it is sufficient to identify the means
of transportation and the number or weight of the units intended for the specific buyer33.
14 The notice of consignment necessary for the identification of the goods has to be
given within reasonable time after the goods have been handed over to the carrier34.
Art. 27 is applicable to such notice35, meaning that the seller is not liable for loss,
delayed reception or any change with regard to the content occurring during the
transmission of the notice if he uses means of communication which are appropriate
in the circumstances36. The notice containing the identification can no longer be
revoked once it has reached the buyer37. Unless the buyer objects, the seller is usually
bound by the identification of the goods contained in the notice of consignment. If the
seller wishes to change the identification later on, he needs the buyer’s consent.
However, amendments and corrections to the notice of consignment are possible to
the extent that they do not affect the buyer’s interest38. Furthermore, the notice of
consignment has to be linguistically understandable for the buyer. If the seller uses the
buyer’s language or the language which was used in the contract or during negotiations,
the buyer cannot invoke any lack of understandability39. In cases where the seller uses a
29 Mullis, in: Huber/Mullis, The CISG (2007), p. 119.

31 Gruber, in: MünchKommBGB (2016), Art. 32 para. 4; Ernst/Lauko, in: Honsell, Kommentar (2010),
Art. 32 para. 5; Benedick, Die Informationspflichten im UN-Kaufrecht (CISG) und ihre Verletzung
(2008), para. 621.
32 Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 32 para. 8; Ernst/Lauko,
in: Honsell, Kommentar (2010), Art. 32 para. 10.


34 Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 32 para. 9; Lando, in:
Bianca/Bonell, Commentary (1987), Art. 32 para. 2.2.2. Cf. Magnus, in: Staudinger Kommentar (2013),
Art. 32 para. 10.

36 For more details see supra Art. 27 paras 5 et seq.
Staudinger Kommentar (2013), Art. 32 para. 12; Fernández de la Gándara, in: Dı́ez-Picazo, Comentario
(1998), p. 271.
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third language, the individual language skills of the buyer or usages or practices relevant
according to Art. 9 have to be considered.
Art. 32(1) does not provide for an independent obligation of the seller to inform the 15
buyer about the fact that the goods have been handed over to the carrier for transmis-
sion irrespective of any need for their identification or allocation40. Addressing the
notice obligation in Art. 32(1) and not in chapter 4 (Passing of Risk) does not suggest
that Art. 32(1) serves such a purpose41. An obligation to inform the buyer does not
depend on the clear identification of the goods and may arise also in situations not
covered by Art. 32(1)42. In order to establish such an obligation, an agreement between
the parties (Art. 6) or usages or practices established between them (Art. 9) are
necessary43. The party relying on such circumstances bears the burden of proof. An
obligation to inform the buyer about the handing over to a carrier can usually be
assumed if the buyer explicitly asks the seller for such information44. Further obligations
to inform the buyer derive from an agreement on clauses of the Incoterms45.
2. Carriage of the goods

The seller has to conclude the necessary contracts for the carriage of the goods if he 16
has to arrange for it according to the contract of sale, Art. 32(2). With respect to the
carriage of the goods, Art. 32(2) provides the use of means of transportation appropriate
under the circumstances and the adherence to the usual terms for such transportation.
a) Seller’s obligation to arrange for carriage. The seller is not bound to arrange for 17
carriage of the goods in all international contracts of sale. In particular, Art. 32(2) does
not state such an obligation of the seller, but rather implies its existence46. Thus, the
basis for an obligation of the seller to arrange for carriage of the goods has to be found
outside of Art. 32(2).
The seller has to arrange for carriage of the goods according to the contract of sale 18
and thus is obliged to conclude the necessary contracts pursuant to Art. 32(2) if the
place where the seller has to perform the act he is required to undertake in order to
deliver (place of delivery) is not identical with the place where the buyer has to take over
the goods (place of taking delivery)47. However, if the buyer has to take over the goods
para. 2; Ernst/Lauko, in: Honsell, Kommentar (2010), Art. 32 para. 5; Benedick, Die Informationspflichten
im UN-Kaufrecht (CISG) und ihre Verletzung (2008), para. 593; Lando, in: Bianca/Bonell, Commentary
(1987), Art. 32 para. 2.2.3. Cf. Obergericht Kanton Zug (Switzerland) 5 March 2013, CISG-Online 2471.
However, in favour of a general obligation to give notice of the consignment Widmer Lüchinger, in:
Schlechtriem/Schwenzer, Commentary (2016), Art. 32 para. 2; Kock, Nebenpflichten im UN-Kaufrecht
(1995), p. 109; Renck, Der Einfluß der INCOTERMS 1990 auf das UN-Kaufrecht (1995), pp. 155 seq.
42 See supra paras 9 seq. Cf. Piltz/Bredow, Incoterms (2016) paras F-182 and D-371.
43 Benicke, in: MünchKommHGB (2013), Art. 32 para. 3; Ernst/Lauko, in: Honsell, Kommentar (2010),
Art. 32 para. 8.
44 Ernst/Lauko, in: Honsell, Kommentar (2010), Art. 32 para. 9; Kock, Nebenpflichten im UN-Kau-
frecht (1995), p. 109. Cf. Benedick, Die Informationspflichten im UN-Kaufrecht (CISG) und ihre
Verletzung (2008), para. 1180.
46 Witz/Salger/Lorenz, Kommentar (2016), Art. 31 para. 19; Benicke, in: MünchKommHGB (2013),
Art. 32 para. 11; Magnus, in: Staudinger Kommentar (2013), Art. 32 para. 16; Fernández de la Gándara,
in: Dı́ez-Picazo, Comentario (1998), p. 272.
47 See supra Art. 31 para. 14., Cf. Ernst/Lauko, in: Honsell, Kommentar (2010), Art. 32 para. 16; Kock,
Nebenpflichten im UN-Kaufrecht (1995), p. 113. In contrast Gruber, in: MünchKommBGB (2016),

Art. 32 para. 9; Witz/Salger/Lorenz, Kommentar (2016), Art. 32 para. 7; Magnus, in: Staudinger Kom-
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at the place of delivery, the contract of sale does not usually48 require carriage of the
goods which the seller would have to arrange for. It is of no relevance whether the goods
are transported to the place of delivery and/or transported further from the place of
taking delivery. With respect to the transportation to the place of delivery, including
constellations where the seller has to perform his delivery obligation at the buyer’s place
of business, the seller’s responsibility is not limited to only arrange for the necessary
transportation. In fact, the seller owes the buyer the transportation to that place49. The
expenses and the risk of transportation have to be borne by the seller. Consequently, he
is liable for any failure of the carrier employed by him to transport the goods to the
place of delivery.
19 If the place of delivery and the place of taking delivery are not identical and no
circumstances indicate that the buyer has to arrange for transportation of the goods
from the place of delivery to the place of taking delivery50, Art. 31(a) obligates the seller
to arrange the carriage of the goods to the buyer51. Thus it triggers the obligation
regulated in Art. 32(2)52. The place of delivery and the place of taking delivery also
diverge whenever a C-clause of the Incoterms is used53. However, since the rules of the
ICC interpreting the Incoterms autonomously regulate the responsibility for the
carriage of the goods54, in this respect no reference to Art. 32(2) is necessary55 if the
Incoterms apply.
20 Furthermore, it is also possible to establish an obligation of the seller to arrange for
carriage of the goods in situations not covered by Art. 31(a)56. However, apart from
sales involving carriage of the goods addressed in Art. 31(a), such a situation requires a
sufficiently clear agreement between the parties57 or other circumstances sufficiently
unambiguous. The party relying on such an exceptional situation bears the burden of
proof. In practice, there might be constellations where the parties have concluded a
contract using the EXW- or an F-clause of the Incoterms58, but in addition have agreed
that the seller shall arrange for carriage of the goods. The expenses incurred for the
carriage are usually covered by the respectively calculated sales price, in other cases
these expenses are invoiced separately. It cannot be derived – without any additional
circumstances from the mere obligation of the seller to take care of the carriage of the
goods and to pay the transportation costs – that this situation leads to an obligation of
the seller to transport the goods shifting the place of delivery to the place of the
destination of the transport59. On the contrary, as confirmed by the C-clauses of the

49Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 32 para. 19; Brunner/
Lauterburg, Kommentar (2014), Art. 32 para. 4; Achilles, in: Ensthaler (ed.), Gemeinschaftskommentar
zum Handelsgesetzbuch mit UN-Kaufrecht (2007), Art. 32 para. 4. Cf. Kock, Nebenpflichten im UN-
52 Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 32 para. 18; Brunner/
Lauterburg, Kommentar (2014), Art. 32 para. 3; Benicke, in: MünchKommHGB (2013), Art. 32 para. 11.
In contrast Witz/Salger/Lorenz, Kommentar (2016), Art. 32 para. 7.
53 See supra Art. 31 paras 60 et seq., and Piltz/Bredow, Incoterms (2016) para. C-145. Cf. Renck, Der
Einfluß der INCOTERMS 1990 auf das UN-Kaufrecht (1995), p. 176.

54 See infra paras 34 et seq., and Piltz, INCOTERMS und UN-Kaufrecht, in: Thume (ed.), Transport-
und Vertriebsrecht 2000, Festgabe für Prof. Herber (1999), pp. 23 seq.
56 Cf. Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 32 para. 18 and
Ramberg, ICC Guide to Incoterms 2010 (2011), ICC publication No 720, p. 51.
57 Cf. Secretariat Commentary on 1978 Draft, Art. 30 para. 4.
58 See supra Art. 30 paras 33 seq.
59 See supra Art. 31 para. 34. Cf. Mullis, in: Huber/Mullis, The CISG (2007), p. 120.
448 Piltz
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Incoterms60, there are situations where the seller has only to arrange for the carriage
without owing the transport itself even when the costs of the transport rest on him61.
b) Contract ensuring carriage. Insofar as the seller has to arrange for carriage of the 21
goods62, he does not owe transportation as such63. Unless respective agreements or
circumstances provide otherwise, the seller does not have to bear the expenses64 or the
risk of the transportation, Art. 67. Consequently, he is not liable for any defective or
insufficient performance or even illegal behaviour of the carrier65. The seller only has to
conclude an appropriate contract of carriage ensuring that the goods are carried to the
“place fixed”, Art. 32(2). However, the seller is liable for any failure with regard to the
choice or the instruction of the carrier66. In contrast, the performance of the transport
according to the contract of carriage does not fall within the seller’s sphere of
responsibility.
The place of destination for the carriage can usually be derived from the contract 22
itself or its circumstances. If no different place of taking delivery or place of destination
is determined, in case of doubt, the transportation has to be directed to the buyer’s place
of business67, in particular since Art. 31(a) explicitly provides transmission of the goods
to the buyer. If more than one means of transportation are used subsequently68, the
seller can either conclude the necessary contracts for each part of the route himself or he
can contractually oblige the first carrier to arrange for the further transport.
The seller has fulfilled his obligation pursuant to Art. 31(2) when he has concluded 23
an appropriate contract of carriage with a carrier. If the seller assigns a forwarding agent
with the task of arranging the carriage of the goods, he has not yet completed his
obligation pursuant to Art. 32(2)69 but has rather delegated it to the forwarding agent.
In such a case the seller’s obligation pursuant to Art. 32(2) is only complied with when
the contracts necessary for carriage of the goods have been effectively concluded.
However, when the forwarding agent does not only arrange for carriage of the goods
but obligates himself vis-à-vis the seller to perform the carriage either himself or
subcontracting a carrier70, the requirements of Art. 32(2) are met71. Whether a handing
over of the goods to the forwarding agent is required, is significant only with respect to
the performance of the act the seller is required to undertake in order to deliver72.
However, it is irrelevant with respect to the compliance with the obligation to conclude
a contract of carriage pursuant to Art. 32(2).
60
See supra Art. 31 para. 65.
61
Cf. Ramberg, ICC Guide to Incoterms 2010 (2011), ICC publication No 720, p. 48.
Lorenz, Kommentar (2016), Art. 32 para. 8; Magnus, in: Staudinger Kommentar (2013), Art. 32 para. 20;
Benicke, in: MünchKommHGB (2018), Art. 31 para. 32; Fernández de la Gándara, in: Dı́ez-Picazo,
Comentario (1998), p. 272; Kock, Nebenpflichten im UN-Kaufrecht (1995), p. 12.


68 For example: truck/lorry-ship-train.
69 Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 32 para. 24. Cf. Witz/

70 Cf. supra Art. 31 para. 23.
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24 The seller must conclude such contracts of carriage which provide for “means of
transportation appropriate in the circumstances.” The seller is under an obligation to use
suitable means of transportation for the carriage of the goods sold. Consequently, refriger-
ated goods must be shipped by means of transportation with the necessary refrigeration
facilities and furniture cannot be transported on open vehicles. The choice of the suitable
means of transportation lies within the seller’s discretion73, unless special circumstances
demand otherwise. The obligation to use appropriate means of transportation also comprises
the obligation to choose a route for the transportation which gives due consideration to the
urgency of the transport, to special risks associated with the transport and, as far as possible,
helps to avoid unnecessary trans-shipments of the goods or the making of detours74.
Additionally, the contract of carriage has to be in accordance with the “usual terms” for
such transportation, especially with regard to the expenses for the carriage, the carrier’s
liability75, the taking out of insurance76 and all other conditions of the carriage77 (Art. 32(2)).
The cornerstones of such usual terms can often be determined by considering the manda-
tory regulations existing in international transport conventions78. The speediness of the
transport or the reliability of the carrier or any other reasonable considerations might allow
the seller not to take the cheapest offer79. If the concept of what constitutes the usual terms
for transportation at the seller’s place of business differs from the buyer’s place of business,
the terms at the place of the seller are prevailing notwithstanding other agreements or other
relevant circumstances80. However, the opinion of the individual seller is not essential, but
rather the objective appreciation at the seller’s place of business regarding such transports.
3. Information regarding insurance

25 Pursuant to Art. 32(3), the seller is obligated to provide the buyer with the necessary
information to take out insurance. However, this obligation does not apply to the extent
that the seller is bound to effect insurance in respect of the carriage81.
26 The seller’s obligation to take out transport insurance can result directly from the
contract or from the delivery clause agreed upon. Namely the CIF- and the CIP-clauses
of the Incoterms constitute that the seller has to effect insurance in respect to the
carriage of the goods82. Apart from this, taking out cargo insurance and/or liability
insurance83 can also be part of the “usual terms” for the transportation which have to be
arranged by the seller84, in particular if the value of the goods to be carried exceeds the
73 Bezirksgericht Saane (Switzerland) 20 February 1997, CISG-Online 426.


Lorenz, Kommentar (2016), Art. 32 para. 11. Cf. Kock, Nebenpflichten im UN-Kaufrecht (1995), pp. 120
seq. See infra para. 26.
77 Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 32 para. 23; Kock, Ne-
benpflichten im UN-Kaufrecht (1995), pp. 118 et seq.

78 Enderlein/Maskow/Strohbach, Internationales Kaufrecht (1991), Art. 32 para. 7.

83 For more details see Thume, Versicherung des Transports – Einführung, TranspR (2006) 1.
84 See supra para. 24, Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 32
para. 29; Witz/Salger/Lorenz, Kommentar (2016), Art. 32 para. 11. Cf. Kock, Nebenpflichten im UN-
Kaufrecht (1995), pp. 120 seq. See infra para. 24. In contrast Benicke, in: MünchKommHGB (2013),
Art. 32 para. 13.
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maximum limit of liability set by law or by the contract of carriage and thus considering
the conclusion of such additional insurance is common practice85. Unless relevant
circumstances indicate differently, the costs for such an insurance taken out by the
seller follow the transportation costs86.
The CISG accepts a situation where an obligation of the seller to effect insurance for 27
the transport can be derived neither from the contract or from the relevant usages or
the practices established between the parties. The mere fact that the seller bears the
transportation costs does not constitute an obligation to effect insurance and to bear the
respective costs87. Art. 32(3) rather assumes that the seller has no general obligation to
effect insurance. This does not only apply to the cargo insurance but all the more to the
liability insurance. Notwithstanding special situations, experience in practice confirms
this position showing that the buyer should preferably take care of the insurance
himself. Therefore, the party which relies on an obligation of the seller to effect
insurance bears the burden of proof.
If the seller is not obligated to take out transportation insurance, the buyer still has 28
the right to request from him all necessary information to enable him to effect such an
insurance (Art. 32(3)). This rule exists independently from the applicable delivery
modalities and even applies if the buyer could get the necessary information somewhere
else. Even if the seller is obliged to hand over the goods to the buyer at the buyer’s place
of business and thus the transportation of the goods falls into the seller’s sphere of
responsibility, the buyer can have a legitimate interest in effecting such insurance for his
benefit88. However, unless otherwise provided, the seller does not have to give the buyer
any information necessary for effecting insurance without being asked for it89. On the
contrary, the buyer has to request from the seller the information he needs90. Further-
more, the obligation to provide information is limited to the information available to
the seller91. Since transportation of the goods without appropriate insurance cannot be
expected from the buyer if the transportation is not the seller’s responsibility, the seller
has to provide him with the available information early enough to enable him to effect
insurance for the imminent transport. Accordingly, Art. 32(3) applies if the seller is
obligated to take care of the insurance but the buyer wishes to extend the insurance to
cover additional risks or amounts92. An obligation of the buyer to provide the seller with
information for obtaining insurance is not regulated by the CISG. If the parties
desire such an obligation in their contract of sale, they should agree on one of the C-
or D-clauses of the Incoterms 2010 which deal with this issue under heading B3 of the
rules of interpretation93.
Lauterburg, Kommentar (2014), Art. 32 para. 5.

Lauterburg, Kommentar (2014), Art. 32 para. 5.

88 Cf. Benicke, in: MünchKommHGB (2013), Art. 32 para. 14; Ernst/Lauko, in: Honsell, Kommentar
(2010), Art. 32 para. 24.

89 Neumayer/Ming, Convention de Vienne (1993), p. 258; Lando, in: Bianca/Bonell, Commentary
(1987), Art. 32 para. 2.4.

90 Mullis, in: Huber/Mullis, The CISG (2007), p. 121; Gruber, in: MünchKommBGB (2016), Art. 32
para. 15.
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III. Comparable rules

1. Incoterms
29 The Incoterms94 contain rules of their own regarding the issues referred to in Art. 32
and commented above. Therefore, if the parties to a contract of sale agree upon the
application of a specific clause of the Incoterms, the rules of interpretation of the
Incoterms applicable to that clause may supersede or modify Art. 3295.
30 a) Obligation to give notices. Unlike the CISG96, according to the explanations under
headings A7 – B7 of the rules of interpretation of the Incoterms, both the seller and the
buyer face obligations to give notices. Again unlike the CISG97, the purpose of this
obligation to give notice is not the identification of the goods sold and handed over to
the carrier, but to make known the delivery to the buyer and to inform the seller about
the details necessary to be able to deliver98. Therefore, if an identification of the goods is
necessary in order to assign them to a specific contract, Art. 32(1) remains applicable
even though a clause of the Incoterms is agreed upon. With regard to the passing of
risk99, the explanations under headings A5 – B5 of the rules of interpretation of the
Incoterms have to be taken into consideration100.
31 According to A7 of the rules of interpretation of the Incoterms, applying EXW the
seller must give the buyer the information he needs to take delivery. Under all of the F-
clauses as well as under CPT and CIP the seller is bound to inform the buyer that the
goods have been delivered. Additionally, under the FCA-clause and also under FAS and
FOB the seller is obligated to inform the buyer if the carrier or the vessel fails to take
delivery within the time agreed. Furthermore, in all contracts with C- or D-clauses of
the Incoterms agreed upon, the seller has to give the buyer the information required to
prepare for taking delivery. Therefore, unlike the CISG101, if the seller breaches his
obligation to inform the buyer, this breach neither affects the performance of the
delivery obligation by the seller as such, nor does it affect the passing of risk, but may
however entitle the buyer to claim damages, e. g. because he did not know about the
delivery of the goods and therefore suffered losses.
32 According to B7 of the rules of interpretation of the Incoterms, the buyer is obligated
in particular to give the seller sufficient information to be able to perform the delivery
obligation, e. g. to determine the time of delivery102, the place of destination if CPT or
CIP applies and the point of delivery or taking delivery within the named place103 if he
is entitled to fix it. The entitlement to exercise such a determination is not regulated by
the Incoterms but is to be derived from the underlying contract of sale. However, if an
F-clause is applied the rules of the Incoterms entitle the buyer to nominate the carrier or
the vessel104 and to specify the loading point within the named place of delivery and the
time for delivery within the period agreed for delivery. If the buyer fails to give the

95 See supra Art. 30 para. 7 seq.
98 Cf. Ramberg, ICC Guide to Incoterms 2010 (2010), ICC publication No 720, pp. 79 seq.
102 See infra Art. 33 paras 24 and 36.
103 See the explanations under heading B7 of the rules of interpretation of the Incoterms.
104 Oberlandesgericht Karlsruhe (Germany) 12 February 1975, RIW (1975) 255.
452 Piltz
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required notice, the seller will very often not be able to discharge the delivery obligation.
However, as this failure is caused by an omission of the buyer, the seller is protected by
Art. 80 notwithstanding the possibility of the seller to resort to Art. 61.
Whereas Art. 27 is based in the dispatch-principle105, under the Incoterms this 33
principle106 and the rule that the communication has to be received by the other party107
are advocated. According to B7, the notices the seller must give to the buyer under
the F-clauses are at the buyer’s risk and expense. Moreover, the Incoterms have to be
regarded in the light of the CISG108. Since a differing interpretation cannot be concluded
from the rules of interpretation of the Incoterms, generally the dispatch-principle
of Art. 27 applies to the obligations to give notice imposed on the seller by the
Incoterms as well. Only regarding the D-clauses, the seller is – in contrast to Art. 27 –
responsible that the buyer receives the required notice correctly and punctually. By
agreeing on a D-clause of the Incoterms the seller has taken over additional obligations,
which, though not excluded, on the other hand are not reflected within the structure of
the CISG109. Consequently, the content of Art. 27 has to be adjusted to such a mo-
dification as well110.
b) Carriage of the goods. Headings A3 – B3 of the rules of interpretation of the 34
Incoterms regulate which party faces the obligation vis-à-vis the other one to contract
for the carriage of the goods111. Whereas the CISG addresses this issue if the place of
delivery and the place of taking delivery do not coincide and therefore the contract of
sale requires carriage of the goods112, the Incoterms go further.
Under the EXW-clause of the Incoterms neither the seller nor the buyer is obligated 35
vis-à-vis the other one to contract for carriage113. Even though the buyer will take care
of the transportation of the goods after having taken delivery in his own interest, this
transport is not an obligation of the buyer which he has to discharge vis-à-vis the seller.
It is irrelevant whether the buyer contracts with a carrier for this purpose or transports
the goods by his own means.
The F-clauses state an obligation of the buyer to contract for carriage from the named 36
place onwards even though he has to take delivery at the very same place114 and
therefore the obligations regarding delivery and taking delivery are fulfilled already at
that place and before the carriage itself starts. Different to an FCA-contract with a
named place of delivery outside the seller’s place of business, the seller has to place the
goods alongside (FAS) or on board (FOB) the ship nominated by the buyer or has to
load them on the means of transport provided by the buyer (FCA with the place of
delivery at the seller’s premises)115. These definitions may imply that, though not
necessarily, in the majority of cases the contract of carriage concluded enables the seller
to perform his delivery obligation. However, irrespective of the different modes of
delivery and irrespective of whether the contract of sale requires carriage of the goods116,
105
See Art. 27 para. 2.
106
Renck, Der Einfluß der INCOTERMS 1990 auf das UN-Kaufrecht (1995), pp. 158 et seq.
107 Bredow/Seiffert, Incoterms 2000 (2000), pp. 30 et seq.
109 Cf. supra Art. 31 paras 13 et seq. and paras 37 et seq.
110 For more details see Piltz/Bredow, Incoterms (2016) para. D-372.
111 Cf. ICC, ICC Guide on Transport and the Incoterms 2010 Rules (2016) ICC Publication 775E.
112 See supra paras 18 seq.
113 Cf. Piltz/Bredow, Incoterms (2016) paras E-122 et seq.
114 See the explanations under heading B4 of the Incoterms rules of interpretation and Piltz/Bredow,

116 See supra paras 18 seq.
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the Incoterms use the term carriage or carrier whenever a third person is typically
involved to transport the goods sold117. This is the situation under the F-clauses of the
Incoterms118 so that the issue of who is responsible for the carriage is addressed even
though the contract does not require carriage of the goods119. In general, it is for the
buyer to contract for carriage. The seller has no obligation regarding a contract of
carriage unless the parties agree so, e. g. by stipulating “FOB shipped”120. However,
under the F-clauses and given certain further conditions121 the seller must contract for
carriage at the buyer’s risk and expense (“additional service”). In contrast, the transport
to the named place preceding the seller’s act of delivery has to be performed by the
seller using his own means of transportation or contracting an independent carrier and
is not addressed in the F-clauses.
37 Both under the C- and D-clauses of the Incoterms the seller must contract at his own
expense for the carriage of the goods122. Regarding the obligation to contract for
carriage, the Incoterms do not distinguish whether the sale requires carriage of the
goods in the meaning of the C-clauses123 or whether the transportation is owed by the
seller to the buyer at the sellers risk because the place of delivery is at the place of
destination named together with a D-clause124. Unlike the CISG, the Incoterms use the
term carriage whenever a third person is typically involved to transport the goods125 and
this is the case both under C- and D-clauses of the Incoterms.
38 Only the C-clauses of the Incoterms obligate the seller to contract the carriage “on
usual terms”, by “a usual route” and “in a customary manner”. The result will be almost
the same as under Art. 32(2)126. Regarding the F- and D-clauses, no such regulation
exists except for the special situation that the seller must contract for carriage under an
F-clause127. This omission reflects that under the F- and D-clauses of the Incoterms the
transport is in the interest of the same party obliged to contract for carriage whereas
under the C-clauses the risks inherent to transport arranged for by the seller are to be
borne by the buyer128.
39 c) Obligations regarding insurance. Only the clause CIF and CIP of the Inco-
terms provide for an obligation of the seller to effect an insurance. The other clauses
state expressly that the seller is not obligated in this respect129. Consequently, the
argument that taking out insurance as regulated in the clauses CIF and CIP130 is part of
the usual terms for the transportation131 is not valid in contracts where the Incoterms
apply.
117 Cf. infra para. 38; ICC, Incoterms 2010, ICC publication No 715 ED (2010), pp. 12 and 137.
120 Cf. Renck, Der Einfluß der INCOTERMS 1990 auf das UN-Kaufrecht (1995), pp. 146 seq. and
Bundesgerichtshof (Germany) 2 October 1963, Wertpapier-Mitteilungen (1963) 1185.

121 For more details see the explanations under heading A3 of the Incoterms rules of interpretation and
Piltz/Bredow, Incoterms (2016) paras F-130 et seq, F-324 et seq. and F-526 et seq.
122 Piltz/Bredow, Incoterms (2016) paras C-2 and D-2.
124 See supra Art. 30 para. 36 and Art. 31 para. 65.
125 Cf. infra para. 38; ICC, Incoterms 2010, ICC publication No 715 ED (2010), pp. 12 and 137; ICC,
Incoterms 2000, ICC publication No 560 ED (1999), pp. 77, 85 and 201, 209.
126 See supra para. 24, and Piltz/Bredow, Incoterms (2016) para. C-127.
127 See supra para. 36, and Piltz/Bredow, Incoterms (2016) para. F-132.
129 See the explanations under heading A3 of the Incoterms rules of interpretation.
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The details of the insurance to be obtained by the seller are explained under heading 40
A3 b of the rules of interpretation of the Incoterms132. Unlike the CISG133, the obligation
to contract insurance regulated by the clauses CIF and CIP refers only to minimum
cargo insurance and unless otherwise agreed or indicated does not include liability
insurance.
According to the rules of interpretation under heading A3 of the Incoterms 2010 and 41
applicable under all clauses, upon request of the buyer and at his risk and expense, the
seller is obligated to procure the information necessary for the buyer to obtain
insurance. Applying the clauses CIF and CIP this obligation concentrates on the
information requested to procure additional insurance. Furthermore, whenever a C- or
D-clause of the Incoterms is agreed the buyer is obligated to provide the seller upon
request with the information he needs to contract an insurance.
2. PICC and PECL

Neither the PICC nor the PECL contain provisions explicitly regulating contracts of 42
sale134. Consequently, they do not distinguish between contracts involving carriage of
the goods and other types of contracts of sale and do not address issues related to the
insurance of transported goods so that the regulatory content of Art. 32 does not find a
3. DCFR
Unlike the situation according to the PICC and the PECL135, the regulatory content of 43
Art. 32 has a direct counterpart in the DCFR136. Art. IV.A.-2:204 DCFR repeats almost
literally Art. 32. There is no indication that the comments on Art. 32 cannot be used
unrestrictedly to interpret Art. IV.A.-2:204 DCFR137.
132 For more details see Piltz/Bredow, Incoterms (2016) paras C-304 et seq.; Lehr, Die neuen Incoterms
2000, VersR (2000) 548 (551 seq.); Bergami, The Importance of Defining the Level of Cargo Insurance
Coverage in International Contracts under Incoterms 2000, Vindobona Journal of International Com-
mercial Law and Arbitration (2000) 229; Murray/Holloway/Timson-Hunt, Schmitthoff’s Export Trade
(2007), paras 19-018 et seq. and Oberlandesgericht Düsseldorf (Germany) 10 April 1980, IPRax (1982)
101.
137 Cf. Principles, Definitions and Model Rules of European Private Law, Draft Common Frame of
Reference (DCFR), Full Edition (2009), Comment B to Art. IV.A.-2:204.
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Article 33
The seller must deliver the goods:
(a) if a date is fixed by or determinable from the contract, on that date;
(b) if a period of time is fixed by or determinable from the contract, at any time
within that period unless circumstances indicate that the buyer is to choose a
date; or
(c) in any other case, within a reasonable time after the conclusion of the
contract.
Bibliography: Magnus/Lüsing, CISG und INCOTERMS, Leistungsverzug und Fixgeschäfte, IHR (2007) 1;
Piltz/Bredow, Incoterms (2016).
Outline
1. Subject matter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
2. Breach of contract. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
3. Further context . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
4. National laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
5. Vienna Conference. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
1. Party autonomy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
2. Time for delivery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
3. Art. 33(a), (b) and (c). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
a) Art. 33(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
b) Art. 33(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
aa) Seller’s right to choose the date for delivery . . . . . . . . . . . . . . . . . . . . . . . . 20
bb) Buyer’s right to choose the date for delivery . . . . . . . . . . . . . . . . . . . . . . . 23
c) Art. 33(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
d) Non-business days . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
4. Part-deliveries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
1. Incoterms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
2. PICC and PECL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
3. DCFR. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38

1. Subject matter
1 Art. 33 specifies the date of delivery or the period of time within which the seller has
to fulfil his obligation to deliver the goods and thus regulates the time frame for the
performance of the seller’s obligation to deliver, as addressed in Art. 30. Consequently,
Art. 33 has to be observed if Art. 30 is applicable1. Art. 33 does not regulate the kind of
act which the seller has to perform in order to discharge his obligation to deliver or the
place where the delivery obligation has to be fulfilled. These issues are governed by
Art. 31 and complemented by Art. 32. Art. 33 merely regulates the time aspect of the
seller’s obligation to deliver and hence, it is the basis for judging whether the seller has
performed his delivery obligation in a timely manner or whether he did so prior to the
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date of delivery or delayed. Just like Art. 302, Art. 33 plays merely a supplementary role
and gains significance only to the extent that the time for delivery cannot be determined
satisfactorily by looking at the contract and its circumstances.
The seller must perform the act he is required to undertake in order to deliver in a 2
timely manner. Depending on the particular kind of act3, timely performance can mean
the timely placing of the goods at disposal or the timely handing over of the goods4.
However, it is irrelevant if the delivered goods conform with the contract and are free
from rights and claims of third parties5. If the seller delivers goods not conforming with
the contract but on the relevant date or within the relevant period of time, he has
nevertheless delivered in a timely manner according to Art. 33, albeit in breach of
Art. 35. The same applies for the timely delivery of goods being affected by rights and
claims of third parties.
In terms of Art. 33, only the timely performance of the act the seller is required to 3
undertake in order to deliver is important6. The point in time when the goods arrive at
the place of destination or at the place where the buyer has to take delivery being
different from the place of delivery is irrelevant for determining whether or not the
performance is on time7. In particular if the contract of sale involves carriage of the
goods (Art. 31(a)), only the seller’s act of delivery, i. e. the handing over of the goods by
the seller to the first carrier for transmission to the buyer8 is relevant and not the
handing over of the goods to the buyer. When the seller performs the act he is obligated
to undertake in order to deliver in a timely manner pursuant to Art. 33, doing so on the
relevant date or within the relevant period of time, but at a different place than the one
established according to Art. 319, he has delivered at the wrong place and therefore is in
breach of Art. 31. However, he cannot be held liable for not having performed in a
timely manner and thus having breached Art. 33.
The seller is in breach of his contractual obligations if he fails to deliver in a timely 4
manner on the relevant date or within the relevant period of time according to Art. 33.
Regarding the consequences of a non-timely delivery, it has to be differentiated whether
the delivery took place prior to the relevant date or whether it was delayed.
If the seller is not entitled to suspend performance pursuant to Art. 71 and is not 5
protected by Art. 80, the mere exceeding of the time of delivery being determined by
Art. 33 constitutes a breach of contract10 and results in the buyer’s right to exercise the
remedies provided for by Arts 45 et seq. There is no need for a reminder, the setting of a
deadline or other formalities11. In particular, no period of grace can be granted to the

6 Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 33 para. 13; Saenger, in:
Bamberger/Roth (eds), Kommentar zum Bürgerlichen Gesetzbuch (2012), Art. 33 para. 7.

7 Witz/Salger/Lorenz, Kommentar (2016), Art. 33 para. 2; Widmer Lüchinger, in: Schlechtriem/Schwen-
zer, Commentary (2016), Art. 31 para. 8.

para. 7. Regarding the question, under which circumstances the late delivery amounts to fundamental
breach, see supra Art. 25 paras 31 et seq.
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seller by a court or an arbitral tribunal12 (Art. 45(3)). The expiration of the time of
delivery determined by Art. 33 has to be proven by the buyer who exercises a remedy
relying on these grounds13. If the buyer fixes the seller an additional period of time
pursuant to Art. 47(1), this does not affect the relevant time for delivery established by
Art. 3314. As a matter of fact, if the seller informs the buyer about a delay regarding the
relevant delivery time and there is no objection by the buyer, such non-objection could
constitute an approval of the date of delivery being modified and thus excluding the
buyer’s legal remedies regarding late delivery only under special circumstances15. More
often this will constitute a unilateral offer for late performance according to Art. 48(2).
6 The seller must perform the act he is required to undertake in order to deliver in a
timely manner according to Art. 33. Without the consent of the buyer or in the absence
of any relevant usages or practices established between the contracting parties the seller
is not entitled to deliver prior to the date or the period of time relevant by virtue of
Art. 33 (Art. 52). Delivery before the appropriate date constitutes a breach of contract
by the seller such as a delayed delivery16 and generally allows the buyer to exercise the
remedies provided for by Arts 45 et seq.17 Unless the buyer is obligated to take delivery
and to preserve the goods according to Art. 86, he is free to take or to refuse delivery if
the goods are delivered before the date relevant according to Art. 33 (Art. 52(1)).
However, by taking delivery without any objection before the relevant date the buyer
does not automatically waive his legal remedies arising out of the delivery, which was
made before the relevant date18.
3. Further context
7 Although Art. 33 addresses only the obligation of the seller to deliver the goods, the
rules of Art. 33 also give an indication with regard to the time or time period regarding
the performance of other obligations of the seller resulting from the contract of sale19.
4. National laws
8 The concepts regarding the delivery time existing in national bodies of law are not
transferable to the CISG, since the CISG governs the delivery time conclusively20. Rules
of national law which for instance demand delivery within 24 hours after the conclusion
of the contract21 or rules such as § 271 BGB (German Civil Code)22 or Art. 455 Polish
Civil Code23 or other national rules regarding the delivery time24 are inapplicable within

15 More generous Hof van Beroep te Gent (Belgium) 8 November 2004, CISG-Online 982.
17 Magnus, in: Staudinger Kommentar (2013), Art. 33 para. 28 and Art. 52 para. 10. Cf. Arbitral Award,
CIETAC, 25 May 2005, CISG-Online 1685.

18 Achilles, in: Ensthaler (ed.), Gemeinschaftskommentar zum Handelsgesetzbuch mit UN-Kaufrecht
(2007), Art. 52 para. 3; Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 52 para. 5;
but see Schlechtriem/Schroeter, Internationales UN-Kaufrecht (2013), para. 357 and Enderlein/Maskow/
Strohbach, Internationales Kaufrecht (1991), Art. 52 para. 2.
21 Cf. Garro/Zuppi, Compraventa internacional (2012), p. 179.
22 In case of doubt immediate performance.
23 In case of doubt immediate performance upon request/calling off.
24 For more details see Schwenzer/Hachem/Kee, Global Sales and Contract Law (2012) para. 29.59 and
Principles, Definitions and Model Rules of European Private Law, Draft Common Frame of Reference
(DCFR), Full Edition (2009), Notes to Art. III.-2:102.
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the sphere of application of the CISG. Likewise the concept of a “fixed date”, namely
known in German law (“Fixtermin”)25, cannot be transferred to contracts governed by
the CISG. If a CISG contract of sale includes the addition “fix” with regard to delivery
time, the meaning of this addition can only be determined from the CISG’s perspective.
The statements of Art. 33 are generally not affected by such an addition. However, the
addition “fix” can gain significance with regard to the legal consequences of a failure to
comply with the fixed date26.
Art. 33 was formulated on the basis of Art. 20–22 ULIS. Nevertheless, the wording 9
was tightened, but without intending to modify its content27. During the Vienna
conference, Art. 33 was accepted without further discussion.

1. Party autonomy
The date of delivery or the period of time within which the seller has to deliver is 10
primarily to be determined by examining the parties’ agreements, any usages applicable
and practices which the parties have established between them (Arts 6, 9). This applies
in particular to an agreement upon rights of the buyer to call off the goods28. Party
autonomy prevails over the provisions of the CISG. Art. 33 is of a subsidiary nature and
gains significance only insofar as the delivery time cannot be determined by the contract
or its circumstances. In particular, terms regarding the delivery time such as “instant
delivery” or “quickest possible/asap”29 have to be interpreted first of all by considering
the relevant circumstances of the case (Art. 8). The same applies to delivery time
particulars like “non-binding” or “subject to change”30. Also terms such as “delivery
July, August, September+-” have to be interpreted primarily by considering the agree-
ment itself before applying Art. 33(b)31. Art. 33 only gains significance when an agree-
ment on delivery time turns out to be incomplete or is missing altogether32.
2. Time for delivery

The time limit for the delivery of the goods sold addressed in Art. 33 has to be 11
distinguished from the time limit for taking delivery. The buyer’s obligation to take
delivery is regulated in Art. 60. However, Art. 60 does not regulate at what date or within
which period of time the buyer is obligated to perform the steps necessary in order to
fulfil his obligation to take delivery. Since the obligation to take delivery includes enabling
the seller to make delivery and taking over the goods (Art. 60), the time parameters for
25
See § 376 HGB (German Commercial Code).
26
Cf. Oberlandesgericht Hamm (Germany) 12 November 2001, CISG-Online 1430.
27 Magnus, in: Staudinger Kommentar (2013), Art. 33 paras 4 and 5; Lando, in: Bianca/Bonell,
Commentary (1987), Art. 33 para. 1.1.

28 Cf. Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 33 paras 11 seq.; Ernst/
Lauko, in: Honsell, Kommentar (2010), Art. 33 para. 17.

29 Cf. Magnus, in: Staudinger Kommentar (2013), Art. 33 para. 15; Mullis, in: Huber/Mullis, The CISG
(2007), pp. 123, 125; Oberlandesgericht Hamm (Germany) 12 November 2001, CISG-Online 1430;
Atamer, in: Vogenauer/Kleinheisterkamp, UNIDROIT Commentary (2015), Art. 6.1.1 para. 10.
31 Cf. Amtsgericht Oldenburg (Germany) 24 April 1990, CISG-Online 20; Enderlein/Maskow/Strohbach,
Internationales Kaufrecht (1991), Art. 33 para. 2.

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the buyer’s action necessary to perform his obligation to take delivery can be determined
widely taking into account the delivery time regulated in Art. 3333. Therefore, the delivery
time addressed in Art. 33 cannot be determined exclusively from the seller’s perspective.
In fact, the determination of the delivery time requires an overall and comprehensive
view, which also gives due consideration to the necessary complementary action of the
buyer or other persons involved in the delivery process.
12 As far as the delivery requires certain preparatory actions from the buyer, namely calling
off the goods, giving shipping instructions, naming the means of transport – especially
when F-Incoterms are used34 –, providing export or import licences35, etc., the buyer must
take the necessary actions in such a time in order to enable the seller to deliver in a timely
manner pursuant to Art. 3336. Otherwise the seller can resort to Art. 80 to the extent that
the delay in delivery is caused by insufficient cooperation from the buyer’s side.
13 Furthermore, the seller has to perform the act he is required to undertake in order to
deliver so early within the time frame set by Art. 33 that the buyer or the involved
carrier is able to take over the goods before the delivery time expires. Usually the taking
over of the goods must be possible during the regular business hours existing at the
place of delivery. Hence, the delivery is late when the buyer or the person authorized by
him cannot be reasonably expected to collect the goods anymore on that day, even
though the goods to be placed at disposal are made available by the seller on the last day
of the time period for delivery (e. g. when the seller places the goods at disposal well
after business hours of work). Also delivery is late when the seller offers the goods to be
handed over to the person who is entitled to take them over on the last day of the time
period for delivery and this person cannot reasonably be expected to take them over
anymore on that day (e. g. when the goods are tendered to the carrier after regular
business hours or shortly before midnight). However, as the time limit for delivery
addressed in Art. 33 has to be distinguished from the time limit for taking delivery, it is
irrelevant if the taking over of the goods in fact takes place before expiration of the
delivery time or at a later point in time37. For deciding whether delivery was on time,
the possibility to collect or to take them over during regular hours of work suffices.
3. Art. 33(a), (b) and (c)

14 Art. 33(a) and (b) govern constellations where the date of delivery or the period of
time within which the seller has to deliver are binding and laid down in the contract of
sale or can be determined considering the relevant circumstances of it. Art. 33(a),(b)
differentiate according to whether a date, Art. 33(a), or a period of time, Art. 33(b),
is applicable. Art. 33(c) regulates the remaining constellations not governed by
Art. 33(a),(b). If the delivery is subject to an uncertain occurrence (for instance
“delivery after export restrictions have been lifted”), the uncertain event may not just
be a stipulation regarding the time of delivery, but the contract may be concluded under
a condition precedent with respect to the uncertain occurrence38. The party who claims
33 Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 33 para. 4; Schnyder/
Straub, in: Honsell, Kommentar (2010), Art. 60 paras 20 et seq.; Lando, in: Bianca/Bonell, Commentary
(1987), Art. 33 para. 2.1.2. Cf. Fernández de la Gándara, in: Dı́ez-Picazo, Comentario (1998), p. 240. In
contrast Mohs, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 60 para. 4.
36 Magnus, in: Staudinger Kommentar (2013), Art. 60 para. 15. Cf. Mohs, in: Schlechtriem/Schwenzer,

37 Saenger, in: Bamberger/Roth (eds), Kommentar zum Bürgerlichen Gesetzbuch (2012), Art. 33 para. 7.
38 Fernández de la Gándara, in: Dı́ez-Picazo, Comentario (1998), p. 279. Cf. Atamer, in: Vogenauer/
Kleinheisterkamp, UNIDROIT Commentary (2015), Art. 6.1.6 para. 12.
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that a date for delivery or a period of time within which the seller has to deliver was
established or that the general rule using the term reasonable time is applicable has to
provide evidence for this contention39. The seller bears the burden of proof for timely
delivery40.
a) Art. 33(a). If the contract of sale provides for a date of delivery, Art. 33(a) affirms 15
that the seller is bound to perform the act of delivery he is required to undertake in
order to deliver on that date and thereby again emphasizes the paramount importance
of the contract41. However, the parties can agree on different terms. For instance
regarding a contract of sale which involves carriage of the goods42, the parties can agree
that on the delivery date the goods shall not only be handed over to the carrier, but shall
already be placed at disposal by the carrier to the buyer considering a certain time for
the transport. Different legal consequences may also result from applicable usages or
practices that have been established between the parties or from other relevant
circumstances. However, with respect to all these consequences modifying the rule of
Art. 33(a), the party who invokes these consequences bears the burden of proof.
Otherwise the rule of Art. 33(a) remains unaltered.
The content of Art. 33(a) becomes particularly clear in comparison with Art. 33(b)43. 16
Art. 33(b) requires a period of time with regard to delivery, whereas Art. 33(a) is
applicable when a specific date for the delivery has been set. A typical constellation to
which Art. 33(a) applies is when the delivery time is stipulated by giving an exact
calendar date (for instance: “delivery on December 1st”)44. It is equally sufficient to
stipulate the delivery time by making an indirect reference to a certain calendar date
(for instance: “two days before Good Friday” or “on the first working day of each
month”)45. A certain calendar date is not even required in order to apply Art. 33(a). It is
sufficient that the date of delivery can be ascertained by referring to the occurrence of a
future event being able to be established objectively (for instance: “on the day after
calling off the goods”)46. However, it is essential that the seller disposes only of a date to
perform the act he is required to undertake in order to deliver. This prerequisite may be
doubtful in cases where the delivery time is described for example as “two months
before Easter”47 or by comparably wide time ranges48. The longer the space of time
between the delivery date and the occurrence referred to (in the aforementioned
example: Easter) is, the less convincing is the assumption that delivery has to be made
exactly on the date calculated accordingly. This applies all the more if the reference to a
future event is ambiguous49 or the date calculated exactly is a Sunday or a public
holiday.
39 See Gruber, in: MünchKommBGB (2016), Art. 33 paras 18 seq; Ernst/Lauko, in: Honsell, Kommentar
(2010), Art. 33 para. 26.

40 Gruber, in: MünchKommBGB (2016), Art. 33 para. 18; Ernst/Lauko, in: Honsell, Kommentar (2010),
Art. 33 para. 27.

41 Lando, in: Bianca/Bonell, Commentary (1987), Art. 33 para. 2.2.
45 Saenger, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 33 para. 3; Fernández de la
Gándara, in: Dı́ez-Picazo, Comentario (1998), p. 276.

46 Gruber, in: MünchKommBGB (2016), Art. 33 para. 4; Widmer Lüchinger, in: Schlechtriem/Schwen-
zer, Commentary (2016), Art. 33 para. 7; Magnus, in: Staudinger Kommentar (2013), Art. 33 para. 9;
Saenger, in: Ferrari et al., Internationales Vertragsrecht (2012), Art. 33 para. 3.
47 Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 33 para. 7. In contrast

49 Easter: Easter Sunday or Easter Monday.
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17 Any calendar day being either directly or indirectly determined is to be regarded as a

date in accordance with Art. 33(a)50. This understanding results from the Spanish
(“fecha”) and the Chinese (“ri|‘ qı̄”) terminology which is exclusively used to identify a
day but not a particular point in time or period of time during a day. The English
(“date”) and the French (“date”) terminology has a similar understanding, although in
everyday use it is sometimes used to fix a certain point in time during the day. The
German translation (“Zeitpunkt”) is less clear and can only be justified due to the fact
that in business it is commonly used to give a specified day for delivery, though not
meaning a specific point in time during this day. This is especially apparent if the act of
delivery only takes a few hours or even only a fraction of an hour.
18 If only a few hours or even less time is needed to perform the act of delivery and if
the parties have not agreed (e. g. “during the afternoon”) or the circumstances do
not indicate otherwise, the seller is generally free to deliver at any time during the
relevant calendar day. The right of the seller to set the precise point in time during
the relevant calendar day agreed for delivery is corroborated by the assessment under-
lying Art. 33(b)51 as well as common practice52. Insofar as the seller is dependent on the
buyer’s cooperation to make delivery (for instance: handing over the goods to the
buyer), the seller is usually bound to respect the regular business hours at the place of
delivery. Even in situations where the seller only has to place the goods at the buyer’s
disposal, the seller usually has to do this early enough in order to enable the buyer or
the person authorized by him to collect the goods on the respective calendar day during
regular hours of work53. As far as the buyer does not have to take over the goods or
collect them, in particular if the sale at hand is a sale involving carriage of the goods54,
the seller has delivered in time if he has performed his act of delivery and the handing
over of the goods to the carrier in connection with the respective shipment instructions
are completed55 before the end of the relevant calendar day. Depending on the
circumstances of the individual case, the seller may not be free to make the delivery
anytime during the relevant calendar day but it may be the buyer who is to choose a
point in time when the delivery shall be made or even both parties have to agree on
such a point in time56. However, such an assumption requires specific circumstances
that have to be proven by the party who invokes them.
19 b) Art. 33(b). Art. 33(b) applies if according to the contract of sale, not a date, but a
period of time is provided for delivery. This is the case when the seller has more than
one calendar day at his hands to make delivery57 (for instance: “during calendar
week 42” or “until June 1st” or “within four weeks after conclusion of this contract”).
Characteristic for this kind of specification of the delivery time is that it is limited by a
final point58. Hence, open delivery stipulations without setting a final point (for
50 Ernst/Lauko, in: Honsell, Kommentar (2010), Art. 33 para. 4; Magnus, in: Staudinger Kommentar
(2013), Art. 33 para. 8.

51 See infra paras 20 et seq. Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016),
Art. 33 para. 7.
52 Cf. Atamer, in: Vogenauer/Kleinheisterkamp, UNIDROIT Commentary (2015), Art. 6.1.1 para. 8.
53 See supra para. 13. Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 33
para. 7.
56 Cf. infra paras 23 et seq.
58 Gruber, in: MünchKommBGB (2016), Art. 33 para. 6; Saenger, in: Ferrari et al., Internationales
Vertragsrecht (2012), Art. 33 para. 4; Magnus, in: Staudinger Kommentar (2013), Art. 33 para. 13. In
contrast Magnus, in: Staudinger Kommentar (2013), Art. 33 para. 15.
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instance: “delivery after Easter” or “delivery after calling off of the goods”) are not
governed by Art. 33(b) but fall under Art. 33(c)59. Stipulations which determine the
delivery time shortly before or after the occurrence of a certain event (for instance: “one
week before Easter” or “five days after the date of the confirmation of the order”) do
not provide for more than one day for the performance of the act of delivery60 unless
otherwise agreed upon by the parties or subject to other relevant circumstances. If the
scheduled space of time is relatively short, then this represents a special mode of
determining the date for delivery according to Art. 33(a)61. However, the relevant
circumstances may indicate that the seller has more than one day available for delivery
and therefore Art. 33(a) is not applicable. In contrast to this, if there is a lack of an
ascertainable final point until which delivery has to be completed, Art. 33(b) will not be
applicable either62. Therefore, in cases of doubt, these constellations will be governed by
Art. 33(c). In order for Art. 33(b) to be applicable, it has to be clear that the seller has
more than one calendar day at his discretion to deliver and the period of time available
lasts until an ascertainable final point.
aa) Seller’s right to choose the date for delivery. Usually the seller may perform his 20
obligation to deliver at any time within the period of time for delivery63, Art. 33(b).
Therefore, the seller may choose to deliver right at the beginning of the delivery time
period, e. g. in order to be no longer responsible for the goods or to trigger the buyer’s
obligation to pay the price for the goods. The seller may also deliver at any other time
during the delivery time period that suits him or exhaust the time period until the last
day. Whenever the seller delivers at some time before the end of the period of time for
delivery, he enjoys the right to cure according to Art. 37.
Generally the seller is not obliged to consult the buyer about the exact point in time 21
within the relevant delivery time when he wants to deliver. Art. 33(b) stipulates that it is
the seller who determines the point in time on which he actually delivers. This applies
all the more as in international commerce those sales which involve carriage of the
goods are prevailing64 and in this kind of contract of sale the seller is only obligated to
hand over the goods to the carrier for transport to the buyer. Since the carriage as such
is not an obligation of the seller65, the arrival of the goods at the place of destination is
not the concern of the seller. Therefore, no consultation with the buyer is needed.
Yet, in virtue of further agreements between the parties, applicable usages or practices 22
or any other relevant circumstances, it may result that the precise delivery date within
the relevant delivery time period has to be agreed upon by the buyer and the seller.
Nevertheless, such an assumption requires certain circumstances for which the party
who relies on it has to provide evidence. Even if the parties do not have to agree upon
the exact delivery date, the seller may be still under an obligation to at least inform the
buyer about the delivery time. In particular when the delivery is to be performed at the
buyer’s (“Bringschuld”) or at the seller’s place of business (“Holschuld”) and the seller
sets the delivery time, he may be obligated to inform the buyer about the forthcoming
delivery early enough, since otherwise the buyer might be unable to take over or to
59See infra paras 26 et seq. and Supreme Court (Hungary) 1 January 2000, CISG-Online 1687.
60See supra para. 16. Probably in contrast WidmerLüchinger, in: Schlechtriem/Schwenzer, Commen-
tary (2016), Art. 33 para. 7.
61 See supra para. 16. Cf. Lando, in: Bianca/Bonell, Commentary (1987), Art. 33 para. 2.2.
62 In contrast Magnus, in: Staudinger Kommentar (2013), Art. 33 para. 15.
see Garro/Zuppi, Compraventa internacional (2012), p. 177.

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collect the goods before the delivery time expires66. In general, the seller will inform the
buyer about the forthcoming delivery anyway, since it is in his own interest that the
buyer takes over the goods instantaneously after the delivery. Nevertheless, a general
obligation of the seller setting the delivery time to inform the buyer about the imminent
delivery does not exist67. However, this is different if a clause of the Incoterms is agreed
upon68.
23 bb) Buyer’s right to choose the date for delivery. On the other hand it may result
from the circumstances that it is not the seller but the buyer who is entitled to
determine the exact point in time within the delivery time period on which the seller
has to deliver (Art. 33(b)). For the timely performance of the delivery on the date set by
the buyer see the commentary regarding Art. 33(a)69 which applies accordingly.
Furthermore, it might be the case that the buyer is not only entitled to determine the
date of delivery, but also the exact point in time during that day. It has to be established
looking at the agreement between the parties, the relevant usages or practices and any
other relevant circumstances, whether the seller in case the buyer does not set the time
for delivery must nevertheless deliver at the end of the delivery time period or whether
the delivery has to be performed only after a time for delivery has been set by the
buyer70. In case of doubt, the seller is obligated to deliver only after the buyer has fixed
the delivery time.
24 A right of the buyer to set the delivery time can be assumed in particular – however
not always and without exception71 – if the carriage of the goods from the place of
delivery onwards being organized by the buyer72 or other reasons on part of the buyer,
such as limited storage capacity, require an exact planning of the delivery time by the
buyer and these reasons are foreseeable and reasonable for the seller73. As a typical
example for such a situation, the use of an F-clause of the Incoterms74 is referred to75.
However, the rules of interpretation of the Incoterms regulate under heading B776 that
the buyer is obligated to inform the seller about the required delivery time77. Therefore,
if an F-clause is applied, no recourse to Art. 33(b) is necessary in order to find an
entitlement for the buyer to determine the delivery time. However, in the absence of a
regulation like the Incoterms or an express agreement, the general rule of Art. 33(b) can
only be inverted to the buyer’s advantage if there are sufficient circumstances indicating
such an entitlement of the buyer. With respect to the delivery modalities regulated in
MünchKommHGB (2013), Art. 33 para. 3; Gruber, in: MünchKommBGB (2016), Art. 33 para. 10;
Magnus, in: Staudinger Kommentar (2013), Art. 33 para. 20; Ernst/Lauko, in: Honsell, Kommentar
(2010), Art. 33 para. 10 Fernández de la Gándara, in: Dı́ez-Picazo, Comentario (1998), p. 277.

68 See supra Art. 32 paras 30 seq.
70 Cf. Gruber, in: MünchKommBGB (2016), Art. 33 para. 9.
71 See the case reported by Mullis, in: Huber/Mullis, The CISG (2007), p. 124.

73 Enderlein/Maskow/Strohbach, Internationales Kaufrecht (1991), Art. 33 para. 3; Erdem, La livraison
des marchandises selon la Convention de Vienne (1990), para. 485; Secretariat Commentary on 1978
Draft, Art. 31 para. 6. Cf. Lando, in: Bianca/Bonell, Commentary (1987), Art. 33 para. 2.3. In contrast
75 Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 33 para. 12; Fernández de
la Gándara, in: Dı́ez-Picazo, Comentario (1998), p. 277.

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Art. 31(b),(c), there is no general right of the buyer to set the date of delivery78. For
those circumstances indicating the right of the buyer to set the date for delivery, the
party relying on it bears the burden of proving it. Without the existence of an agreement
or indicating circumstances the right of the buyer to set the date may also result from
applicable usages or practices established between the parties (Arts 6, 9).
If the buyer is entitled to set the date for delivery or even the moment of delivery, the 25
buyer has to provide the seller with all the information necessary to perform the delivery
at a reasonable time in advance79. Notwithstanding the provision in Art. 27, the buyer is
responsible for the necessary information as well as the declaration setting the delivery
time reaches the seller80. This applies all the more as the delivery has to be performed by
the seller only after the delivery time has been set by the buyer81. As long as the seller has
not received the buyer’s declaration setting the delivery time and all the information
necessary to perform the act he is required to do to deliver, the seller can invoke Art. 80 in
case he is reproached with not performing his delivery obligation in a timely manner82.
Whether the seller is also entitled to bring a claim against the buyer for breaching the
obligation to take delivery of the goods (Arts 60, 61) depends on whether the buyer is
obligated to take delivery of the goods in any case or whether the obligation to take
delivery exists only under certain conditions, e. g. depends on certain future occurrences
or the buyer has the right to use discretion about calling off the goods83.
c) Art. 33(c). As far as the contract of sale does not stipulate a binding delivery date 26
or a binding period of time within which the seller has to deliver and the delivery time
cannot be established from other relevant circumstances, the seller has to perform the
act he is required to undertake in order to deliver within a reasonable time after the
conclusion of the contract (Art. 33(c)). Art. 33(c) also applies if the parties have agreed
on a period of time for delivery without ascertaining a final point until which delivery
has to be completed84. The moment at which a contract is concluded is regulated by
Art. 23. However, this does not mean that in each and every case the period of
reasonable time starts running instantaneously with the conclusion of the contract85.
The beginning, the duration and the end of the period of reasonable time is rather to be
determined with regard to the circumstances of the contract in question which are
known or ought to be known by the parties86. The exact point in time for delivery
within the period of reasonable time is generally determined by the seller87.
The assessment of the reasonable time will differ from case to case depending on the 27
kind of goods, the preparations that have to be carried out by the seller before delivery,
the urgency regarding the demand of the buyer or any other relevant circumstances88.
78 Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 33 para. 12; Mullis, in:
Huber/Mullis, The CISG (2007), p. 124. In contrast Enderlein/Maskow/Strohbach, Internationales Kau-

frecht (1991), Art. 33 para. 3; Lando, in: Bianca/Bonell, Commentary (1987), Art. 33 para. 2.3.
79 Gruber, in: MünchKommBGB (2016), Art. 33 para. 9; Mullis, in: Huber/Mullis, The CISG (2007),
p. 125; Secretariat Commentary on 1978 Draft, Art. 31 para. 7; cf. supra para. 12.
80 Cf. Piltz, Internationales Kaufrecht (2008), paras 4–195.
82 Cf. supra Art. 32 para. 32; Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016),
Art. 33 para. 13; Secretariat Commentary on 1978 Draft, Art. 31 (now Art. 33) para. 7.
84 Lauterburg, in: Brunner, Kommentar (2014), Art. 33 para. 5. Cf. supra para. 19.
85 Ernst/Lauko, in: Honsell, Kommentar (2010), Art. 33 para. 13. Cf. infra para. 40.

88 Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 33 para. 15 seq.; Magnus,
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Foodstuffs or commodities are usually to be delivered within a shorter time89 if the

products are subject to material price fluctuations. With regard to goods that have to be
manufactured or obtained by the seller from third parties, generally more generous time
limits will apply than to goods that are typically in stock. In case of doubt, if the seller
knows or could not be unaware that spare parts are urgently needed by the buyer, these
spare parts are to be delivered immediately90. When assessing the reasonable time for
delivery, consideration may also be given to information or data with regard to the
delivery time received from the seller before the conclusion of the contract91 or to
delivery time periods used in earlier contracts92. If the parties have agreed on a non-
binding delivery time93 the reasonable time for delivery extends beyond it.94 If the seller
without fixing a particular date or period for delivery has promised to deliver the goods
within about one and a half months, a delivery more than three months later was
considered as no longer within a reasonable time95. However, if the buyer in situations
governed by Art. 33(c) accepts delivery and takes over the goods without any objection,
this will under normal circumstances indicate that delivery was performed within a
reasonable time96.
28 Depending on the circumstances, the period of reasonable time addressed in
Art. 33(c) may start running instantaneously with the conclusion of the contract or
expire shortly thereafter so that the seller is entitled or obligated to deliver immediately.
Immediate delivery can be reasonable particularly when the contract of sale refers to
goods that are on stock at the seller’s premises when getting them ready for dispatch
involves no difficulties97 or the buyer has an urgent demand for the goods and the
sellers knows or ought to know this. However, a general right to immediate delivery98 or
a general preference of the seller’s rights over the buyer’s99 is not covered by Art. 33(c).
The interests of both parties have to be weighed against each other considering all
aspects that are known or ought to be known by the other party100.
29 For the purpose of avoiding imponderables the parties should not rely on the rule of
Art. 33(c). Although being very flexible, it is not really precise. The parties should rather
stipulate the specific delivery time whenever possible, also when the rules of the
Incoterms apply101. Otherwise there is concern that when assessing the reasonable
89 Garro/Zuppi, Compraventa internacional (2012), p. 178. Cf. Turku Court of Appeals (Finland)
18 February 1997, CISG-Online 1297 (reasonable time for delivery of animal food in international sales
is a maximum of eight weeks) and ICC Arbitration Case No. 16369, Yearbook Commercial Arbitration
XXXIX (2014), 169 (no. 94).
91 Tribunale de Forli (Italy) 12 November 2012, CISG-Online 2594; Kantonsgericht Appenzell Ausser-
rhoden (Switzerland) 10 March 2003, CISG-Online 852; too stringent Oberlandesgericht Naumburg
(Germany) 27 April 1999, CISG-Online 512.
92 Rechtbank van Koophandel te Kortrijk (Belgium) 3 October 2001, CISG-Online 757.
95 Kantonsgericht Appenzell Ausserrhoden (Switzerland) 10 March 2003, CISG-Online 852.
96 Supreme Court (Hungary) 01 January 2000, CISG-Online 1687; Audiencia de Barcelona (Spain)
20 June 1997, CISG-Online 338.

98 Schackmar, Die Lieferpflicht des Verkäufers in internationalen Kaufverträgen (2001), p. 169. In
contrast Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 33 para. 17; Saenger,
in: Bamberger/Roth (eds), Kommentar zum Bürgerlichen Gesetzbuch (2012), Art. 33 para. 6; Magnus, in:
Staudinger Kommentar (2013), Art. 33 para. 21 and Soergel/Lüderitz/Schüßler-Langeheine, Kommentar
zum Bürgerlichen Gesetzbuch (2000), Art. 33 para. 7.
Soergel/Lüderitz/Schüßler-Langeheine, Kommentar zum Bürgerlichen Gesetzbuch (2000), Art. 33 para. 8.

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time, the view of the relevant national setting102 will gain influence, possibly leading to
surprising results for at least one of the parties and furthermore impeding the
autonomous and uniform application of the CISG.
d) Non-business days. The effects which Sundays, holidays or other non-business 30
days may have on the delivery date or the delivery time period has to be determined
considering the parameters set out in Art. 20(2)103. In any case, the agreement between
the parties, relevant usages and practices and other circumstances of the case are of
paramount importance. Thus, the result may be that delivery has in fact to be
performed on a holiday. In case of doubt, the circumstances at the relevant place of
delivery are decisive104. As a result, in a contract of sale involving carriage of the
goods105 the seller cannot hand over the goods to the carrier one day later arguing that
the day agreed upon for delivery or the last day of the period of time for delivery is a
national holiday at the buyer’s place of business if this very day is not a holiday at the
place of delivery as well.
4. Part-deliveries
The CISG does not contain any regulation concerning if and under which circum- 31
stances the seller is entitled to perform part-deliveries in absence of respective agree-
ments with the buyer, relevant usages or established practices (Arts 6, 9).
Generally, the seller cannot deliver before the respective delivery date106. On the 32
other hand, failing to deliver before the end of the delivery date also constitutes a
breach of contract by the seller107. The mere possibility to cure any failure to perform
his obligations by virtue of Art. 48, prerequisites of which have to be examined on a
case-by-case basis, does not amount to a general right of the seller to deliver at his
own discretion in part on the delivery date and in part at a later stage. Notwithstand-
ing differing agreements, usages or practices, in case of doubt, the seller has to deliver
at the relevant date of delivery and has to perform his obligation completely in only
one act108. Otherwise, the seller breaches his obligation to deliver in a timely manner,
unless under specific circumstances he is entitled to cure his failure enjoying the rights
under Art. 48.
The general rule according to which in case of doubt the seller has to deliver at the 33
relevant date of delivery and has to perform his obligation completely in only one act109
is basically not altered if the seller is not bound to deliver at a specific date but within a
period of time, even if the seller has the right to determine the exact date of delivery110.
As the modalities of delivery affect interests of the buyer, a right of the seller to deliver
the goods in part even though only one delivery unit was agreed upon can only be
assumed if there exist specific agreements, usages or practices. The seller who relies on
such agreements, usages or practices must provide evidence for this.
102
See supra para. 8.
103
108 Coming to the same result Magnus, in: Staudinger Kommentar (2013), Art. 37 para. 23 and Art. 51
para. 10 and Huber, in: MünchKommBGB (2016), Art. 51 para. 14. In contrast Widmer Lüchinger, in:
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1. Incoterms
34 Whereas one of the five articles of the CISG regulating the obligations of the seller
deals with nothing else but the time of delivery, notwithstanding the utmost importance
of this issue in practice, the Incoterms111 do not dedicate even one of the ten headings112
of their rules of interpretation to determine the delivery time in more detail. Under
heading A4 of the rules of interpretation regulating the delivery obligation is merely set
out for all Incoterms that the seller has to deliver “on the date or within the agreed
period”113. Therefore, as a general rule, if a clause of the Incoterms and the CISG apply,
the time of delivery is determined according to the contract of sale in combination with
Art. 33114 and in case the contract is silent according to Art. 33115. This result underlines
the character of the Incoterms as a set of rules which supplements or may modify the
CISG, but does not make it superfluous116.
35 Apart from heading A-4, other regulations of the Incoterms also make reference to an
agreed date or period of delivery or are based on A-4. Therefore, some of the regulations
of the Incoterms may result inoperable if no date or period of delivery can be
determined by looking at the contract and its circumstances117.
36 According to B7 of the rules of interpretation of the Incoterms, the buyer is obligated
to give sufficient information to the seller in order to enable him to perform the delivery
obligation118. In particular, the buyer has to determine the time of delivery to the extent
that he is entitled to fix it. The E-, the C- and the D-clauses of the Incoterms do not
regulate whether the buyer is entitled to set the delivery time119. As the E-, the C- and the
D-clauses do not give this right to the seller either, this issue has to be settled according to
the contract of sale or the CISG120. The FCA-, FAS- and the FOB-clauses of the Incoterms
obligate the buyer to give notice of the “selected delivery time” without mentioning any
necessity for an entitlement. Unlike the CISG121 and notwithstanding other agreements,
considering the special transport modalities the FCA-, FAS- and the FOB-clauses of the
Incoterms refer to, it is the buyer and not the seller who has the right to specify the point
of time for delivery122. Whenever the buyer is entitled to specify the delivery time, he is
responsible that the information reaches the seller123. However, the right of the buyer to
specify the delivery time when an F-clause is applied exists only within the frame of the
date or the period agreed for delivery addressed in A4 of the rules of interpretation. The
113 Cf. Piltz/Bredow, Incoterms (2016) para. F-158; Magnus/Lüsing, CISG und INCOTERMS, Leis-
tungsverzug und Fixgeschäfte, IHR (2007) 1 (7).

114 Regarding the consequences of non-compliance with an agreed delivery date when applying
Incoterms cf. Magnus/Lüsing, CISG und INCOTERMS, Leistungsverzug und Fixgeschäfte, IHR (2007) 1.
115 Cf. Piltz/Bredow, Incoterms (2016) para. F-158. In contrast Bredow/Seiffert, Incoterms 2000 (2000),
p. 39.
116 See supra Art. 30 paras 7 seq. and Art. 30 para. 30.
117 Piltz/Bredow, Incoterms (2016) paras E-154, F-168, F-355, F-555, C-158, C-459 and D-355.
119 Piltz/Bredow, Incoterms (2016) para. E-174, C-182, C-482 and D-376.
120 In contrast Schackmar, Die Lieferpflicht des Verkäufers in internationalen Kaufverträgen (2001),
p. 172.
121 See supra paras 18 and 20.
122 Piltz/Bredow, Incoterms (2016) para. F-187, F-374 and F-574; Magnus/Lüsing, CISG und INCO-
TERMS, Leistungsverzug und Fixgeschäfte, IHR (2007) 1 (7).

123 Piltz/Bredow, Incoterms (2016) para. F-185, F-372 and F-572.Cf. supra para. 25.
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buyer does not enjoy a unilateral right to fix the delivery time if neither a date nor a
period of time for delivery has been agreed between the parties124.
2. PICC and PECL

Neither the PICC nor the PECL contain provisions explicitly regulating contracts of 37
sale125. On the other hand, both sets of rules address the time of performance so that the
regulatory content of Art. 33 CISG finds a counterpart in the PICC and in the PECL.
The respective texts of Art. 6.1.1 PICC and Art. 7:102 PECL are almost identical. Even
more, they repeat almost literally Art. 33126 with just two deviations. Whereas Art. 33
CISG refers explicitly to the obligation of the seller to deliver the goods, Art. 6.1.1 PICC
and Art. 7:102 PECL address the performance of contractual obligations in general.
However, this does not exclude their application if a sales transaction is governed by the
PICC or the PECL. Moreover, whereas Art. 33(a) CISG uses the term “date”,
Art. 6.1.1(a) PICC and Art. 7:102(a) PECL prefer the wording “time”. However, this
concept does not include a period of time because the period of time is regulated in
Art. 6.1.1(b) PICC and Art. 7:102(b) PECL. Therefore, the meaning will be the same as
in Art. 33(a)127 even though tending to some more flexibility than the term “date”128. As
regards the rest of Art. 6.1.1(a) PICC and Art. 7:102(a) PECL, they are identical to
Art. 33 CISG in all material aspects129.
3. DCFR
The regulatory content of Art. 33 CISG has a direct counterpart in Art. IV.A.-2:202 38
DCFR130 which refers to Art. III.-2:102 DCFR. In the present context only Art. III.-
2:102(1) and (2) DCFR will be looked at. The further paragraphs deal with consumer
contracts131 which are generally excluded from the scope of application of the CISG132.
Furthermore, it has to be highlighted that just like under the CISG133, the rules of
Art. III.-2:102(1) and (2) DCFR only apply to the extent that the time for delivery
cannot be determined otherwise134.
The structure of Art. III.-2:102(1) and (2) DCFR differs from both Art. 33 CISG and 39
Art. 6.1.1(b) PICC, Art. 7:102(b) PECL. However, this differentiation does not lead to a
material distinction. Moreover, unlike Art. 33(a) CISG which uses the term “date”, Art. III.-
2:102(1) DCFR applies the wording “time”. However, the meaning will be almost the same
as in Art. 33(a)135, even though the term “time” is more flexible than the term “date”136.
124 Piltz/Bredow, Incoterms (2016) para. F-187, F-374 and F-574. In contrast Magnus/Lüsing, CISG und
INCOTERMS, Leistungsverzug und Fixgeschäfte, IHR (2007) 1 (7).

127 Cf. Atamer, in: Vogenauer/Kleinheisterkamp, UNIDROIT Commentary (2015), Art. 6.1.1 paras 7 et
seq.
129 Colin Ying, Time for delivery and early delivery: Comparison between the provisions of CISG
Articles 33 and 52(1) and the counterpart provisions of the PECL (Articles 7:102 and 7:103), in:
Contracts for the International Sale of Goods (1980) as Uniform Sales Law (2007), p. 360 (361).
135 See supra para. 17. Cf. Atamer, in: Vogenauer/Kleinheisterkamp, UNIDROIT Commentary (2015),
Art. 6.1.1 paras 7 et seq.

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40 Art. III.-2:102(1) DCFR combines the basic regulatory contents of Art. 33 CISG in
just one paragraph. If a time at which or a period of time within which the obligation in
question has to be performed cannot be determined, performance is due within a
reasonable time after the obligation’s arising. This rule matches Art. 33(c) CISG137 with
the only difference that Art. 33(c) refers to a reasonable time after the conclusion of the
contract. Anyhow, in the essence both concepts are identical. If no time or period of
time for delivery can be determined and due to special circumstances the obligation to
perform does not arise with the conclusion of the contract, this feature has to be
considered by setting the reasonable time138.
41 Condition precedent for applying the reasonable time regulated in Art. III.-2:102(1)
DCFR is that no time or no period of time for the performance can be determined. If
that condition is not complied with, the consequences are not explicitly stated in
Art. III.-2:102(1) DCFR. However, it goes without saying that if a time or a period of
time for the performance of an obligation can be determined, this result has to be
respected139. Therefore, the result is the same as under Art. 33(a),(b) CISG140.
42 Art. III.-2:102(2) DCFR addresses the issue which of the two parties is entitled to
determine at which moment an obligation is to be performed if a period of time applies.
The result is almost the same as according to Art. 33(b) CISG141.
138Cf. supra para. 26.
Reference (DCFR), Full Edition (2009), Comments B and C to Art. III.-2:102.

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Article 34
If the seller is bound to hand over documents relating to the goods, he must hand
them over at the time and place and in the form required by the contract. If the seller
has handed over documents before that time, he may, up to that time, cure any lack
of conformity in the documents, if the exercise of this right does not cause the buyer
unreasonable inconvenience or unreasonable expense. However, the buyer retains any
right to claim damages as provided for in this Convention.
Bibliography: Fleischmann/Schmidt-Kessel, in: DiMatteo/Janssen/Magnus/Schulze, International Sales

Law (2016), p. 341; Piltz/Bredow, Incoterms (2016); Kock, Nebenpflichten im UN-Kaufrecht (1995);
Schütze/Vorpeil, Das Dokumentenakkreditiv im Internationalen Handelsverkehr (2016).
Outline
1. Subject matter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
2. Breach of contract . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
3. Further context. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
4. National laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
1. Handing over of documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
a) Obligation of the seller . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
b) Documents governed by Art. 34 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
c) Place, time and form of handing over . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
2. Right to cure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
1. Incoterms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
2. PICC and PECL. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
3. DCFR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36

1. Subject matter
Art. 34 serves the purpose of specifying the seller’s obligation addressed in Art. 30 to 1
hand over documents relating to the goods. Consequently, Art. 34 has to be observed if
Art. 30 is applicable1. Just like Art. 302, Art. 34 merely plays a supplementary role and
gains significance only to the extent that the issues regulated in Art. 34 cannot be
determined satisfactorily by looking at the contract and its circumstances. Furthermore,
Art. 34 supplements Art. 37 by providing an opportunity to cure an insufficient
performance with regard to the handing over of documents.
Generally, the non-performance of the seller’s obligations pursuant to Art. 34, not 2
cured in accordance with Arts 34 or 483, constitutes a breach of contract and results in the
consequences regulated by Arts 45 et seq. unless the seller may rely on Arts 71 or 80.

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3 Arts 39 and 43 do not apply to documents subject to Art. 344. The obligation to give
notice according to Arts 39 and 43 is designed for the actual subject of the delivery of a
contract of sale, the goods sold. However, it is not suitable for the paperwork that has to
be dealt with in cross-border commerce and the different modalities of passing on such
paperwork. In particular, the legal remedies specifically provided for the delivery of
non-conforming goods, namely the delivery of substitute goods which is conditioned to
a fundamental breach of contract5 and the reduction of the price6, are not appropriate in
such constellations where the seller fails to properly perform his obligation to hand over
documents governed by Art. 347. Instead, the regular remedies provided for all kinds of
breach of contract apply. This assessment is corroborated by the provisions contained in
Art. 34 second and third sentence which would otherwise have been unnecessary
because of the existence of Art. 37. Notwithstanding the aforesaid, the buyer remains
under the obligation to take such measures as are reasonable in the circumstances to
mitigate the loss pursuant to Art. 77.
4 If the failure to hand over correct documents relating to the goods results in the
buyer’s inability to legitimize himself when taking over the goods, the seller has also
breached his obligation to deliver8. In such a case the buyer is in particular entitled to
rely on the legal remedies provided for non-delivery.
3. Further context
5 Even though the seller’s obligations regulated in Art. 34 have been developed as
obligations independent from the ones addressed in Art. 30, they still have to be seen
in the context of the seller’s obligation to deliver the goods and to transfer property in
the goods sold. Therefore, unless the parties’ agreements, any usages applicable and
practices which the parties have established between them (Arts 6, 9), or other
relevant circumstances indicate otherwise, Arts 31 and 33 give indications also with
regard to the place where and the time when the seller has to perform the duties
imposed by Art. 349.
4. National laws
6 Regulations in national bodies of law regarding the seller’s obligations with respect to
documents relating to the goods are not applicable within the CISG’s sphere of
application since the CISG regulates such obligations of the seller conclusively10. The
same applies for the right to cure pursuant to Art. 34 second and third sentence.
4 Gruber, in: MünchKommBGB (2016), Art. 34 para. 7; Witz/Salger/Lorenz, Kommentar (2016), Art. 34
para. 10; Ernst/Lauko, in: Honsell, Kommentar (2010), Art. 34 para. 14; Saenger, in: Bamberger/Roth
(eds), Kommentar zum Bürgerlichen Gesetzbuch (2012), Art. 34 para. 5. In contrast Bundesgericht
(Switzerland) 2 April 2015, CISG-Online 2592 (without going into details); Widmer Lüchinger, in:
Schlechtriem/Schwenzer, Commentary (2016), Art. 34 para. 9; Lauterburg, in: Brunner, Kommentar
(2014), Art. 34 para. 5; Benicke, in: MünchKommHGB (2013), Art. 34 para. 9; Magnus, in: Staudinger
Kommentar (2013), Art. 34 para. 18; Ferrari, Contracts for the International Sale of Goods (2012), p. 192;
Soergel/Lüderitz/Schüßler-Langeheine, Kommentar zum Bürgerlichen Gesetzbuch (2000), Art. 34 para. 4.
Differentiating Kock, Nebenpflichten im UN-Kaufrecht (1995), p. 77.
KommHGB (2013), Art. 34 para. 8; Ernst/Lauko, in: Honsell, Kommentar (2010), Art. 34 para. 14.
9 In contrast Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 34 para. 4,
however less stringent paras 6 and 7.

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Art. 34 first sentence was contained in Art. 50 ULIS with practically the same 7
content11. Art. 34 second and third sentence were added only during the Vienna
conference12.

1. Handing over of documents
In addition to the obligation to deliver the goods and to transfer property in them, 8
the seller may be obligated to hand over documents relating to the goods (Art. 30).
Art. 34 regulates the details of this obligation. However, Art. 34 does not constitute such
an obligation, but rather implies the existence of a contractual duty to hand over
documents13. A duty of the seller to assist the buyer in procuring required documents is
not provided for in Art. 3414.
a) Obligation of the seller. The obligation of the seller to hand over documents often 9
derives from agreements between the parties15. An obligation to hand over documents
and details regarding this obligation can result particularly from the use of the
Incoterms16. Moreover, any usages applicable and practices being established between
the parties, (Arts 6, 9), or other relevant circumstances, especially the specific perfor-
mance of the contract which the parties have agreed upon, may result in the seller’s
obligation to hand over documents. Which specific documents are comprised by this
obligation also has to be determined by considering the contract, the usages applicable,
the practices established between the parties or other relevant circumstances. However,
as Art. 34 regulates an obligation of the seller, only those documents are referred to
which theoretically could be procured by the seller. Where a certain legal relation or
status is required as precondition for being issued or provided a document and the seller
as such does not meet these requirements, no obligation of the seller to provide this
document exists unless the parties have agreed otherwise.
b) Documents governed by Art. 34. Art. 34 generally governs all kinds of documents 10
typically used for the performance of cross-border contracts of sale17. On the one hand,
Art. 34 encompasses those documents necessary for the performance of the contract of
sale, namely documents which are needed by the buyer to acquire the property and/or
the possession of the goods and – in case it is the buyer’s responsibility – to arrange for
import, export and security clearance and release of the goods comprising licences,
11Magnus, in: Staudinger Kommentar (2013), Art. 34 para. 4.
12For more details see Fernández de la Gándara, in: Dı́ez-Picazo, Comentario (1998), p. 281; Lando, in:
Bianca/Bonell, Commentary (1987), Art. 34 para. 1.1.
Lorenz, Kommentar (2016), Art. 34 para. 2; Ernst/Lauko, in: Honsell, Kommentar (2010), Art. 34 para. 6.
14 Lando, in: Bianca/Bonell, Commentary (1987), Art. 34 para. 2.1. Probably in contrast Fernández de

17 Cf. Bundesgericht (Switzerland) 2 April 2015, CISG-Online 2592; Tribunal Supremo (Spain) 9 December
2008, CISG-Online 2100; Witz/Salger/Lorenz, Kommentar (2016), Art. 34 para. 3; Widmer Lüchinger, in:
Schlechtriem/Schwenzer, Commentary (2016), Art. 34 para. 2; Gruber, in: MünchKommBGB (2016), Art. 30
para. 4; Benicke, in: MünchKommHGB (2013), Art. 34 para. 2; Ernst/Lauko, in: Honsell, Kommentar (2010),
Art. 34 para. 4; Kock, Nebenpflichten im UN-Kaufrecht (1995), p. 47; Enderlein/Maskow/Strohbach, Inter-
nationales Kaufrecht (1991), Art. 34 para. 2; Secretariat Commentary on 1978 Draft, Art. 32 para. 2.
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certificates and alike that have to be presented in order to clear the goods for import18.
On the other hand, Art. 34 also includes those documents which are not necessarily
required for the performance of the contract of sale, but nevertheless are needed by the
buyer in order to make claims against third parties or to benefit from tariff advantages,
tax privileges or other preferences19. A common characteristic of all documents
governed by Art. 34 is the fact that these documents are relevant for the buyer’s
relations with third parties organized either under public or private law20.
11 Documents identifying21 or describing the goods sold, such as technical documents or
circuit diagrams, or documents regarding the use of them, such as assembly or fitting
instructions, instructions for use or maintenance or operating manuals, are part of the
goods the seller is obligated to deliver according to Art. 35(2)(a) without any need for
further agreements regarding this point22. Therefore, these kinds of documents are
subject to the obligations to examine the goods and to give notice as provided for by
Arts 38 et seq., in contrast to documents being addressed in Art. 3423. Certificates of
compliance or test or guaranty certificates which the seller has to provide due to an
agreement between the parties or other relevant circumstances are not within the scope
of Art. 34 either. As a matter of fact, providing these documents which neither serve the
purpose of describing the goods or relate to their intended use is an additional
contractual obligation of the seller24. Therefore, these documents are not subject to the
obligation to examine and give notice pursuant to Arts 38 et seq. Failure to perform this
additional obligation does not result in non-conformity of the goods according to
Art. 35, but leads directly to the legal remedies under Arts 45 et seq.
12 With respect to their legal function, the documents governed by Art. 34 may be
categorized as follows25.
13 Transportation documents26: These documents serve the purpose of confirming the
formation and the contents of the contract of carriage concluded by the seller and of
proving the handing over of the goods to the carrier.
14 Some transportation documents are negotiable instruments. Apart from the right to
have the goods delivered at the place of destination which is embodied in such
documents, also the property in the goods can be transferred by handing over such
18 CISG-AC Opinion no. 11, 259, 263 et seq.; Witz/Salger/Lorenz, Kommentar (2016), Art. 34 para. 3;
Lauterburg, in: Brunner, Kommentar (2014), Art. 34 para. 1.

19 CISG-AC Opinion no. 11, 259, 267. Cf. Foreign Trade Court of Arbitration (Serbia) 23 January 2008,
CISG-Online 1946; Hof van Beroep te Gent (Belgium) 24 March 2010, unpublished.
20 See also Fleischmann/Schmidt-Kessel, in: DiMatteo/Janssen/Magnus/Schulze, International Sales Law
(2016), p. 367 (para. 77).

21 Handelsgericht St. Gallen (Switzerland) 14 June 2012, CISG-Online 2468 (Bio-Swiss Certificates).
para. 3; Magnus, in: Staudinger Kommentar (2013), Art. 34 para. 7; Kock, Nebenpflichten im UN-
Kaufrecht (1995), p. 54. In contrast Garro/Zuppi, Compraventa internacional de mercaderı́as (2012),
p. 181; Carlini, El contrato de compraventa internacional de mercaderı́as (2010), p. 133; Hussonmorel, La
Compraventa Internacional de Mercaderı́as (2004), p. 61; Renck, Der Einfluß der INCOTERMS 1990 auf
das UN-Kaufrecht (1995), p. 131; Erdem, La livraison des marchandises selon la Convention de Vienne
(1990), para. 538; Reinhart, UN-Kaufrecht (1990), Art. 34 para. 2.
23 See supra para. 3. In contrast Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016),
Art. 34 para. 3.
25 Cf. CISG-AC Opinion no. 11, IHR (2013) 259, 263 et seq.; Widmer Lüchinger, in: Schlechtriem/
Schwenzer, Commentary (2016), Art. 34 para. 2; Jimenez, ICC Guide to Export/Import(2012), ICC
publication No 686, pp. 23 et seq. and Ramberg, ICC Guide to Incoterms 2010 (2010), ICC publication
No 720, pp. 36 seq.
26 For more details see Schütze, Das Dokumentenakkreditiv im Internationalen Handelsverkehr (2008),
pp. 86 et seq.
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documents. Examples of documents of this kind are the bill of lading, the consignment
bill and the warehouse warrant. A special form of the consignment bill is the FIATA
Multimodal Transport Bill of Lading.
Other transportation documents are instruments solely intended for evidence pur- 15
poses which cannot be transferred like negotiable instruments of value. The good faith
of the recipient who trusts in the content of the paper is not protected. Such documents
are for instance the air waybill, the sea waybill and the waybill, the railway consignment
note and the road consignment note, moreover the warehouse receipt and the for-
warder’s certificate of receipt.
Accompanying documents for export or import: Typical accompanying documents 16
are for instance export licences, import licences, customs delivery notes, cargo declara-
tions, goods control certificates, sanitary certificates, weight certificates, certificates of
origin27, supplier’s declarations28, commercial invoices29, consular invoices, packing lists
and insurance policies30.
c) Place, time and form of handing over. Regarding the place, the time and the form 17
of the handing over of the documents, Art. 34 first sentence refers to the contract of sale.
Further specifications may apply when a clause of the Incoterms has been agreed upon31.
According to Art. 9, applicable usages or practices established between the parties have to
be considered likewise. These circumstances may also lead to the conclusion that the
respective documents do not have to be handed over but only have to be placed at disposal
or might completely or in part be transmitted in an electronic form.
The seller has to provide the buyer with the documents he is obligated to hand over32 18
in a number and design which generally enables the buyer to take over the goods at the
place of taking delivery33, to arrange for customs and security clearance and release of
the goods, to apply for tax benefits and, if needed, to bring a suit against the carrier or
the insurer34. These functions should determine the details of the handing over the seller
is obligated to perform. If necessary, such papers therefore have to be authenticated or
legalized. In instruments made out to order the buyer has to be identified as beneficiary.
Hence, a continuous chain of endorsements is required35. However, only under special
circumstances the seller owes translation of the documents into a language different
from the one in which the papers are issued.
The CISG does not regulate at which particular place or to whom the documents 19
have to be handed over. However, in most cases the place at which the seller is bound to
hand over the documents will derive from the parties’ agreements concerning delivery
modalities and the payment of the purchase price. Where the parties have agreed upon
a documentary letter of credit or a documentary collection, the required papers have to
27 For more details see the WTO Agreement on Rules of Origin, at http://www.wto.org/english/docs_e/
legal_e/22-roo.pdf [last accessed 21 March 2017].

28 For more details see EC Regulation 1207/2001 of 11 June 2001 (EC Official Journal, L 165,
21 January 2001), EC Regulation 1617/2006 of 24 October 2006 (EC Official Journal, L 300, 31 October
2006) and EC Regulation 75/2008 of 28 January 2008 (EC Official Journal, L 24, 29 January 2008.
29 For more details see Schütze/Vorpeil, Das Dokumentenakkreditiv im Internationalen Handelsverkehr
(2016), pp. 120 et seq.

30 For more details see Schütze/Vorpeil, Das Dokumentenakkreditiv im Internationalen Handelsverkehr
(2016), pp. 117 et seq.

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be presented to the respective appointed bank36. Moreover, the place where the
documents have to be handed over will regularly coincide with the relevant place of
delivery37 notwithstanding other circumstances. Therefore, unless indicated differently,
in sales which involve carriage of the goods38 the seller is bound to hand over the
documents to a courier or another carrier appropriate for such transmission at the place
of delivery and to instruct such carrier to transmit the documents to the buyer39. Art. 34
does not state an obligation of the seller to hand over the documents to the buyer40.
Consequently, the cost for their transmission to the buyer and the risk of transmission
in due time are to be borne by the buyer. However, the seller bears the risk of procuring
them again if such documents do not reach the buyer at all41.
20 The CISG does not contain a regulation comparable to Art. 33 with respect to the
time at which the documents governed by Art. 34 have to be handed over. The time for
handing over the documents is to be determined by the circumstances of the transaction
and the kind of documents in question, notwithstanding any specific agreements, usages
or practices. In this context, the German translation (“Zeitpunkt”) turns out to be too
narrow since the regulation of Art. 3442 comprises a specific point in time as well as a
period of time.
21 When using a documentary letter of credit it is in the seller’s own interest to present
the documents to the appointed bank in a timely manner before the expiration of the
documentary letter of credit. Art. 6(d) UCP 600 regulates that all documentary letters of
credit must have a date of expiration. Until this date the seller has to present the
documents which are stipulated in the letter of credit (Art. 6(e) UCP 600), or otherwise
he will lose his rights from the letter of credit43. Thus, the expiration date of a letter of
credit indicates the end of a time period within which the seller may, comparable to
Art. 33(b) CISG44, present the documents at any time. An early handing over of the
documents is hardly imaginable. A right to cure a delayed handing over of the
documents pursuant to Art. 48 CISG is excluded since the handing over of documents
after the expiration date results in the loss of the rights arising out of the letter of credit.
22 If the buyer needs the documents in order to have the goods sold handed over to him,
he has to be provided with the documents early enough to be able to take over the goods

Art. 34 para. 6; Magnus, in: Staudinger Kommentar (2013), Art. 34 para. 8; Schackmar, Die Lieferpflicht
des Verkäufers in internationalen Kaufverträgen (2001), p. 189; Fernández de la Gándara, in: Dı́ez-Picazo,
Comentario (1998), p. 285. In contrast Lauterburg, in: Brunner, Kommentar (2014), Art. 34 para. 4;
Eckert/Maifeld/Matthiesen, Handbuch des Kaufrechts (2014), para. 505; Benicke, in: MünchKommHGB
(2013), Art. 31 para. 4. Mullis, in: Huber/Mullis, The CISG (2007), p. 129; Soergel/Lüderitz/Schüßler-
Langeheine, Kommentar zum Bürgerlichen Gesetzbuch (2000), Art. 34 CISG para. 2.
39 Cf. Gruber, in: MünchKommBGB (2016), Art. 34 para. 6; Witz/Salger/Lorenz, Kommentar (2016),
Art. 34 para. 6; Fernández de la Gándara, in: Dı́ez-Picazo, Comentario (1998), p. 285. In contrast Widmer
Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 34 para. 7; Saenger, in: Bamberger/Roth
(eds), Kommentar zum Bürgerlichen Gesetzbuch (2012), Art. 34 para. 4; Ernst/Lauko, in: Honsell,
40 In contrast Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 34 para. 7;
Soergel/Lüderitz/Schüßler-Langeheine, Kommentar zum Bürgerlichen Gesetzbuch (2000), Art. 34 CISG

para. 2; Kock, Nebenpflichten im UN-Kaufrecht (1995), p. 57.
42 “… he must hand them over at the time …”
43 Schütze/Vorpeil, Das Dokumentenakkreditiv im Internationalen Handelsverkehr (2016), para. 487.
476 Piltz
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in conformity with the contract45. Thus, the date set for the taking over of the goods by
the buyer will be the latest point in time of a period within which the seller may,
comparable to Art. 33(b)46, hand over the documents to the buyer at any given time.
Notwithstanding special circumstances, early handing over of the documents is hardly
imaginable47. After the expiration of the time limit for the handing over of the
documents the seller may be entitled to remedy his failure to perform pursuant to
Art. 4848. By virtue of Art. 48, the seller can remedy a lack of conformity in the
documents already handed over, but also perform his obligation to hand over the
documents for the first time if it has not been done so far, provided that the
requirements of Art. 48 are met.
In other constellations it will usually be derived from the circumstances until which 23
point in time the documents have to be handed over, unless specific parties’ agreements
provide otherwise. For instance, documents which the buyer needs for customs clearance
when importing the goods have to be handed over so early that the import release can be
carried out without any loss of time49. Insofar as no other circumstances are present to
determine the time for the handing over of documents, some authors argue that the
documents have to be handed over as soon as possible after the goods have been
shipped50 or within a reasonable period of time51. In general, the relevant date will
indicate the end of a time period within which the seller may, comparable to
Art. 33(b)52, in case of doubt hand over the documents at any time. Notwithstanding
special circumstances, after expiration of the time period for the handing over of the
documents, the seller is entitled to remedy a lack of conformity in the documents already
handed over and also to perform his obligation to hand over the documents for the first
time if it has not been done so far, provided that the requirements of Art. 48 are met53.
2. Right to cure
According to Art. 34 second sentence, the seller may generally cure any lack of 24
conformity in the documents if the documents were handed over ahead of time. After
expiration of the relevant time for the handing over of documents the seller has a right
to cure if the requirements of Art. 48 are met54. The early as well as the delayed handing
over of the documents constitutes a breach of contract. However, in contrast to cases of
premature delivery of goods55, it is hardly imaginable for an early handing over of
documents to result in actual losses to be suffered by the buyer. It is even less apparent
45 Witz/Salger/Lorenz, Kommentar (2016), Art. 34 para. 5; Widmer Lüchinger, in: Schlechtriem/
Schwenzer, Commentary (2016), Art. 34 para. 6; Lauterburg, in: Brunner, Kommentar (2014), Art. 34
para. 3; Kock, Nebenpflichten im UN-Kaufrecht (1995), p. 56.
47 Cf. Gruber, in: MünchKommBGB (2016), Art. 34 para. 8; Widmer Lüchinger, in: Schlechtriem/

49 Cf. Magnus, in: Staudinger Kommentar (2013), Art. 34 para. 8; Lauterburg, in: Brunner, Kommentar
(2014), Art. 34 para. 3; Ernst/Lauko, in: Honsell, Kommentar (2010), Art. 34 para. 8.
50 Mullis, in: Huber/Mullis, The CISG (2007), p. 128; Renck, Der Einfluß der INCOTERMS 1990 auf
das UN-Kaufrecht (1995), p. 132 seq.

51 Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 34 para. 6; Ernst/Lauko,
in: Honsell, Kommentar (2010), Art. 34 para. 8; Neumayer/Ming, Convention de Vienne (1993), p. 267.

54 Schlechtriem/Butler, CISG (2009), para. 131; Widmer Lüchinger, in: Schlechtriem/Schwenzer, Com-

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that an early handing over of the documents could amount to a fundamental breach of
contract entitling the buyer to declare the contract avoided. Ultimately, early handing
over of documents constitutes a breach of contract, but will generally not result in any
consequences.
25 An early handing over of the documents will be practically very rare since hardly any
constellations exist under which documents may be handed over only after a certain
date, but not before it56. Nevertheless, the right to cure by virtue of Art. 34 second
sentence is of significance for the seller. Art. 34 second sentence provides the opportu-
nity to remedy such documents which have already been handed over as long as the
final date for their handing over has not yet been reached. Respecting the requirements
of Art. 34, the seller may offer documents which have been rejected by the buyer once
again57 or may undertake more than one attempt to remedy a lack of conformity in the
documents. Still, it can be derived from the contract or other circumstances that the
right to cure is limited or excluded completely58. However, the right to cure should not
be undermined by assuming the requirements of a fundamental breach of contract too
generously prior to the date of performance according to Art. 72.
26 Until the final date for handing over the documents the seller may remedy any lack of
conformity in the documents. It is irrelevant what causes the lack of conformity59. The
seller may correct typing errors or other erroneous entries or – if the documents were
not issued by the seller – have them corrected60. The same applies to annotations on the
documents which possibly could impair their use. The seller may make up for missing
signatures or legalizations or ensure that it is done by a third party. Confounded or
other incorrect documents may be replaced by the seller with the correct ones or
missing attachments may be added. The kind and extent of the lack of conformity in the
documents is irrelevant. There is also a lack of conformity, if documents are completely
different from the ones required or if an insufficient amount of documents has been
handed over. However, a precondition for the application of Art. 34 second sentence is
that a document has already been handed over or at least tendered61. Otherwise, the
seller has no need to resort to Art. 34 second sentence. As long as the time period for
the handing over of the documents has not yet expired, the seller may hand over
documents not yet delivered at any time.
27 The seller is granted the right to cure any lack of conformity in the documents on
condition that exercising this right does not result in unreasonable inconveniences for
the buyer. Even though Art. 34 replicates Art. 37, the underlying interest of Art. 37
cannot be compared with the situation of Art. 34. Whilst the repair or replacement of
the goods which have already been delivered to the buyer can indeed cause the buyer
inconveniences62, the correction or exchange of documents being already handed over
to the buyer can hardly cause any difficulties63. Also it is hardly imaginable that
unreasonable expenses will occur from which the buyer shall be protected (Art. 34
58 Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 34 para. 11; Gabriel, in:
Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 351; Fernández de la Gándara, in: Dı́ez-

61 Widmer Lüchinger, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 34 para. 13. Cf. Ernst/
Lauko, in: Honsell, Kommentar (2010), Art. 34 para. 15.

63 Cf. Gruber, in: MünchKommBGB (2016), Art. 34 para. 8; Widmer Lüchinger, in: Schlechtriem/
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second sentence). Thus, in case of doubt it must be assumed that the seller principally
has a right to cure any lack of conformity in the documents. Or looking at it from
another perspective, if the buyer wants to object to the right of the seller to cure
pursuant to Art. 34 second sentence, he has to present evidence for the unreasonable
inconvenience or expense this would cause.
Comparable to the regulation in Art. 37, the buyer retains any right to claim damages 28
for disadvantages caused by the seller’s exertion of his right to cure. The basis for a
claim for damages is Art. 45(1)(b)64. The extent of such damages has to be determined
according to Arts 74 et seq., so that generally only foreseeable damages are to be
indemnified (Art. 74 second sentence)65. The buyer is bound to take measures to
mitigate the loss according to Art. 77.
1. Incoterms
The Incoterms66 contain rules of their own regarding some of the issues referred to in 29
Art. 34. Therefore, if the parties to a contract of sale agree upon the application of a
clause of the Incoterms, the rules of interpretation of that clause apply supplemented by
Art. 3467. Furthermore, unlike the CISG68, the Incoterms regulate a duty of the seller to
assist the buyer in procuring required documents.
Whereas Art. 34 does not constitute an obligation of the seller to hand over 30
documents and does not specify the kind of documents to be handed over69, if the
Incoterms apply, both the seller and the buyer face obligations to hand over certain
documents according to the explanations under headings A8 – B8 of the rules of
interpretation of the Incoterms.
According to A8 of the rules of interpretation of the Incoterms, the seller is generally 31
bound to provide the buyer with the usual proof of the delivery of the goods at his expense.
Furthermore, if the CFR- or CIF-clause of the Incoterms is agreed upon, the transport
document proving the delivery and the contracted carriage must be dated within the
delivery period and enable the buyer to claim the goods from the carrier at the port of
destination70 or sell them while in transit. In contrast, under the clauses CPT and CIP the
seller has to provide the buyer with such transport document only if customary or
requested by the buyer and the transport document must enable the buyer to claim the
goods at the named place of destination or sell them only when agreed or customary.
Applying a D-clause of the Incoterms, the seller is obligated to provide the buyer with the
document necessary to take delivery of the goods which pursuant to the heading of A8/B8
is considered the delivery document or proof of delivery. Under the clause EXW no
obligation of the seller with regard to any document proving the delivery exists.
According to B8 of the rules of interpretation of the Incoterms clause EXW, the buyer 32
is obligated to provide the seller with appropriate proof of having taken delivery. With
regard to the F-, C- and D-clauses of the Incoterms, there is no obligation of the buyer
to hand over any document of this kind to the seller.

67 See supra Art. 30 para. 7 seq.
70 Cf. Interim Arbitral Award, ICC 7645/1995, Yearbook of Commercial Arbitration (2001) 130 (137 seq.).
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33 The Incoterms have to be considered in light of the CISG71. To the extent that a
differing interpretation cannot be derived from the rules of interpretation of the
Incoterms, generally the comments on Art. 34 regarding place, time and form of
handing over documents72 also apply when the Incoterms obligate the seller to provide
the buyer with documents73. However, under the CFR- and CIF-Incoterm the provision
must be effected without delay74. Furthermore, A8 of the rules of interpretation of the
Incoterms specifies that the seller has to bear the costs for providing the documents.
34 Unlike the CISG75, the Incoterms provide for duties of the seller or the buyer to assist
the other party at his request, risk and expense in procuring documents. According to
A8 of the rules of interpretation of the Incoterms, the seller must assist the buyer in
obtaining a transport document if this document does not constitute the usual proof of
delivery owed by the seller76. Furthermore, heading A10 of the rules of interpretation of
the Incoterms stipulates that the seller has to provide or assist the buyer in getting any
other document required by the buyer for the export, transit and/or import of the goods
and their transport to the final destination. As under the DDP-clause the seller is
responsible for the import clearance anyway77, the obligation is reduced to the
documents necessary for the transport of the goods to their final destination. This
regulation shows that the “transport to the final destination” as addressed under A10 of
the rules of interpretation of the Incoterms means the transport beyond the place of
delivery or the place of taking delivery78. Vice versa the buyer has to provide or assist the
seller in getting any document required by the seller for the export, transit and if the
DDP-clause applies, import of the goods.
2. PICC and PECL

35 Neither the PICC nor the PECL contain provisions explicitly regulating contracts of
sale79. Consequently, they do not address issues related to the handing over of
documents in contracts of sale so that the regulatory content of Art. 34 does not find a
3. DCFR
36 Unlike the PICC and the PECL80, the articles of the DCFR81 dealing with sales refer to
documents in various instances. Art. IV.A.-2:101(c) DCFR constitutes the general
obligation of the seller to transfer documents82. Furthermore, Arts IV. A.-2:201(1),(2)
and IV. A.-2:202(2) DCFR address certain issues regarding documents.
37 Art. IV.A.-2:101(c) DCFR obligates the seller to transfer those documents represent-
ing the goods. Unlike the CISG83, the DCFR differentiates between documents repre-
senting the goods and documents relating to the goods84. Due to the importance of

73 Cf. Schackmar, Die Lieferpflicht des Verkäufers in internationalen Kaufverträgen (2001), p. 189.
74 See the explanations under heading A8 of the rules of interpretation of the Incoterms.
78 Piltz/Bredow, Incoterms (2016) para. D-528.
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documentary sales85, the first group is elaborated on in more detail in Arts IV. A.-
2:201(1),(2) and IV. A.-2:202(2) DCFR.
Furthermore, Art. IV.A.-2:101(c) DCFR obligates the seller to transfer the documents 38
relating to the goods as required by the contract. This part of Art. IV.A.-2:101(c) DCFR
addresses all those documents which do not serve the purpose of representing the
goods. However, the comments on this article86 remain ambiguous with regard to those
documents, the purpose of which consists of describing the goods or their intended
use87.
The DCFR obligates the seller to “transfer” the documents. The purpose of this term 39
is to emphasize that more than just a handing over of the relevant documents is
required88. However, the final result will be very much the same as under Art. 34 CISG
which refers to the contract of sale and the relevant circumstances regarding the place,
the time and the form of handing over of the documents89.
Furthermore, just like Art. 34 second and third sentence, Art. IV.A.-2:203(2),(3) 40
DCFR provide an opportunity to cure an insufficient performance with regard to the
transfer of documents.
85 For more details see Principles, Definitions and Model Rules of European Private Law, Draft
Common Frame of Reference (DCFR), Full Edition (2009), Comment D to Art. IV.A.-2:102 and Notes
paras 10, 13.
86 See Principles, Definitions and Model Rules of European Private Law, Draft Common Frame of
Reference (DCFR), Full Edition (2009), Comment D to Art. IV.A.-2:102.

88 See Principles, Definitions and Model Rules of European Private Law, Draft Common Frame of
Reference (DCFR), Full Edition (2009), Comment D to Art. IV.A.-2:102.

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Section II
Conformity of the goods and third party claims
I. Importance of Section II in Practice

1 Section II of Chapter II, composed of Arts 35–44 and entitled “Conformity of the
goods and third party claims”, is of considerable importance for the success of the CISG
in practice. Some of its provisions, i. e. Arts 35–40, are among the most cited provisions
in case law.1 They address one of the central questions for any sales law regime: what
are the requirements the seller has to meet in relation to the quality of the goods and
under which circumstances is he liable for the non-conformity of the goods.
II. Structure of Section II

2 Like most national laws, Section II distinguishes between the seller’s obligations as to
the conformity of the goods in relation to quality, nature and quantity on the one hand
(Arts 35–40, 44) and the seller’s obligations as to the title on the other hand (Arts 41–
43, 44).2 Both “parts” of Section II have largely the same structure. They define first the
seller’s general obligations in relation to the goods (Arts 35–37 and 41–42) and then
regulate the buyer’s duties concerning possible breaches of these obligations (Arts 38–39
and 43(1)), including cases in which the seller may not rely on the buyer’s failure to
comply with such duties (Arts 40, 44 and 43(2)).
3 In this sense, the provisions contained in Section II can be divided in two groups. The
first group of Articles, Arts 35–37 and Arts 41–42, deals with the primary function of
Section II as expressed in the section’s title and its structure. They specify and
supplement the content of the seller’s general obligation to deliver the goods in
Art. 30.3 The seller is not only required to deliver goods, rather, he must deliver goods
that are in conformity with the contractual and legal requirements (Arts 35–36) and are
free from third party rights and claims (Arts 41, 42). A failure to comply with such
duties constitutes a breach of contract and gives rise to the normal remedies in Art. 45.
4 The second group of Articles, Arts 38–39, 43 as well as Art. 44 specifies the
procedures the buyer must follow in order to preserve those remedies. They impose
important examination and notification duties upon the buyer relating to the fulfilment
of the seller’s obligations (Arts 38, 39, 43). Systematically these provisions could also
have been included in Section III, regulating the buyer’s remedies for breach of
contract.4 In general, a failure to comply with these notification duties results in a loss
of the remedies for the breach of the seller’s obligations as to the conformity of the
1 Schlechtriem/Butler, CISG (2009), para. 132; Eiselen, in: Kritzer/Vanto/Vanto/Eiselen, International
Contract Manual (2008), Vol. 4 § 89:1; Flechtner, Funky Mussels, a Stolen Car, and Decrepit Used Shoes:
Non-Conforming Goods and Notice thereof under the United Nations Sales Convention, Boston
University International Law Journal (2008) 1(3) (Pace).
3 Art. 2:001 PEL-Sales explicitly differentiates between the obligation to deliver goods and the duty as to
the conformity of the goods, listing them as separate obligations.

4 See also Schlechtriem, The Seller’s Obligations Under the United Nations Convention on Contracts
for the International Sale of Goods, in: Galston/Smit (eds), International Sales: The United Nations
482 Kröll
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Section II. Conformity of the goods 5–9 Introduction to Articles 35–44

goods. Only where the seller knew about his breach of contract (Arts 40, 43(2)) or the
buyer has a reasonable excuse for the lack of notification (Art. 44) are his remedies – at
least partially – preserved. A violation of these notification duties by the buyer, however,
does not constitute a breach of contract resulting in further remedies for the seller.
III. Differences Between the Liability Regimes for Non-conformity

and Defects in Title
There are certain differences between the two liability regimes for non-conformity 5
and defects in title.5 They relate primarily to the required levels of awareness of the
defects. On the one hand, in the case of non-conforming goods, the seller’s liability is
already excluded pursuant to Art. 35(3) if the buyer could not have been unaware of the
deficiencies. For defects in title, Art. 41 requires the buyer’s actual consent. On the other
hand, in the case of non-conforming goods, the seller may not rely on a buyer’s failure
to give notice in time if he could not have been unaware of the lack of conformity
(Art. 40). For defects in title, by contrast, positive knowledge is required (Art. 43(2)).
Moreover, the examination obligation in Art. 38 and the final time limit for notifica- 6
tion in Art. 39(2) only exist in relation to the conformity of the goods. The same applies,
at least according to the prevailing view, for some remedies. The wording of Arts
46(2)(3), 50, dealing with the remedies of repair, delivery of substitute goods and price
reduction, only refers to the non-conformity of the goods and not to defects in title.6
IV. Differences in the Remedial Systems for Other Breaches

Unlike legal systems following the Roman Law tradition7, the CISG, in principle, does 7
not provide for a special remedial system for breaches of the obligations contained in
Arts 35, 41, 42. Such breaches give rise to the normal remedies listed in Art. 45.
Irrespective of this general approach of a uniform system of remedies, there are a
number of particularities which clearly distinguish the remedial systems for the delivery
of non-conforming goods (which is the most relevant breach in practice8) from those of
other breaches.
The primary difference is the aforementioned notice requirement which exists for 8
non-confirming goods as well as for defects in title, the non-compliance with which will
lead to a loss of remedies.
Another particularity relates to the remedy of avoidance. According to the prevailing 9
view, the buyer may only avoid the contract if the breach is fundamental under
Art. 49(1)(a). By contrast, the option to avoid the contract under Art. 49(1)(b) by
setting an additional time for remedying the breach is not possible.9 This often leads
Convention on Contracts for the International Sale of Goods (1984), pp. 6-1; see also the PEL-Sales and the
DCFR (IV.A. – 4:301) where the provisions are included into the parts dealing with remedies.
5 On the differences see also Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 35
para. 5; Ferrari, in: Ferrari et al. (eds), Internationales Vertragsrecht (2012), Art. 35 CISG para. 4; Eckert/
Maifeld/Matthiessen, Handbuch des Kaufrechts (2014), para. 551.
6 For a detailed discussion see Art. 46 para. 7, Art. 50 paras 12 et seq.
7 For the abandonment of that tradition see Bianca, in: Bianca/Bonell, Commentary (1987), Art. 35
para 1.4; for the old Roman System see Zimmermann, The Law of Obligations – Roman Foundations of
the Civilian Tradition (1996), pp. 293 et seq.
8 See Graffi, Case Law on the Concept of “Fundamental Breach” in the Vienna Sales Convention,
International Business Law Journal (2003) 338 (341) (“most recurrent situation in international sales
litigation”); Honnold/Flechtner, Uniform Law (2009), Art. 35 para. 222.
9 Cf infra Art. 49 para. 51
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Introduction to Articles 35–44 10 Part III. Chapter II. Obligations of the Seller
to considerable uncertainty for the buyer. Unless the parties have expressly stipulated
under which conditions non-conformity may amount to a fundamental breach, it may
be difficult for a buyer to determine whether the breach is fundamental and, conse-
quently, whether the contract can be avoided.10
V. Relationship to the National Remedies

10 Different views exist as to the relationship between the CISG’s rules on non-
conformity and defects in title on the one hand and national non-contractual remedies
such as mistake or tortious liability on the other. It is submitted that, with the exception
of remedies which are based on facts and circumstances which go beyond the mere non-
conformity of the goods or defects in title, remedies under national rules should be
excluded. The CISG contains exhaustive remedies. Any other view would endanger the
pursued harmonization in a central area of the CISG.11
10 Graffi, Case Law on the Concept of “Fundamental Breach” in the Vienna Sales Convention,
International Business Law Journal (2003) 338 (341).

11 Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 35 paras 47 et seq. with further
references as to the development of this view and opposing views; Huber, Irrtumsanfechtung und
Sachmängelhaftung (2001), pp. 275 et seq.; cf. Oberster Gerichtshof (Austria) 13 April 2000 (machines),
CISG-Online 576 (Pace) with note Schlechtriem, Noch einmal: Vertragsgemäße Beschaffenheit der Ware
bei divergierenden öffentlich-rechtlichen Qualitätsvorgaben, IPRax (2001) 161 (162); for a more detailed
discussion see Art. 35 paras 200 et seq.
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Article 35
(1) The seller must deliver goods which are of the quantity, quality and description
required by the contract and which are contained or packaged in the manner required
by the contract.
(2) Except where the parties have agreed otherwise, the goods do not conform with
the contract unless they:
(a) are fit for the purposes for which goods of the same description would
ordinarily be used;
(b) are fit for any particular purpose expressly or impliedly made known to the
seller at the time of the conclusion of the contract, except where the
circumstances show that the buyer did not rely, or that it was unreasonable
for him to rely, on the seller’s skill and judgement;
(c) possess the qualities of goods which the seller has held out to the buyer as a
sample or model;
(d) are contained or packaged in the manner usual for such goods or, where
there is no such manner, in a manner adequate to preserve and protect the
goods.
(3) The seller is not liable under subparagraphs (a) to (d) of the preceding
paragraph for any lack of conformity of the goods if at the time of the conclusion of
the contract the buyer knew or could not have been unaware of such lack of
conformity.
Bibliography: Butler, The CISG a Secret Weapon in the Fight for a Fairer World, in Schwenzer (ed), 35
Years CISG and Beyond (2015), p. 295; Ferrari, Divergences in the application of the CISG’s rules on
non-conformity of goods, RabelsZ (2004) 473 (Pace); Flechtner, Funky Mussels, a Stolen Car, and
Decrepit Used Shoes: Non-Conforming Goods and Notice thereof under the United Nations Sales
Convention, Boston University International Law Journal (2008) 1 (Pace); Gillette/Ferrari, Warranties
and “Lemons” under CISG Article 35(2)(a), Internationales Handelsrecht (2010) 2 (Pace); Heilmann,
Mängelgewährleistung im UN-Kaufrecht (1994); Henschel, Conformity of the goods: Interpreting or
supplementing Article 35 of the CISG by using the UNIDROIT Principles of International Commercial
Contracts and the Principles of European Contract Law, in: Felemegas (ed.) An International Approach
to the Interpretation of the United Nations Convention on Contracts for the International Sale of Goods
(1980) as Uniform Sales Law (2007), p. 166 (Pace); Henschel, Conformity of Goods in International Sales
Governed by CISG Article 35: Caveat Venditor, Caveat Emptor and Contract Law as Background Law
and as Competing Set of Rules, Nordic Journal of Commercial Law (2004) (Pace); Hyland, Conformity of
Goods to the Contract under the United Nations Sales Convention and the Uniform Commercial Code,
in: Schlechtriem (Hrsg), Einheitliches Kaufrecht und nationales Obligationenrecht (1987), p. 305 (Pace);
Kröll/Hennecke, From New Zealand Mussels to New Zealand Trucks – The (not so) “ordinary use” in
Article 35(2), in Schwenzer/Spagnolo (eds), Growing the CISG (2016), p. 43; Kruisinga, (Non-)confor-
mity in the 1980 UN Convention on Contracts for the International Sale of Goods: a uniform concept?
(2004); Maley, The Limits to the Conformity of Goods in the United Nations Convention on Contracts
for the International Sale of Goods (CISG), 12 International Trade and Business Law Review (2009) 82;
Müller, Ausgewählte Fragen der Beweislastverteilung im UN-Kaufrecht im Lichte der aktuellen Re-
chtsprechung (2005); Saidov, Art. 35 of the CISG: Reflecting on the Present and Thinking about the
Future, 58 Villanova Law Review 2013, 529 (Pace); Saidov, Conformity of Goods and Documents, (2015);
Vincze, Conformity of the Goods under the UN Convention on Contracts for the International Sale of
Goods (CISG): Overview of CIETAC’s Practice, FS Kritzer (2008), p. 552 (Pace); CISG-AC Opinion no
17, Limitation and Exclusion Clauses in CISG Contracts, 16 October 2015. Rapporteur: Prof. Lauro Gama
Jr., Pontifical Catholic University of Rio de Janeiro, Brazil (http://www.cisg-ac.org).
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Outline
I. Importance and Role of Provision . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1. Overview on the content . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2. History . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
3. Terminology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
4. Art. 35 as part of the CISG’s liability regime for non-conformity . . . . . . . . 8
1. The concept of non-conformity. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
b) Lack of any materiality requirement concerning the discrepancy . . . . . 15
c) Discrepancies in quantity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
d) Discrepancies in quality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
e) Discrepancies in description . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
f) Discrepancies in containers and packaging . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
2. Art. 35(1). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
a) Determining the relevant standard under Art. 35(1) . . . . . . . . . . . . . . . . . . . 37
b) Implicit agreements. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
c) Practices and usages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
d) Limitations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
e) Sale of used goods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
f) (Minimal) Ethical Standards, Codes of Conduct and other CSR-
Policies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
g) Subsequent amendment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
3. Art. 35(2). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
b) Fit for ordinary purpose: Art. 35(2)(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
aa) General remarks. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
bb) The notion of “ordinary purpose”. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
cc) Relationship to the standards of average and merchantable quality 79
dd) Differing standards and public law provisions . . . . . . . . . . . . . . . . . . . . . 89
ee) Application of the standard in practice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 103
(i) Resaleability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 103
(ii) Suspicion of defects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105
(iii) Duration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 106
(iv) Necessary documentation for assembly and usage . . . . . . . . . . . . 108
(v) Other issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 109
c) Fit for a particular purpose stated by the buyer: Art. 35(2)(b) . . . . . . . . . 112
bb) Information about purpose. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 115
cc) Reliance on the seller’s skill and knowledge . . . . . . . . . . . . . . . . . . . . . . . . 128
d) In conformity with sample or model: Art. 35(2)(c) . . . . . . . . . . . . . . . . . . . . . 134
bb) The required characteristics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 136
cc) Samples provided by the buyer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 142
e) Contained or packaged in the usual or adequate manner: Art. 35(2)(d) 143
aa) The accessory duty of packing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 143
bb) “Usual manner” . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 145
cc) “Adequate manner”. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 147
dd) Damages limited to packaging . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 150
ee) Extent of the duty to packaging and costs associated with it. . . . . . 152
4. Art. 35(3). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 155
a) Rationale and scope of the exclusion. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 155
b) Extension to breaches of Art. 35(1)? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 158
c) Buyer’s actual or presumed knowledge . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 162
d) Seller acting in bad faith . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 168
e) Waiver . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 169
5. Exclusion of express and implied obligations as to conformity . . . . . . . . . . . 170
6. Burden of proof . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 176
a) General rule . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 176
b) Allocation of the burden of proof in practice: Overview on the
different positions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 179
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Section II. Conformity of the goods and third party claims 1–4 Article 35
c) Suggested approach. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 184
d) Burden of proof concerning specific facts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 195
aa) Art. 35(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 195
bb) Art. 35(2)(a) – Fitness for ordinary purpose . . . . . . . . . . . . . . . . . . . . . . . . 198
cc) Art. 35(2)(b) – Fitness for a particular purpose . . . . . . . . . . . . . . . . . . . . . 200
dd) Art. 35(2)(c) – Sale by sample or model . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 202
ee) Exclusion of liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 203
e) Discharging the burden of proof: relevance of certificates confirming
conformity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 204
7. Relationship to the non-contractual remedies under national law. . . . . . . . . 207
I. Importance and Role of Provision

Art. 35 as a whole is designed to establish which requirements the seller has to meet 1
in order to fulfil his delivery obligation in relation to conformity of the goods. Its
importance in practice results from the fact that the majority of controversies arising
from sales transactions relate to the conformity of the goods. Delivery of non-conform-
ing goods, often also referred to as “defective delivery”, is in practice by far the most
frequent breach of contract.1 In comparison, the complete failure to deliver any goods,
i. e. cases of an actual “non-delivery”, are rare.
1. Overview on the content

Art. 35 adopts a broad and largely unified concept of conformity.2 Unlike many 2
national sales laws, it covers not only quality but also quantity, identity and packaging.3
Outside the conformity concept of Art. 35 are, however, third party rights and claims,
which are regulated separately in Arts 41–43.4
Art. 35(1) defines the contractual provisions of the parties, i. e. the description of the 3
goods in the contract, as the primary standard for conformity. Thus, it adopts a
subjective standard, based on the promises or undertakings by the parties in connection
with the specific transaction. Art. 35(2) then stipulates a number of the supplementary
standards which apply unless excluded by the parties.5 To that extent, it can be said that
Art. 35(1) respects the actual agreement of the parties where it exists, and Art. 35(2)
protects the reasonable expectations of the parties where the contractual provisions
concerning conformity of the goods are insufficient. Finally, Art. 35(3) contains an
exclusion of liability for all cases in which the buyer knew or could not have been
unaware of the lack of conformity under the objective standards set out in Art. 35(2).
Notwithstanding the supplementary criteria in Art. 35(2), the parties must in their 4
contract include at least a minimum standard concerning the kind of goods to be
supplied and their quantity. Where no agreement on these two issues has been reached,
1 See Gaffi, International Business Law Journal (2003) 338 (341): “most recurrent situation in
international sales litigation”; Honnold/Flechtner, Uniform Law (2009), Art. 35 para. 222.
2 Honnold/Flechtner, Uniform Law (2009), Art. 35 para. 223; Schwenzer, in: Schlechtriem/Schwenzer,
Commentary (2016), Art. 35 para. 4 (“uniform concept”); Schlechtriem/Butler, CISG (2009), para. 132.
3 Tribunal Supremo (Spain) 17 January 2008 (300 second-hand automobiles), CISG-Online 1640
(Pace); for details see infra paras 12 et seq.

4 Secretariat Commentary on 1978 Draft, Art. 39 (now Art. 41) para. 7; the differences concern the
effects of the buyer’s awareness of the existing defects (sufficient under Art. 35(3) – consent required
under Art. 41), the time limit for liability (Art. 39(2)) and the available remedies (Arts 46(2)(3), 50); for a
more detailed analysis of the differences see above Introductory Remarks pre Arts 35–44 para. 5.
5 Oberster Gerichtshof (Austria) 19 April 2007 (scaffold hooks), CISG-Online 1495 (Pace) at 1.1; for a
more detailed analysis of the relationship between the two paragraphs see infra paras 64 et seq. (at 3.1).
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either directly or indirectly through a provision for a mechanism to make the necessary
determination, in general no contract will exist between the parties.6
2. History
5 Art. 35 is a mixture of elements from various legal systems.7 It differs from its
predecessors in the ULIS, Arts 19(1), 33(1) and 36 ULIS, in several respects. One of the
most important differences is the clear distinction between the obligation to deliver and
non-performance on the one hand and obligations as to the conformity of the goods and
defective performance on the other hand.8 Under Art. 33(1) ULIS a seller only fulfilled his
delivery obligation if conforming goods were delivered. By contrast, under the CISG a
seller may fulfil his general obligation to deliver pursuant to Art. 30 by goods which meet
the general description of the contract but do not conform with the contractual or legal
requirements as to quality and form. As a consequence, the buyer is limited to the
remedies for non-conforming delivery and cannot invoke the remedies for non-delivery,
such as Art 49(1)(b). A second difference relates to the abandonment of the requirement
of “materiality of the discrepancy” previously contained in Art. 33(2) ULIS.9 As avoidance
under the CISG is limited to fundamental breaches, the materiality-restriction of the ULIS
is no longer considered to be justified for the other remedies.10
6 In addition, a different drafting technique was adopted. Art. 35 is a much simpler
and, at the same time, more comprehensive text. Art. 33 ULIS limited itself to clarify the
instances in which the seller has breached its delivery obligation. By contrast, Art. 35(2)
defines the content of the seller’s delivery obligation in a positive way, setting out the
legal requirements for conformity.11
3. Terminology
7 In some legal systems, such as the U.S., and in numerous international contracts the
terms “express” or “implied warranties” are used to describe the type of obligations
referred to in Art. 35(1) and (2).12 In practice, this use of the term “warranty” largely boils
down to a question of terminology. Systematically, however, according to the concept
underlying the CISG, the seller undertakes an obligation (and not only a warranty) to
actually delivery the kind and quality of goods as agreed.13
4. Art. 35 as part of the CISG’s liability regime for non-conformity

8 Art. 35, by stipulating a duty to deliver conforming goods and determining the
relevant standards of conformity, is the foundation of the CISG’s regime for liability
for non-conformity. The relevant time at which the goods must be in conformity is
defined in Art. 36. In principle, the goods must comply with the standards imposed by
Art. 35 at the time when the risk passes (Art. 36(1)). This liability is extended to
6 Bianca, in: Bianca/Bonell, Commentary (1987), Art. 35 para. 2.2.

7 Critical Hyland, Conformity of Goods, in: Schlechtriem (ed.), Einheitliches Kaufrecht (1987), p. 305.
8 Secretariat Commentary on 1978 Draft, Art. 33 (now Art. 35) para. 2; Mullis, in: Huber/Mullis, The
CISG (2007), p. 107.

10 For details see infra paras 15 et seq.
11 For a more comprehensive comparison between Art. 35 CISG and its ULIS antecedents see
Bianca, in: Bianca/Bonell, Commentary (1987), Art. 35 paras 1.1 et seq.; Magnus, in: Staudinger
Kommentar (2013), Art. 35 paras 3 et seq.
12 See Gillette/Walt, UN-Convention (2014), § 6.01.
13 Lookofsky, Understanding the CISG (2017), p. 76 seq.; Gillette/Walt, Sales Law (2016), Ch. 8-III
p. 370 et seq.
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conformity at a later stage if the seller has either guaranteed such conformity or has
breached an obligation resulting in the subsequent non-conformity (Art. 36(2)).
The remedies for a breach of the obligation to deliver conforming goods are regulated 9
in Arts 45 et seq. In general, any failure of the seller to deliver goods which meet the
relevant standards of Art. 35 constitutes a breach of contract giving rise to the remedies
in Arts 45 et seq. and to the right of retention concerning the payment obligation.14
Unlike the ULIS, there is no longer a requirement concerning the materiality of the
breach.15 Avoidance of the contract for non-conformity is, however, only possible where
the lack of conformity constitutes a fundamental breach in the sense of Art. 49(1)(a). By
contrast, the mere expiry of a time set for curing the lack of non-conformity in the sense
of Art. 49(1)(b) is not sufficient.
Moreover, the seller’s liability for his obligations under Art. 35 is not dependent on 10
any knowledge concerning the non-conformity of the goods. The CISG is generally
based on non-fault liability. In those very rare cases where the non-conformity of the
goods was due to an impediment beyond the seller’s control, claims for damages may be
excluded pursuant to Art. 79. Equally, Art. 80 applies where the non-conformity is due
to acts of the buyer.
Irrespective of the non-conformity of the goods, in principle, the buyer’s remedies 11
only arise if he fulfils his examination and notification duties stipulated in Arts 38 and
39. Pursuant to Art. 39(1) the buyer “loses the right to rely on a lack of conformity of
the goods” if he does not give proper notice of their non-conformity within a reasonable
time. Exceptions to this rule exist where either the seller knew about the non-
conformity (Art. 40) or the buyer has a reasonable excuse for not giving proper notice
(Art. 44).

1. The concept of non-conformity
a) General remarks. Art. 35 is based on a wide concept of non-conformity which has 12
to be interpreted broadly and autonomously from comparable national concepts.16 In
addition to quality, the concept in Art. 35 also includes differences in quantity, identity
and packaging. In particular, if a broad interpretation of the various notions is adopted,
the concept encompasses all relevant features of the goods. In any case, it is uncontested
that the list is non-exhaustive. The parties may agree on additional requirements to be
met by the goods for their conformity.17
As a consequence of this uniform concept of non-conformity, there is no need and no 13
justification for the subtle distinctions between the various forms of deviations that exist
under many national laws. In principle, Art. 35 does not distinguish between the
delivery of “defective goods” and the delivery of “different goods”, i. e. between peius
and aliud or different types of aliud (capable and incapable of being approved by the
14
For details concerning the right of retention see below Art. 45 para. 8.
15
See Eckert/Maifeld/Matthiessen, Handbuch des Kaufrechts (2014), para. 557; Piltz, Internationales
Kaufrecht (2008), paras 5–31; for details see infra paras 15 et seq.
16 Bridge, International Sales Law (2013), para. 11.23; Piltz, Internationales Kaufrecht (2008), paras 5–
28; Tribunal Cantonal du Valais (Switzerland) 28 October 1997 (second hand bulldozer), CISG-Online
328 (Pace) at 4 b.
17 Magnus, in: Staudinger Kommentar (2013), Art. 35 para. 15; Ferrari, in: Ferrari et al., Internationales
Vertragsrecht (2018), Art. 35 CISG para. 2 mentioning compliance with labelling and composition
requirements; Landgericht Paderborn (Germany) 25 June 1996 (granulated plastic -PVC), CISG-Online
262 (Pace).
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buyer), as does, for example, Austrian law.18 Neither is a distinction made between
ordinary characteristics of the goods and specific warranties as to their particular
characteristics, i. e. between Sacheigenschaft and Zusicherung, as is done, for example,
under Swiss law.19 Furthermore, Art. 35 does not distinguish between vice caché and
vice apparent20, like the French law, between conditions and warranties, as is done
under English law, or express and implied warranties, as is done under U.S. law. This
has to be borne in mind when interpreting Art. 35.
14 In light of the relevance of this provision in practice, it is particularly important to
give the concept an autonomous meaning as required by Art. 7 to avoid resort to
national law concepts, which may undermine the intended harmonization of sales law.
As national laws often provide for comparable standards using identical or comparable
terminology there is an increased and imminent danger of importing national law
standards into the CISG.21 Due to Art. 35’s reference to elements and formulations,
which may be contained in various national laws, the risk of interpreting these concepts
on the basis of the comparable national concept is fairly high.22 While Art. 35 might at
first sight “mimic” domestic warranty provisions it is “an entirely different legal animal,
best kept and studied in its own conformity cage”.23
15 b) Lack of any materiality requirement concerning the discrepancy. Discrepancies
do not have to be material to constitute a breach of the obligation to deliver conforming
goods under Art. 35.24 The materiality requirement imposed by Art. 33(2) ULIS, the
predecessor of Art. 35, has been abolished.25 Its primary purpose under the ULIS was to
prevent situations in which the buyer could require delivery of substitute goods or avoid
the contract for minor deviations from the conformity requirements. Under the CISG,
the necessary limitations upon both remedies are ensured by the additional requirement
that the breach must be fundamental to justify either remedy (Arts 46(2), 49(1)(a)). To
that extent, conformity in the sense of Art. 35 has to be clearly distinguished from the
later question of whether the non-conformity constitutes a fundamental breach. The
same applies to the question as to the amount of damages due. Therefore, it is in
principle irrelevant whether the discrepancies affect the usability or value of the goods
18 Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 35 para. 4; for the limits see below.
19 Brunner, Kommentar (2014), Art. 35 para. 2.
20 Kruisinga, (Non-)conformity (2004), pp. 27 seq.; Schwenzer, in: Schlechtriem/Schwenzer, Commen-
tary (2016), Art. 35 para. 4.

21 Hyland, Conformity of Goods, in: Schlechtriem (ed.), Einheitliches Kaufrecht (1987), p. 305 (pp. 327
seq.).
22 For examples of an interpretation on the basis of national laws see Oberlandesgericht Frankfurt
(Germany), 29 January 2004 (pork meat), CISG-Online 822 (Pace), criticized by Bundesgerichtshof
(Germany) 2 March 2005 (Belgian frozen pork) CISG-Online 999 (Pace) at II1; Juzgado de Primera
Instancia e Instrucción No. 3 de Tudela (Spain), 29 March 2005 (machine for rectification of bricks),
Cerámica Tudelana, S. A. v Wassmer Gruppe Spezial Machinen GmbH, CISG-Online 1016 (Pace) with
critical comment by Schlechtriem/Perales di Viscasillas (Pace); for differences in interpretation see also
Ferrari, Divergences in the application of the CISG’s rules on non-conformity of goods, RabelsZ (2004)
473 (474 et seq.); see also Ferrari,.”Domestication” of Art. 35(2)(a) CISG, in: Lookofsky/Andersen (eds).
The CISG Convention (2014), p. 91 (101 et seq.).
23 Lookofsky, Tooling up for Warranties with the CISG Case Digest, in: Flechtner/Brand/Walter (eds),
Drafting Contracts (2007), p. 343 (348).

24 Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 35 para. 34; Ferrari, in: Ferrari
et al., Internationales Vertragsrecht (2018), Art. 35 CISG para. 13; Eckert/Maifeld/Matthiessen, Handbuch
des Kaufrechts (2014), para. 557; Piltz, Internationales Kaufrecht (2008), paras 5–31; for a different view
based on good faith considerations Neumayer/Ming, Convention de Vienne (1993), Art. 35 para. 2.
25 Magnus, in: Staudinger Kommentar (2013), Art. 35 para. 4; for the considerations relevant see
Honnold, Documentary History (1989), p. 121.
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or even if they favour the buyer. Every discrepancy results in the non-conformity of the
goods unless it is covered by contractual stipulations or usages or practices.26
Through the adoption of a conformity concept without any “materiality” require- 16
ment, the CISG avoids the often difficult decision of whether a discrepancy was
immaterial or not. Moreover, the contractual equilibrium is best preserved if non-
material discrepancies constitute a breach of the obligation and entitle the buyer to the
remedies of price reduction (Art. 50), repair (Art. 46(3)) or damages (Arts 74 et seq).
However, in principle, the CISG concept of conformity is not based on a perfect 17
tender rule. Minor discrepancies are often within the tolerances allowed under the
contract or in general practice. It is not uncommon that contracts provide that certain
deviations as to quantity or quality are permissible and in certain sectors minor
discrepancies in quantity or quality are considered to be permissible even without such
explicit clauses. While such discrepancies, particularly in relation to quantity, may result
in a reduction of price under the contract or trade usage, they do not constitute a breach
of the obligation to deliver conforming goods.27
In addition, notwithstanding that it is in principle irrelevant for the finding of a 18
breach whether the non-conformity results in a reduced value or affects the utility, both
factors de facto retain a certain relevance. In practice, both may be relevant considera-
tions first in determining whether the goods are conforming, i. e. the definition of the
relevant standard, and second whether the other requirements for the remedies are met.
If goods are delivered which are equal in value and utility to conforming goods, in
general, no damages will have occurred nor will the breach be fundamental. Where the
non-conformity amounts to a fundamental breach it may form the basis for an
avoidance of the contract.28
c) Discrepancies in quantity. Art. 35 is based on the concept that, in general, 19
discrepancies in quantity constitute a delivery of non-conforming goods and not partial
non-delivery.29 Irrespective of the reference in Art. 51 to a delivery of “only a part of the
goods”, the wording of Art. 35 is unequivocal. In principle, this applies irrespective of
the size of the discrepancies and whether the discrepancies are evident from the relevant
documents or not.30 Thus, the buyer is required to notify the seller even of large
deviations to avoid the loss of his rights under Art. 39.31 While the buyer will often be
26 Magnus, in: Honsell, Kommentar (2010), Art. 35 para. 11; to that extent at least misleading
Handelsgericht Zürich (Switzerland) 30 November 1998 (lambskin coats), CISG-Online 415 (Pace).
27 Arbitral Award, ICC, 1 August 1999 (books), CISG-Online 706; Schwenzer, in: Schlechtriem/
Schwenzer, Commentary (2016), Art. 35 para. 8; for the less than perfect deliveries see also Lookofsky,
Tooling up for Warranties with the CISG Case Digest, in: Flechtner/Brand/Walter (eds), Drafting
Contracts (2007), p. 343 (p. 349).
28 Tribunale di Busto Arsizio (Italy) 13 December 2001 (machinery for recycling of plastic bags), CISG-
Online 1323 (Pace).

29 Piltz, Internationales Kaufrecht (2008), para. 5–28; Bundesgericht (Switzerland) 7 July 2004 (cable
drums), CISG-Online 848 (Pace); Landgericht Landshut (Germany) 5 April 1995 (sport clothing), CISG-
Online 193 (Pace); but see contra Arbitral Award, Tribunal of International Commercial Arbitration at the
Russian Federation Chamber of Commerce 132/2004, 27 October 2005 (goods not specified), CISG-Online
1503 (Pace).
30 Gruber, in: MünchKommBGB (2016), Art. 35 CISG paras 6 seq.; for the qualification as partial non-
delivery where the discrepancy is obvious from the documents Enderlein/Maskow, International Sales
Law (1992), Art. 35 para. 3; Salger, in: Witz/Salger/Lorenz, Kommentar (2016), Art. 35 para. 6.
31 Bundesgericht (Switzerland) 7 July 2004 (cable drums), CISG-Online 848 (Pace); Oberlandesgericht
Brandenburg (Germany) 3 July 2014 (cuttings), CISG-Online 2543 (Pace), para. 22; Landgericht Landshut
(Germany) 5 April 1995 (sport clothing), CISG-Online 193 (Pace); cf. for excess quantities: Oberlandes-
gericht Rostock (Germany) 25 September 2002 (frozen food), CISG-Online 672 (Pace); Heilmann,
Mängelgewährleistung (1994), pp. 171 seq.; for a loss due to an unspecific notice Oberlandesgericht
Koblenz (Germany) 31 January 1997 (acrylic blankets), CISG-Online 256 (Pace).
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able to rely on Art. 40 in case of large discrepancies, this may not always be the case if
the seller has informed the buyer about these discrepancies.
20 Contracts sometimes provide that certain deviations as to quantity are permissible.
Where the quantity is only stated as an approximate amount through clauses such as
“more or less”, “not less than” or “about” the seller has some latitude as to the amount
he can deliver. In certain sectors, minor discrepancies in quantity are considered to be
permissible even without such explicit clauses (e. g. usage in the sense of Art. 9). Unless
the permitted tolerances have been exceeded, such discrepancies do not constitute a
non-conforming delivery.32 Nevertheless they will often result in a reduction of price
under the contract or the trade usage.
21 One further example where a temporary discrepancy in quantity may not lead to
non-conformity is instalments contracts. In principle, each instalment has to be treated
separately and this also pertains to conformity. However, unless the buyer needs a
particular amount of the goods at a specified date, as in cases of just-in-time production,
shortage in delivery in earlier instalments can be remedied by the delivery of a larger
quantity in subsequent instalments. Such temporary shortages are regularly due to the
availability of transportation space and are often covered by existing customs in
particular areas of trade or practices between the parties.33
22 Equally, the delivery of excess quantity constitutes a non-conformity.34 Its conse-
quences are regulated specifically in Art. 52(2) which provides that the buyer may
take delivery of the excess quantity and pay for it or refuse to take delivery. The
latter option may, however, be lost if the buyer violates its notice obligation under
Art. 39.
23 The above principles also apply mutatis mutandis to partial deliveries, which, in
relation to non-conformity, can be equated with the explicitly mentioned lack of
quantity.35
24 d) Discrepancies in quality. Quality as used in Art. 35 covers primarily the – broadly
understood – physical condition of the goods, whether agreed upon (Art. 35(1)) or
justifiably expected (Art 35(2)). Thus, deviations from the physical or chemical compo-
sition of the goods36 or the resulting characteristics, such as being washable without
shrinking37 or being suitable for consumption, as well as from the expressly or impliedly
agreed age or hours of use, constitute discrepancies in quality.
32 Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 35 para. 8; Arbitral Award, ICC
9083/1999, 1 August 1999 (books), CISG-Online 706; Ontario Superior Court of Justice (Canada)
31 August 1999 (picture frame mouldings), CISG-Online 433 (Pace).
33 See Arbitral Award, ICC 9083/1999, 1 August 1999 (books), CISG-Online 706, relying additionally
on a practice established between the parties due to the lack of complaints against such discrepancies.
34 Piltz, Internationales Kaufrecht (2008), para. 5–33; Oberlandesgericht Rostock (Germany)
25 September 2002 (frozen food), CISG-Online 672 (Pace); Ontario Superior Court of Justice (Canada)
31 August 1999 (picture frame mouldings), CISG-Online 433 (Pace); but see Cour d’appel Paris
(France) 22 April 1992 (electronic components), Société Fauba France FDIS GC Electronique v Société
Fujitsu Mikroelectronic GmbH, CISG-Online 222 confirmed by Cour de cassation (France) 4 January
1995 (electronic components), CISG-Online 138 (Pace) applying Arts 81 et seq. to such cases with
critical note by Witz, The First Decision of France’s Court of Cassation Applying the U. N. Convention
on Contracts for the International Sale of Goods, 16 Journal of Law and Commerce (1997) 345–356.
36 Appellationsgericht Basel-Stadt (Switzerland) 23 August 2003 (soyaprotein products), CISG-Online
943 (Pace); Landgericht Paderborn (Germany) 25 June 1996 (granulated plastic – PVC), CISG-Online 262
(Pace).
37 Landgericht Landshut (Germany) 5 April 1995 (sport clothing), CISG-Online 193 (Pace) – shrinking
of one to two sizes considered to be fundamental breach.
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Additionally, quality in the sense of Art. 35 further encompasses non-physical 25
attributes of the goods, i. e. factual and legal circumstances affecting the relationship of
the goods to their surroundings.38 Depending on the circumstances of the case, these
can include public law regulations,39 technical standards or compliance with certain
standards in production, such as good manufacturing practice, the absence of child
labour or other ethical or environmental standards.40 The origin of the goods may also
be considered to be an element of their quality, particularly when the origin affects
import quotas, customs duties or the general resalability of the goods for political
reasons.41
The same applies to the existence of certificates or documents42 and the brand of the 26
goods, i. e. whether they are originals or counterfeits.43 Also, cultural traditions and
religious convictions can influence the parties’ expectation as to the quality of the goods,
for example that foodstuff does not contain beef or pork.
Documents necessary for the use of the goods, such as assembly instructions or user 27
manuals, can equally be considered to form part of the quality of the goods.44 By
contrast, documents used in the performance of international transactions, such as bills
of lading or packing lists do not fall within the ambit of Art. 35 but are regulated
separately in Art. 34.45
Discrepancies in quality permitted under the contract or under trade usages in the 28
relevant sector – or practices established between the parties – do not result in the non-
conformity of the goods.46
e) Discrepancies in description. In principle, the delivery of different goods is 29
considered to constitute delivery of non-conforming goods. Unlike some national laws,
the CISG does not differentiate between the delivery of non-conforming goods and the
38 For a comprehensive treatment of the issue see Maley, The Limits to the Conformity of Goods, 12
International Trade and Business Law Review (2009) 82 et seq. (Pace).

39 Oberster Gerichtshof (Austria) 13 April 2000 (machines), CISG-Online 576 (Pace) – lack of CE-
certificate; Cour d’appel Grenoble (France) 13 September 1995 (cheese), Caito Roger v Société francaise de
factoring, CISG-Online 157 (Pace) – lack of correct labelling as to composition and expiry date of
parmesan cheese.
40 Butler, The CISG a Secret Weapon in the Fight for a Fairer World, in Schwenzer (ed.), 35 Years
CISG and Beyond, p. 295 (302); Schwenzer, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2013),
Art. 35 para. 9.
41 Bundesgerichtshof (Germany) 3 April 1996 (cobalt sulphate), CISG-Online 135 (Pace) – from South
Africa instead of UK; Landgericht Saarbrücken (Germany) 1 June 2004 (pallets), CISG-Online 1228
(Pace) – pallets not from Poland as alleged so that additional customs duties were due.
42 Oberlandesgericht München (Germany) 13 November 2002 (barley), CISG-Online 786 (Pace) with
note by Hohloch, Juristische Schulung 2003, 1134 (1135) – absence of a certificate identifying the goods as
bio; Handelsgericht St. Gallen (Switzerland) 14 June 2012 (organic juices and organic oils), CISG-Online
2468 (Pace), para. III.2.a; Court of Appeal of New Zealand (New Zealand) 22 July 2011 (trucks), RJ & AM
Smallmon v Transport Sales Ltd and Grant Alan Miller, CISG-Online 2215 (Pace) absence of a certificate
that production is according to Australian Design Rules; Oberlandesgericht Hamm (Germany) 30 No-
vember 2010 (pigs), CISG-Online 2217, para. II.3 lack of breeding documentation.
43 Maley, The Limits to the Conformity of Goods, 12 International Trade and Business Law Review
(2009) 82 (87 et seq.) (Pace); Ferrari, in: Ferrari et al., Internationales Vertragsrecht (2018), Art. 35 CISG
para. 8; where the “brand equity” is protected by intellectual property rights, the special rules in Art. 42
supersede Art. 35.
44 For details see below para. 102.
45 Piltz, Internationales Kaufrecht (2008), para. 5–29; for details see Art. 34 paras 3, 10 et seq.
46 Ontario Superior Court of Justice (Canada) 31 August 1999 (picture frame mouldings), CISG-Online
433 (Pace).
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delivery of different goods, i. e. the delivery of an aliud.47 This applies for bulk sales as
well as for the sale of specific goods.48
30 Thus, even at the time of the economic embargo against South Africa, the delivery of
cobalt sulphate of South African origin did not constitute a non-delivery of the English
Cobalt Sulphate contracted for but merely the delivery of non-conforming cobalt
sulphate.49 Equally, delivery of gravel instead of porphyry stones does not result in
non-delivery but merely in a non-conforming delivery.50
31 However, different views exist as to whether a blatant divergence from a contractual
condition has to be classified as non-delivery instead of delivery of non-conforming
goods. The differentiation between non-delivery and delivery of non-conforming goods
is of practical relevance as the notification obligation under Art. 39 only exists for the
delivery of non-conforming goods. Furthermore, the buyer may only avoid the contract
pursuant to Art. 49(1)(a) if the breach is fundamental, while in cases of non-delivery the
buyer may additionally rely on Art. 49(1)(b) to avoid the contract, i. e. after the expiry of
an additional period of time.51
32 Some authors and courts have submitted that the delivery of goods, which do not at
least meet the general description of the contract, i. e. goods which are “absolutely
extraneous to the seller’s obligation”, must be considered as non-delivery and not as
defective delivery.52 Some support for this view can be found in the Secretariat’s
Commentary, which states that the delivery of potatoes instead of corn does not fulfil
the obligations to deliver goods for the purpose of Art. 30.53
33 The prevailing54 and, in this author’s opinion, better view is, however, to avoid such
distinctions, even if this may sometimes seem contrary to the notion of delivery.
Otherwise, the distinction between aliud and non-conforming goods would in those
cases be merely replaced by a no less difficult distinction between non-conforming
47 See Oberster Gerichtshof (Austria) 29 June 1999 (dividing wall panels), CISG-Online 483 (Pace);
Oberster Gerichtshof (Austria) 21 March 2000 (wood), CISG-Online 641 (Pace). Handelsgericht des
Kantons Zürich (Switzerland) 30 November 1998 (lambskin coats), CISG-Online 415 (Pace) – goods
with different article number delivered; cf. Amtsgericht Viechtach (Germany) 11 April 2002 (pallets),
CISG-Online 755 (Pace) – pallets delivered did not fulfil the agreed EUR-Norm; Landgericht Stuttgart
(Germany) 4 June 2002 (porphyr stones), CISG-Online 909 (Pace) – in part delivery of gravel instead of
the purchased porphyr stones. Gruber, in: MünchKommBGB (2016), Art. 35 CISG para. 4.
48 Oberster Gerichtshof (Austria) 29 June 1999 (dividing wall panels), CISG-Online 483 (Pace); for a
limitation in cases where specific goods are sold Benicke, in: MünchKommHGB (2013), Art. 35 para. 4.
49 Bundesgerichtshof (Germany) 3 April 1996 (cobalt Sulphate), CISG-Online 135 (Pace) at II 2 b;
Benicke, Zur Vertragsaufhebung nach UN-Kaufrecht bei Lieferung mangelhafter Ware, IPRax (1997) 326
(328): see also Oberlandesgericht Zweibrücken (Germany) 2 February 2004 (milling equipment), CISG-
Online 877 (Pace) – Russian and Turkish mills delivered are non-conforming German mills.
50 Landgericht Stuttgart (Germany) 4 June 2002 (porphyr stones), CISG-Online 909 (Pace); cf. Amts-
gericht Viechtach (Germany) 11 April 2002 (pallets), CISG-Online 755 (Pace) (pallets delivered did not
fulfil the agreed EUR-Norm).
51 See for details Art. 49 paras 49 et seq.
52 Bianca, in: Bianca/Bonell, Commentary (1987), Art. 35 para. 2.4. Neumayer/Ming, Convention de
Vienne (1993), Art. 35 para. 3; Neumayer, Offene Fragen zur Anwendung des Abkommens der Vereinten
Nationen über den internationalen Warenkauf, RIW (1994) 99 (105); see also Oberlandesgericht
Düsseldorf (Germany) 10 February 1994 (fabrics), CISG-Online 115 (Pace); in obiter dicta favour also
Amtsgericht Viechtach (Germany) 11 April 2002 (pallets), CISG-Online 755 (Pace); left open Bundesger-
ichtshof (Germany) 3 April 1996 (cobalt sulphate), CISG-Online 135 (Pace).
54 Aicher, Leistungsstörungen aus der Verkäufersphäre, in: Hoyer/Posch (eds), Das Einheitliche Wiener
Kaufrecht (1992), p. 111 (p. 120 et seq.); Schlechtriem, The Seller’s Obligations Under the United Nations
Convention on Contracts for the International Sale of Goods, in: Galston/Smit (eds), International Sales:
The United Nations Convention on Contracts for the International Sale of Goods (1984), pp. 6–11;
Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 35 para. 11; Gruber, in: Münch-
KommBGB (2016), Art. 35 CISG para. 4; Magnus, in: Staudinger Kommentar (2013), Art. 35 para. 9.
494 Kröll
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delivery and non-delivery. The legislative history of Art. 30 does not provide a basis for
the statement in the Secretariat’s Commentary seemingly supporting such a distinction.
Furthermore, there is no practical need for this distinction. The buyer’s legitimate
interests are sufficiently protected even if blatant discrepancies between the goods
delivered and contracted for are included into the concept of non-conforming delivery.
In such cases, the buyer is generally substantially deprived “of what he is entitled to
expect under the contract” and thus has the right to avoid the contract or to ask for
delivery of substitute goods under Arts 46(2) and 49(1)(a). In addition, the argument of
the problems encountered in calculating the reduction of price under Art. 50 is largely
of a theoretical nature. In cases of blatant discrepancies, the buyer normally has an
interest either in delivery of substitute goods or avoidance of the contract and not in a
mere reduction of the price. The threat of losing the rights to rely on the non-
conformity is negligible. In cases of blatant discrepancies, the seller will normally be
aware of the non-conformity of the goods or at least ought to have been aware thereof.55
Pursuant to Art. 40, the seller will thus not be able to rely on any failure by the buyer to
notify the seller under Art. 39. Furthermore, in cases where the discrepancies are of such
a weight that the buyer is not even able to attribute the delivery to a particular
contract,56 the buyer will be excused under Art. 44 for a failure to give notice.57
f) Discrepancies in containers and packaging. In light of the peculiarities of inter- 34
national transactions, often requiring long distance transportation crossing several
borders, packaging of the goods may be of considerable importance. Accordingly, unlike
in some national sales laws,58 deviations from the agreed mode of containment or
packaging may result in non-conformity of the goods.59 Implicit agreements as to
packaging are possible and may result from previous practice between the parties. This
does not apply, however, in cases where the packaging under previous contracts was
inadequate.60
The principle of good faith in Art. 7 prohibits reliance on discrepancies in packing if 35
the sole purpose of the containers or the packaging is to ensure that the goods can be
transported without being damaged and this objective has been attained despite the
failure to comply with the packaging requirements.61 Additionally, the packaging may
also have the purpose of preventing harm or damage to other persons or goods that
may be caused by improper packaging or it may be a crucial element in the brand image
of the goods.
55 E. g. Handelsgericht Zürich (Switzerland) 30 November 1998 (lambskin coats), CISG-Online 415
(Pace) at 5 b, bb; for a different view in cases of a slight negligent mix up of goods Aicher, Leistungsstör-
ungen aus der Verkäufersphäre, in: Hoyer/Posch (eds), Das Einheitliche Wiener Kaufrecht (1992), p. 111
(118); Benicke, Zur Vertragsaufhebung nach UN-Kaufrecht bei Lieferung mangelhafter Ware, IPRax
(1997) 326 (328).
56 In favour of making the attributability an additional requirement Resch, Zur Rüge bei Sachmängeln
nach UN-Kaufrecht, ÖJZ (1992) 470 (472); Janssen, Untersuchungs- und Rügepflichten im deutschen,
niederländischen und internationalen Kaufrecht (2001), p. 78.
57 Gruber, in: MünchKommBGB (2016), Art. 35 CISG para. 5.
58 See the example in Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 35 para. 12
note 63.
59 Comisión para la Protección del Comercio Exterior de México (Mexico) 29 April 1996 (canned fruit),
Conservas la Costena v Lanis, CISG-Online 350 (Pace).

60 Saarländisches Oberlandesgericht (Germany) 17 January 2007 (natural stone marble panels), CISG-
Online 1642 (Pace).

61 Ferrari, in: Ferrari et al., Internationales Vertragsrecht (2018), Art. 35 CISG para. 10; Janssen,
Untersuchungs- und Rügepflichten im deutschen, niederländischen und internationalen Kaufrecht

(2001), pp. 79 seq.
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36 In cases of inadequate packaging, the seller will be deemed to have delivered non-
conforming goods even if the damage to the goods occurrs after the passing of risk.62
2. Art. 35(1)
37 a) Determining the relevant standard under Art. 35(1). Art. 35(1) defines the con-
tract as the primary source for the standard of conformity of the goods. It contains a
clear endorsement of the supremacy of contractual provisions over the supplementary
legal standard provided by Art. 35(2).63 Consequently the CISG, like many national
laws, has as its starting point a subjective concept of non-conformity.64
38 A contractual agreement in the sense of Art. 35(1) does not require any special
wording of the parties and its formation is governed by the general rules on formation.
In particular, no confirmation or even guarantee of certain characteristics by the seller is
required.65 Such guarantees may, however, be relevant in determining whether a breach
is fundamental (Arts 46(2), 49(1)(a)) or for the application of Art. 36(2).
39 The contractual requirements may be explicit or implicit.66 They may be spelt out in
some detail or may follow from the specific termionology used.67 In determining the
exact content of the seller’s contractual obligation concerning the conformity of the
goods, the parties’ statements and conduct have to be interpreted in accordance with the
principles set out in Art. 8.68 This means, in particular, that the courts are not restricted
to the four corners of the contract and what has been put down in writing. The parol
evidence rule (at least its substantive part) as applied in common law jurisdictions is not
applicable in this regard.69 Instead, as required by Art. 8(3), courts have to base their
interpretation on “all relevant circumstances of the case”. In addition to the contractual
document itself and its annexes, these include other documents exchanged between the
parties, such as assembly instructions, service manuals,70 pre-contractual negotiations
62 Piltz, Internationales Kaufrecht (2008), paras 5–37; Comisión para la Protección del Comercio
Exterior de México (Mexico) 29 April 1996 (canned fruit), Conservas la Costena v Lanis, CISG-Online
350 (Pace); see also Arbitral Award, CIETAC, 23 February 1995 (jasmine aldehyde), CISG-Online 568
(Pace).
63 Schlechtriem/Butler, CISG (2009), para. 133; Ferrari, in: Ferrari et al., Internationales Vertragsrecht
(2018), Art. 35 CISG para. 5; cf. Bundesgerichtshof (Germany) 3 April 1996 (cobalt Sulphate), CISG-
Online 135 (Pace) at II2c(aa); Kantonsgericht Schaffhausen (Switzerland) 27 January 2004 (model
locomotives), CISG-Online 960 (Pace).
64 The objective standards implied by Art. 35(2) lead in the end to a mixed system of conformity;
Magnus, in: Honsell, Kommentar (2010), Art. 35 para. 12.

65 Piltz, Internationales Kaufrecht (2008), para. 5–32; Flechtner, Funky Mussels, a Stolen Car, and
Decrepit Used Shoes: Non-Conforming Goods and Notice thereof under the United Nations Sales
Convention, Boston University International Law Journal (2008) 1 (5) (Pace).
66 Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 35 para. 7; Hyland, Conformity of
Goods, in: Schlechtriem (ed.), Einheitliches Kaufrecht (1987), p. 305 (308); see also Bundesgericht
(Switzerland) 22 December 2000 (used rotary printing textile machine), CISG-Online 628 (Pace).
67 Bundesgerichtshof (Germany) 26 September 2012 (clay), CISG-Online 2348 (Pace) where the dutch
description used “Aardappelbescheidingsklei A 01” made clear that the clay was used as a separator of
potatoes and therefore had to comply with food legislation.
68 Handelsgericht Zürich (Switzerland) 3 April 2013 (steel coils), CISG-Online 2562 (Pace), para. 5.3.2;
Bundesgericht (Switzerland) 23 September 2013 (steel coils), CISG-Online 2560 (Pace), para. 3.2; Ober-
landesgericht Hamm (Germany) 30 November 2010 (pigs), CISG-Online 2217, para. II.1.a.
69 Lookofsky, Understanding the CISG (2017), p. 78; Gillette/Walt, Sales Law (2016), Chap. 8 III p. 370
seq.; see generally on the non-applicability of the parol evidence rule U.S. Court of Appeals (11th Circuit)
(U.S.) 29 June 1998, MCC-Marbel Ceramic Center Inc. v Ceramica Nuova D’Agostino S. p. A., 144 F.3 d
1384 (ceramic tiles), CISG-Online 342 (Pace).
70 Arbitral Award, SCC 5 June 1998 (rail press), CISG-Online 379 (Pace) – relevance of service manual
for determining the standard of conformity.
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and previous contacts.71 Documents issued by third parties in conjunction with the
contract, such as letters of credit or inspection certificates, may also provide indications
as to the parties’ agreed standard of conformity. Where, for example, a letter of credit
provides that documents may be accepted which mention minor deficiencies in the
goods, that may be an indication that such deficiencies do not affect the conformity of
the goods.72 Equally, public statements of the seller or his advertising may be relevant in
determining the characteristics of the goods the parties have agreed upon.73
There is, however, a need to distinguish between statements or conduct, which 40
contain legally relevant descriptions of the goods, and those that are merely puffing
language.74 In doing so, one has to take cultural differences into account, as well as the
fact that often parties do not communicate in their native language. Consequently, the
subtle distinctions developed in national laws between, for example, “affirmation of
facts”, “promises”, “statements of commendation” or “opinion” as well as the meaning
attached to certain phrases are largely irrelevant for interpretation under the CISG.75
This may be different, however, where both parties have used a certain phrase with a
view to its meaning in a particular country, e. g. when the contract has been negotiated
by lawyers coming from the same country.
Different views exist as to who bears the risk of ambiguous descriptions. Some 41
authors deduce from the wording of “could not have been unaware” in Art. 8(1) that
the recipient of an ambiguous declaration has to enquire as to its contents. Others
promote an application of the “contra proferentem rule” under Art. 8(2), imposing the
burden upon the party making a statement to make its intention clear.76
The parties’ subsequent conduct can give valuable indications as to the exact content 42
of the parties’ agreement. For example, the lack of any immediate complaint about
missing quantities or over-shipments may be indicative that the parties agreed on the
quantity delivered. Equally, efforts by the seller to increase the output of a machine
upon complaints by the buyer are a strong indication that a higher output than attained
by the machine was agreed by the parties.77 However, in the latter situation it must
always be borne in mind that additional efforts are often made as an expression of good
will to maintain the business relationship without the existence of a legal obligation.
Also, efforts to sell the goods may be part of the buyer’s efforts to mitigate damages
under Art. 77 and not an indication that the goods delivered were conforming.78
The contractual conformity requirements may result from individually agreed clauses 43
or from standard terms which have become part of the contract. In practice, parties
71 For the relevance of previous correspondence see Appellationsgericht Basel-Stadt (Switzerland)
23 August 2003 (soyaprotein products), CISG-Online 943 (Pace); Arbitral Award, CIETAC, 22 May
1996 (broadcasting equipment) (Pace); Helsinki Court of First Instance (Finland) 11 June 1995, confirmed
by Helsinki Court of Appeal (Finland) 30 June 1998 (skin care product), CISG-Online 1304 (Pace) –
statement that product has a 30 months shelf life.
72 Bundesgericht (Switzerland) 2 April 2015 (wire rod), CISG-Online 2592 (Pace), para. 7.1.1 allowing
bills of lading mentioning that “some bands brooken or loose”.

73 Schlechtriem/Butler, CISG (2009), para. 134; Oberlandesgericht Koblenz (Germany) 19 December
2012 (generator), CISG-Online 2470 (Pace) – relevance of description of the generator in the internet
offer.
74 High Court of Justice (United Kingdom) 1 May 2012 (borence, polymer), Kingspan Environmental
Ltd et al v Borealis A/S et al, CISG-Online 2391 (Pace), paras 626 seq. – general representation that
Borecene was “fully UV stabilised” not apt to import contractual terms as to timespan of UV resistence.
75 Gillette/Walt, Sales Law (2016), Chap. 8 III pp. 370 seq.
76 For a discussion of the problem Maley, The Limits to the Conformity of Goods, 12 International
Trade and Business Law Review (2009) 82 (108 seq.) (Pace).

77 Appelationsgericht Basel-Stadt (Switzerland) 26 September 2008 (packaging machine), CISG-Online
1732 (Pace).
78 See Landgericht Berlin (Germany) 15 September 1994 (shoes), CISG-Online 399 (Pace).
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often refer to particular industry norms or standards such as the various ISO-
standards79 or standard terms prepared for a certain branch or industry by the relevant
organisation. Thus, a reference in a contract for the delivery of fruits or vegetable to the
COFREUROP-conditions, determines inter alia, that the goods supplied must comply
concerning their condition, labelling and packaging “with the rules in force, in the
country where the goods will be marketed” (Clause 3.1.1).
44 By contrast, mere contractual references to the “usual characteristics”, “normal quality”
or “big crystals”80 are normally too vague to constitute contractual stipulations in the sense
of Art. 35(1) unless these notions have a particular meaning in the relevant industry.
45 If the contractual description of the goods requires the certification or classification of
the goods by a public authority or a third party, the mere absence of such a certification
or classification leads to their non-conformity. Whether the goods actually fulfil the
quality requirements and the certification or classification was wrongly denied or made
is normally irrelevant. In general, the mere lack of the required stamps negatively affects
the use of the goods.81
46 The agreement of the parties is also relevant where they agreed on characteristics, which
cannot be attained with the present knowledge.82 The same applies for agreements
concerning packaging, which go far beyond what is necessary for transportation.83 How-
ever, in all those cases, courts, when interpreting the parties’ agreement, should be
reluctant to assume that the parties agreed on technically impossible characteristics.
47 Also, ostensibly clear contractual descriptions of the goods have to be interpreted in
light of the surrounding circumstances. Thus, where the parties had agreed on the sale
of a particular machine selected by the buyer but specified a different category of
machine in the contract, the non-compliance of the chosen machine with the contrac-
tual description does not amount to non-conformity.84
48 b) Implicit agreements. The parties may also agree implicitly on certain character-
istics of the goods or the packaging required. The dividing line between an implicit
agreement under Art. 35(1) and the requirements imposed by Art. 35(2) is slim and
depends on the facts of each particular case. Its practical relevance results from the fact
that an exclusion of liability under Art. 35(3) is in principle only possible for the breach
of obligations imposed under Art. 35(2). In addition, unlike Art. 35(2)(b), Art. 35(1)
does not require any reliance of the buyer on the seller’s skill.85 Thus, an implicit
79 E. g. Oberlandesgericht Köln (Germany) 12 January 2007 (paperboard containers), CISG-Online 1581
(Pace); U.S. Bankruptcy Court for the District of Oregon (USA) 29 March 2004, In re Siskiyou Evergreen,
Inc. (Christmas trees), CISG-Online 1174 (Pace) where the parties defined the quality of the trees to be
delivered by reference to a grading system for agricultural goods established by the US Department of
Agriculture.
80 Bundesgericht (Switzerland) 13 January 2004 (menthol USP brand crystals), CISG-Online 838 (Pace)
(UNILEX) at E. 3.4 considering the reference to be not sufficiently specific to constitute an agreement on
a certain size of the crystals purchased; cf. Arbitral Award, CIETAC, 22 March 1995 (down jacket and
winter coat), CISG-Online 1118 (Pace) – “European style”.
81 Obiter also U.S. Bankruptcy Court for the District of Oregon (USA) 29 March 2004 (Christmas trees),
In re Siskiyou Evergreen, Inc., CISG-Online 1174 (Pace) at 3; see also Maley, The Limits to the
Conformity of Goods, 12 International Trade and Business Law Review (2009) 82 (106 seq.) (Pace).
82 Schlechtriem/Butler, CISG (2009), para. 133; Piltz, Internationales Kaufrecht (2008), para. 5–31.
83 Ferrari, in: Ferrari et al., Internationales Vertragsrecht (2018), Art. 35 CISG para. 10.
84 Arbitral Award, SCC 90/2004, 2 June 2006, SIAR 2007/2 211 (220) – contract provided for a “cold
mill” but mill selected and delivered was a “temper mill” which unlike a cold mill is not able to flatten
steel.
85 For a different view Neumann, Features of Article 35 in the Vienna Convention; Equivalence, Burden
of Proof and Awareness, 11 Vindobona Journal of International Commercial Law and Arbitration (2007/
1) 81 at paras 10 et seq. (Pace).
498 Kröll
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agreement should not be assumed lightly. Its assumption should be limited to cases
where, in light of the negotiations, the documents submitted, the express contractual
provisions or the conduct of the parties, the buyer can expect certain qualities to be
present.86 For example, samples provided by the buyer to the seller and accepted by the
latter constitute an implicit agreement that the goods are of the same quality as the
sample.87 Equally, the use of certain terms or phrases for goods which may be used for
several different purposes can constitute an implicit agreement.88
Where documents are submitted which either show the production date or from 49
which a certain use can be deduced, this normally constitutes an implicit agreement that
the goods have that age and have not been used differently.89
Additionally, implicit agreements on a certain output per hour can be derived from the 50
circumstances. In a Swiss case, the buyer had expressed his interest in buying a packaging
machine with a certain output. Though the seller never explicitly stated that the machine
had this output, subsequent communications, answers to other questions and post-
installation efforts to reach the output showed an implicit agreement on this output.90
There is normally also an implicit agreement that the goods are delivered with an 51
appropriate user manual where it is necessary for the ordinary use of the goods.91 In
principle, the implicit agreement also extends to the language of the manual. At least
where the goods are produced and sold for a particular market, the manual should be in
the language spoken in this country. By contrast, without any indications to the
contrary, a Swiss buyer of stocked goods cannot expect that goods delivered by a
German seller to Switzerland are accompanied by user manuals not only in German but
also in French and Italian.92
Equally, it generally cannot be assumed that the parties implicitly agreed on the 52
relevance of public regulations at the buyer’s place of business, if there are no
indications to this effect in the contract.93 An agreement on the place of delivery, in
particular where it is the buyer’s place of business, is in itself insufficient to justify the
assumption of an implicit agreement that the goods will be in compliance with public
law standards in that country.94 An implicit agreement may exist if such rules have
86 Magnus, in: Staudinger Kommentar (2013), Art. 35 para. 13 seq.; slightly different in favour of a
theory of equivalence Neumann, Features of Article 35 in the Vienna Convention; Equivalence, Burden of
Proof and Awareness, 11 Vindobona Journal of International Commercial Law and Arbitration (2007/1)
81 at paras 17 et seq. (Pace).
87 Oberlandesgericht Graz (Austria) 9 November 1995 (marble slabs), CISG-Online 308 (Pace) (Unilex);
Lookofsky, Understanding the CISG (2017), p. 88.

88 Bundesgerichtshof (Germany) 26 September 2012 (clay), CISG-Online 2348 (Pace) where the dutch
description used “Aardappelbescheidingsklei A 01” made clear that the clay was used as a separator of
potatoes and therefore had to comply with food legislation.
89 Oberlandesgericht Köln (Germany) 21 May 1996 (used car), CISG-Online 254 (Pace) implicit
agreement that car sold is not two years older than shown in the papers and has been driven an
additional 50.000 km.
90 Appelationsgericht Basel-Stadt (Switzerland) 26 September 2008 (packaging machine), CISG-Online
1732 (Pace).
91 Magnus, in: Staudinger Kommentar (2013), Art. 35 para. 13; Achilles, CISG-Kommentar (2000),
Art. 35 para. 5.
92 Landgericht Darmstadt (Germany) 9 May 2000 (video recorders and other electrical appliances),

93 Magnus, in: Staudinger Kommentar (2013), Art. 35 para. 15; Bundesgerichtshof (Germany) 8 March
1995 (New Zealand mussels), CISG-Online 144 (Pace) at II1 a; Oberster Gerichtshof (Austria) 13 April
2000 (machines), CISG-Online 576 (Pace); Audiencia Provincial de Granada (Spain), 2 March 2000
(food), CISG-Online 756 (Pace).
94 Ferrari, in: Ferrari et al., Internationales Vertragsrecht (2018), Art. 35 CISG para. 6; cf. Bundesge-
richtshof (Germany), 8 March 1995 (New Zealand mussels), CISG-Online 144 (Pace) at II1 a; Oberster
Gerichtshof (Austria) 13 April 2000 (machines), CISG-Online 576 (Pace).
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already played a role in a previous contract or have been explicitly mentioned during
the negotiations as a precondition for entering into the contract.
53 In general, one should be cautious to assume an implicit agreement whenever such an
agreement would either result in a considerable burden for the seller or seriously limit
the usability of the goods for the buyer. Agreements of a certain importance are
normally made expressly. Thus, for example, the mere fact that the buyer did not
complain about a certain method of packaging in previous deliveries does not amount,
in general, to an implicit agreement where the packaging inadequately protects the
goods.95
54 c) Practices and usages. In defining the relevant standard of conformity in Art. 35(1),
usages and practices agreed and established between the parties in the sense of Art. 9(1)
are relevant. The same applies for generally respected usages in a particular trade sector
in the sense of Art. 9(2).96 Those usages prevail over the objective standards imposed by
the CISG in Art. 35(2) and can relate to all aspects of conformity.97 They may have a
bearing on the definition of the goods by determining which of the various designations
used is relevant98 or prescribe a minimum quality of the goods or the documents which
have to be provided with the goods.99 For example, in the international fish trade a
usage exists that provides that, in the absence of an agreement to the contrary, fish
delivered has to be of this year’s catch. Thus, a delivery of fish from last year’s catch will
be deemed non-conforming irrespective of its quality.100 Such usages often define the
acceptable tolerances in relation to quantity as well as to quality.
55 d) Limitations. The seller’s right to determine the extent of his obligations as to the
conformity of the goods is not affected by limitations contained in the national law,
which may prohibit any restriction of the buyer’s remedies.101 In particular, in cases
falling within the scope of the European Consumer Sales Directive102 the various
restrictions imposed on limiting the buyer’s rights do not affect the seller’s right to
define his contractual obligations as to conformity.
Online 1642 (Pace).

96 Bianca, in: Bianca/Bonell, Commentary (1987), Art. 35 para. 2.1; Gruber, in: MünchKommBGB
(2016), Art. 35 CISG para. 9; Huber, Vertragswidrigkeit und Handelsbrauch im UN-Kaufrecht, IPRax
(2004) 358 (359) criticizing Oberster Gerichtshof (Austria) 27 February 2003 (frozen fish), CISG-Online
794 (Pace) for applying Art. 35(2)(a) in such a case.
97 See also in relation to the notification period under Art. 39; Oberster Gerichtshof (Austria) 21 March
2000 (wood), CISG-Online 641 (Pace) – Tegernseer Bräuche for the wood trade between Austria and
Germany.
98 Danish Maritime and Commercial Court (Denmark) 31 January 2002 (fish (mackerel)), CISG-Online
679 (Pace) where the designation of the fish in Latin was considered to be relevant as the trade in fish was
normally done on the basis of the latin denominations.
99 Handelsgericht St. Gallen (Switzerland) 14 June 2012 (organic juices and organic oils), CISG-Online
2468 (Pace), where the alleged trade usage was determined to be non-existent.
100 Huber, Vertragswidrigkeit und Handelsbrauch im UN-Kaufrecht, IPRax (2004) 358 (359); but see
Oberster Gerichtshof (Austria) 27 February 2003 (frozen fish), CISG-Online 794 (Pace) which applied
Art. 35(2)I to the case, as the seller had provided a sample from last year’s catch; see also Oberlandesger-
icht Hamm (Germany) 30 November 2010 (pigs), CISG-Online 2217, para. II.1.a – undertaking to
delivery pigs from producers who are clinicly PRRS free does not mean that the pigs do not carry the
PRRS-virus but only that there is no acute outbreak of the virus.
101 Gruber, in: MünchKommBGB (2016), Art. 35 CISG para. 10; Piltz, Gestaltung von Exportverträgen
nach der Schuldrechtsreform, IHR (2002) 2 (4).

102 EC Directive 1999/44/EC of 25 May 1999 on certain aspects of the sale of consumer goods and
associated guarantees, EC Official Journal, L 171, 7 July 1999, pp. 12–16; for a detailed analysis of possible
conflicts see Schroeter, UN-Kaufrecht und Europäisches Gemeinschaftsrecht (2005), § 6 paras 199 et seq.,
§ 15 paras 98 et seq.
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The parties are, however, prevented from agreeing on the delivery of goods which do 56
not comply with those few minimal ethical standards which are protected by public
international law and are suffiently defined to impose concrete obligations, e. g. Art. 3 of
the ILO Convention No. 182 on the worst forms of Child Labour.103
e) Sale of used goods. Intricate problems as to the contractual requirements for 57
conformity are often raised by the sale of used goods. It is clear that they do not need to
have the same quality as new goods.104 Irrespective of this, parties often have different
views as to the acceptable signs of wear and tear, in particular if the contract does not
contain any further specifications. It is, however, obvious that the buyer can be expected
to be informed about all structural changes to the goods and important events which
obviously go beyond the normal wear and tear. For example, in the sale of used
containers, signs of abrasion can be expected but modifications to bottom struttings,
which affect the stability and carrying capacity of the containers, may lead to their non-
conformity if the buyer has not been informed of them.105
Often contracts contain further specifications. Used goods which are sold as “good- 58
as-new” must at least function properly to be conforming106 and should show little signs
of use. By contrast, clauses explicitly providing for a sale on an “as it is” basis may
constitute a warranty disclaimer denying the buyer the default protection of the
ordinary use standard in Art. 35(2)(a). Cases where the pre-contractual or contractual
correspondence refers to specifications that the used goods do not have are problematic.
In such cases, the conflict between the specifications and the “as it is” clause have to be
solved by interpretation.107 Where an examination has been made, the “as it is” clause
will normally prevail at least in those cases where the non-compliance with the
specifications is obvious. Things may be different if the specification has been made
after the examination. In such cases, the seller may be understood to have undertaken
an obligation to ensure that until the performance of the contract the goods will have
the specified quality.
f) (Minimal) Ethical Standards, Codes of Conduct and other CSR-Policies108. 59
Production, environmental or human rights standards promulgated in codes of con-
ducts developed in the context of CSR-policies or other ethical standards become part of
the contractual conformity requirements when compliance with them has been re-
quested explicitly in the individually agreed terms or the applicable standard terms. The
only question which then has to be answered by interpreting the relevant documents or
conduct of the parties pursuant to Art. 8 is whether a seller, who relies on suppliers for
103 Butler, The CISG a Secret Weapon in the Fight for a Fairer World, in Schwenzer (ed), 35 Years
CISG and Beyond, p. 295 (302).

104 Tribunal Supremo (Spain) 17 January 2008 (300 second-hand automobiles), CISG-Online 1640
(Pace).
105 Landgericht Hamburg (Germany) 6 September 2004 (containers), CISG-Online 1085 (Pace).
106 Tribunal Cantonal (Switzerland) 21 February 2005 (CNC machine), CISG-Online 1193 (Pace).
107 Bundesgericht (Switzerland) 22 December 2000 (used rotary printing textile machine), CISG-Online
628 (Pace) where the court held that a reference in the purchase order to a certain printing range merely
specified the type of machinery and its potential printing range. Due to the “as it is” clause, the used
machine sold, which obviously lacked the required additional materials did not have to attain this
printing range.
108 On the issue see Butler, The CISG – a Secret Weapon in the Fight for a Fairer World, in Schwenzer
(ed), 35 Years CISG and Beyond (2015), p. 295 (302 et seq.); Ramberg, Emotional Non-Conformity in the
International Sale of Goods, Particularly in Relation to CSR-Policies and Codes of Conduct, in Schwen-
zer/Spagnolo (eds), Boundaries and Intersections (2014) p. 71; Schwenzer/Leisinger, Ethical Values and
International Sales Contracts, in Cranston/Ramberg/Ziegel (eds), Commercial Law Challenges in the 21th
Century: Jan Hellner in Memoriam (2007), p. 249 (Pace).
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the product or parts of it, merely undertook a “best efforts” obligation to ensure that its
suppliers also complied with the standard or has actually ensured compliance. For that
interpretation, numerous factors may play a role, such as the particularities of the
industry in question, the possibility of the seller to supervise its suppliers as well as the
effect non-compliance with the standard may have for the buyer. Taking into account
commercial realities, which often make it impossible for a seller to guarantee compli-
ance of its suppliers and their suppliers with the standard, in case of doubt a “best
efforts” commitment seems to be the more likely contractual commitment.
60 Implicit agreements on such standards should not be assumed too readily. Where
both parties have subscribed to a voluntary CSR-standard such as e. g. the UN Global
Compact, an implicit agreement on such standard can be assumed, even without any
direct communication between the parties as to the applicability of the standard,
provided that the other party knows about the commitment.109 Without such knowl-
edge, the standard becomes applicable via Art. 35(2).
61 Equally, where only one party has publicly declared its adherence to certain CSR-
standards, such a standard will only become part of the contractual provisions under the
rules for the inclusion of standard terms. The mere fact that one party is known to have a
particular CSR-policy is in itself not sufficient to assume an implicit agreement on the
standards contained in that policy. There must be additional factors present, such as a higher
price or industry expectations, to turn such policies into binding contractual agreements.
62 g) Subsequent amendment. The parties are free to modify the contractual require-
ments at any time. Within the limits imposed by Art. 29, such modifications may be
explicit or implicit. Implicit modifications, however, should not be assumed lightly. In
particular, not every acceptance of non-conforming goods by the buyer should be
interpreted to constitute consent to a subsequent modification of the contractual
conformity requirements. Such behaviour has to be evaluated in light of the surround-
ing circumstances, such as the extent of the modification and the parties’ general
relationship.
63 A modification may be assumed where the buyer knowingly accepts goods with a
different article number, which in their quality and appearance at first sight do not
deviate to a great extent from the goods contracted for.110 Any subsequent modification
has to be proven by the party who wishes to rely on it. Oral agreements are usually
insufficient where the parties have subjected amendment of the contract to a writing
requirement.111
3. Art. 35(2)
64 a) General remarks. Art. 35(2) sets out objective and supplementary standards of
conformity that are presumed part of the agreement subject to the parties specifying
otherwise.112 The purposes for which the buyer wants to use the goods is of paramount
109 Generally in favour of an implicit agreement independent of the knowledge of the particular parties
Butler, The CISG a Secret Weapon in the Fight for a Fairer World, in Schwenzer (ed), 35 Years CISG and
Beyond (2015), p. 295 (304); generally critical to the assumption of an implied agreement Ramberg,
Emotional Non-Conformity in the International Sale of Goods, Particularly in Relation to CSR-Policies
and Codes of Conduct in Schwenzer/Spagnolo (eds), Boundaries and Intersections (2014) p. 71 (80).
110 Handelsgericht Zürich (Switzerland) 30 November 1998 (lambskin coats), CISG-Online 415 (Pace)
at 5 b, bb seq.
111 Oberlandesgericht Hamm (Germany) 30 November 2010 (pigs), CISG-Online 2217, para. II.1.a.
112 For the legal nature of the standards in Art. 35(2) and whether they contain default rules or
supplemental standards see Flechtner, Excluding CISG Article 35(2) Quality Obligations: The “Default
Rule” vs. The “Cumulation” View, FS Bergsten (2011), pp. 571 et seq.
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significance.113 Art. 35(2)(c) deals with cases where the seller has provided a model or
sample, Art. 35(2)(b) with cases where a specific purpose has been made known to the
seller, while Art. 35(2)(a) stipulates that in all other cases the goods must be fit for their
ordinary purpose. In addition, Art. 35(2)(d) imposes obligations as to the packaging of
the goods. Consequently, while the standards in subsections (a) and (d) apply to all
contracts, subsections (b) and (c) require the presence of certain facts.
In principle, the different standards in Art. 35(2) must be complied with cumula- 65
tively.114 Systematically, however, the more transaction specific standard in Art. 35(2)(b)
prevails over the general standard in Art. 35(2)(a).115 A seller, who is informed by the
buyer that the buyer wants to use the goods exclusively for a particular purpose, can
normally assume that the goods do not have to be fit for other purposes, even if they are
ordinary purposes in the sense of Art. 35(2)(a). Thus, a car sold to an artist solely for a
performance or a piece of art need not be fit for use in ordinary traffic. In case of doubt,
however, the goods must also be fit for their ordinary purposes.116
The objective legal standards contained in Art. 35(2) impose implied obligations on 66
the seller and thereby allocate the risk of non-conforming deliveries to the seller.117
These obligations are based on the normal expectations of parties in comparable
transactions, but not on promises or undertakings relating to the specific transaction.
Thus, it is wrong to consider the standards in Art. 35(2)(b) and (c) primarily as rules to
lighten the burden of proving an actual agreement in the sense of Art. 35(1).118
Art. 35(2) accounts for the fact that, in practice, parties often do not articulate all 67
their expectations concerning the quality of the goods associated with a transaction.
This may be due to time restraints, high transaction costs or because the parties just
assume that these basic expectations are so obvious that they go without saying.119 The
implied obligations imposed by Art. 35(2) are a codification of these expectations; or to
put it differently, Art. 35(2) sets out those obligations “which would be so contained [in
the contract] if the contract were accurately drawn out.”120
It follows from the wording of Art. 35(2), as well as from the supplementary 68
character of the standards in Art. 35(2), that reliance on them is excluded where the
parties have agreed on a different and conflicting standard under Art. 35(1). For
example, in the sale of used goods, an agreement on an “as it is” standard deprives the
buyer of the protection provided for by Art. 35(2)(a) if the goods delivered are no longer
fit for their ordinary purpose. Unlike under some national laws, such as the UCC, no
express or special wording is required for excluding the application of the objective
standards in Art. 35(2). An exclusion may occur impliedly. This may be the case where
113 Schlechtriem, The Seller’s Obligations Under the United Nations Convention on Contracts for the
International Sale of Goods, in: Galston/Smit (eds), International Sales: The United Nations Convention
on Contracts for the International Sale of Goods (1984), pp. 6–19.
115 Schlechtriem, Noch einmal: Vertragsgemäße Beschaffenheit der Ware bei divergierenden öffentlich-
rechtlichen Qualitätsvorgaben, IPRax (2001) 161 (163); Schwenzer, in: Schlechtriem/Schwenzer, Com-
116 Magnus, in: Staudinger Kommentar (2013), Art. 35 para. 26; generally in favour of an obligation to
comply with both standards Koch, Vertragsmäßigkeit der Ware bei Divergenz öffentlich-rechtlicher
Vorgaben, IHR (2009) 233 (235).
117 Gillette/Ferrari, Warranties and “Lemons” under CISG Article 35(2)(a), Internationales Handels-
recht (2010) 2 (2) (Pace).

118 For such a tendency see Honnold/Flechtner, Uniform Law (2009), Art. 35 paras 226 seq.
119 Honnold/Flechtner, Uniform Law (2009), Art. 35 paras 222, 225.
120 This formulation was already used by Lord Justice Brett in Randall v Newson, 2. Q. B. 102
(C.A. 1877); Schlechtriem/Butler, CISG (2009), para. 135 refer to “what reasonable parties would have
agreed upon had they put their mind to it”; cf. Gillette/Ferrari, Warranties and “Lemons” under CISG
Article 35(2)(a), Internationales Handelsrecht (2010) 2 (3) (Pace).
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the agreement on a particular quality under Art. 35(1) is intended by the parties as a
comprehensive and exclusive quality regime.121
69 However, such express “warranties” are often worded in positive terms and therefore
do not relieve the seller from his responsibilities under Art. 35(2). In other words, they
supplement the standards in Art. 35(2) and do not disclaim them. Thus, for example,
the agreement that a machine was “made of the best materials with first class work-
manship, brand new and unused” can be considered to be an addition to the standard
of fitness for purpose rather than a disclaimer.122
b) Fit for ordinary purpose: Art. 35(2)(a)
70 aa) General remarks. Art. 35(2)(a) contains the final default rule for the required
quality: if the parties have neither agreed on a different conflicting quality standard
(Art. 35(1)) nor have made such a standard applicable through information passed
(Art. 35(2)(b)) or samples provided (Art. 35(2)(c)), Art. 35(2)(a) requires the seller to
deliver goods which are “fit for the purpose for which goods of the same description
would ordinarily be used”. To that extent, Art. 35(2)(a) takes account of the fact that in
practice goods are often ordered by general description without any further indications
as to their future use.123
71 As stated in the Secretariat Commentary, “the normal expectations of persons buying
the goods of this contract description” are relevant for the standard.124 This means that
the goods must have the normal qualities, i. e. have the characteristics normally required
from goods of the types described in the contracts and be free from defects normally not
expected in such goods.125 The fitness for special purposes, which go beyond the normal
use, is not warranted by the seller under Art. 35(2)(a).126 It may, however, be that an
agreed upon specific use of the goods results in side products which are then also
ordinarily used in a certain way. In these cases, the resulting side products can also be
relevant for the fitness for the ordinary purpose.127
72 The relevant time for determining the ordinary uses is the time of contract conclu-
sion. Subsequent changes in the use of a product are not relevant.128
73 bb) The notion of “ordinary purpose”. Goods purchased under the CISG are
normally either bought for their use in the buyer’s undertaking (e. g. machinery), their
consumption or reprocessing (e. g. raw materials) or their resale (e. g. clothing, food).129
Often there are several purposes from these larger categories for which the goods may
ordinarily be used. Livestock, for example, may be sold to be used for breading, for
121 See Flechtner, Excluding CISG Article 35(2) Quality Obligations: The “Default Rule” vs. The
“Cumulation” View, FS Bergsten (2011), p. 571 (581 et seq.).

122 Arbitral Award, SCC, Beijing Light Automobile Co. Ltd. v Connell Limited Partnership, 5 June 1998
(rail press), CISG-Online 379 (Pace).

124 Secretariat Commentary on 1978 Draft, Art. 33 (now Art. 35) para. 5; for other relevant considera-
tion see Kröll/Hennecke, From New Zealand Mussels to New Zealand Trucks – The (not so) “ordinary
use” in Article 35(2), in Schwenzer/Spagnolo (eds), Growing the CISG (2016), pp. 43 et seq.
125 Bianca, in: Bianca/Bonell, Commentary (1987), Art. 35 para. 2.5.1.
126 Piltz, Internationales Kaufrecht (2008), para. 5–45.
127 Bundesgerichtshof (Germany) 26 September 2012 (clay), CISG-Online 2348 (Pace) where the clay deli-
vered under the contract was used as a separator of potatoes and therefore had to comply with food legis-
lation, while the seperated potatoes of a lower quality were used for feeding animals so that non-compliance
of the lower quality potatoes with animal feed regulation resulted in a non-conformity of the goods.
128 But see Arbitral Award, NAI No. 2319, 15 October 2002 (condensate crude oil mix), CISG-Online
740 (780) (Pace), at para. 72.

129 Schlechtriem/Butler, CISG (2009), para. 136; Honnold/Flechtner, Uniform Law (2009), Art. 35
para. 225; Ferrari, in: Ferrari et al., Internationales Vertragsrecht (2018), Art. 35 CISG para. 14.
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direct slaughtering, or to be fattened before slaughtering. In principle, the goods
delivered have to be fit for all these – not only theoretically conceivable – purposes
and deficiencies in relation to a single one of them may lead to the non-conformity of
the goods.130 That applies even where one of the purposes is the main focus of the
contract and the other only concerns the ordinary use of derivative or side products.131
Thus, the Secretariat Commentary advises a seller who knows that the goods are only fit
for some purposes to ask the buyer for which purpose the goods will be used and reject
the offer if they are not fit for the intended use.132
In practice, it may be difficult to distinguish between the “ordinary uses” of goods 74
and uses, which, though occurring in practice, may no longer be considered to be
ordinary uses. It is impossible to give any generally applicable percentage of how
frequent a use must be in practice to qualify as an “ordinary use”. Even if it were
possible to determine with sufficient certainty how often goods are used for a particular
purpose in practice, the disparity of the goods involved and the potential purposes for
which they may be used would prevent the implementation of any general rule.133
There are numerous factors which can play a role in determining whether a particular 75
purpose is an “ordinary use” in the sense of Art. 35(2)(a). These include inter alia the
nature of the goods as such, the normal expectations of the general public as to certain
characteristics,134 public statements or advertisements by the seller or the producer
emphasizing certain qualities of the goods, the price of the goods,135 the place of likely
use and international or regional usages.136
The parties involved are also of considerable importance. Thus, the legitimate 76
expectations of the buyer are influenced by the nature of the seller. If the latter is a
producer of premium products, the buyer may expect a higher quality than from a
cheap producer.137 The same may apply, where the seller has actively marketed its social
responsibility in production and sourcing of goods. The buyer may expect that the
goods were produced in line with the relevant standards.138
Equally, the nature of the buyer may become relevant. For example, in the sale of 77
sand it makes a difference of whether the sand is sold to a construction company or a
company providing equipment for children’s playgrounds. Equally, for the sale of
livestock, different expectations as to the characteristics of the stock, in particular their
immediate suitability for slaughtering, exists when the goods are sold to a breeder or to
a slaughter house.139
130 But see Oberlandesgericht Schleswig-Holstein (Germany) 22 August 2002 (live sheep), CISG-Online
710 (Pace) which held that unless the buyer informed the seller about his intention to directly slaughter
the sheep purchased they had not to be fit for direct slaughtering; for the opposite view Kantonsgericht
Glarus (Switzerland) 6 November 2008 (bags), CISG-Online 1996 (Pace), IV para. 1.3 (bad smell leads to
non-conformity of bags if one of the possible uses for the bags is the packaging of food).
131 Bundesgerichtshof (Germany) 26 September 2012 (clay), CISG-Online 2348 (Pace), para. II.1(b)(aa).
132 Secretariat Commentary on 1978 Draft, Art. 33 (now Art. 35) para. 5; the information given about
the intended use would make the standard in Art. 35(2)(b) applicable.
133 See Bridge, International Sales Law (2013), para. 11.23 who for that reason considers that the
“reliance” criteria in Art. 35(2)(b) should also in this respect be the relevant criteria.
134 Oberlandesgericht Innsbruck (Austria) 1 July 1994 (garden flowers), CISG-Online 219 (Pace) –
flowers should blossom for the whole summer.

135 Arbitral Award, CIETAC, 22 March 1995 (down jacket and winter coat), CISG-Online 1118 (Pace).
136 At least where not covered already by Art. 35(1); Oberster Gerichtshof (Austria) 27 February 2003
(pork meat), CISG-Online 794 (Pace); critical Huber, Vertragswidrigkeit und Handelsbrauch im UN-
Kaufrecht, IPRax (2004) 358 (359) who considers that usages fall within the ambit of Art. 35(1).
138 Generally on the issue of Corporate Social Responsibility Codes see Beckers, Enforcing Social
Responsibility Codes (2015), pp. 58 et seq.; for a more detailed discussion see supra para. 59 et seq.
139 See Oberlandesgericht Schleswig (Germany) 22 August 2002 (live sheep), CISG-Online 710 (Pace).
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78 The goods are only fit for the ordinary purpose if they can be used without any
additional precautionary or remedial measures, such as additional cleansing, which –
while making the goods useable – are not expected by the market.140
79 cc) Relationship to the standards of average and merchantable quality. Fitness for
ordinary use depends primarily on the quality of the goods. It is largely uncontested that
the standard of “ordinary use” should not be equated with comparable standards used
in the various national sales laws, such as the standard of average quality (§ 243(1)
German Civil Code) or the standard of merchantability (§ 2–314 UCC).141
80 Irrespective of that, the question arises – and has been extensively discussed – of how
the autonomous standard of “ordinary use” in the sense of Art. 35(2)(a) has to be
understood, and in particular whether it requires the goods to be of an average quality,
of a merchantable quality or whether the standard is that of a reasonable quality.142 In
practice, it may well happen that the goods are below average quality but are still
merchantable or fit for their ordinary purpose and vice versa. Shellfish, for example,
may have an average cadmium content of 0.5mg while its resale and consumption is
prohibited only from a cadmium content of 1.5mg onwards. In such a case, a consign-
ment of shellfish containing 1mg of cadmium is well below the average quality, but is
still fit for consumption and resale, without any reduction in price.
81 Relying primarily on the wording of the provision and the legislative history, i. e. the
withdrawal of a Canadian proposal providing for an average-quality-standard, it is often
submitted, in particular in common law jurisdictions, that as long as the goods are
merchantable they are conforming, irrespective of whether they are of an average quality.143
82 Comparatively, in civil law jurisdictions in particular, the prevailing view appears to
be that the seller is obliged to deliver goods of an “average quality”.144 In favour of this
view, its proponents refer to the fact that numerous national laws have explicitly
adopted the standard of average quality,145 so that the expectation from parties coming
from such countries is normally that the goods delivered will have an average quality.
Also Art. 5.1.6 PICC and Art. 6:108 PECL refer to an average quality as the default or at
least the minimum standard.146
140 Bundesgerichtshof (Germany) 26 September 2012 (clay), CISG-Online 2348 (Pace), para. II.1(b)(aa).
141 See for the differences see Hyland, Conformity of Goods, in: Schlechtriem (ed.), Einheitliches
Kaufrecht (1987), p. 305 (317 seq.); Gillette/Walt, Sales Law (2016), Chap. 8 III p. 373 seq.; but see Ontario
Superior Court of Justice (Canada) 31 August 1999 (picture frame mouldings), CISG-Online 433 (Pace)
where the judge without any further discussion relied on the Canadian standard of merchantability.
142 For a detailed discussion of the problem Arbitral Award, NAI No. 2319, 15 October 2002 (con-
densate crude oil mix), CISG-Online 740 (780) (Pace), at paras 68 et seq. and paras 88 et seq.; Gillette/
Ferrari, Warranties and “Lemons” under CISG Article 35(2)(a), Internationales Handelsrecht (2010) 2 (3
et seq.) (Pace).
143 For case law applying the standard of merchantability see Ontario Superior Court of Justice (Canada)
31 August 1999 (picture frame mouldings), CISG-Online 433 (Pace); High Court Auckland (New
Zealand) 31 March 2003 (housewares (toasters, deep fryers, food processors, kettles, etc.)), International
Housewares Ltd. v SEB S. A., CISG-Online 833 (Pace), paras 56 et seq.; Supreme Court of New South
Wales (Australia) 30 January 2012 (glass bottles), Fryer Holdings v Liaoning MEC Group, CISG-Online
2325 (Pace), para. 19; Federal Court of Australia (Australia) 28 September 2010 (electrical appliances),
CISG-Online 2158 (Pace), para. 123; further Soergel/Lüderitz/Schüssler-Langheine, Kommentar (2000),
Art. 35 para. 10.
144 Magnus, in: Staudinger Kommentar (2013), Art. 35 para. 19; Eckert/Maifeld/Matthiessen, Handbuch
des Kaufrechts (2014), para. 559; Ferrari, in: Ferrari et al., Internationales Vertragsrecht (2018), Art. 35
CISG para. 15; Landgericht Berlin (Germany) 15 September 1994 (shoes), CISG-Online 399 (Pace).
145 See also Ferrari, in: Ferrari et al., Internationales Vertragsrecht (2018), Art. 35 CISG para. 15.
146 See for their relevance in the interpretation of Art. 35: Henschel, Interpreting or supplementing
Article 35 of the CISG by using the UNIDROIT Principles of International Commercial Contracts and
the Principles of European Contract Law (2004) (Pace).
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Others have suggested a standard of “reasonable quality”, relying on the gap-filling 83
provision in Art. 7(2) and declaring “reasonableness” to be a general principle under-
lying the CISG.147
It has correctly been doubted that the replacement or refinement of the notion 84
“ordinary use” by other comparably broad, abstract and necessarily imprecise standards
is helpful or even necessary for deciding cases in practice.148 The decisive issue is not so
much the standard itself but more the criteria underlying these other standards.
In light of this, the standard of “reasonable quality” is preferable, as it carries the least 85
national baggage with it.149 The CISG tries to avoid, as far as possible, any references to
concepts used in domestic law. Such concepts always entail the considerable danger that
the interpretation in practice will be along the lines of domestic concepts, irrespective of
any call for an autonomous interpretation in the Convention context. As the domestic
concepts of “average quality” and in particular “merchantability” differ considerably,
reliance on either of them could constitute a threat to harmonization. The standard of
“reasonableness” is used in the CISG on several other occasions150 and constitutes a
general principle underlying the CISG. Its open texture allows for sufficient flexibility,
without being too vague,151 if properly understood. In comparison to a primarily
mathematical “average quality” standard, it has the additional advantage of being
sufficiently flexible to accommodate those cases where, due to the circumstances, the
goods must be above average quality or can be below average quality.152 In general, in
light of the problems associated with determining the average quality, it should
normally be acceptable if the goods deviate from the average within certain parameters.
Thus, in the above example, delivery of shellfish containing 0.7 mg cadmium would still
be sufficient though below the average.
In determining whether the goods are of a reasonable quality, from the factors listed 86
above, special regard should be given to the price of the goods. To a certain extent, the
price reflects the quality expectations of the market. Thus, the crucial question is
whether a reasonable buyer aware of the alleged deficiencies would have paid in the
same market conditions a substantially similar price for the goods as the contract
price.153 In this respect not only the mere physical quality of the goods plays a role, but
147 Arbitral Award, NAI No. 2319, 15 October 2002 (condensate crude oil mix), CISG-Online 740 (780)
(Pace), at para. 121; for a criticism of the decision see Gillette/Ferrari, Warranties and “Lemons” under
CISG Article 35(2)(a), Internationales Handelsrecht (2010) 2 (9 seq.) (Pace).
148 Honnold/Flechtner, Uniform Law (2009), Art. 35 para. 225 who rightly doubt the practical use of the
sometimes abstract discussions between the different broadly worded standards.

149 In favour of this standard Arbitral Award, NAI No. 2319, 15 October 2002 (condensate crude oil
mix), CISG-Online 740 (780) (Pace), at paras 117 et seq.; for a different view Maley, The Limits to the
Conformity of Goods, 12 International Trade and Business Law Review (2009) 82 (111 seq.) (Pace);
Gillette/Ferrari, Warranties and “Lemons” under CISG Article 35(2)(a), Internationales Handelsrecht
(2010) 2 (9 seq.) (Pace).
150 See, e. g., Arts 16(2)(b), 18(2), 25, 33(c), 39(2), 43(1), 47, 49(2), 63(1), 64(2)(b), 65(2), 72(2), 73(2),
75, 77 first sentence, 79(1) and (4), 85 first sentence, 86(1), 88(1) and (3); also “unreasonable”: e. g. in
Arts 86(2), 87, 88(2); for the standard see also Magnus, Die Allgemeinen Grundsätze im UN-Kaufrecht,
RabelsZ (1995) 469 (482) (Pace); cf. Art. 7 para. 58.
151 But see Gillette/Ferrari, Warranties and “Lemons” under CISG Article 35(2)(a), Internationales
Handelsrecht (2010) 2 (10) (Pace) which consider the standard to be too vague, creating “perverse
incentive” for sellers to exploit their superior information.
152 See the illustration given for the reference to the additional standard of reasonableness in Art. 5.1.6.
PICC of a company from a country with mediocre cuisine which orders meals from a renowned
restaurant in Paris for a celebration exactly with the intention to get food above the average quality.
153 See also Gillette/Ferrari, Warranties and “Lemons” under CISG Article 35(2)(a), Internationales
Handelsrecht (2010) 2 (14) (Pace) who, however, consider that to be part of the “merchantability”
standard where the test originally comes from.
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also their brand value, which, in connection with fashion or luxury goods in particular,
accounts for a large part of the price.
87 The second important factor is the seller. The legitimate expectations of the buyer are
also influenced by the nature of the seller. If the latter is a producer of premium
products the buyer may expect a higher quality than from a cheap producer. Someone
buying from a premium producer and paying a price above the average market price
can reasonably expect to receive goods which are above the average that someone
buying the same type of goods for a much lower price from a less reputable producer
would expect.154 The goods would then be deemed to lack a reasonable quality if any
other buyer knowing their characteristics would pay less for them.
88 Another factor, which may play a role, is the long term nature of a relationship,
which – even below the threshold of an established practice in the sense of Art. 9 – may
have led to certain expectations as to quality.155 Art. 1:302 PECL lists other factors,
which may play a role in determining what is reasonable.156
89 dd) Differing standards and public law provisions. Problems arise in cases where
the standards – and consequently the expectations – as to the characteristics of goods
for ordinary use differ between the seller’s place of business and the buyer’s place of
business or the place of final destination or use. These differences may be due to a
number of factors. The standards that have to be met for the “ordinary use” in a
particular market can depend on factors such as historical developments, tradition,
religious belief, the state of economic development or climatic conditions. For example,
technical equipment or batteries which operate perfectly well in the seller’s country may
hardly be usable at the final destination due to extreme altitude or permafrost condi-
tions prevailing in that country. Differences may exist as to the industry standards to be
complied with or the voltages for which fuses must be designed. The same applies for
foodstuff, where the expectations as to the use of hormones, chlorine or radiation in the
production process may differ considerably.
90 Of particular importance in this context are public law provisions which exist to
protect consumers, employees or the environment. They vary considerably from
country to country.157 Such regulations do not directly affect the physical characteristics
of the goods and may not prevent their actual delivery in the sense of Art. 30. Never-
theless, they may strongly influence the use and merchantability of the goods. The
alleged lack of fitness does not then arise from the physical properties of the goods, but
as a result of the non-compliance with a regulatory requirement.
91 In numerous countries, the sale or consumption of food products, for example, is
strictly regulated by public law regulations. The same applies to technical goods, the sale
or use of which is submitted to certain industry standards or labelling requirements.158
It is obvious that deviations from such rules, which prevent or at least affect the future

(Pace), at para. 121.
156 The list included…the nature and purpose of the contract, the circumstances of the case, and the
usages and practices of the trades or professions involved…”. In favour of making use of the concepts of
reasonableness in the PICC and the PECL see also Henschel, Interpreting or supplementing Article 35 of
the CISG by using the UNIDROIT Principles of International Commercial Contracts and the Principles
of European Contract Law (2004) (Pace).
157 For a comprehensive treatment of the topic Krätzschmar, Öffentlichrechtliche Beschaffenheitsvor-
gaben und Vertragsmäßigkeit der Ware im UN-Kaufrecht (2008); see also Kröll/Hennecke, From New
Zealand Mussels to New Zealand Trucks – The (not so) “ordinary use” in Article 35(2), in Schwenzer/
Spagnolo (eds), Growing the CISG (2016), p. 43 (51 et seq.).
158 See for example Oberster Gerichtshof (Austria) 13 April 2000 (machines), CISG-Online 576 (Pace).
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sale or use of the goods, can result in the non-conformity of the goods. Due to the
prescriptive character of such regulations, it is generally irrelevant whether the actual
use of the goods would be affected or whether the thresholds imposed are scientifically
justifiable.159 To that extent, public law regulations have a slightly different character
compared to other external factors such as cultural or religious traditions, which may
also affect the use of the goods.160
The wording of Art. 35(2)(a) is completely silent as to the standard of the public law 92
provisions applicable in such cases.161 The reference in the Secretariat Commentary to
the “normal expectations of persons buying goods of this contract description” seems to
point to the expectations of the buyer, which are primarily influenced by the uses in his
country. This reference, however, is by no means conclusive. As far as it can be deduced
from the available legislative materials, the issue did not attract any major discussion
during the drafting of the CISG. Ultimately, it is a political question of how to allocate
the risks: should the seller’s expectations as to the standards required by the goods
prevail or those of the buyer?162
Some authors consider that in such cases, in principle, the requirements for the “ordinary 93
use” should be determined by the standards relevant at the buyers’s place of business or the
place of destination and use of the goods.163 The underlying argument is that the goods are
most likely to be used at the buyer’s place of business. In addition, at least in relation to the
public law provisions, Art. 42(1)(b) seems at first sight to support such a view. It declares
the rules of the buyer’s place of business applicable for intellectual property provisions,
which could be considered to be comparable to other public law restrictions.164
The prevailing165 and, in this author’s opinion, better view, however, is that as a default 94
rule, in the absence of any other relevant considerations, the requirements for an “ordinary
use” should be determined by the standards and public law provisions at the seller’s place
159 High Court of New Zealand (New Zealand) 30 July 2010, RJ & AM Smallmon v Transport Sales
Limited and Grant Alan Miller (trucks), CISG-Online 2215 (Pace) where the mere absence of a
compliance plate prevented the use of an otherwise roadworthy truck.
160 See Krätzschmar, Öffentlichrechtliche Beschaffenheitsvorgaben und Vertragsmäßigkeit der Ware im
UN-Kaufrecht (2008), pp. 12 et seq.; in favour of a completely equal treatment, Schlechtriem, Vertrags-
mäßigkeit der Ware als Frage der Beschaffenheitsvereinbarung, IPRax (1996) 12 (13).
161 Cf. Schlechtriem, Vertragsmäßigkeit der Ware als Frage der Beschaffenheitsvereinbarung, IPRax
(1996) 12 (14 seq.); who raises doubts whether the standard is at all applicable due to eventual absence of
an ordinary use.
162 Kröll/Hennecke, From New Zealand Mussels to New Zealand Trucks – The (not so) “ordinary use”
in Article 35(2), in Schwenzer/Spagnolo (eds), Growing the CISG (2016), pp. 43 et seq.
on Contracts for the International Sale of Goods (1984), pp. 6–20 (Pace).
164 But see for the opposite conclusion emphasising the special character of intellectual property laws
Bianca, in: Bianca/Bonell, Commentary (1987), Art. 35 para. 3.2.

165 Bianca, in: Bianca/Bonell, Commentary (1987), Art. 35 paras 2.5.1 and 3.2; Neumayer/Ming,
Convention de Vienne (1993), Art. 35 para. 7; Gillette/Walt, Sales Law (2016), Chap. 8 III p. 373 seq.;
Piltz, Internationales Kaufrecht (2008), para. 5–48; Ferrari, in: Ferrari et al., Internationales Vertragsrecht
(2018), Art. 35 CISG para. 14; Magnus, in: Honsell, Kommentar (2010), Art. 35 para. 14; Aue, Mängelge-
währleistung im UN-Kaufrecht (1989), p. 75; Eiselen, in: Kritzer/Vanto/Vanto/Eiselen, International
Contract Manual (2008), Vol. 4 § 89:9 (b); from case law Bundesgerichtshof (Germany) 8 March 1995
(New Zealand mussels), CISG-Online 144 (Pace); id. 2 March 2005 (Belgian meat), CISG-Online 999
(Pace) at II3 b; Oberlandesgericht Hamm (Germany) 30 November 2010 (pigs), CISG-Online 2217, para.
II.1.b, Oberster Gerichtshof (Austria) 13 April 2000 (machines), CISG-Online 576 (Pace), id., 19 April
2007 (scaffold hooks), CISG-Online 1495 (Pace) at 1.2; Audienca Provincial Granada (Spain) 2 March
2000 (food), CISG-Online 756; Court of Appeal of New Zealand (New Zealand) 22 July 2011 (trucks), RJ
& AM Smallmon v Transport Sales Ltd and Grant Alan Miller, CISG-Online 2215, paras 60 et seq.
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of business. It provides for the most appropriate allocation of the risk of non-conformity,
taking into account the standards implied by Art. 35(2) and the system of the CISG.166
95 It is impossible for the seller to know the various public law regulations at the buyer’s
place of business.167 As is well evidenced by the New Zealand-Mussels-decision of the
German Supreme Court, such rules may be hidden in administrative guidelines as to the
application of broad concepts contained in the relevant laws. By contrast, the buyer has
the chance to inform the seller about an intended use and thereby ensure that the
relevant standard becomes applicable under Art. 35(2)(b). Where he does not make use
of that opportunity, it seems sensible from an economic point of view to allow the seller
to rely on the standards in his country of origin. In addition, this solution is more in
line with the structure of the CISG.168 In both cases, where the CISG explicitly declares
that the rules at the buyer’s place of business or the place of final destination should be
relevant, i. e. Arts 35(2)(b) and 42(1)(b), it contains an express limitation.169 By contrast,
in the context of Art. 35(1)(a) no such limitation would exist. The seller would be liable
irrespective of whether he could not have been unaware of the use or reliance on his
knowledge was justified. In the end, the basic question in this context is often not
one relating to the actual “ordinary use” of the goods but whether the seller can
legitimately be expected to know the relevant provisions in the buyer’s country and be
bound by them.
96 However, as in many other areas, there are no rules of general application, but rather
the solution must be found on a case-by-case basis according to the particular
circumstances.170 The above considerations concerning the seller’s lack of knowledge
serve as a valid starting point and default rule,171 which may have a bearing on the
burden of proof. In the majority of cases, there are special considerations which tip the
balance in favour of the application of either standard without the need to resort to the
default rule. Hence it is often primarily a question of interpreting the particular
contract.172
166 See also Gillette/Ferrari, Warranties and “Lemons” under CISG Article 35(2)(a), Internationales
Handelsrecht (2010) 2 (7) (Pace) pointing to the asymmetric information as the underlying risk allocation
principle in Art. 35(2)(a) which only exist in relation to the standards in the seller’s country; Kröll/
Hennecke, From New Zealand Mussels to New Zealand Trucks – The (not so) “ordinary use” in
Article 35(2), in Schwenzer/Spagnolo (eds), Growing the CISG (2016), p. 43 (51 et seq.).
167 Bundesgerichtshof (Germany) 8 March 1995 (New Zealand mussels), CISG-Online 144 (Pace); id.
2 March 2005 (Belgian meat), CISG-Online 999 (Pace) at II3 b; Oberster Gerichtshof (Austria) 13 April
2000 (machines), CISG-Online 576 (Pace), id., 19 April 2007 (scaffold hooks), CISG-Online 1495 (Pace)
at 1.2; Audienca Provincial Granada (Spain) 2 March 2000 (food), CISG-Online 756; High Court of New
Zealand (New Zealand) 30 July 2010 (trucks), RJ & AM Smallmon v Transport Sales Limited and Grant
Alan Miller, CISG-Online 2113 (Pace).
168 See also Art. 6. 2. 14(a) PICC referred to in support of this view by Henschel, Conformity of the
goods: Interpreting or supplementing Article 35 of the CISG, in: Felemegas (ed.) An International
Approach to the Interpretation of the United Nations Convention on Contracts for the International
Sale of Goods (1980) as Uniform Sales Law (2007), 166 (171 seq.).
169 For the limiting requirement of the reasonableness of the reliance on the “seller’s skill and
judgment” see infra paras 122 et seq.; for the requirement in Art. 42 that the seller “knew or could not
have been unaware” see Art. 42 paras 25 et seq.; see also Bridge, International Sales Law (2013),
para. 11.23 who justifies the result with the reliance criteria which he wants to extend to Art. 35(2)(a).
Commentary (2016), Art. 35 paras 17 seq.

171 A comparable balancing of interest is also underlying Art. 6.1.14(a) PICC according to which
applications for public permissions required for the validity of a contract or its performance should be
made by the party located in the country where the permissions are needed.
Commentary (2016), Art. 35 paras 17 seq.
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Often the buyer may have informed the seller about the use of the goods in a particular 97
country or a particular use in the sense of Art. 35(2)(b).173 To that extent, it is not their
“ordinary use” in the sense of Art. 35(2)(a) which determines the standards to be met, but
the specific use under Art. 35(2)(b).174 Where the seller has been informed or knows from
previous dealings or from the structure of their relationship that the goods are to be used
in a particular country, he is normally aware that the goods must be fit for use in that
country.175 This leads to the application of the standards relevant for this use, including
existing public law regulations at the intended place of use.176 Awareness of such use can,
for example, be assumed where the seller has appointed the buyer as his exclusive
distributor in a certain territory. The same applies where the seller has to deliver the
goods to a customer of the buyer, which is obviously the end user.177 At the same time,
the limitations of Art. 35(2)(b) will be applicable, i. e. liability is excluded in all cases
where it is unreasonable for the buyer to rely on the seller’s judgment. This may depend
on the clarity and availability of the public regulation. Where the relevant rules are hidden
in not readily available administrative guidelines, to be applied by analogy and the
authorities have considerable discretion in their application, reliance is much less justified
than in cases of clear prohibitions in obviously applicable laws.178
Different considerations may, however, apply in long lasting business relationships, 98
where the goods delivered do not conform with relevant standards at the buyer’s place of
business but the buyer never raised any objection. In such cases, the seller may assume
that the goods do not have to meet industry standards at the buyer’s place of business.179
In other cases, irrespective of prima facie existing differences between the standards 99
and expectations in the buyer’s and the seller’s countries, the relevant standard may be
influenced by the existence of an international or at least regional usage. The latter may,
for example, have been created by directives of the European Union, which have not yet
been complied with by one of countries concerned.180 There may be other circum-
173 See in favor of a more frequent application of Art. 35 (2)(b) in such cases Schlechtriem, Vertrags-
mäßigkeit der Ware als Frage der Beschaffenheitsvereinbarung, IPRax (1996) 12; cf. Gerechthof’s Arnhem
(Netherlands) 27 April 1999 (movable room units), G. Mainzer Raumzellen v Van Keulen Mobielbouw
Nijverdal BV, CISG-Online 741 (Pace); Dokter/Kruisinga, The application of the CISG in the Nether-
lands: a Dutch treat for the CISG?, IHR (2003) 105 (109).
174 Critical towards qualifying the use in a particular market as a special use in the sense of
Art. 35(2)(b), Daun, Öffentlichrechtliche “Vorgaben” im Käuferland und Vertragsmäßigkeit der Ware
nach UN-Kaufrecht, NJW (1996) 29 seq.
175 Cf. Cour d’appel Grenoble (France) 13 September 1995 (cheese), Caito Roger v Société francaise de
factoring, CISG-Online 157 (Pace) – French labelling requirements as to composition and expiry date not
met; critical Ferrari, Divergences in the application of the CISG’s rules on non-conformity of goods,
RabelsZ (2004) 473 (477) who suggests that the court should have relied on a practice established between
the parties in the sense of Art. 9; for a different view see Gerechthof’s Arnhem (Netherlands) 27 April 1999
(movable room units), G. Mainzer Raumzellen v Van Keulen Mobielbouw Nijverdal BV, CISG-Online
741 (Pace), though the case can be explained on the basis of its special circumstances; see infra at paras
109 et seq.
176 See Landgericht Ellwangen (Germany) 21 August 1995 (Spanish paprika), CISG-Online 279 (Pace)
where it was held that the parties agreed that the goods had to be fit to be sold in Germany.
177 Landgericht Coburg (Germany) 12 December 2006 (plants), CISG-Online 1447 (Pace) – in relation
to plants delivered from a tree nursery.

178 Schlechtriem, Noch einmal: Vertragsgemäße Beschaffenheit der Ware bei divergierenden öffentlich-
rechtlichen Qualitätsvorgaben, IPRax (2001) 161 (163); cf. Bundesgerichtshof (Germany), 8 March 1995
(New Zealand mussels), CISG-Online 144 (Pace) denying the relevance of German administrative
guidelines issued for meat but applied by analogy to fish for the sale of mussels from New Zealand by a
Swiss seller to a German buyer, however, with a different reasoning.
179 See Gerechthof’s Arnhem (Netherlands) 27 April 1999 (movable room units), G. Mainzer Raumzel-
len v Van Keulen Mobielbouw Nijverdal BV, CISG-Online 741 (Pace).

180 Landgericht Trier (Germany) 12 October 1995 (wine), CISG-Online 160 (Pace).
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stances, which weigh in favour of either standard, such as the price paid for the goods or
previous dealings, which though not raising to the level of practice established between
the parties in the sense of Art. 9, may indicate what the parties could expect.181
100 Different considerations may apply if the standard in the seller’s country of origin is
higher than that in the buyer’s. The buyer may not assume that goods which do not
fulfil the higher standard in the seller’s country but are fit for the ordinary use in the
buyer’s country in general will be non-conforming in the sense of Art. 35(2)(a).182 The
fact that goods which are not fit for their ordinary purpose in the seller’s country of
origin are sold to a buyer in a different country, where they are fit for their ordinary
purpose, may in itself already be an indication that the lower standard in the buyer’s
country was the relevant one.
101 The evaluation may be different in cases where the buyer selected a particular seller
from a number of potential other sellers because he comes from a country which has the
reputation of producing goods which fulfil high standards, in particular if a higher
price was paid for the goods.183 The same applies if the buyer explicitly emphasizes
the importance of the quality. Thus, the addition of potassium bromate to wheat flour
to enhance its tenability may render the goods non-conforming in the sense of
Art. 35(2)(a) if such an addition is prohibited under EU Standards, irrespective of
whether the same prohibition applies in Mozambique, i. e. the country of destination.184
102 The goods can reasonably be required to comply with foreign administrative and
statutory requirements where these are the same as in the seller’s country or where the
seller knows or ought to know these requirements, either from previous dealings or
other sources.185 Examples are sellers who regularly sell to other customers in the same
market and have been informed by them about the applicable regulations or who are
themselves active in the relevant market through subsidiaries or branches.186 Also,
marketing activities directed at a particular market may change the general rule.187
Even in such cases, it has to be determined for each particular case whether the seller
has not made clear that he does not have the required knowledge by recommending, for
example, the use of local experts for the import and registration of the goods.188
181 Cf. Cour d’appel Grenoble (France) 13 September 1995 (cheese), Caito Roger v Société francaise de
factoring, CISG-Online 157 (Pace); critical Ferrari, Divergences in the application of the CISG’s rules on
non-conformity of goods, RabelsZ (2004) 473 (477) who suggests that the court should have relied on a
practice established between the parties in the sense of Art. 9; Gerechthof’s Arnhem (Netherlands)
27 April 1999 (movable room units), G. Mainzer Raumzellen v Van Keulen Mobielbouw Nijverdal BV,
182 Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 35 para. 17.
183 Gerechtshof’s Gravenhage (Netherlands) 23 April 2003 (wheat flour), Rynpoort Trading v Meneba
Meel, CISG-Online 903 (Pace); Piltz, Internationales Kaufrecht (2008), para. 5–50 who correctly remarks
that in such cases the additional requirements for remedies, such as damages, will often not be fulfilled.
184 Gerechtshof’s Gravenhage (Netherlands) 23 April 2003 (wheat flour), Rynpoort Trading v Meneba
Meel, CISG-Online 903 (Pace).

185 Bundesgerichtshof (Germany) 2 March 2005 (Belgian frozen pork), CISG-Online 999 (Pace) at
II 3 b; Oberlandesgericht Koblenz (Germany) 10 September 2013 (hauler), CISG-Online 2472 (Pace),

para. II. 1. b. bb.
186 Rechtbank Hertogenbosch (Netherlands) 1 November 2012 (articulated loader), CISG-Online 2394
(Pace), para. 4.7.

187 Magnus, in: Staudinger Kommentar (2013), Art. 35 para. 22; Oberlandesgericht Koblenz (Germany)
10 September 2013 (hauler), CISG-Online 2472 (Pace), para. II. 1. b. bb.

188 See High Court of New Zealand (New Zealand) 30 July 2010, RJ & AM Smallmon v Transport Sales
Limited and Grant Alan Miller (trucks), CISG-Online 2113 (Pace); confirmed by Court of Appeal of New
Zealand (New Zealand) 22 July 2011 (trucks), RJ & AM Smallmon v Transport Sales Ltd and Grant Alan
Miller, CISG-Online 2215 (Pace), paras 65 et seq.
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ee) Application of the standard in practice
(i) Resaleability. In international wholesale and intermediate trade, but also in a 103
number of other cases, a resale of the goods belongs to the ordinary use for which the
goods have to be fit.189 Consequently, the goods must be honestly resaleable in the normal
course of business.190 Thus, goods which – due to their quality or non-physical factors,
such as their reputation191 – can only be resold at a considerable discount, do not meet
this requirement. The same applies if the goods may render the buyer liable for non-
conformity to his customers.192 If one of the purposes of a contract concerning consumer
goods is to sell the goods within Europe to consumers, European sellers will at least have
to comply with the standards imposed by Art. 2(2)(d) of Directive 1999/44/EC.193
In the case of foodstuff intended for human consumption, resaleability includes that the 104
goods are unobjectionable as to health.194 Furthermore, existing labelling requirements
must be complied with.195 The relevant standards can often be found in the national food
regulations which – due to the existing differences in the various countries – raises the
question as to the relevant rules (see supra at 3.2.4). Thus, not only the prohibited addition
of water may render wine non-conforming, but also chapitalization if that is not accepted
in the country of use.196 The same applies for other additional ingredients, such as flavors
or coloring, which are regulated even if their health-relevance is not proven.197
(ii) Suspicion of defects. In principle, the mere suspicion that goods may be defective 105
does not result in the non-conformity of the goods nor does bad press. The goods must
actually not be fit for their ordinary purpose. However, there may be cases where a
reasonable suspicion that the goods are non-conforming, based on past events or
experience, is in itself sufficient to render them unfit for their ordinary use. For
example, in relation to potentially dangerous goods or foodstuff, local authorities, due
to the health implications, often act upon the basis of such suspicions and ban the sale
of such goods. However, even without such bans, there may not be sufficient time to
dispel these concerns before the goods perish and the mere suspicion that the goods
may be dangerous may render them non-merchantable.198
189 Bundesgerichtshof (Germany) 2 March 2005 (Belgian frozen pork), CISG-Online 999 (Pace);
Kantonsgericht Glarus (Switzerland) 6 November 2008 (bags), CISG-Online 1996 (Pace), para. 1.3; Piltz,
Internationales Kaufrecht (2008), para. 5–46.
191 See Maley, The Limits to the Conformity of Goods, 12 International Trade and Business Law
Review (2009) 82 (112 seq.) (Pace).

194 Bundesgerichtshof (Germany) 2 March 2005 (Belgian frozen pork), CISG-Online 999 (Pace) at
II 3 b; for the relevant health regulations see supra paras 89 et seq.

195 Cour d’appel GFrancee (France), 13 September 1995 (cheese), Caito Roger v Société francaise de
factoring, CISG-Online 157 (Pace).

196 Cour d’appel de Grenoble (France) 23 January 1996 (wine), Sacovini/M Marrazza v Les fils de Henri
Ramel, CISG-Online 159 (Pace) concerning the sale of chapitalized Italian wine in France; for the
prohibited addition of water see Landgericht Trier (Germany) 12 Ocotober 1995 (wine), CISG-Online 160
(Pace).
197 Audiencia Provincial de Murcia (Spain) 25 May 2012 (red pepper powder), CISG-Online 2463
(Pace) – food with too much colorant.

198 Magnus, in: Honsell, Kommentar (2010), Art. 35 para. 13; Eckert/Maifeld/Matthiessen, Handbuch
des Kaufrechts (2014), para. 559; Bundesgerichtshof (Germany) 2 March 2005 (Belgian frozen pork),
CISG-Online 999 (Pace) at II. 3. d., with critical comment as to the reasoning by Schlechtriem, JZ (2005)
846 (Pace); see also from outside the CISG context – but with a potential influence on the application of
the CISG – European Court of Justice (as it then was) (EU) 5 March 2015, Boston Scientific Medizintech-
nik GmbH v AOK Sachsen-Anhalt – Die Gesundheitskasse et al., Joined Cases C-503/13 and C-504/13
(ECLI:EU:C:2015:148), PharmR 2015, 245 concerning cardiac pacemaker.
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106 (iii) Duration. The expectations concerning the ordinary use also extend to the
duration of such use.199
107 The normal qualities of goods necessarily require that they remain in good condition for
a reasonable time after delivery.200 The extent of that period depends on the nature of the
goods and the particularities of the transaction. Professionally designed and manufactured
machinery, e. g. motors for globes used for presentations or large steel presses or other high
value machinery, must normally be suitable for several years of operation provided they
are properly installed and maintained.201 The required duration of proper operation is not
limited to the two-year cut-off period mentioned in Art. 39(2). To that extent, one has to
distinguish between the question of conformity, which may require a proper use for much
more than two years, and whether, for reasons of legal certainty, claims can be brought
after the expiry of two years. Thus, for example, an expensive rail press, which breaks
down three years after delivery due to the use of inappropriate parts in the construction of
the press, may be considered non-conforming in the sense of Art. 35(2)(a) irrespective of
the fact that pursuant to Art. 39(2) no claims could have been brought for such non-
conformity had the seller not known about it (Art. 40).202 Even for perishable goods it can
normally be expected that they remain intact for a sufficient time period necessary for
their anticipated use. For other goods, expectations may be influenced by the price or
statements made during negotiations.203 Thus, where raw material is bought to produce oil
tanks which are supposed to last for 10 years, the polymer delivered is only conforming if
it is capable of being used to produce tanks which last for such a timespan.204
108 (iv) Necessary documentation for assembly and usage. Fitness for an ordinary purpose also
requires that the necessary assembly instructions, operating manuals and other documenta-
tion are provided and do not contain mistakes which prevent the assembly or use of the
goods or lead to defects when followed.205 Sellers which, for justified proprietary reasons,
may not be willing to provide customers with descriptions containing all the details of the
goods, are advised to exclude any liability for all installations not done by themselves, as the
lack of crucial information or warnings may result in the non-conformity of the goods.206
109 (v) Other issues. For certain goods requirements of fitness for ordinary use are
beyond doubt. Thus, medical equipment must be sterile,207 ceramic baking dishes must
199 Magnus, in: Staudinger Kommentar (2013), Art. 35 para. 23; Landgericht München I (Germany)
27 February 2002 (globes), CISG-Online 654 (Pace) – operational lifetime of three years for expensive
globes for use in showrooms of a car rental agency assumed.
200 Eckert/Maifeld/Matthiessen, Handbuch des Kaufrechts (2014), para. 563.
201 Landgericht München I (Germany) 27 February 2002 (globes), CISG-Online 654 (Pace); Arbitral
Award, SCC, Beijing Light Automobile Co. Ltd. v Connell Limited Partnership, 5 June 1998 (rail press),
CISG-Online 379 (PaI cf. s14(2B)(e) UK Sale of Goods Act.

203 Piltz, Internationales Kaufrecht (2008), para. 5–46; Helsinki Court of First Instance (Finland) 11 June
1995, confirmed by Helsinki Court of Appeal (Finland) 30 June 1998 (skin care product), CISG-Online
1304 (Pace) – statement that goods had a 30 month shelf life.
Ltd et al v Borealis A/S et al, CISG-Online 2391 (Pace), paras 651 et seq. – (in the context of Art. 35(2)(b)
emphasising that under Art. 35(2) the polymer only had to be capable of being used for such a purpose
but that the buyer bore the risk that the final product would meet the durability requirements).
205 Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 35 para. 54; Magnus, in: Staudin-

206 See Arbitral Award, SCC, Beijing Light Automobile Co. Ltd. v Connell Limited Partnership, 5 June
1998 (rail press), CISG-Online 379 (Pace).

207 Obergericht des Kantons Luzern (Switzerland) 8 January 1997 (blood infusion devices), CISG-Online
228 (Pace).
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be heat resistant for use in an oven208 and plants must generally be able to prosper.209
Part of the suitability for an ordinary use is also that the goods operate at sufficient 110
speed, have the normally anticipated output210 and are of the right dimensions. A dust
ventilator, for example, should contain adequate storage for the dust sucked in, which is
not undersized such that it has to be emptied in short intervals.211 By contrast, it is not part
of the conformity requirements for fabrics bought for the production of clothes that they
allow for a particular cut, anticipated by the buyer but not communicated to the seller.212
Notwithstanding the absence of the materiality requirement, minor defects of the 111
goods will often not affect their ordinary use.213 However, protective coverage should be
removable without leaving any traces on the goods.214
c) Fit for a particular purpose stated by the buyer: Art. 35(2)(b)
aa) General remarks. Art. 35(2)(b) requires the seller to deliver goods which are fit for 112
a particular purpose expressly or impliedly made known to the seller. It is modelled on s.
14(3) Sale of Goods Act 1979 (UK) and § 2–315 UCC. The standard takes account of the
fact that buyers often know that they need goods of a general description for a particular
purpose but do not have sufficient knowledge about the goods to give exact specifications.
They state their purpose and then rely on the superior knowledge of the sellers, familiar
with the goods they offer, to determine whether the goods are suitable for such purposes.
Consequently, the standard does not apply if the buyer either did not rely on the 113
information provided as to the suitability for that purpose or it was unreasonable for
him to rely on it, because of the seller’s skill and judgment. All three requirements, i. e.
information about the purpose, reliance on seller’s knowledge and reasonableness of
reliance, must be fulfilled for the standard to be implied. It is, however, not necessary
that the buyer has informed the seller about his reliance on the seller’s expertise.
The practical consequence of the inclusion of Art. 35(2)(b) is that, whenever the 114
buyer informs the seller about a particular purpose for which he wants to use the goods,
the seller is in principle obligated to object to such a purpose and refrain from entering
into the contract if he does not want to be bound by it under Art. 35(2)(b).215 To a
certain extent, Art. 35(2)(b) gives the buyer a limited right to unilaterally determine the
content of the contract by informing the seller about a particular use.216 For that reason,
it should be interpreted narrowly.217
bb) Information about purpose. For the standard to apply, it is necessary and 115
sufficient that the seller is informed about the special purpose. The inclusion of this
standard in Art. 35(2) shows that no agreement of the parties on the purpose trans-
208 Cour de cassation (France) 17 December 1996 (ceramic ovenware), Ceramique v Musgrave, CISG-
Online 220 (Pace).

209 Landgericht Coburg (Germany) 12 December 2006 (plants), CISG-Online 1447 (Pace) holding,
however, that suitability for the concrete climate conditions could only be required if the place of use
has been communicated under Art. 35(2)(b).
210 Rechtbank van Koophandel Veurne (Belgium) 25 April 2001 (diesel tram), CISG-Online 765.
211 Oberlandesgericht München (Germany) 17 November 2006 (dust ventilator), CISG-Online 1395 (Pace).
212 Landgericht Regensburg (Germany) 24 September 1998 (cloth), CISG-Online 514 (Pace).
213 Rechtbank van Koophandel Hasselt (Belgium) 28 June 2006 (leaflets), Drukkerij Moderna NV v IVA
Groep BV, (Pace).

214 Bundesgerichtshof (Germany) 25 November 1998 (surface protective film), CISG-Online 353 (Pace).
215 For the effect of clauses requiring approval of the use for a particular purpose High Court of Justice
(United Kingdom) 1 May 2012 (borence, polymer), Kingspan Environmental Ltd et al v Borealis A/S
et al, CISG-Online 2391 (Pace), paras 659 et seq.
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mitted by the buyer is required.218 Such cases will fall under Art. 35(1). Looking at the
legislative history, a proposal by Germany to make Art. 35(2)(b) dependent on consent
has been rejected,219 to the effect that the consent requirement which existed under
Art. 33(1)(e) ULIS has been abolished.220 Art. 35(2)(b) serves to reduce uncertainties for
the buyer in all cases where the seller did not explicitly articulate any consent to the
purpose transmitted by the buyer.221 The buyer is only required to prove that the seller
was informed about the purpose and not that the seller consented to the information, as
is necessary under Art. 35(1).
116 The seller must, however, be able to deduce the particular purpose from the
information passed.222 For example, the mere fact that different goods are ordered
together does not imply that they should necessarily be used together. Consequently, the
non-delivery of one of the goods does not result in the non-conformity of the other
goods delivered, unless the buyer has informed the seller that the two different goods
can only be used together.223
117 Problems arise where the seller ought to have deduced a particular purpose from the
information provided to him but has not done so. Contrary to what appears to be the
view supported by the Secretariat Commentary,224 no actual knowledge of the purpose
is required. Rather, it is sufficient that the seller ought to have been aware of the
purpose.225 The wording of Art. 35(2)(b), which focuses on the act of “making known”
and not the result, as well as the underlying rationale, do not require actual knowledge.
The buyer should not be burdened by having to prove facts, such as actual consent or
actual knowledge, which are difficult to establish in practice.226
118 It follows from the above that the buyer must either have informed the seller about
the particular purpose himself or least know that the seller has been informed about it.
Furthermore, if the buyer does not know that the seller has been informed of the
purpose, there will be no basis for the necessary reliance on the seller’s superior
knowledge.
119 The information about the purpose must have been passed by the time of contract
conclusion.227 When making their decisions whether to enter into a contract, sellers
must know the exact content of their obligations as to the conformity of the goods. Any
other view would give the buyer the opportunity to subsequently impose additional
requirements as to conformity upon the seller.
218 Schlechtriem/Butler, CISG (2009), para. 13 8; Eckert/Maifeld/Matthiessen, Handbuch des Kaufrechts
(2014), para. 564; Oberster Gerichtshof (Austria) 19 April 2007 (scaffold hooks), CISG-Online 1495 (Pace)
at 1.3.
219 Official Records, p. 316 paras 57 seq.
220 Magnus, in: Staudinger Kommentar (2013), Art. 35 para. 5; cf. s14(3) UK Sale of Goods Act upon
which the provision is based.

222 Bundesgericht (Switzerland) 13 January 2004 (menthol USP brand crystals), CISG-Online 838
(Pace) (UNILEX), at E. 3.4 where the reference in a contract to “grands cristaux” were held to be
insufficient, since no special meaning was allocated to them in practice.
223 Oberlandesgericht Düsseldorf (Germany) 10 February 1994 (fabrics), CISG-Online 115 (Pace).
225 Schlechtriem/Butler, CISG (2009), para. 138; Magnus, in: Honsell, Kommentar (2010), Art. 35
para. 18; for a different view Ferrari, in: Ferrari et al., Internationales Vertragsrecht (2018), Art. 35 CISG
para. 18 interpreting the wording differently.

227 Secretariat Commentary on 1978 Draft, Art. 33 (now Art. 35) para. 8; Ferrari, in: Ferrari et al.,
Internationales Vertragsrecht (2018), Art. 35 CISG para. 18; Arbitral Award, NAI No. 2319, 15 October
2002 (condensate crude oil mix), CISG-Online 740 (780) (Pace), at para. 67.
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The information about a particular purpose may be passed explicitly or implicitly. 120
Sources for implicit information can be, for example, brochures provided to the seller by
the buyer, in which the latter describes its activities or products sold. Thus, where such a
brochure given to the seller indicates that the buyer is selling scaffolds fulfilling a certain
quality norm, hooks and scaffolding decks ordered must be fit to be used for that
purpose.228
Equally, contractual agreements falling under Art. 35(1) may be relevant to determine 121
additional characteristics required under Art. 35(2)(b). For example, a contractual
requirement that the goods have to be labelled in a particular language constitutes an
agreement on the required labelling in the sense of Art. 35(1). At the same time, it
indicates to the seller that the goods are to be used in that country so that they have to
be fit for that use in relation to other characteristics, such as the prevailing climate
conditions in that country.
In addition to the language, other references in the parties’ contract or during the 122
negotiation to measures, industry norms or other facts peculiar to a particular country,
are indicators that the goods will be used in that country.
By contrast, the mere information about the place of delivery or to which of the 123
buyer’s customers the goods have to be sent cannot, without further indications, be
considered as implicit information about a particular use,229 as a resale is normally not
excluded. This may be different if the buyer’s customer is a consumer or the goods are
of a kind that a resale can be excluded.
A particular purpose communicated may result in special safety requirement230 or 124
may imply that the goods must have a certain operational lifetime.231 For example, the
purchase of expensive and heavy globes by a company for the communicated purpose of
using them as marketing tools in their offices was considered to imply that the motors
for such globes must operate for at least three years.232
Where the particular purpose is the use of goods in a particular country, the goods 125
must be fit for that purpose in relation to their inherent characteristics, such as being
able to operate in the prevailing climatic conditions.
The goods then also have to conform to the public law standards imposed in that 126
country.233 Contrary to a widely held view234, there is no reason to treat standards
imposed by public law any different than other factors which affect the use or
resaleability in the relevant country, such as customary standards or religious beliefs.
The argument that a seller cannot be required to know the standards in the country of
228 Oberster Gerichtshof (Austria) 19 April 2007 (scaffold hooks), CISG-Online 1495 (Pace) at 1.3,
where reliance was placed on the seller’s catalogue.

230 Handelsgericht Aargau (Switzerland) 5 November 2002 (inflatable triumphal arch), CISG-Online
715 (Pace).
Ltd et al v Borealis A/S et al, CISG-Online 2391 (Pace), paras 651 et seq. – raw material bought to produce
oil tanks for which a 10 years guarantee is given must be capable of being used for the production of oil
tanks with such a lifespan.
232 Landgericht München I (Germany) 27 February 2002 (globes), CISG-Online 654 (Pace).
233 Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 35 para. 21; Schlechtriem, Noch
einmal: Vertragsgemäße Beschaffenheit der Ware bei divergierenden öffentlich-rechtlichen Qualitätsvor-

gaben, IPRax (2001) 161 (162); but see for the issue of reliance infra paras 122 et seq.
234 Magnus, in: Honsell, Kommentar (2010), Art. 35 para. 19 Bundesgerichtshof (Germany), 8 March
1995 (New Zealand mussels), CISG-Online 144 (Pace); Oberster Gerichtshof (Austria) 13 April 2000
(machines), CISG-Online 576 (Pace); Oberster Gerichtshof (Austria) 19 April 2007 (scaffold hooks),
CISG-Online 1495 (Pace) at 1.2; Gerechthof’s Arnhem (Netherlands) 27 April 1999 (movable room units),
G. Mainzer Raumzellen v Van Keulen Mobielbouw Nijverdal BV, CISG-Online 741 (Pace).
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destination and therefore has to be protected, does not apply in the context of
Art. 35(2)(b). Unlike under Art. 35(2)(a), the seller is adequately protected against the
application of obscure or unexpected rules by the reliance requirement. The buyer has
done his part by informing the seller about the use of the goods in a particular country.
If the seller does not want to be bound by the public law regulations applicable in that
country or does not know them, he has to inform himself or refuse to enter into the
contract under those conditions.
127 This is also the solution explicitly adopted for defects in title in Art. 42(1)(a), which
declares the “law of the State where the goods will be resold or otherwise used” to be
relevant if the parties had anticipated the use in that country. There are no reasons to limit
the underlying rule in Art. 42(1)(a) to defects in title and to allocate the risks differently for
other cases of non-conformity.235 Industrial property rights are not public law regulations,
which differ to such an extent from other provisions that they require different treatment.
128 cc) Reliance on the seller’s skill and knowledge. The exception relating to the buyer’s
non-reliance and the seller’s lack of skill and judgment is the necessary limitation to the
buyer’s right to unilaterally determine the exact content of the contract.236 Its wording
and the ensuing allocation of the burden of proof take into account that normally,
whenever information is passed about a particular purpose, the buyer can and does rely
on the seller’s knowledge about whether the goods are fit for that purpose. In the
majority of cases, the seller – in particular if he is also the producer of the goods –
knows the specific features of the goods better than the buyer. The latter normally trusts
in that superior knowledge of the seller who should be able to evaluate whether the
goods are fit for their purpose.237 Thus, it seems reasonable to put the burden on the
seller. Where the buyer, however, does not rely on the seller’s knowledge there is no
need to protect the buyer.238
129 The lack of reliance exception may be the result of two different sets of facts. It can be
based either on a sufficient or even superior knowledge of the buyer or on an obvious
lack of the seller’s knowledge.
130 Sufficient knowledge by the buyer may exist in all cases where the buyer himself has
gained considerable experience in relation to the goods in question. For example the
buyer may have previously reprocessed the goods in his factories. Indications demonstrat-
ing the buyer’s lack of reliance on the seller’s knowledge are when the buyer orders the
goods by a specific brand name239, takes part in their selection or describes them “in
terms of highly technical specifications”.240 The same applies if the buyer orders the goods
despite doubts or warnings expressed by the seller.241 The mere fact that the buyer has
some knowledge about the goods, however, does not in itself exclude reliance in the sense
of Art. 35(2)(b). As long as the seller has superior knowledge, reliance is justified.242
235 Schlechtriem, Vertragsmäßigkeit der Ware als Frage der Beschaffenheitsvereinbarung, IPRax (1996)
12 (15 seq.).
237 Magnus, in: Staudinger Kommentar (2013), Art. 35 paras 31 seq.; Handelsgericht Aargau (Switzer-
land) 5 November 2002 (inflatable triumphal arch), CISG-Online 715 (Pace); Landgericht Coburg
(Germany) 12 December 2006 (plants), CISG-Online 1447 (Pace).
238 See Rechtbank van Koophandel Hasselt (Belgium) 19 April 2006 (doors), CISG-Online 1389 (Pace).
239 For a limited value of this indication Maley, The Limits to the Conformity of Goods, 12 Interna-
tional Trade and Business Law Review (2009) 82 (119 et seq.) (Pace).
240 Secretariat Commentary on 1978 Draft, Art. 33 (now Art. 35) para. 9; Schwenzer, in: Schlechtriem/

242 Landgericht Coburg (Germany) 12 December 2006 (plants), CISG-Online 1447 (Pace); Eckert/
Maifeld/Matthiessen, Handbuch des Kaufrechts (2014), para. 566; slightly different Schwenzer, in:
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The lack of seller’s skill may become particularly relevant in cases where the goods 131
are of a certain complexity and the seller is only an intermediary or where he informs
the buyer about his lack of knowledge, for example, by recommending the use of local
experts.243 By contrast, a lack of skill cannot normally be argued by a party producing
the goods.
In the absence of indications to the contrary, the buyer may not assume that the seller 132
knows the relevant public law standards in the buyer’s country.244 This may be different
if the seller is regularly exporting goods to that country, has a local representative in the
country or the standards are in accordance with internationally or regionally recognized
standards which should be known to the seller.245 In all other cases the buyer should
know the standards in his own country better than the seller and inform the latter about
them if he expects compliance with them. General remarks, such as that the authorities
impose a high standard, are not sufficient in this regard.246
Even in those cases where the buyer has obviously not relied on the seller’s knowl- 133
edge, the principle of good faith may impose on the seller an obligation to inform the
buyer that the goods ordered do not qualify for the intended purpose.247 In appropriate
circumstances, the breach of this obligation may give rise to claims for damages
irrespective of the fact that the goods delivered are not in breach of the standard in
Art. 35(2)(b).248 There is, however, no general obligation for the seller who has provided
sufficient details about the goods delivered to investigate whether they can be used in
the buyer’s facilities.249
d) In conformity with sample or model: Art. 35(2)(c)
aa) General remarks. Art. 35(2)(c) determines the standard for contracts concluded 134
on the basis of a sample or a model held out by the seller. It obliges the seller to deliver
goods which possess the quality of the sample or model, which are also relevant for the
packaging of the goods.250
The underlying rationale of this standard is that holding out a sample or a model has 135
the same effect as describing the goods in detail. In general, the submission of a sample
or a model can be seen as a factual description of the goods. For that reason,
Art. 35(2)(c), unlike its predecessor Art. 33(c) ULIS, does not require an express or
implied undertaking of the seller that the goods conform with the sample or model.251
Schlechtriem/Schwenzer, Commentary (2016), Art. 35 para. 25 who requires superior knowledge of the
buyer for the exception to apply; as the burden of proof lies anyway with the seller the difference in
approach will probably have little effect in practice.
243 High Court of New Zealand (New Zealand) 30 July 2010 (trucks), RJ & AM Smallmon v Transport
Sales Limited and Grant Alan Miller, CISG-Online 2113 (Pace); confirmed by Court of Appeal of New
Zealand (New Zealand) 22 July 2011 (trucks), RJ & AM Smallmon v Transport Sales Ltd and Grant Alan
Miller, CISG-Online 2215 (Pace), paras 65 et seq.
244 Cf. Schlechtriem, Noch einmal: Vertragsgemäße Beschaffenheit der Ware bei divergierenden öffen-
tlich-rechtlichen Qualitätsvorgaben, IPRax (2001) 161 (163) who excludes reliance only for obscure
provisions.
246 Gerechthof’s Arnhem (Netherlands) 27 April 1999 (movable room units), G. Mainzer Raumzellen v
Van Keulen Mobielbouw Nijverdal BV, CISG-Online 741 (Pace).

249 Oberlandesgericht Graz (Austria) 19 June 2013 (heavy oil), CISG-Online 2461, para. C.2 holding
that the buyer has in such cases an obligation to examine the suitability of the goods.
251 Bianca, in: Bianca/Bonell, Commentary (1987), Art. 35 para. 2.6.1; an explicit or implicit agreement
of the parties that the goods have the characteristics of the sample is not required; but see: Magnus, in:
Staudinger Kommentar (2013), Art. 35 para. 36; Honnold/Flechtner, Uniform Law (2009), Art. 35
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Even without such an undertaking, the buyer expects that the goods have the same
characteristics and features as the sample or model.252 However, the wording of
Art. 35(2)(c) (“held out”) requires that the model or sample is not merely presented
on a non-obligatory basis. The seller must intend it to be of relevance for the contract253
or at least his declarations and conduct must be able to be interpreted in such a way.254
136 bb) The required characteristics. Goods usually have an infinite number of char-
acteristics. In particular, where a model is provided, it cannot be assumed that the goods
have to comply with all of the characteristics of the model to be conforming. The
problem is determining which characteristics must be complied with. If the seller
indicates that the sample or model differs in some respects from the goods to be
delivered, he will not be held to these qualities. The same applies in cases where a model
has been presented with the intention to solely point out particular qualities of the
goods. In such cases the goods only have to comply with these qualities.255 Such a
limitation may be assumed, for example, if the sample or model was given to dispel a
particular concern raised by the buyer during the negotiations or to show compliance
with certain requirements set out by the buyer in his offer or his requests for offers.
137 There may be cases where the model or sample has been held out by the seller in
order to give an approximate description of the goods. In these cases, while the sample
or model binds the seller in principle, slight differences from it may be tolerated.256
138 Cases where the goods delivered comply with the sample or the model presented but
do not have the characteristics and qualities contractually agreed upon between the
parties under Art. 35(1), or are not fit for a special purpose in the sense of Art. 35(2)(b)
or their ordinary purposes in the sense of Art. 35(2)(a) are problematic. In such
circumstances, the question of whether the goods are non-conforming in the sense of
Art. 35 is firstly a question of contractual interpretation.257 The sample or model
provided may only relate to certain characteristics while other express contractual
agreements exist. It may also be that the wording of the contractual agreements has to
be interpreted narrowly as, for certain characteristics, a sample has been provided which
should determine the quality due under the contract.
139 There may, however, be cases where conflicts turn out to be real and cannot be solved
by means of contractual interpretation. In such cases, the contractually agreed require-
ments in the sense of Art. 35(1) should prevail, unless it is based on a general usage in
para. 227 who considers the standard to be one which “articulates contractual understandings that are
given effect by paragraph (1)” which would imply an actual agreement of the parties.
252 Gabriel, Sale of Goods (2004), p. 120.
253 Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 35 para. 28; Eckert/Maifeld/Mat-
thiessen, Handbuch des Kaufrechts (2014), para. 567; cf. Landgericht Berlin (Germany) 15 September
1994 (shoes), CISG-Online 399 (Pace).
254 See Oberster Gerichtshof (Austria) 11 March 1999 (frames for mountain bikes), CISG-Online 524
(Pace) where the question arose whether the sample presented at a fair formed the basis of the order or
was merely a concept study for promotional purposes; cf. Handelsgericht St. Gallen (Switzerland) 14 June
2012 (organic juice and organic oils), CISG-Online 2468 (Pace), para. III. 3. c. where the sample was
found to be provided merely to give a general impression of the goods but not to warrant certain
characteristics.
255 Bianca, in: Bianca/Bonell, Commentary (1987), Art. 35 para. 2.6.2; Schwenzer, in: Schlechtriem/

256 Rechtbank van Koophandel Hasselt (Belgium) 19 April 2006 (doors), CISG-Online 1389 (Pace)
where the sample of the relevant wood provided was so small that it justified no assumption that there
would be no change in colour in the doors produced from the wood.
257 Magnus, in: Staudinger Kommentar (2013), Art. 35 para. 39; Schwenzer, in: Schlechtriem/Schwen-
zer, Commentary (2016), Art. 35 para. 27; critical Ferrari, in: Ferrari et al., Internationales Vertragsrecht
(2018), Art. 35 CISG para. 22 who assumes that Art. 35(2)(c) has generally a subsidiary character.
520 Kröll
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the sense of Art. 9(2). In all other cases, though the standard in Art. 35(2)(c) is based on
facts specific to the particular contract, it is overridden by the more specific express or
implied contractual stipulations, which require consent by both parties.
Comparable considerations apply for the relationship between Arts 35(2)(c) and 140
35(2)(a). In principle, the more specific standard in Art. 35(2)(c) prevails.258 This may
be different in cases where the sample or model had a hidden defect, which excludes any
presumption that the parties consented to such a standard.259 If the model or the sample
has apparent defects, Arts 38 et seq. may apply by analogy, so that a failure to notify of
such defects may exclude reliance on the lack of fitness for the ordinary use of the
goods.260
Goods which have the same characteristics as the model or sample but are not fit for 141
a particular purpose communicated to the seller are normally conforming in the sense
of Art. 35. One of the purposes of providing a sample or a model is to allow the buyer to
examine it and make his own judgment as to whether the goods will be fit for the
intended purpose so that he does not have to rely on the seller’s skill and knowledge.
Things may be different where the buyer can prove that he was nevertheless justified to
rely on the seller’s superior knowledge and did so.261
cc) Samples provided by the buyer. Art. 35(2)(c) does not apply to samples or 142
models provided by the buyer.262 The seller is only liable for the conformity with such
samples or models if they fall within the scope of Art. 35(1), i. e. have become part of
the contractual description of the goods, or under Art. 35(2)(b), if they can be
considered to constitute information about a particular purpose. In all other cases,
models or samples provided by the buyer do not result in obligations for the seller as to
conformity.263 There may, however, be fact patterns where the samples or models
provided by the buyer lead, under the principle of good faith, to duties to warn imposed
on the seller if the goods provided do not comply with the buyer’s samples.
e) Contained or packaged in the usual or adequate manner: Art. 35(2)(d)
aa) The accessory duty of packing. Art. 35(2)(d), which has no antecedent in the 143
ULIS,264 imposes criteria as to the standard of packaging for all cases in which the parties
have not agreed on a particular standard. It evinces the seller’s accessory duty to do what is
ordinarily required to ensure that the buyer receives the goods in a satisfactory condition.
Thus, in the absence of an agreement between the parties to the contrary, the seller is
under an obligation to assure appropriate packaging. This is obvious in cases where the
contract involves the carriage of goods. This duty, however, also exists in cases where the
goods are to be handed over at the seller’s place of business or where the goods are stocked
258 Eckert/Maifeld/Matthiessen, Handbuch des Kaufrechts (2014), para. 568; Ferrari, in: Ferrari et al.,

259 Piltz, Internationales Kaufrecht (2008), para. 5–40; see Oberster Gerichtshof (Austria) 27 February
2003 (frozen fish), CISG-Online 794 (Pace) with note Huber, IPRax (2004) 358 (359).
260 Magnus, in: Staudinger Kommentar (2013), Art. 35 para. 37; Landgericht München I (Germany)
27 February 2002 (globes), CISG-Online 654 (Pace) where the buyer knew from the sample that the
globes purchased for use in its showrooms were very noisy and could therefore not rely on that.
261 Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 35 para. 27; cf. Bianca, in: Bianca/
Bonell, Commentary (1987), Art. 35 para. 2.6.1.; for a different view, in favour of a general prevalence of
the standard in Art. 35(2)(b) see: Magnus, in: Staudinger Kommentar (2013), Art. 35 para. 38.
263 Magnus, in: Staudinger Kommentar (2013), Art. 35 para. 40; Schwenzer, in: Schlechtriem/Schwen-

264 For a comparable standard see § 2–314 UCC.
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(Art. 31(b)(c)).265 Thus, even where goods are sold ex works, the seller has to ensure that
they are packed in a way which is suitable for their transportation by the buyer.266
144 The provision implies two standards, i. e. the goods are required to have been
packaged either in the “usual manner” or in an “adequate manner”. In general, it can
be assumed that the “adequate manner” of containing or packaging is sufficient to
preserve and protect the goods. Therefore, a buyer having difficulties in establishing the
“usual manner” of packaging and non-compliance with it may rely on the supplemen-
tary second standard.
145 bb) “Usual manner”. In principle, the goods must be “contained or packaged in the
manner usual for such goods”. The “usual manner” in the sense of Art. 35(2)(d) is
determined by the general industry standards that apply to the goods and the type of
contract in question. Of particular relevance in this respect is normally the anticipated
mode of transportation, unless the seller is not aware of the mode of transportation and
the goods are sold ex works. By contrast, particular packaging practices agreed upon or
established between the parties are covered by Art. 35(1).267
146 There may be cases where different standards of packaging exist in different
countries. In determining the relevant standard for the purpose of Art. 35(2)(d), it
must first be ascertained that the existing standards actually apply to international sales.
Such sales are submitted to peculiar factual risks, in particular transportation risks,
against which the packaging needs to protect. Thus, packaging standards developed for
local transactions are of limited or at least lesser importance. Where different manners
of packaging exist for international transactions in different countries, the method at the
seller’s place of business prevails.268 To that extent, the same considerations apply as are
relevant for determining the relevant national standards in the context of Art. 35(2)(a).
147 cc) “Adequate manner”. Where there is no such “usual manner”,269 the goods must
be contained and packaged in a “manner adequate to preserve and protect the goods.” A
manner is adequate, if it preserves and protects the goods under ordinary circumstances,
i. e. against the normal risks to which comparable goods in comparable contracts are
submitted.270 Extraordinary risks or events are not relevant in determining the necessary
standard of packaging. Relevant factors for the determination of what is adequate are the
nature and value of the goods, the type and duration of the transport, the transportation
route, climatic conditions and typical dangers associated with the particular mode of
transportation. For example, goods to be shipped by sea to a destination with difficult
climatic conditions may have to be contained or packaged in a way which prevents any
damage through the normal humidity and variations in temperature.271 The packaging
must not only be adequate to endure the carriage, including a foreseeable amount of
delay, but also the normal time of storage at the destination.

266 Oberlandesgericht Koblenz (Germany) 14 September 2006 (bottles), CISG-Online 1408 (Pace); for
the duties in connection with an FOB contract see Comisión para la Protección del Comercio Exterior de
México (Mexico) 29 April 1996 (canned fruit), CISG-Online 350 (Pace) (Unilex).
267 But see Cour d’appel de Douai (France) 17 March 2016 (alternators), CISG-Online 2744, para. 9
where the practice established between the parties was subsumed under Art. 35(2)(d).
269 For the subsidiary nature of that requirement see Cour d’appel de Douai (France) 17 March 2016
(alternators), CISG-Online 2744, para. 9.

Online 1642 (Pace).

271 See Cour de cassation (France) 24 September 2003 (decorated laminated glass panels), Aluminum
and Light Industries Company v Saint Bernard Miroiterie Vitretie, CISG-Online 791 (Pace).
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In general, the fact that the packaging did not prevent damage to the goods is a 148
strong indication that the packaging was not adequate, unless the seller can show that
the damage was due to extraordinary circumstances.272
Notwithstanding that the buyer is responsible to arrange transportation, the goods 149
must be contained and packaged by the seller in an adequate manner with regard to
their destination, if this is known to the seller. Sending the goods to a particular
destination can be considered to be one of the expressly or impliedly made known
purposes with which the goods have to comply under Art. 35(2)(b).
dd) Damages limited to packaging. The seller does not incur any liability for non- 150
conforming goods, if only the packaging is damaged during the transport but the goods
are intact and the sole purpose of the packaging was to protect the goods during their
transport.273 Non-conformity exists, however, if the goods are normally resold by the
buyer with the same packaging. The same applies in cases of high end, luxury or other
products where the packaging in itself has a commercial value.
Pursuant to Art. 36(1), the relevant time for conformity of the goods is at the passing 151
of risk. Where goods are damaged during transportation after risk has passed, the seller
may nevertheless be liable, if those damages are due to non-conforming packaging that
already existed before the risk passed.274
ee) Extent of the duty to packaging and costs associated with it. The obligation as to 152
packaging under Art. 35(d) does not apply to goods which are normally not delivered
with any particular packaging. This is, for example, the case with certain raw materials
such as bulk shipments of coal or ore.275
In the absence of an explicit contractual agreement, the seller is not liable if the 153
packaging should serve additional purposes going beyond the usual purposes, such as
including particular codes allowing for an automatic processing of the goods at the
buyer’s premises.276 Maintaining sterility for goods which have to be sterile for their use
is, however, part of the usual purpose of packaging.277
In the absence of contractual agreements to the contrary, the seller is required to bear 154
the costs associated with his obligation to deliver packaged goods. Where the packaging
is merely intended to protect the goods during transport and is reusable, such as
containers, the seller is in general not obligated to also transfer the property in the
packaging. As such, the buyer may be obligated to return the packaging and a violation
of that obligation may result in a liability of the buyer according to Art. 45(1)(b).278
272 The strength of the presumption may be limited; see Cour de cassation (France) 24 September 2003
(decorated laminated glass panels), Aluminum and Light Industries Company v Saint Bernard Miroiterie
Vitretie, CISG-Online 791 (Pace).

274 Honnold/Flechtner, Uniform Law (2009), para. 242; Eckert/Maifeld/Matthiessen, Handbuch des
Kaufrechts (2014), para. 572; Piltz, Internationales Kaufrecht (2008), para. 5–37; Comisión para la
Protección del Comercio Exterior de México (Mexico) 29 April 1996 (canned fruit), CISG-Online 350
(Pace) (Unilex).
277 Oberlandesgericht Koblenz (Germany) 14 September 2006 (bottles), CISG-Online 1408 (Pace) where
the non-conformity of the goods resulted from the use of a porous foil, unsuitable to guarantee sterility.
278 Magnus, in: Staudinger Kommentar (2013), Art. 35 para. 45; but see Bundesgerichtshof (Germany)
5 February 1997 (containers for plants), (Pace) applying German law to the question as in its view the
then applicable ULIS did not contain a provision on the question of return.
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4. Art. 35(3)
155 a) Rationale and scope of the exclusion. Art. 35(3) excludes any liability of the seller
for the delivery of goods not conforming to any of the standards in Art. 35(2)(a)–(d) if
the buyer knew or could not have been unaware of such a lack of conformity at the time
of contract conclusion. The obligations as to the quality of the goods arising from
Art. 35(2) are imposed on the seller because the buyer can legitimately expect the goods
to meet these standards even in the absence of any express or implicit stipulation in the
contract.279 No such legitimate expectations exist if the buyer knows or ought to have
known that the goods do not conform to such standards. The rationale of Art. 35(3) is
that a buyer who knows or ought to have known which type of goods the seller is going
to deliver cannot later ask for better qualities or conditions.280 Such a buyer can be
considered to have consented to the seller’s proposal to deliver the goods in their
present status or at least be treated as if he had consented.
156 In practice, the exclusion of liability under Art. 35(3) may become relevant primarily
in two types of cases: first, where specific goods are sold which are known to the buyer;
second, for the sale of generic goods where the buyer was given the chance to inspect or
examine the goods or knows their effective state from earlier contracts.
157 In cases where the seller has provided a sample or a model, Art. 35(3) has only a
limited scope of application. The model or sample provides the relevant standard
pursuant to Art. 35(2)(c). Therefore, the buyer’s knowledge about certain qualities will,
in principle, already exclude the non-conformity of the goods and not merely lead to an
exclusion of liability. However, there remains scope for the application of Art. 35(3) in
the following two situations. The first covers cases where the buyer knows from the
examination of the sample that the apparent qualities of the sample, which define the
relevant standard for conformity, are in fact not present.281 The second concerns
qualities of the goods which were not described by the sample but have to be met
according to any of the other standards in Art. 35(2).
158 b) Extension to breaches of Art. 35(1)? Different views exist as to whether the
exclusion of liability in Art. 35(3) may also apply for contractually agreed quality
standards under Art. 35(1). Some authors favour an analogous application of
Art. 35(3) to such cases, though the wording of the provision only refers to non-
conformity with the standards in Art. 35(2).282 The prevailing view relies on the
unequivocal wording of Art. 35(3) and limits the exclusion to the standards implied by
Art. 35(2).283 Notwithstanding actual or constructive knowledge about the actual quality
of the goods, the buyer should be able to rely on the engagement undertaken by the
seller. The buyer’s knowledge should not change the content of the seller’s undertaking
nor should it free the seller from the obligations assumed.284
280 Bianca, in: Bianca/Bonell, Commentary (1987), Art. 35 para. 2.8.1; Schlechtriem, The Seller’s
Obligations Under the United Nations Convention on Contracts for the International Sale of Goods, in:
Galston/Smit (eds), International Sales: The United Nations Convention on Contracts for the Interna-
tional Sale of Goods (1984), p. 6–22.
282 In favour of such an extension Herber/Czerwenka, Kommentar (1991), Art. 35 para. 11; critical of
the limitation Neumayer/Ming, Convention de Vienne (1993), Art. 35 para. 14 (“limitation … peu
compréhensible”).
283 Schlechtriem/Butler, CISG (2009), para. 144; Ferrari, in: Ferrari et al., Internationales Vertragsrecht
(2018), Art. 35 CISG para. 27.

284 Secretariat Commentary on 1978 Draft, Art. 33 (now Art. 35) para. 14; Bianca, in: Bianca/Bonell,
Commentary (1987), Art. 35 para. 2.9.2.
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The latter view is more in line with the rationale of Art. 35(3). In general, an 159
express285 contractual agreement by the parties precludes the assumption that the buyer
consented to a different standard at the same time. This applies in all cases where the
buyer had no actual knowledge but could not have been unaware of the non-conformity
and where the buyer, despite his knowledge, could reasonably assume that the seller
would remedy the defects before delivery.286
It could, however, be contrary to the principles of good faith to prevent the seller 160
from relying on Art. 35(3) in cases where the buyer had positive knowledge that the
seller would deliver non-conforming goods. Buyers which have superior knowledge
about the characteristics of the goods and nevertheless induce the seller to enter into
contractual agreements which the seller will probably not be able to fulfil act contrary to
good faith. This applies, in particular, in cases where the seller is an intermediary, who
has already expressed doubts as to whether the goods to be resold by him will meet the
contractually agreed standards.287
In these cases, it first has to be determined whether, in light of the buyer’s knowledge 161
about defects, the parties actually agreed on the standard expressly mentioned in the
agreement. It may well be that the goods were sold under a different standard reflecting
the knowledge of the parties.288 In particular, where the buyer’s knowledge is based on a
prior examination of the goods, the parties may have agreed on the sale of the goods as
witnessed, despite conflicting wording in the agreement.289 In practice, however, this
distinction between relevant standards and the buyer’s knowledge is often not made and
cases of an earlier examination are regularly treated under Art. 35(3).290
c) Buyer’s actual or presumed knowledge. Art. 35(3) requires that the buyer must 162
either have known about the non-conformity or that he could not have been unaware of
it. The relevant point in time is, to that extent, the time of contract conclusion.
Subsequent discovery of defects, even if they occurred before actual delivery, is
irrelevant.291
The first alternative requires actual knowledge. “Constructive” knowledge on the 163
basis of clauses included into the contract is not sufficient.292 Furthermore, it always has
to be ascertained whether or not the buyer is actually aware of the non-conformity. For
example, a buyer of skin care products who is aware that over the lifetime of the
product the chemical composition of a crucial vitamin will decrease is not necessarily at
the same time aware that it will actually fall below the critical threshold. To the
contrary, the buyer may, in most cases, assume that the seller is able to prevent such
285 The buyer’s knowledge about the actual qualities of the goods prevents to assume an implied
agreement on different qualities; Bianca, in: Bianca/Bonell, Commentary (1987), Art. 35 para. 2.9.2.
286 Magnus, in: Staudinger Kommentar (2013), Art. 35 para. 50; see also Henschel, Conformity of
Goods in International Sales Governed by CISG Article 35, Nordic Journal of Commercial Law (2004/1)
(Pace), according to whom there is a presumption in favour of the buyer that the seller would remedy the
defects until delivery.
287 In these cases it will often be possible to construe the agreement between the parties that they agreed
on the actual characteristics of the goods as the relevant standard.

288 In this direction Tribunal Cantonal du Valais (Switzerland) 29 June 1998 (sports clothing), CISG-
Online 420 (Pace).

289 Henschel, Conformity of Goods in International Sales Governed by CISG Article 35, Nordic Journal
of Commercial Law (2004/1) (Pace) listing factors which may be relevant in this regard.
290 Tribunal Cantonal du Valais (Switzerland) 28 October 1997 (second hand bulldozer), CISG-Online
328 (Pace).
291 Federal Court of Australia (Australia) 20 April 2011 (electrical appliances), Castel Electronics Pty
Ltd v Toshiba Singapore Pte Ltd, CISG-Online 2219 (Pace), para. 313.
292 Magnus, in: Staudinger Kommentar (2013), Art. 35 para. 47; Ferrari, in: Ferrari et al., Internatio-
nales Vertragsrecht (2018), Art. 35 CISG para. 28.
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deterioration in quality.293 Equally, the knowledge about one deviation from the agreed
upon quality does not necessarily imply knowledge about another non-conformity.294
164 Where the seller has shown goods to the buyer or has given him the opportunity to
examine them, his liability is only excluded for the apparent defects. The buyer is only
required to undertake an examination that is normal in the particular industry or can be
expected in light of the statements made by the seller.295 Thus, liability for hidden
defects or defects which can only be discovered by examinations involving extra costs,
time or complexity beyond those which can reasonably be expected, is not excluded by
Art. 35(3).
165 The exclusion of liability also extends to deficiencies of the goods of which the buyer
“could not have been unaware”. Different views exist as to the understanding of the
second alternative, i. e. that the buyer “could not have been unaware”. While some parts
of the literature consider grossly negligent lack of knowledge sufficient,296 others want to
impose a stricter standard. They rely on the fact that the CISG distinguishes between the
concept of “ought to have known”, which covers gross negligence, and the concept of
“could not have been unaware”. The latter does not lead to any examination duties297
and only covers those cases where all facts were apparent and the buyer had to draw the
necessary conclusions. The purpose of the reference in this context is to lighten the
burden of proving that the facts which were before the buyer’s eyes and also reached his
mind, and that he drew the necessary conclusions as to the conformity of the goods.298
166 The two understandings may lead to different results in those cases where the buyer
has not made use of an offer by the seller to examine the goods at the time of contract
conclusion, which would have revealed the non-conformity. Gross negligence can be
assumed in all cases where the lack of awareness results from the failure to undertake
the necessary and possible examination of the goods. However, as the supporters of the
gross negligence standard make it clear that they do not want to create an additional299
examination duty for the buyer through the back door,300 the practical relevance of the
difference should not be exaggerated.
167 The buyer’s knowledge or required knowledge may also result from previous deal-
ings. The seller may have previously delivered goods which were below the objective
standard in Art. 35(2). If the buyer did not complain about the non-conformity on that
occasion he cannot expect that the seller will deliver goods of a higher quality under
future contracts.301
293 Helsinki Court of First Instance (Finland) 11 June 1995, confirmed by Helsinki Court of Appeal
(Finland) 30 June 1998 (skin care product), CISG-Online 1304 (Pace).

294 Federal Court of Australia (Australia) 20 April 2011 (electrical appliances), Castel Electronics Pty
Ltd v Toshiba Singapore Pte Ltd, CISG-Online 2219 (Pace), paras 310 seq. (knowledge about lack of
software irrelevant for defects based on faulty wiring).
295 See Oberlandesgericht Koblenz (Germany) 19 December 2012 (generator), CISG-Online 2470 (Pace),
pp. 4 seq. (no need to verify detailed descriptions as to performance of the generator when examining it).
296 Ferrari, in: Ferrari et al., Internationales Vertragsrecht (2018), Art. 35 CISG para. 29; Brunner,
Kommentar (2014), Art. 35 para. 24; Gruber, in: MünchKommBGB (2016), Art. 35 CISG para. 36; also in
favour of gross negligence Aue, Mängelgewährleistung im UN-Kaufrecht unter besonderer Berücksichti-
gung stillschweigender Zusicherungen (1989), pp. 82 et seq. adopting, however, a restrictive standard.
299 It must be distinguished from the examination duty pursuant to Art. 38 or other examination duties
which do not affect the “conformity” of the goods as they concern examinations post contract conclusion;
a violation of such duties may lead to a loss of all remedies or a reduction of the damages pursuant to
Arts 77, 80; see Bundesgerichtshof (Germany) 26 September 2012 (clay), CISG-Online 2348 (Pace), para.
II.3.
300 E. g. Gruber, in: MünchKommBGB (2016), Art. 35 CISG para. 36.
301 See Arbitral Award, CIETAC, 20 January 1994 (hydraulic press) (Pace).
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d) Seller acting in bad faith. Art. 35(3) does not explicitly restrict its scope of 168
application to cases where the seller was not aware of the non-conformity. Thus, it
applies, in principle, to cases in which the seller was aware of the non-conformity of the
goods but did not disclose that fact to the buyer. This may be justified in those cases
where the buyer had positive knowledge about the non-conformity of the goods. In this
case, the buyer may not also rely on national rules of fraudulent misrepresentation to
circumvent the application of Art. 35(3). The exclusion of liability in Art. 35(3) does
not, however, apply to such cases where the buyer only “could not have been unaware”
of the non-conformity while the seller had positive knowledge of it.302 To that extent,
Art. 40 contains a general principle which is a special emanation of the principle of
good faith, i. e. the seller may not rely on failures by the buyer if he acts in bad faith to
an even greater extent.303
e) Waiver. The seller may waive the right to rely on Art. 35(3). The question of a 169
potential waiver arises where the seller, despite being aware that the requirements of
Art. 35(3) are met, has tried or promised to remedy defects or has partially compensated
the buyer.304 A waiver should, however, not be assumed lightly. It requires that the seller
is aware and has the intention to waive his rights under Art. 35(3) or his actions could
at least be interpreted as a waiver pursuant to Art. 8(2)(3).
5. Exclusion of express and implied obligations as to conformity

Clauses trying to limit or even exclude liability for non-conforming goods are fairly 170
standard in international contractual practice.305 The CISG – unlike some national sales
laws306 – does not contain a special provision explaining how to exclude the legal
standards imposed by Art. 35(2) or those agreed upon under Art. 35(1). Hence the
general rules on the formation of contracts (Arts 14 et seq.) and interpretations of
declarations (Art. 8) apply.
The fact that only Art. 35(2) explicitly refers to an agreement to the contrary cannot 171
be interpreted as limiting a possible exclusion of liability to the standards imposed by
Art. 35(2).307 In principle, and in line with Art. 6 endorsing party autonomy, the seller
could also try to disclaim obligations resulting from Art. 35(1). However, courts are
generally reluctant to interpret broadly worded disclaimer clauses to cover contractually
agreed conformity standards, i. e. express warranties.308 Moreover, clauses which pur-
port to exclude liability for contractually agreed conformity standards would probably
be considered invalid, if they cannot be interpreted in a way which excludes the clear
contradiction to the obligation assumed.
In principle, the validity of all disclaimers is governed by national law (Art. 4).309 172
However, by stating that the obligations under Art. 35(2) only arise “[e]xcept where the
302 Magnus, in: Staudinger Kommentar (2013), Art. 35 para. 52; Ferrari, in: Ferrari et al., Internatio-
nales Vertragsrecht (2018), Art. 35 CISG para. 30.

303 Oberlandesgericht Köln (Germany) 21 May 1996 (used car), CISG-Online 254 (Pace).
304 See Federal Court of Australia (Australia) 20 April 2011 (electrical appliances), Castel Electronics
Pty Ltd v Toshiba Singapore Pte Ltd, CISG-Online 2219 (Pace), para. 307.
305 E. g. ICC Model International Sales Contract, ICC Publication, Part A Clause 11; Part B Article 11;
on the topic see CISG AC Opinion no 17.

306 E. g. § 2–316(3) UCC.
307 In this direction, however, Hyland, Conformity of Goods, in: Schlechtriem (ed.), Einheitliches
Kaufrecht (1987), p. 305 (309).

308 Lookofsky, Tooling up for Warranties with the CISG Case Digest, in: Flechtner/Brand/Walter (eds),
Drafting Contracts (2007), p. 343 (351).

International Commercial Law and Arbitration (2009) 91 (97) (Pace); Hyland, Conformity of Goods, in:
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parties have agreed otherwise” the CISG made clear that disclaimers cannot be completely
prohibited. The various national laws differ considerably as to the permissibility of such
waivers and, in particular, as to the requirements for their effectiveness, which, for example,
in the U.S. requires the use of certain wordings.310 Inquiries into the effects of such
disclaimers can easily be phrased as questions concerning the validity of the disclaimer.
Given the varying and sometimes very detailed requirements for the validity and effective-
ness of such disclaimers under national laws, an approach requiring that a disclaimer would
have to meet the various national provisions in regards to their appearance or wording to
be valid would constitute a serious threat to the uniform application of the CISG. In light of
this, a narrow understanding of “validity” should be adopted, which is largely restricted to
the question of whether a disclaimer is as such permissible and if so to what extent, but
does not cover issues relating to the effectiveness of such clauses. Questions relating to the
“effectiveness” of such clauses should be treated as those of contract formation or contract
interpretation, forming part of the contractual descriptions of the goods.311 In addition,
where under national law a valid disclaimer requires special wording, the latter may be
based on the formulations used for implied warranties in the national law and therefore not
be applicable or at least not suitable for CISG contracts.312
173 Comparative analysis reveals that it is probably impossible to validly exclude all
liability for non-conformity. In particular, exclusions of liability covering fraudulent
behaviour are likely to be invalid.313
174 These limits imposed by the national laws, however, only relate to contractual
disclaimers. The seller may always inform the buyer about the defects in the goods
and thereby benefit from the exclusion of liability in Art. 35(3).314
175 In principle, the requirements as to conformity implied under Art. 35(2) may also be
excluded by express warranties in regards to the characteristics of the goods, which
would conflict with such implied standards. Such an exclusion should, however, not be
assumed lightly. The primary purpose of such clauses is to make positive statements
about the quality of the goods and not to relieve the seller of his responsibilities.315
6. Burden of proof
176 a) General rule. In the context of the seller’s liability for non-conforming goods, the
burden of proof is of considerable practical relevance. Both buyer and seller will often
encounter difficulties proving that the goods were or were not in conformity at the time
Schlechtriem (ed.), Einheitliches Kaufrecht (1987), p. 305 (313); Magnus, in: Staudinger Kommentar
(2013), Art. 35 para. 53; see also Pennsylvania Federal District Court (U.S.) 25 July 2008 (locomotives),
Norfolk Southern Railway Company v Power Source Supply, Inc, CISG-Online 1776 (Pace).
310 Hyland, Conformity of Goods, in: Schlechtriem (ed.), Einheitliches Kaufrecht (1987), p. 305 (314);
for further references to national laws see also Schwenzer, in: Schlechtriem/Schwenzer, Commentary
(2016), Art. 35 para. 45.
311 In favour of such an approach see Gillette/Walt, Sales Law (2016), Chap. 8 III pp. 377 seq.; Lookofsky,
Tooling up for Warranties with the CISG Case Digest, in: Flechtner/Brand/Walter (eds), Drafting Contracts
(2007), p. 343 (356 et seq.) see also Hyland, Conformity of Goods, in: Schlechtriem (ed.), Einheitliches
Kaufrecht (1987), p. 305 (314 seq.); in favour of a broader concept of “validity” determined by the national
law, Longobardi, Disclaimers of Implied Warranties: The 1980 United Nations Convention on Contracts for
the International Sale of Goods, 53 Fordham Law Review (1985) 863 (873 et seq.) (Pace).
International Commercial Law and Arbitration (2009) 91 (96 seq.) (Pace).

313 Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 35 para. 45; Oberlandesgericht
Dresden (Germany) 27 May 2010 (used car), CISG-Online 2182 (Pace), para. II.3.C.a.
528 Kröll
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the risk passed so that the outcome of a dispute depends on who bears the burden of
proof.316 This applies, in particular, in cases of hidden defects only discovered after
some time, but also for contracts involving the transport of goods317 or where the goods
are used in combination with other products in a way that defects in the final product
could have several different causes.318
Notwithstanding that Arts 35 et seq. do not explicitly regulate the burden of proof, it is 177
widely319 accepted that the CISG – and not national law – determines the allocation of the
burden of proof for the non-conformity.320 Some go even further and submit that the
CISG also governs the way in which this burden can be discharged.321 The prevailing view
is, however, that national law governs by which means a party may discharge its burden,
as well as other primarily procedural questions relating to the admissibility and weight of
evidence. Thus, whether the party may prove the non-conformity by submitting the
report of a party-selected expert or whether the non-conformity can only be proven by
court appointed experts is a question for the national law.322 The same applies for
questions of the evidentiary value and consequences of admissions of non-conformity.323
There is large consensus that the burden of proof in the context of Art. 35 follows the 178
general principles underlying the CISG in relation to burden of proof. Thus, in general,
each party has to prove the existence of the factual prerequisites contained in the legal
provision upon which it wants to rely for its claims or defences.324 The principle of
proof proximity may require certain exceptions to that rule.325 What follows from these
316 See Kröll, The burden of proof for the non-conformity of goods under Art. 35 CISG, 15 Vindobona
Journal of International Commercial Law and Arbitration (2011) 33 seq. (Pace).

317 For a more detailed account of the proof problems arising from transportation see Antweiler,
Beweislastverteilung im UN-Kaufrecht (1995), pp. 141 et seq.

318 Audiencia Provincial de Barcelona (Spain) 20 June 1997 (dye for clothes), CISG-Online 338 (Pace).
319 For the opposite view i. e. submitting the burden of proof to national law, Arbitral Award, ICC
6653/1993, 26 March 1993 (steel bars) (Pace); Khoo, in: Bianca/Bonell, Commentary (1987), Art. 2
para. 3.2; Heuzé, Vente Internationale (2000), para. 299; Gillette/Walt, Sales Law (2016), Chap. 6 V C
p. 272 et seq.; Flechtner, Selected Issues Relating to the CISG’s Scope of Application, 13 Vindobona
Journal of International Commercial Law and Arbitration (2009) 91 (102 et seq.) (Pace).
320 E. g. Bundesgerichtshof (Germany) 9 January 2002 (powdered milk), CISG-Online 651 (Pace) at 2(b)
with note Perales Viscasillas, Battle of the Forms and the Burden of Proof: An Analysis of BGH 9 January
2002, 6 Vindobona Journal of International Commercial Law and Arbitration (2002) 217 (227) (Pace);
Bundesgericht (Switzerland) 13 November 2003 (used laundry machine), CISG-Online 840 (Pace) at 5.3
with approving note Mohs, IHR (2004) 219 (220); Bundesgericht (Switzerland) 16 July 2012 (spinning
mill), CISG-Online 2371 (Pace), para. 8.1; Ferrari, Burden of Proof under the CISG, Pace Review of the
Convention on contracts for the International Sale of Goods (2000–2001), 1 et seq.; Müller, Ausgewählte
Fragen der Beweislastverteilung im UN-Kaufrecht im Lichte der aktuellen Rechtsprechung (2005), pp. 28
et seq.; see also the decisions in the following footnotes.
321 DiMatteo et al., The Interpretive Turn in International Sales Law, 34 Northwestern Journal of
International Law and Business (2004) 299 (438 seq.); see also Schwenzer, in: Schlechtriem/Schwenzer,
Commentary (2016), Art. 35 para. 58 advocating that the CISG governs the standard of proof which
should be “reasonableness”.
322 See Tribunale di Vigevano (Italy) 12 July 2000 (sheets of vulcanized rubber used in manufacture of
shoe soles), CISG-Online 493 (Pace) where the evidence submitted by the German buyer to prove the
non-conformity, i. e. the report and testimony of an expert appointed by the buyer, had been rejected
under Italian procedural law; cf. Cámara Nacional de Apelaciones en lo Commercial (Argentina) 24 April
2000 (charcoal), CISG-Online 699 (Pace) at III; Cámara Nacional de Apelacioines en lo Commercial
(Argentina) 21 July 2002 (malt), CISG-Online 803 (Pace) requesting proof of non-conformity under
Art. 476 Commercial Code by submission to independent expert arbitrators (peritos arbitradores).
323 Bundesgerichtshof (Germany) 9 January 2002 (powdered milk), CISG-Online 651 (Pace).
324 Often referred to by the Latin adages “onus probandi incumbit ei qui dicit, non qui negat” or “actori
incumbit probatio”; see Müller, Ausgewählte Fragen der Beweislastverteilung im UN-Kaufrecht im Lichte
der aktuellen Rechtsprechung (2005), pp. 36 et seq.
325 Bundesgericht (Switzerland) 13 November 2003 (used laundry machine), CISG-Online 840 (Pace) at
5.4; Obergericht des Kantons Zug (Switzerland) 8 November 2011 (spinning mill), CISG-Online 2425
Kröll 529
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general principles in the context of Art. 35 is, however, highly controversial. The various
views are in part strongly influenced by the position taken under respective national
laws, as is particularly evident with some of the French and German decisions.326 In
addition, often the various statements by courts and tribunals or in the literature lack
the necessary specificity and distinction to attribute them clearly to a particular view so
that the same authors and decisions are relied upon for different views.327 That is in part
due to the fact that there is no universally accepted concept of the notion of burden of
proof, which is considered to be one of the most slippery notions of any legal system.
On a proper understanding, the burden of proof only becomes relevant if at the end of
the evidentiary process, which involves the application of all evidentiary tools such as
prima facie evidence or presumptions, it cannot be established with the required
certainty whether a relevant fact exists or not.
179 b) Allocation of the burden of proof in practice: Overview on the different
positions. The Swiss courts want to allocate the burden of proof primarily on the basis
of the “actori incumbit probatio” principle. Thus, the burden of proof is largely
dependent on the position of the parties in the process, i. e. who invokes Art. 35 in
their favour. Where the seller claims for the purchase price he has to prove that he
fulfilled his obligation to deliver conforming goods. By contrast, the burden of proof
should lie with the buyer where he wants to hold the seller liable for non-conforming
goods or where he refuses acceptance of the goods for non-conformity.328
180 In most other jurisdictions, courts and literature pay at best lip-service to this rule. De
facto the burden of proof is allocated largely independently from the procedural
position of the relevant parties. Due to the particularities of Art. 35, the application of
the “rule-exception” principle is fraught with uncertainties.
181 Some courts have held that the burden should generally lie with the seller.329 Also, in
the German literature, influenced by the situation in domestic law, the seller is in
principle considered to bear the burden of proof that he properly performed his
obligation.330 In the view of others, the buyer should normally bear the burden of
proof.331
(Pace), para. 4.2.2 – overruled as to the question whether an exception was justified in the case at hand by
Bundesgericht (Switzerland) 16 July 2012 (spinning mill), CISG-Online 2371 (Pace), para. 8.4.
326 For a critical analysis of this see Gruber, in: MünchKommBGB (2016), Art. 35 CISG para. 44.
327 For a detailed discussion of the various positions and issues see the monographs by Müller,
Ausgewählte Fragen der Beweislastverteilung im UN-Kaufrecht im Lichte der aktuellen Rechtsprechung

(2005), pp. 36 et seq.; Antweiler, Beweislastverteilung im UN-Kaufrecht (1995), pp. 141 et seq.; Linne,
Burden of Proof under Article 35 CISG, 20 Pace international Law Review (2008) 31.
5.3 (in the case the principle is, however, de facto overridden by the “proof-proximity” principle);
Bundesgericht (Switzerland) 13 January 2004 (menthol USP brand crystals), CISG-Online 838 (Pace)
(UNILEX) at E. 3.1. in two of the cases; in this direction also Ferrari, Divergences in the application of the
CISG’s rules on non-conformity of goods, RabelsZ (2004) 473 (479); Neumann, Features of Article 35 in
the Vienna Convention; Equivalence, Burden of Proof and Awareness, 11 Vindobona Journal of
International Commercial Law and Arbitration (2007/1) 81 at paras 16 et seq. (Pace).
329 Rechtbank van Koophandel Kortrijk (Belgium) 6 October 1997 (crude yarn), CISG-Online 532
(Pace); in this direction also Landgericht Berlin (Germany) 15 September 1994 (shoes), CISG-Online
399 (Pace) requiring, however, first a detailed complaint of the buyer.
330 Henninger, Die Frage der Beweislast im Rahmen des UN-Kaufrechts (1995), p. 221.
331 Bianca, in: Bianca/Bonell, Commentary (1987), Art. 36 para. 3.1; Mohs, Case note (Bundesgericht
13 November 2003), IHR (2004) 219 (220); U.S. Court of Appeals (7th Circuit) (U.S.) 23 May 2005 (pork
ribs) Chicago Prime Packers, Inc. v Northam Food Trading Co., CISG-Online 1026 (Pace), to a large
extent de facto also Bundesgericht (Switzerland) 13 January 2004 (menthol USP brand crystals), CISG-
Online 838 (Pace) (UNILEX) at E. 3.1.
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The prevailing view in practice is that the burden shifts from the seller to the buyer in 182
conjunction with the delivery of goods.332 The exact time of such shift as well as its legal
justification, however, is controversial. In general, a buyer who has taken delivery of the
goods without any complaints or reservation as to their conformity has to prove that the
goods were non-conforming at the time the risk passed.333 The seller has to prove the
conformity of the goods before the buyer takes delivery or makes reservations.334 The
views concerning the exact time of the shift of the burden of proof range from the mere
physical acceptance of the goods,335 to the expiry of a time to examine the goods in the
sense of Art. 58(3),336 to the expiry of the notification period under Art. 39.337 It is
argued that due to the considerable protection afforded to the seller by Art. 39, it is
justifiable to impose the burden of proof on the seller at least until the notification
period expires.
In the literature, a number of variances of these general approaches have been 183
suggested. They often try to facilitate the burden of proof for the buyer concerning the
existence of the non-conformity at the time risk passes. Some authors consider it
sufficient that the buyer proves the present non-conformity of the goods to put into
operation a presumption in his favour that this non-conformity also existed at the time
the risk passed. It is then for the seller to rebut such presumption by showing that the
non-conformity is the consequence of a subsequent event.338 Others want to limit that
exception to the period between the dispatch of the goods by the seller and their arrival
to the buyer in cases of contracts including carriage and based on C-Incoterms.339 One
author suggests a three step approach according to which the seller carries an initial
burden of establishing a prima facie case of conformity, for example by inspection
certificates or routine business practices. Upon fulfilment of this burden, the buyer
would then have to establish a case of non-conformity and that this was not caused by
332 See in particular Handelsgericht Zürich (Switzerland) 30 November 1998 (lambskin coats), CISG-
Online 415 (Pace); Piltz, Internationales Kaufrecht (2008), para. 5–23; Schwenzer, in: Schlechtriem/
Schwenzer, Commentary (2016), Art. 35 para. 55; as well as the references in the following footnotes.
5.3.; Bundesgericht (Switzerland) 7 July 2004 (cable drums), CISG-Online 848 (Pace) at 3.3; Bundesgericht
(Switzerland) 16 July 2012 (spinning mill), CISG-Online 2371 (Pace), para. 8.1; Bundesgerichtshof
(Germany) 8 March 1995 (mussels), CISG-Online 144 (Pace) at II 1(b)(aa); Bundesgerichtshof (Germany)
9 January 2002 (milkpowder), CISG-Online 651 (Pace) at 2 (a); less explicit also Cour de cassation
(France) 24 September 2003 (decorated laminated glass panels), Aluminium and Light Industries
Company v Saint Bernard Miroiterie Vitretie, CISG-Online 791 (Pace).
334 Handelsgericht Zürich (Switzerland) 30 November 1998 (lambskin coats), CISG-Online 415 (Pace);
Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 35 para. 55.

335 Bundesgericht (Switzerland) 13 November 2003 (used laundry machine), CISG-Online 840 (Pace)
at 5.3.
336 Benicke, in: MünchKommHGB (2013), Art. 36 paras 8, 10; Mohs, Case note (Bundesgericht
13 November 2003), IHR (2004) 219 (220); Schwenzer, in: Schlechtriem/Schwenzer, Kommentar (Ger-
man ed. 2013), Art. 35 para. 52 note 265; different now in Schwenzer, in: Schlechtriem/Schwenzer,
337 Antweiler, Beweislastverteilung im UN-Kaufrecht (1995), p. 162 et seq.; Henninger, Die Frage der
Beweislast im Rahmen des UN-Kaufrechts (1995), p. 221 et seq.; Daun, Öffentlichrechtliche “Vorgaben”
im Käuferland und Vertragsmäßigkeit der Ware nach UN-Kaufrecht, NJW (1996) 29 (30); see also the
earlier Swiss jurisprudence Handelsgericht Zürich (Switzerland) 30 November 1998 (lambskin coats),
CISG-Online 415 (Pace); Obergericht Luzern (Switzerland) 12 May 2003 (used textile cleaning machine),
CISG-Online 846; Appellationshof Bern (Switzerland) 11 February 2004 (wire and cable), CISG-Online
1191 (Pace), which has, however, been overruled by the Bundesgericht (Switzerland) 7 July 2004 (cable
drums), CISG-Online 848 (Pace).
338 So originally Magnus, in: Staudinger Kommentar (2005), Art. 36 para. 25; in the 2013 edition the
presumption was replaced by mere proof alleviations such a prima facie evidence, Art. 36 para. 25.
Kröll 531
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the buyer. If the buyer meets that burden of proof, the burden would shift back to the
seller to explain why he should not be liable for the non-conformity.340
184 c) Suggested approach.341 In allocating the burden of proof a distinction should first
be made between establishing the relevant standard for conformity on the one hand and
the question of its breach or fulfilment when risk passes on the other.
185 The allocation of the burden of proof for the determination of the relevant standard
to be met, whether subjective (Art. 35(1)) or objective (Art. 35(2)), should be governed
by the “actori incumbit probatio” principle. The starting point is the default standard in
Art. 35(2)(a). A party seeking to rely on Art. 35 has to prove any deviations in its favour
from that standard or, if he wants to rely on Art. 35(2)(a), the content of the standard as
such.
186 In most cases, it will therefore be the buyer who has to prove the relevant standard
where he wants to rely on the non-conformity of the goods. This applies to the fall-back
standard in Art. 35(2)(a) as well as any higher or different standard either on the basis
of an agreement between the parties or because of a special purpose communicated or
on the basis of a sample. By contrast, the seller has to prove any deviations from the
ordinary use standard in Art. 35(2)(a) upon which he wants to rely, to counter requests
by the buyer for the delivery of goods of a higher standard. The same applies for
disclaimers.
187 The allocation of the burden of proof for the second question, that of the breach or
fulfilment of the standard established, should be governed primarily by the principles of
proof proximity.342 Thus, before the actual delivery or where the buyer accepts the
goods only with complaints or reservations, the seller has to prove their conformity. The
goods are, or in case of acceptance with reservation were at least at the relevant time,
still within the seller’s sphere of influence. He is in the most appropriate position to take
the necessary evidence to prove their conformity.
188 The same applies if the buyer objects to the non-conformity of the goods within the
time necessary for the superficial inspection of the goods under Art. 58(3). The buyer
must at least have the opportunity to inspect the goods as to their prima facie
conformity. Given the short period between the handing over of the goods to the buyer
and the reservations declared, it can normally be assumed that the goods have not
deteriorated but are in the same condition as at the time of delivery. Thus, while the
seller may no longer have direct possession of the goods at the time the reservation is
declared, it is still justifiable to leave the burden of proof with him.
189 By contrast, once the buyer has taken delivery of the goods without any complaints or
reservations as to their conformity within the timeframe of Art. 58(3), he has to prove
that the goods were non-conforming at the time the risk passed.343 This also includes
340 Linne, Burden of Proof under Article 35 CISG, 20 Pace international Law Review (2008) 31 (42 seq).
341 For a more detailed discussion see Kröll, The burden of proof for the non-conformity of goods
under Art. 35 CISG, 15 Vindobona Journal of International Commercial Law and Arbitration (2011) 33
(45 et seq.) (Pace).
342 For the primary relevance of the principle see also Benicke, in: MünchKommHGB (2013), Art. 36
para. 11; cf. Bundesgericht (Switzerland) 7 July 2004 (cable drums), CISG-Online 848 (Pace) at 3.3; for a
case where proof proximity was considered to be irrelevant Handelsgericht Zürich (Switzerland) 18 June
2012 (antique statue), CISG-Online 660 (Pace), para. 4.3.1(c).
5.3; Bundesgericht (Switzerland) 7 July 2004 (cable drums), CISG-Online 848 (Pace) at 3.3; Bundesgericht
(Switzerland) 16 July 2012 (spinning mill), CISG-Online 2371 (Pace), para. 8.1; Tribunale di Vigevano
(Italy), 12 July 2000 (sheets of vulcanized rubber used in manufacture of shoe soles), CISG-Online 493
(Pace); Bundesgerichtshof (Germany) 8 March 1995 (mussels), CISG-Online 144 (Pace) at II 1(b)(aa);
Bundesgerichtshof (Germany) 9 January 2002 (milkpowder), CISG-Online 651 (Pace) at 2(a).
532 Kröll
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proof that insufficient quantities have been delivered.344 Different considerations can
apply in cases where due to the nature of the alleged defect it is clear that it must have
been present at the time of the passing of the risk and cannot have occurred later.345
As a consequence, a buyer in an ex works contract, where the risk passes when the 190
goods have been made available at the agreed upon premises, has not met his burden of
proof for non-conformity if it cannot be established whether defects result from
manufacturing or from transportation.346 The same applies to FOB contracts, where
the buyer has to establish that the non-conformity already existed at the time the risk
passed at the mentioned place.347
To make the expiry of the notification period the relevant point in time when the 191
burden of proof passes to the buyer, as is suggested in the literature and jurisprudence,
does not give sufficient weight to the principle of proof proximity. In light of the possible
length of the notification period in Art. 39, the seller would be faced with considerable
problems in fulfilling an obligation to prove that the goods were conforming at the time
risk passed. Not only are the goods in question no longer in his possession, but the seller,
unlike the buyer, normally has no information about their treatment during the time
between delivery and the notification of the non-conformity.348 Notwithstanding that the
need to secure evidence also plays a role for the notification requirement in Art. 39, the
latter also serves additional purposes. Consequently, the shift in the burden of proof
should not be directly linked to the expiry of the notification requirement.349
This assertion is further supported by the fact that a clear distinction between the two 192
allows for a graded approach which is more in line with the whole structure of the CISG,
and in particular the various examination periods. These take into account the different
stages in the process of performing a contract and the consequences resulting thereof for
the ability of each party in proving its case. Thus, while the actual acceptance of the goods
without any reservations after a superficial investigation of their conformity leads to a
shift in the burden of proof, the later expiry of the notification period, including time for
a more thorough examination under Art. 38, leads to a complete loss of remedies.
Moreover, the imposition of the burden of proof on a buyer who has accepted the 193
goods does not constitute an undue burden on the buyer. Given that the goods are in his
possession, he should have no problem in proving that the current condition of the goods
is not in conformity with the requirements of Art. 35. For the second step, i. e. to show
that the non-conformity already existed at the time risk passed, he may frequently be able
to rely on evidentiary privileges such as prima facie evidence or even presumptions.350
344 Bundesgericht (Switzerland) 7 July 2004 (cable drums), CISG-Online 848 (Pace) at 3.3, justifying the
rule with the fact that after taking over the goods it is easier for the buyer to prove their non-conformity;
for an exceptional case where the seller had to prove the quantities delivered as they were defined not by
numbers, but by an area Oberlandesgericht Brandenburg (Germany) 3 July 2014 (cuttings), CISG-Online
2543 (Pace), para. 23 et seq.; generally in favour of putting the burden for the delivery of sufficient
quantities upon the seller Obergericht des Kantons Zug (Switzerland) 8 November 2011 (spinning mill),
CISG-Online 2425 (Pace), para. 4.2.2 overruled by Bundesgericht (Switzerland) 16 July 2012 (spinning
mill), CISG-Online 2371 (Pace), para. 8.4.
345 Handelsgericht Zürich (Switzerland) 18 June 2012 (antique statue), CISG-Online 2660 (Pace),
para. 4.3.1.(c) – concerning the age of the statue.

346 Cour de cassation (France) 24 September 2003, Aluminium and Light Industries Company v Saint
Bernard Miroiterie Vitretie (decorated laminated glass panels), CISG-Online 791 (Pace).
347 See the example in Honnold/Flechtner, Uniform Law (2009), para. 242 example 36A.
5.3 with approving note Mohs, IHR (2004) 219 (220); Schwenzer, in: Schlechtriem/Schwenzer, Kommen-
tar (German ed. 2013), Art. 35 para. 52 giving up an earlier support for extending the period.
349 See Benicke, in: MünchKommHGB (2013), Art. 36 para. 10 who fears that a linkage of both could
lead to pressures to shorten the time for notification endangering a uniform interpretation of the CISG.
350 For details see Art. 36 paras 21 et seq.
Kröll 533
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194 The CISG, however, only regulates the burden of proof within its own scope of
substantive applicability. Questions as to what effects an admission or an acknowledgment
of the non-conformity of goods by the buyer have on the burden of proof, are governed by
the applicable national law. Thus, letters acknowledging the existence of deficiencies may
result, under the relevant national law, in a mere alleviation of the standard of proof,
presumptions in favour of the buyer or even a shift of the burden of proof.351 In this
respect, other pre-trial correspondence of the parties may become relevant.352
d) Burden of proof concerning specific facts
195 aa) Art. 35(1). The buyer who alleges that certain requirements as to conformity have
been agreed bears the burden of proof for that.353 Normally the burden can be
discharged not only by direct evidence, i. e. submission of the express contractual terms,
but also by indirect evidence such as the description of the goods in pro-forma invoices,
examination reports, packing lists, to which the seller did not object at the time.
196 By contrast where the seller tries to rely on a contractually agreed standard in the
sense of Art. 35(1) which imposes lower requirements than the standards in Art. 35(2),
he has to prove such standard.354
197 Subsequent changes to an originally agreed standard have to be proven by the party
relying on them.355 The opposite applies where a party alleges that, despite an
uncontested subsequent amendment of a contract, certain previously agreed standards
continue to be relevant.356 A party which relies on a usage allegedly defining the quality
has to prove such usage.357
198 bb) Art. 35(2)(a) – Fitness for ordinary purpose. Allegations that the goods are not
fit for the ordinary purpose must be proven by the buyer.358 This includes that a buyer,
who wants to rely on the non-compliance of the goods with public law restrictions in a
country different from the country of the seller, proves why the seller should have been
aware of them.
199 By contrast, the seller has to prove that he disclaimed this or any other of the implied
obligations found in Art. 35(2).
200 cc) Art. 35(2)(b) – Fitness for a particular purpose. A buyer trying to invoke the
non-conformity of the goods with the standard imposed by Art. 35(2)(b) has to prove
that the particular purpose was made known to the seller.359 The seller then bears the
351 Bundesgerichtshof (Germany) 9 January 2002 (powdered milk), CISG-Online 651 (Pace) at 2(b) with
note Perales Viscasillas, Battle of the Forms and the Burden of Proof: An Analysis of BGH 9 January 2002,
6 Vindobona Journal of International Commercial Law and Arbitration (2002) 217 (227) at 9.
352 See also Tribunale d’Appello Ticino (Switzerland) 15 January 1998 (cocoa beans), CISG-Online 417
(Pace) implicit acknowledgement of the non-conformity of the goods by relying merely on technicalities.
353 Oberlandesgericht Zweibrücken (Germany) 2 February 2004 (milling equipment), CISG-Online 877
(Pace) – origin of goods; Landgericht Hamburg (Germany) 6 September 2004 (containers), CISG-Online
1085 (Pace) – year of production.
354 Müller, Ausgewählte Fragen der Beweislastverteilung im UN-Kaufrecht im Lichte der aktuellen
Rechtsprechung (2005) p. 65.

355 Landgericht Landshut (Germany) 5 April 1995 (sport clothing), CISG-Online 193 (Pace) at II 1 c.
356 Pennsylvania Federal District Court (U.S.) 25 July 2008 (locomotives), Norfolk Southern Railway
Company v Power Source Supply, Inc., CISG-Online 1776 (Pace).

357 Handelsgericht St. Gallen (Switzerland) 14 June 2012 (organic juice – organic oil), CISG-Online
2468 (Pace), para. III.5 reliance on usage as to documents required.

358 Oberlandesgericht Innsbruck (Austria) 1 July 1994 (garden flowers), CISG-Online 219 (Pace).
359 Bundesgericht (Switzerland) 13 January 2004 (menthol USP brand crystals), CISG-Online 838
(Pace) (UNILEX) at E. 3.1; Neumann, Features of Article 35 in the Vienna Convention; Equivalence,
Burden of Proof and Awareness, 11 Vindobona Journal of International Commercial Law and Arbitration
(2007/1) 81 at paras 38 et seq. (Pace).
534 Kröll
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burden of proof for the fact that the buyer did not rely upon the seller’s skill and
judgment or that it was unreasonable for him to do so.360
To establish non-conformity pursuant to Art. 35(2)(b), it may be sufficient that the 201
buyer shows that the goods cannot be used for the purpose without providing direct
evidence as to what was the actual cause or defect preventing such use.361 Such an
inference is, however, only possible where it can be established that the non-suitability
was not due to factors in the buyer’s sphere of responsibility, i. e. improper handling or
wrong processes used.362
dd) Art. 35(2)(c) – Sale by sample or model. The buyer bears the burden of proof that 202
a sample or model has been provided and the goods do not conform with this sample.363
By contrast, where the seller tries to rely on the standard in Art. 35(2)(c) to avoid the
application of Art. 35(2)(a), he has to prove that a sample or model has been provided.364
ee) Exclusion of liability. A seller trying to rely on Art. 35(3) to exclude liability has 203
to prove that the buyer knew of the defects at the time of contract conclusion.365
e) Discharging the burden of proof: relevance of certificates confirming confor- 204
mity. Parties regularly provide in their contract for an examination of the goods by
outside experts. Clauses such as “final according to SGS certification”366 are not
uncommon and seem to imply that the findings of the expert constitute conclusive
evidence of the non-conformity. Whether that is really the case has to be determined by
interpreting the clause on the basis of Art. 8. In the majority of cases, such clauses do
not exclude proof to the contrary, i. e. that the findings in the expert report are wrong. It
is, however, up to the party which contests the findings of the expert to prove that they
are actually wrong, which may lead to a de facto reversal of the burden of proof.
Moreover, the proof provided by such certificates cannot go further than the examina-
tion made. Thus, where it follows from the certificate that only the top layers of a
consignment of bricks were examined, it does not provide any proof as to the
conformity of the lower layers.367
Even beyond such express contractual provisions, inspection certificates issued by 205
third parties are often of crucial relevance in determining the conformity of the goods.
However, they lose their evidentiary value if there is a considerable period of time
between the inspection and the passing of the risk, during which the goods may have
ger Kommentar (2013), Art. 35 para. 56; Maley, The Limits to the Conformity of Goods, 12 International
Trade and Business Law Review (2009) 82 (118 seq.) (Pace); hesitant in relation to the reliance
requirement Hyland, Conformity of Goods, in: Schlechtriem (ed.), Einheitliches Kaufrecht und nationales
Obligationenrecht (1987), p. 305 (322).
361 U.S. Court of Appeals (4th Circuit) (U.S.) 21 June 2002, Schmitz-Werke GmbH & Co v Rockland
Industries, Inc. (drapery fabric), CISG-Online 625 (Pace) where the buyer could establish that transfer
printing was not possible on the goods sold for that purpose but did not prove the reason for that.
Ltd et al v Borealis A/S et al, CISG-Online 2391 (Pace), paras 670 et seq.
363 Rechtbank van Koophandel Hasselt (Belgium) 19 April 2006 (doors), CISG-Online 1389 (Pace).
364 Müller, Ausgewählte Fragen der Beweislastverteilung im UN-Kaufrecht im Lichte der aktuellen
Rechtsprechung (2005), p. 66.

365 Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 35 para. 57; Aue, Mängelgewähr-
leistung im UN-Kaufrecht (1989), p. 81; Saarländisches Oberlandesgericht (Germany) 17 January 2007

(natural stone marble panels), CISG-Online 1642 (Pace) – relating to the manner of packaging.
366 For such a clause and its treatment see Arbitral Award, Exchange for farm products Vienna,
10 December 1997 (barley), CISG-Online 351 (Pace) – at VII 1.5.

367 See the facts underlying the decision by the Dalian Maritime Court (China) 29 June 2005 (magnesia
chromite clinker), CISG-Online 2030 (Pace) where allegedly only the upper layers which the SGS inspector
was allowed to examine contained the ordered clinker while the lower layers contained ordinary bricks.
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deteriorated or may have been exchanged.368 Furthermore, where generic goods are
sold, the buyer must also prove that the certificates relate to the goods in question.369
Equally, other documents, such as bills of lading, packing lists and invoices may also
constitute prima facie evidence of the facts described in them.370
206 In addition, the conduct of the parties subsequent to the first complaints about the
non-conformity plays an important role in determining the relevant standards, in
particular in the context of Art. 35(1), as well as whether they have been met. Efforts
by the seller to repair the goods, discussions about possible ways to remedy defects371,
reductions in invoices and the like can constitute a strong indication that the goods
were actually non-conforming.372 The conduct is, however, by no means conclusive
since it may also be based on commercial reasons, i. e. to maintain a long-term
relationship or retain a highly valued customer.
7. Relationship to the non-contractual remedies under national law

207 Art. 35 clearly preempts reliance on national rules for non-conforming goods.373
Different views exist as to the relationship between the CISG’s rules on non-conformity
and the concurrent or competing non-contractual remedial rules under the otherwise
applicable national law. Of practical relevance in this respect are the remedies for
misrepresentation or mistake374 as well as the remedies for tortious liability, when the
defects in the goods result in damages to the buyer’s other property. Such national rules
may allow for an avoidance of the contract under less strict requirements than those
imposed by Art. 49 (“fundamental breach”) or may not make remedies dependent on
compliance with any notification requirement. For example, in the U.S. the seller’s
negligent misrepresentation as to the quality of the goods entitles the buyer to terminate
the contract without any need to show that this misrepresentation was fundamental.375
Equally, the non-conformity of the goods may result, under national law, in concurrent
claims in delict or tort which go beyond those provided for under the CISG.
208 Unlike the ULIS, where Art. 34 expressly provided for an exclusion of all remedies
available for lack of conformity under domestic law, the CISG does not expressly
368 Tribunale d’Appello Ticino (Switzerland) 15 January 1998 (cocoa beans), CISG-Online 417 (Pace),
SGS inspection certificate issued three weeks before shipment largely disregarded in determining the
conformity of the goods.
369 U.S. Court of Appeals (7th Circuit) (U.S.) 23 May 2005 (pork ribs), Chicago Prime Packers, Inc. v
Northam Food Trading Co., CISG-Online 1026 (Pace) where the buyer did not fulfil this burden; equally
Oberlandesgericht Karlsruhe (Germany) 8 February 2006 (Hungarian wheat), CISG-Online 1328 (Pace).
370 Landgericht Tübingen (Germany) 18 June 2003 (computers and accessories), CISG-Online 784
(Pace) relating to a shortfall in delivery, assumes a great likelihood “that the customers received exactly
the goods that were ordered and for which the invoice was sent”; but see Obergericht des Kantons Zug
(Switzerland) 8 November 2011 (spinning mill), CISG-Online 2425 (Pace), para. 4.3.3 where the fact that
the bank paid under a letter of credit after submission of conforming documents was given little weight.
(Pace), at paras 74 et seq.; but see also para. 98.

372 Arbitral Award, Foreign Trade Court of Arbitration attached to the Serbian Chamber of Commerce,
23 February 2004 (gray cast iron), CISG-Online 2078 (Pace) where the mere lack of clear objection to a
complaint was already considered to be an admission.
373 E. g. Arkansas Federal District Court (U.S.) 23 December 2009 (refrigerator motors), Electrocraft
Arkansas, Inc. v Electric Motors, Ltd et al, CISG-Online 2045 (Pace).

374 For an overview see Henschel, Conformity of the goods: Interpreting or supplementing Article 35 of
the CISG, in: Felemegas (ed.) An International Approach to the Interpretation of the United Nations
Convention on Contracts for the International Sale of Goods (1980) as Uniform Sales Law (2007), 166
(172 seq.); see also Saidov, Conformity of Goods and Documents (2015), pp. 25 et seq. Lookofsky,
Understanding the CISG (2012), pp. 69 et seq.
375 Farnsworth, Contracts (2004) §§ 4.10–4.15.
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address the question of a recourse to remedies under national law. The omission of such
a provision in the CISG does not constitute a conscious decision in favour of the
availability of remedies under national laws.
In practice, parties have tried to rely on national remedies to terminate their contract, 209
arguing either that the seller misrepresented the quality of the goods or that they have
erred about what quality has been agreed. This view has found some support from the
courts and legal literature.376 It is argued that questions of misrepresentation or mistake
concern the validity of the contract in the sense of Art. 4(a) and are therefore outside
the scope of the CISG with the consequence that a party can rely on the remedies
available under national law.
Equally, where the defects in the goods delivered resulted in damage to the buyer’s 210
other property, buyers have tried to invoke remedies for tortious liability existing under
the national law.377
However, the prevailing and, it is suggested, better view, is that questions as to the 211
conformity of the goods are regulated exclusively by Arts 35 et seq., excluding all remedies
under national law which are based on the same factual and legal considerations.378 Thus,
the national remedies for mistake, negligent misrepresentation and tortious liability which
are de facto based on the conformity of the goods are excluded.379 To that extent, the CISG
contains exhaustive remedies. Any other view would endanger the allocation of informa-
tional risks and the pursued harmonization in a central area of the CISG.380
By contrast, the buyer’s remedies under domestic law for fraud and deceit are not 212
excluded. In such cases, the buyer does not rely primarily on the non-conformity of the
goods but on circumstances which clearly go beyond the mere non-conformity of the
goods.381
376 Ohio Federal District Court (U.S.) 10 October 2006 (used paper winder), Miami Valley Paper, LLC v
Lebbing Engineering & Consulting GmbH, CISG-Online 1362 (Pace) – negligent misrepresentation and
in a later decision in the same matter of 26 March 2009, CISG-Online 1880 (Pace) for mistake; Lookofsky,
Understanding the CISG (2017), pp. 80 et seq.; Lessiak, UNCITRAL-Kaufrechtsabkommen und Irrtums-
anfechtung, JBl (1989) 487 (493); Neumayer/Ming, Convention de Vienne (1993), Art. 4 para. 6; see also
Art. 4:119 PECL which explicitly allows for a choice between the different remedies.
377 See Thüringisches Oberlandesgericht (Germany) 26 May 1998 (live fish), CISG-Online 513 (Pace)
where the claim was however rejected for a non-compliance with the notice requirement under Art. 39; cf.
Oberlandesgericht Koblenz (Germany) 24 February 2011 (clay), CISG-Online 2301 (Pace), para. II.B.10.
378 For details of the dual test see Schroeter, Defining the Borders of Uniform International Contract
Law: The CISG and Remedies for Innocent, Negligent, or Fraudulent Misrepresentation, Villanova Law
Review 2013, 553 (563 et seq.).
379 Saidov, Conformity of Goods and Documents (2015), pp. 26 et seq.; Oberster Gerichtshof (Austria)
13 April 2000 (machines), CISG-Online 576 (Pace) endorsing the decision of the lower instance which
had rejected the application of Art. 4(a) to mistakes concerning the quality of the goods; for misrepre-
sentation see Schroeter, Defining the Borders of Uniform International Contract Law: The CISG and
Remedies for Innocent, Negligent, or Fraudulent Misrepresentation, Villanova Law Review 2013, 553 (568
et seq.); for questions of tortious liability see Köhler, Die Haftung nach UN-Kaufrecht im Spannungsver-
hältnis zwischen Vertrag und Delikt (2003), p. 135 et seq.
380 Schroeter, Defining the Borders of Uniform International Contract Law: The CISG and Remedies for
Innocent, Negligent, or Fraudulent Misrepresentation, Villanova Law Review 2013, 553 (571 et seq.);
Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 35 paras 47 seq. with further references
as to the development of this view and opposing views; Huber, Irrtumsanfechtung und Sachmängelhaf-
tung (2001), pp. 275 et seq.; cf. Oberster Gerichtshof (Austria) 13 April 2000 (machines), CISG-Online 576
(Pace) with note Schlechtriem, Noch einmal: Vertragsgemäße Beschaffenheit der Ware bei divergierenden
öffentlich-rechtlichen Qualitätsvorgaben, IPRax (2001) 161 (162).
381 See Arkansas Federal District Court (U.S.) 23 December 2009 (refrigerator motors), Electrocraft
Arkansas, Inc. v Electric Motors, Ltd et al., (Pace); Schwenzer, in: Schlechtriem/Schwenzer, Commentary
(2016), Art. 35 para. 51.
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213 Equally, remedies for the violation of specific information and warning duties arising
under Art. 7(1) are not excluded, even if they are closely connected with physical
features of goods.382
214 According to the French courts, the same applies also for the remedy provided for in
Art. 442-6 I 5 of the French Code de commerce for an immediate termination of
existing contractual relationship without prior notice.383

215 There is no direct equivalent to Art. 35 in the PICC or the PECL. Due to their much
broader scope of application – covering contracts in general and not only sales contracts –
both sets of principles have described the obligation to deliver conforming goods in much
more general terms, allowing for maximum flexibility.384 The obligation to deliver con-
forming goods is not set out positively, but does form part of the rules on non-performance.
While the text of Art. 7.1.1 PICC mentions defective performance as one of the incidences
of non-performance, Art. 8:101 PECL only mentions the failure to perform and “defective
performance” generally in the comments.385 Notwithstanding the absence of a provision
directly comparable to Art. 35, there are several provisions in both sets of rules which
parties could try to rely on in arguing a particular view in a given case. These include
provisions on interpreting contracts and could be used to supplement Art. 8 in determining
the parties’ agreement as to the required features of the goods in the sense of Art. 35(1).
216 In addition, as indicated above, Art. 5.1.6 PICC and Art. 6:108 PECL both refer to the
standards of average quality and reasonableness in cases where no other standard has
been agreed. The examples given, as well as the general factors for the standard of
reasonableness listed in Art. 1:320 PECL, can be used by parties trying to support their
view of what is reasonable in a particular case.
217 By contrast, the DCFR (Arts IV. A. -2:301 et seq.) and the PEL Sales (Arts 2:201 et
seq.) contain provisions which directly address the issues regulated in Art. 35. In
relation to their content they follow the same principles. They emphasize the primary
importance of contractual descriptions in determining the conformity of the goods and
provide default standards if the parties have not agreed on a particular standard.
However, the drafting technique adopted differs slightly and the provisions are much
more detailed in defining the various aspects of conformity. They explicitly mention a
number of additional features of conformity, such as delivery of accessories and
instructions. To that extent, they might provide support for submissions that certain
characteristics are part of the required conformity also under the CISG.
382 Oberlandesgericht Koblenz (Germany) 24 February 2011 (potato separation clay), CISG-Online 2301
(Pace); Bundesgerichtshof (Germany) 26 September 2012 (clay), CISG-Online 2348 (Pace).

383 Cour de Cassation (France) 27 November 2012 (cooking unit), SMEG v. Rothelec, CISG-Online
2403 (Pace), p. 9.
384 Henschel, Conformity of the goods: Interpreting or supplementing Article 35 of the CISG, in:
Felemegas (ed.) An International Approach to the Interpretation of the United Nations Convention on
Contracts for the International Sale of Goods (1980) as Uniform Sales Law (2007), p. 166 (167) (Pace).
385 Comment A.
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Article 36
(1) The seller is liable in accordance with the contract and this Convention for any
lack of conformity which exists at the time when the risk passes to the buyer, even
though the lack of conformity becomes apparent only after that time.
(2) The seller is also liable for any lack of conformity which occurs after the time
indicated in the preceding paragraph and which is due to a breach of any of his
obligations, including a breach of any guarantee that for a period of time the goods
will remain fit for their ordinary purpose or for some particular purpose or will retain
specified qualities or characteristics.
Bibliography: See selected bibliography of Art. 35; Bollée, The Theory of Risks in the 1980 Vienna Sales of
Goods Convention, Pace Review of the Convention on Contracts for the International Sale of Goods
(1999–2000) 245 (Pace).
Outline
1. Art. 36(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
2. Art. 36(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
a) Breach of an obligation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
b) Guarantee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
3. Burden of proof . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

Art. 36 defines the relevant point in time at which the goods have to be in conformity 1
with the standards in Art. 35. As the characteristics of the goods may change over time,
defining the exact point is of considerable practical relevance for the delineation of the
respective spheres of risk.1 Notwithstanding the wording declaring that the “seller is
liable”, Art. 36 does not constitute a separate basis of claim.2
Art. 36(1), which contains the general rule, links the seller’s obligations as to con- 2
formity and his liability for non-conformity to the passing of the risk to the buyer.3 In
principle, the relevant point in time is the passing of risk. That is in line with the solutions
adopted in most national laws4 and also in the provision’s predecessor, Art. 35 ULIS.
Art. 36(2) extends the seller’s liability to subsequent deficiencies if those are either due to 3
a violation of seller’s duties or if the seller has given a guarantee in the sense of Art. 36(2).
Its underlying rationale is that the general transfer of the risk for deterioration to the buyer
should not exempt the seller for consequences that arise from his breach of contract.5
1Piltz, Internationales Kaufrecht (2008), para. 5–20.

International Sale of Goods, in: Galston/Smit (eds), International Sales: The United Nations Convention on
Contracts for the International Sale of Goods (1984), p. 6–23 seq.; the Secretariat Commentary on 1978 Draft,
Art. 34 (now Art. 36) para. 2 speaks about a “necessary implication of the rules on risk of loss or damage”.
4 Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 36 para. 2; see also DCFR,
Art. IV:A. – 2: 308(1).

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4 The present wording is the product of controversial discussion during the drafting
process. National laws differ in relation to the extension of liability beyond the passage
of risk and the original draft of the provision underwent some changes. In particular,
the requirement of an “express guarantee” for a “specific period” contained in Art. 34 of
the New York Draft was replaced by a less strict formulation allowing for “implied
guarantees” for “a period of time”.6

1. Art. 36(1)
5 Art. 36(1) requires the goods to be conforming “at the time the risk passes to the
buyer”.7 The time for the passage of the risk of loss is primarily determined by the
agreement of the parties. Of importance in this regard are agreements on the relevant
shipping terms, which are often made by reference to trade terms, in particular
INCOTERMS.8 Thus, an agreement on particular INCOTERMS such as F.O.B. does
not exclude the application of Art. 36(1) but merely determines when the “risk passes”
in the context of Art. 36(1).9 Additionally, usages and practices established between the
parties (Art. 9(1)) or in international trade (Art. 9(2)) may become relevant.
6 In the absence of an agreement, the passage of risk is determined by the default rules
in Arts 67–69. Thus, goods delivered under contracts involving carriage in the sense of
Art. 31(a) must be in conformity when the seller hands them over to the first carrier,10
provided that the seller is not bound to hand them over at another place (Art. 67). For
goods sold in transit, the relevant time is the conclusion of the contract (Art. 68), while
for all other contracts it is, in principle, the taking over of the goods by the buyer
(Art. 69). Arts 66 and 70 are of no relevance in this respect, since they do not address
the time when the risk passes.11
7 Only the existence of a defect is relevant for the seller’s liability, not the buyer’s
knowledge of it. Thus, in cases of contracts involving carriage, the mere fact that the
buyer only discovers the defects when the goods are delivered to his place of business
and not upon their handing over to the carrier when the risks passes, does not preclude
the seller’s liability for non-conformity as long as it can be proven that the defect
already existed.12
8 The same rule applies in cases of hidden defects where the time of the discovery of
the defect is irrelevant as long as it existed at the time of risk passage.13 Thus, for
example, the mere fact that a ban on the resale of foodstuff is only ordered after the risk
has passed does not mean the goods are in conformity, if the circumstances which led to
concerns as to the suitability of the goods for consumption already existed at the time of
6Honnold, Documentary History (1989), pp. 533 et seq., 677; Official Records, pp. 312 et seq.
7But see Audiencia Provincial de Pontevedra (Spain) 8 February 2007 (machine), CISG-Online 1802,
which seems to refer to the time of contract conclusion.
8 For a detailed discussion of passing of risk under the various INCOTERMS see Art. 30 paras 30 et seq.
9 U.S. District Court for the Southern District of New York (U.S.) 28 September 2011, Cedar Petro-
chemicals, Inc v Dongbu Hannong Chemical Co, Ltd (phenol), CISG-Online 2338 (Pace); see also
Tribunal de Première Instance de Genève (Switzerland) 19 April 2016 (urea fertilizer), CISG-Online 2758
(Pace), para. 6.
10 See Oberlandesgericht Schleswig-Holstein (Germany) 22 August 2002 (live sheep), CISG-Online 710
(Pace); Amtsgericht Duisburg (Germany) 13 April 2000 (pizza boxes), CISG-Online 659 (Pace).
12 See Tribunal de Première Instance de Genève (Switzerland) 19 April 2016 (urea fertilizer), CISG-
Online 2758, paras 5 seq. where the buyer was, however, unable to prove the defect.
13 Oberlandesgericht Linz (Austria) 23 January 2006 (car), CISG-Online 1377 (Pace).
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the passing of the risk.14 The same applies if edible goods deteriorate early because of
the use of an inadequate preservative or if cloths fade when first washed due to an
unstable dye in material.15
Also covered by Art. 36(1) are defects in packaging which result in damages to the 9
goods during transportation. The goods may only physically become non-conforming
after the risk has passed. However, the inappropriate packaging in itself, existing at the
time of risk-passing, leads to their non-conformity per Art. 35.16 As a consequence,
under an ex works contract a seller who made sterile bottles available to the buyer may
become liable for non-conformity if such bottles lose their sterility during the transpor-
tation due to an unsuitable foil used for packaging.17 The duty to package the goods
properly also exists under an ex works contract, thus it is irrelevant that the goods as
such were still in conformity at the time of handing them over, when the risk passed.
At the same time, a seller’s liability for the non-conformity of the goods at the time of 10
passing of the risk is not excluded by the fact that it is subsequently remedied by, for
example, delivering missing certificates.18
2. Art. 36(2)
According to the basic rule contained in Art. 36(1) the buyer bears the risk that the 11
goods may deteriorate after the risk has passed. Art. 36(2) takes account of the fact that
specific circumstances warrant an extension of the seller’s liability for the conformity of
the goods beyond the passage of the risk. This is the case, first, whenever the subsequent
non-conformity is due to a breach of an obligation by the seller. Second, a guarantee
given by the seller that the goods will keep their condition for some time will also justify
an extension of the seller’s liability for the conformity of the goods.
a) Breach of an obligation. The seller is liable for a subsequent non-conformity of 12
the goods if this is the direct result of a breach of an obligation by the seller or any third
party for which the seller is responsible pursuant to Art. 79. By contrast, breaches of the
contract of carriage or other duties by independent carriers, which are not used by the
seller to perform his own obligations, do not justify an application of Art. 36(2). The
seller has fulfilled his delivery obligations by handing over the goods to the carrier.19
14 Bundesgerichtshof (Germany) 2 March 2005 (frozen pork), CISG-Online 999 (Pace) at II. 3. c.; for a
different view – probably driven by usage – concerning the attribution to a painter which was corrected
subsequent to delivery Arrondissementsrechtbank Arnhem (Netherlands) 17 July 1997 (painting), Kunsthaus
Math. Lempertz v Wilhemina van der Geld, CISG-Online 548 (Pace); affirmed, however, on the basis of
domestic law by Gerechtshof Arnhem (Netherlands) 9 February 1999 (painting), Kunsthaus Math. Lempertz
v Wilhemina van der Geld, CISG-Online 1338 (Unilex) critical comment Ferrari, Divergences in the
application of the CISG’s rules on non-conformity of goods, RabelsZ 68 (2004) 473 (480).
15 Bollée, The Theory of Risks in the 1980 Vienna Sales of Goods Convention, Pace Review of the
Convention on Contracts for the International Sale of Goods (1999–2000) 245 (278) (Pace).
16 Ferrari, in: Ferrari et al., Internationales Vertragsrecht (2018), Art. 36 CISG para. 4; Gruber, in:
MünchKommBGB (2016), Art. 36 CISG para. 7; Cour de Cassation (France) 24 September 2003 (decorated
laminated glass panels), CISG-Online 791 (Pace); Comisión para la Protección del Comercio Exterior de
México (Mexico) 29 April 1996 (canned fruit), Conservas la Costena v Lanis, CISG-Online 350 (Pace); for
an application of Art. 36(2) in such cases Benicke, in: MünchKommHGB (2013), Art. 36 para. 4; Brunner,
Kommentar (2014), Art. 36 para. 3; Enderlein/Maskow, International Sales Law (1992), Art. 36 para. 5.
17 Oberlandesgericht Koblenz (Germany) 14 September 2006 (bottles), CISG-Online 1408 (Pace).
18 Handelsgericht St. Gallen (Switzerland) 14 June 2012 (organic juices and organic oils), CISG-Online
2468 (Pace), concerning the non-availability of bio-certification at the time of risk passing which was
subsequently delivered.
19 Karollus, UN-Kaufrecht (1991), pp. 120 seq.; see Amtsgericht Duisburg (Germany) 13 April 2000
(pizza boxes), CISG-Online 659 (Pace).
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13 In principle, it is irrelevant whether the breach is based on fault or not. An exclusion

of liability under Art. 79, however, also affects the liability for non-conformity.20
14 Possible obligations, the breach of which may result in an extension of liability, may
be primary or auxiliary obligations arising from the parties’ agreement or under the
CISG. Of practical relevance in this respect are, primarily, information or warning
duties concerning the transportation or handling of the goods and the duty to select an
appropriate means of transportation and qualified carrier.21 Thus, the breach of an
obligation to supply the necessary documents for export or import clearance may lead
to an extended liability of the seller if it results in such a delay that the goods may no
longer be sold since they are too close to their expiry date.22 The same applies if the
deterioration of the goods is the direct result of instructions given by the seller to the
carrier.23 Further obligations are assembly and service duties undertaken by the seller.
Not covered by Art. 36(2), but by Art. 36(1), are breaches of the obligation to deliver
conforming goods under Art. 35.
15 The breach may occur before or after the passing of the risk.24 For subsequent
breaches, however, it is necessary that the obligation and its breach are closely related to
the contract. This is, for example, the case where the non-conformity results from a
breach of additional contractual duties such as subsequent service of maintenance
obligations.
16 b) Guarantee. A seller, who has given a guarantee for future conformity beyond the
passage of the risk, is liable if, within the period of guarantee, the goods become non-
conforming. In principle, such liability is a direct consequence of the contractual
undertaking given by the seller, so that Art. 36(2) merely states the obvious.
17 It is not necessary that the guarantee is part of the contractual agreement of the
parties. Unilateral guarantees given by the seller are sufficient. Whilst the parties’ duties
are predominantly defined at the time of contracting, guarantees given thereafter may
change the extent of the seller’s liability in this regard and lead to the application of
Art. 36(2). As subsequent changes of the parties’ contract should not be assumed lightly,
it first has to be determined whether such statements are not mere confirmations of
guarantees already given at the time of contracting in the sense of Art. 8(3).
18 In practice, such guarantees may be made through a direct reference to a certain time,
i. e. usability for two years, expiration dates for food, or by referring to other factors
having the same effect, i. e. guarantees for a certain mileage, operational hours or an
output. Guarantees may be given for any purpose or characteristic of goods as the
examples provided in Art. 36(2) are not intended to be conclusive.25
19 It follows from the drafting history that the guarantee must not necessarily be explicit.
The reference to an “express guarantee” originally contained in the 1978 New York draft
was replaced after a controversial discussion concerning the less strict wording of a
“guarantee…for a period of time” which also covers implicit guarantees. These may arise,
for example, from descriptions of the goods or communicated purposes which – in
20Gruber, in: MünchKommBGB (2016), Art. 36 CISG para. 8.
21Ferrari, in: Ferrari et al., Internationales Vertragsrecht (2018), Art. 36 CISG para. 5; for a violation of
an information duty see Arbitral Award, SCC, 5 June 1998 (rail press), Beijing Light Automobile Co. Ltd.
v Connell Limited Partnership, CISG-Online 379 (Pace).
Chamber of Commerce, 23 December 2004 (goods not specified), CISG-Online 1188 (Pace).
23 See obiter Oberlandesgericht Schleswig-Holstein (Germany) 22 August 2002 (live sheep), CISG-
Online 710 (Pace).

24 Gruber, in: MünchKommBGB (2016), Art. 36 CISG paras 9 et seq.; Magnus, in: Staudinger

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combination with the price paid – can implicate their continuous uninhibited use for
some time.26 At the same time, such implicit guarantees should not be assumed lightly. In
particular, there is not always a guarantee that the goods will keep their characteristics for
a reasonable time. The inclusion of such an “implied guarantee” was explicitly rejected.27
While in theory goods are only conforming in the sense of Art. 35 if they remain useable
for a normal period of time, the assumption of an implied guarantee to this effect would
change the burden of proof. It would no longer be the buyer who has to prove that the
non-conformity existed at the time of risk passage, but the seller who has to prove that the
non-conformity is due to external factors not covered by the guarantee.28
As a consequence of the admission of implicit guarantees, it is also no longer 20
necessary that the relevant undertaking contains a “specific time”. If no such time is
given, the length of the guarantee is to be determined through interpretation.29
Irrespective of this – and in light of the drafting history of the notion “period of time”
– it is the time derived from the undertaking, which is relevant and not any other
“reasonable” time determined by the local courts.30
Content and scope of such guarantees have to be determined according to Art. 8. In 21
general, such interpretation will lead to a limitation of the guarantee to defects inherent in
the goods. Non-conformity arising from external factors, such as an incorrect handling of
the goods or the non-observance of maintenance instructions, is normally not covered.31
To that extent, the seller is by no means liable for all subsequent defects, but only for those
actually covered by the guarantee. Thus, defects due to the non-observance of maintenance
instructions or incorrect handling are not covered by Art. 36(2). The same applies to
defects resulting from force majeure, unless the parties have agreed differently.32
3. Burden of proof
On the basis of the general principle of “ei incumbit probatio, qui dicit, non qui 22
negat” underlying the CISG, the buyer who has accepted the goods without any direct
complaint or reservation as to their conformity bears the burden of proof for their non-
conformity.33 This entails both the proof of the non-conformity as such, as well as its
existence when the risk passed.
Often, the proof of the non-conformity of the goods will at the same time prove, or at 23
least imply, its existence at the time of risk passage. This is obvious whenever goods of a
different type or description are delivered. The same applies for structural deficiencies
based on the use of defective or wrong materials. Equally, the nature or the extent of the
non-conformity may be of such a kind that it excludes conformity of the goods at the
26 See Landgericht München (Germany) 27 February 2002 (globes), CISG-Online 654 (Pace) – where in
the context of Art. 35(2)(b) an impliedly agreed operational lifetime of three years was assumed for the
globes bought due to the intended use communicated and the price paid for the globes.
27 Official Records, p. 105; Herber/Czerwenka, Kommentar (1991), Art. 36 para. 4; Ferrari, in: Ferrari
et al., Internationales Vertragsrecht (2018), Art. 36 CISG para. 6; in favour of such an implied guarantee
see Bianca, in: Bianca/Bonell, Commentary (1987), Art. 36 para. 3.2.
on Contracts for the International Sale of Goods (1984), paras 6–24 seq.
31 Hovioikeus (Court of Appeal) of Turku (Finland) 12 April 2002 (forestry equipment), CISG-Online
660 (Pace); Schlechtriem/Butler, CISG (2009), para. 146.

33 Bianca, in: Bianca/Bonell, Commentary (1987), Art. 36 para. 3.1; Ferrari, in: Ferrari et al., Inter-
nationales Vertragsrecht (2018), Art. 36 CISG para. 9; for a detailed discussion see Art. 35 paras 171 et
seq.
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relevant time of risk-passing. Foodstuff, for example, which arrives at the buyer’s place
already in a state of decay, can hardly have been conforming where the transport only
took two days.34
24 However, cases where the goods may have deteriorated during transportation or
missing quantities may have been stolen are problematic. In light of the problems
associated with proving non-conformity at the time of risk passing, some authors want
to alleviate the buyer’s burden through a presumption that once the non-conformity has
been proven it is presumed that it existed when risk passed unless the seller can prove
otherwise.35 While such a general presumption is not justified, there are cases where
only special circumstances, to be pleaded by the seller, would justify a finding that the
established non-conformity did not exist at the time of risk passage, taking into account
the nature of the goods and the time expired between the discovery of the defect and the
passage of risk. Thus, it is highly likely that a refrigerating unit, which proves to be
defective upon first use 15 days after its installation, was already defective at the time
risk passed.36 In such a case, it is then for the seller to provide other possible
explanations as to why the non-conformity only occurred after the passage of risk,
such as a breach of assembly or handling instructions.37
25 By contrast, it is much more likely that mushrooms or other foodstuff found to be
non-conforming upon arrival were conforming at the time when the risk passed under a
C&F contract and deteriorated during transport. In such cases, a presumption to the
contrary in favour of the buyer would not be justified.38 The same also applies, to a
lesser extent, in cases of complex machinery where the likelihood of mishandling is
much higher than with the refrigerating unit. This is even more so where certificates of
pre-transport examinations confirm the conformity at the time.
26 In the context of Art. 36(2), the burden of proof lies with the buyer that the seller
either breached an obligation or gave a guarantee for future conformity of the goods. In
the latter case, once the buyer has proven the guarantee and the non-conformity within
the guarantee period, the seller has to prove that the actual non-conformity is not
covered by the guarantee, i. e. is due to external factors39. To that extent, Art. 36(2)
contains a shift of the burden of proof from the buyer to the seller.40

27 The PICC and the PECL, with their focus on general contract law, do not specifically
address the non-conformity of the goods. Consequently, there is no rule which is
comparable to Art. 36.
34 Bollée, The Theory of Risks in the 1980 Vienna Sales of Goods Convention, Pace Review of the
Convention on Contracts for the International Sale of Goods (1999–2000) 245 (278 seq.) (Pace).
35 Karollus, UN-Kaufrecht (1991), p. 121; see also Gruber, in: MünchKommBGB (2016), Art. 36 CISG
para. 26; in this direction also Cour d’appel de Grenoble (France) 15 May 1996 (cooling plant), Thermo
King v Cigna Insurance Company of Europe et al., CISG-Online 219 (Pace); previously also Magnus, in:
Staudinger Kommentar (2005), Art. 36 para. 25 – given up in the 2013 edition.
36 Cour d’appel de Grenoble (France) 15 May 1996 (cooling plant), Thermo King v Cigna Insurance
Company of Europe et al., CISG-Online 219 (Pace).

37 In this respect also inspection certificates by third parties or from its own exit-control may play a
crucial role, if the examination occurred close to the passing of the risk.
38 See Audiencia Provincial de Barcelona (Spain) 24 March 2009 (cuttlefish), People Fisheries (Pvt) Ltd
v Pescados Videla SA, CISG-Online 2042 (Pace).

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Section II. Conformity of the goods and third party claims 28 Article 36
The relevant provision in the DCFR, Art. IV:A.-2:308, is nearly a verbatim adoption 28
of Art. 36(1). It contains, however, no direct equivalent to Art. 36(2). The same applies
to Art. 2:208 PEL where the second paragraph merely contains an extension of liability
in cases of consumer sales.
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Article 37
If the seller has delivered goods before the date for delivery, he may, up to that date,
deliver any missing part or make up any deficiency in the quantity of the goods delivered,
or deliver goods in replacement of any non-conforming goods delivered or remedy any
lack of conformity in the goods delivered, provided that the exercise of this right does not
cause the buyer unreasonable inconvenience or unreasonable expense. However, the
buyer retains any right to claim damages as provided for in this Convention.
Bibliography: See selected bibliography of Art. 35; Keller, Early delivery and the seller’s right to cure lack
of conformity: Comparison between the provisions of Article 37 CISG and the counterpart provisions of
the UNIDROIT Principles, in: Felemegas (ed.) An International Approach to the Interpretation of the
Law (2007), p. 174 (Pace).
Outline
1. Prerequisites for the right to cure under Art. 37 . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
a) Delivery before the date for delivery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
b) Non-conformity of the goods in the sense of Arts 35, 41, 42 . . . . . . . . . . 8
c) Cure before the agreed date of delivery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
d) Exclusion of the right to cure causing unreasonable inconveniences or
expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
2. Means of cure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
3. Legal consequences. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
a) Exclusion of remedies for non-conformity under Art. 45(1)(a). . . . . . . . 21
b) Claims for damages. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
4. Burden of proof . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25

1 Art. 37 regulates the seller’s right to cure before the date of delivery in cases where the
seller has prematurely delivered goods which turn out to be non-conforming. An
identical rule for the delivery of non-conforming documents is contained in Art. 34
sentences 2 and 3,1 while the right to cure after the date of delivery is regulated in
Art. 48, which imposes additional requirements.
2 Art. 37 sentence 1 stipulates a right for the seller to remedy the non-conformity until
the prescribed date of delivery, unless the exercise of such right would “cause the buyer
unreasonable inconvenience or unreasonable expenses”. Sentence 2 clarifies this provid-
ing that a right to cure does not affect any right to claim damages arising from the
delivery of the defective goods.
3 The most important part of Art. 37 with respect to its content is the definition of the
limits of the right to cure. In light of the other provisions of the CISG, an avoidance of
the contract would in such situations only be possible in the rare case where the
premature delivery of the non-conforming goods constitutes an anticipatory breach in
1 In fact the first drafts of the CISG only contained a single rule covering both goods and documents.
Official Records, pp. 106, 158, 309 seq.
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the sense of Art. 72. In all other cases, the seller’s right to deliver conforming goods
until the prescribed date of delivery could, in general, be derived from contractual
provisions. To that extent, Art. 37 has primarily a clarifying function, remedying any
uncertainty which may exist concerning the existence and limits of the right to cure.2
Art. 37 is an expression of the general approach adopted by the CISG to keep the 4
contract alive wherever that is possible, taking into account the interests of both parties.3
The rule, which is adopted from Art. 37 ULIS,4 is eminently sensible and can therefore be
found in a comparable form in many national sales laws as well as the European DCFR.5
In most cases, curing defective performance will solve any possible breach and the buyer
will not be deemed to have suffered any harm as possible breaches will have occured before
the prescribed time of delivery.6 Consequently, there is little case law on this provision.

1. Prerequisites for the right to cure under Art. 37
a) Delivery before the date for delivery. Art. 37 only applies to the rare cases where 5
the seller delivered before the date of delivery and the buyer has accepted premature
delivery, though not being obligated to do so under Art. 52(1). In all cases involving
delivery at or after the agreed date of delivery, the seller’s right to cure is submitted to
the stricter requirements of Art. 48. In this respect, it always has to be verified whether a
delivery which is “premature” on the basis of the originally agreed date for delivery does
not entail an amendment of this delivery date by the parties or evinces such an
agreement. In particular, this also may be the case where the buyer fulfils his payment
obligations prematurely. However, without any further indications, the mere acceptance
of premature delivery without any reservations should not be lightly interpreted as an
amendment of the original contract.7
Contracts sometimes provide for a period within which delivery must occur. In such 6
cases, any delivery occurring before the final date of that period constitutes a “pre-
mature” delivery in the sense of Art. 37, and the seller will be entitled to cure the defects
until the end of the period.8 While it is true that in such cases the buyer cannot reject
delivery pursuant to Art. 52(1),9 his interests are sufficiently protected by the exclusion
2 Brunner, Kommentar (2014), Art. 37 para. 1; see also Bianca, in: Bianca/Bonell, Commentary (1987),
Art. 37 para. 2.1 emphasizing the need for such a clarification in light of the cooperation which might be
required from the buyer in remedying the defects.

4 For the drafting history and the slight differences to Art. 37 ULIS see Bianca, in: Bianca/Bonell,
Commentary (1987), Art. 37 paras 1.1 et seq.

5 Gärtner, Britain and the CISG: The Case for Ratification – A comparative Analysis with Special
Reference to German Law, Pace Review of the Convention on Contracts for the International Sale of
Goods (2000) 59 at C 1 (Pace); see § 2–508(1) UCC; but see Bianca, in: Bianca/Bonell, Commentary
(1987), Art. 37 para. 1.3.
6 Eiselen, in: Kritzer/Vanto/Vanto/Eiselen, International Contract Manual (2008), Vol. 4 § 89:32; cf.
Gruber, in: MünchKommBGB (2016), Art. 37 CISG para. 1.

7 Magnus, in: Staudinger Kommentar (2013), Art. 37 para. 11; Gruber, in: MünchKommBGB (2016),

8 Honnold/Flechtner, Uniform Law (2009), Art. 37 paras 245, 246; Gruber, in: MünchKommBGB
(2016), Art. 37 CISG paras 5 et seq.; Ferrari, in: Ferrari et al., Internationales Vertragsrecht (2018),
Art. 37 CISG para. 5; Magnus, in: Staudinger Kommentar (2013), Art. 37 para. 9.
9 With this argument the application of Art. 37 is rejected in such cases by some authors. In the
absence of a right to reject delivery a right to cure is only considered to be justified under the stricter
requirements of Art. 48; for that see Herber/Czerwenka, Kommentar (1991), Art. 37 para. 3; Salger, in:
Witz/Salger/Lorenz, Kommentar (2016), Art. 37 paras 5 seq.
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of the right to cure where it would cause unreasonable inconvenience. In light of the
underlying rationale of the CISG to keep contracts alive to avoid reshipment of the
goods, the requirement of a premature delivery should be interpreted broadly to cover
all cases of delivery before the final date for agreed delivery. It is one of the purposes of
a period for delivery to give the seller an option to fulfil his obligation to deliver
conforming goods until the last day.10
7 Where the contract provides for delivery upon request by the buyer, any delivery
occurring before such a request constitutes a premature delivery per Art. 37.11
8 b) Non-conformity of the goods in the sense of Arts 35, 41, 42. The goods delivered
prematurely must be non-conforming per Art. 35. The right to cure is independent
from the type and the size of the non-conformity.12 It also extends to serious defects
which, in the absence of a cure, would result in a “fundamental breach”. Consequently,
unless it is clear that the seller will not cure or a cure is obviously not possible, the buyer
cannot avoid the contract for an anticipatory fundamental breach under Art. 72 before
the date for delivery has passed.13
9 It is controversial whether Art. 37 also applies to cases where the goods are affected
by third party claims under Arts 41 and 42. The Secretariat Commentary seems to
exclude such an application.14 The considerations underlying Art. 37, however, also
warrant its extension to cases of non-conformity due to defective title. In numerous
cases, the seller may be able to remedy existing defects in relation to third party claims
and thereby keep the contract alive without any harm being done to the buyer. For
example, the seller may be able to satisfy an outstanding lien or other security interest,
acquire the conflicting rights or a least a licence for the use of the goods, or prevent a
third party from raising groundless claims. In such cases the cure does not even require
the return of the goods. It cannot be deduced from the explicit stipulation of a right to
cure in Arts 34 and 37 that no such right exists for goods with a defective title. To the
contrary, Arts 34, 37 and 48 are the expression of a general principle underlying the
CISG which should be used to fill gaps pursuant to Art. 7(2).15
10 c) Cure before the agreed date of delivery. The right to cure is limited in time until
the prescribed date of delivery. Whenever delivery has to occur within a certain period,
it is sufficient if the cure occurs on the last day of that period.16
11 In case the cure is to occur after the date of delivery, a right to cure only exists under
the more restrictive requirements of Art. 48.17
12 d) Exclusion of the right to cure causing unreasonable inconveniences or expenses.
A right to cure is excluded if it causes unreasonable inconvenience or expense to the
buyer. Taking into account that under Art. 37 the seller offers to remedy the non-

13 Honnold/Flechtner, Uniform Law (2009), Art. 37 para. 246; cf. Art. 72 paras 8 et seq.
15 Honnold/Flechtner, Uniform Law (2009), Art. 37 para. 245.1; Gruber, in: MünchKommBGB (2016),
Art. 37 CISG para. 10; Keller, Comparison between the provisions of Article 37 CISG and the counterpart
provisions of the UNIDROIT Principles, in: Felemegas (ed.) An International Approach to the Inter-
pretation of the United Nations Convention on Contracts for the International Sale of Goods (1980) as
Uniform Sales Law (2007) 174 (175) (Pace).
16 Brunner, Kommentar (2014), Art. 37 para. 4.
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conformity at a time when delivery is still not due and that the buyer was, pursuant to
Art. 52(1), not required to accept the premature delivery, this should rarely be the case
as the standard ought to be high. Nevertheless, there are cases where the seller’s efforts
to cure would affect the buyer’s interest in such a way that it justifies the exclusion of a
right to cure or at least of certain possible measures.
It follows from Art. 37 that the causation of inconvenience or cost for the buyer only 13
excludes the seller’s right to cure if they are unreasonable. Whether this is the case has
to be decided on a case-by-case basis balancing the interests of the parties.18 To this
extent, it is not necessary that the inconvenience caused by the seller’s efforts exceeds in
“an intolerable way the normal prejudice brought about to the buyer by the replacement
or repair of the goods”.19 In some cases, the “normal prejudice” already caused by a
second tender makes it unreasonable.
Primarily relevant for the determination of unreasonableness is the extent of the 14
inconvenience and the expense produced. In addition, the likely consequences of a failure
to remedy the defects are also of importance. It makes a difference whether the alternative
to allow the seller to cure the defects is an avoidance of the contract or merely a reduction
of the price. As the former would very likely entail the reshipment of the goods, the
threshold for the “unreasonableness” of the inconveniences and expenses is higher. Other
relevant factors for the balancing process are the chances for a successful cure20 and
contractual provisions which may eventually conflict with certain means of cure. Where
the parties have explicitly excluded partial shipments in their contract, the right to cure
discrepancies in quantities may not be abused to circumvent this contractual provision.21
Unreasonable inconveniences are caused to the buyer where the seller’s efforts to 15
remedy defects would seriously affect the buyer’s business. This may be the case where a
machine delivered has been included in the buyer’s production line and the offered
repair would cause considerable interruption.22 Moreover, the lack of information about
efforts to cure defects may result in unreasonable inconvenience.23
In principle, the seller has to bear the expenses for any efforts to remedy his defective 16
performance. Consequently, the buyer may reject any efforts to cure where the seller
wants to burden the buyer with considerable costs or to transfer the risk for such costs
to the buyer.24 Where the seller provides adequate security, the buyer may also be
obligated to advance certain costs related to the efforts to cure, which will then later be
reimbursed by the seller.
2. Means of cure
Art. 37 lists the following as possible means of cure: the delivery of missing parts to 17
make up any deficiency in quantity, the delivery of replacement goods and efforts to
remedy deficiencies in the goods delivered. The list is not intended to be exhaustive. For
18
Ferrari, in: Ferrari et al., Internationales Vertragsrecht (2018), Art. 37 CISG para. 10.
19
For this definition see Bianca, in: Bianca/Bonell, Commentary (1987), Art. 37 para. 2.5.
21 See for this problem Keller, Comparison between the provisions of Article 37 CISG and the
counterpart provisions of the UNIDROIT Principles, in: Felemegas (ed.) An International Approach to
(1980) as Uniform Sales Law (2007) 174 (178) (Pace).
23 Ferrari, in: Ferrari et al., Internationales Vertragsrecht (2018), Art. 37 CISG para. 11; Keller, Comparison
between the provisions of Article 37 CISG and the counterpart provisions of the UNIDROIT Principles, in:
Felemegas (ed.) An International Approach to the Interpretation of the United Nations Convention on
Contracts for the International Sale of Goods (1980) as Uniform Sales Law (2007) 174 (177) (Pace).
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example, breach of auxiliary instruction duties may be remedied by providing the

necessary instruction or training.
18 In principle, and within the restrictions imposed by the above limitation, the seller
has discretion as to which measure he adopts.25 He is not required to adopt a measure
which is requested by the buyer or has the least effects on the buyer. Thus, as long as the
additional burden on the buyer is not unreasonable in light of the costs involved with
the various measures, the seller may choose how to remedy the non-conformity.26 In
particular, the buyer may not always request the delivery of replacement goods if the
goods delivered can be repaired without causing unreasonable inconvenience for the
buyer. The latter may be the case if the repair of a machine included into the buyer’s
production line entails the danger of seriously affecting the production for some time
while a replacement could easily be included without any greater disturbance.27
19 The seller may also combine the various measures mentioned, i. e. repair those goods
with minor defects and replace all other non-conforming goods. As long as the
measures are taken before the agreed time for delivery, the failure of an effort to cure
does not, in principle, exclude further efforts. The seller’s right is not limited to a single
effort. Any failed effort will, however, be a factor in determining whether a further effort
will cause an unreasonable inconvenience for the buyer. Furthermore, the buyer is not
entitled to reject additional tenders, which are themselves not completely conforming or
do not completely remedy any deficiency, unless they would cause an unreasonable
inconvenience.28 Such an unreasonable inconvenience exists where the selected means
of cure are obviously ineffective to even improve the situation.29
20 Delivery of replacement goods must only be made concurrently with the return of the
non-conforming goods originally delivered. However, a buyer who has already paid the
price for the goods without being required to do so has a retention right in relation to
such goods.
3. Legal consequences
21 a) Exclusion of remedies for non-conformity under Art. 45(1)(a). The existence of
the right to cure under Art. 37 excludes all remedies of the buyer for non-conformity
under Arts 45(1)(a), 46 et seq. until the agreed date of delivery.30 Only in exceptional
cases, i. e. where the non-conformity amounts to an anticipatory fundamental breach,
may the buyer declare the contract avoided pursuant to Art. 72. This requires that it is
already obvious before the agreed date of delivery that the seller is either not willing or
unable to cure the defects and that these defects constitute a fundamental breach.31
22 A buyer who has accepted a premature delivery is, within the limits imposed by
Art. 37, bound to accept the seller’s efforts to remedy his defective performance. On the
25 Keller, Comparison between the provisions of Article 37 CISG and the counterpart provisions of
the UNIDROIT Principles, in: Felemegas (ed.) An International Approach to the Interpretation of the
Law (2007) 174 (177) (Pace); Ferrari, in: Ferrari et al., Internationales Vertragsrecht (2018), Art. 37
CISG para. 9.
26 In favour of a stricter limitation of the seller discretion to the least inconvenient measure Benicke, in:

28 Honnold/Flechtner, Uniform Law (2009), Art. 37 para. 246 with a detailed example; for a different
view Bianca, in: Bianca/Bonell, Commentary (1987), Art. 37 para. 2.6 – only measures proper “to restore
the goods to a fully sound condition” are covered.
31 For details see below Art. 72 paras 8 et seq.
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basis of the principle of good faith, the buyer can even be required to cooperate with the
seller as far as that is necessary for the cure.32 If the buyer prevents the exercise of the
right to cure by refusing to co-operate or to take necessary actions, he may not invoke
any remedies for the original non-conformity of the goods. To that extent, Art. 80, or at
least the principle expressed in it, is applicable.33 The buyer is, however, entitled to reject
offers to cure which would lead to unreasonable inconvenience or cost. He may then
rely on the normal remedies for non-conformity when the time for delivery has expired
or the case falls within Art. 72.34
In some cases, the seller’s right to cure may entail a return of the goods already 23
delivered which may leave a buyer, who has already paid for the goods, in a disadvanta-
geous position. In such a situation, the buyer may have a right of retention until the
seller provides adequate security for the return of the goods.35
b) Claims for damages. Pursuant to Art. 37 sentence 2, a successful cure of non- 24
conformity before the time of delivery does not exclude a claim for damages caused to the
buyer through the originally defective delivery. The buyer may, for example, have incurred
costs in connection with the cure of the deficiencies, such as costs for transportation or for
including machinery into a production line. Furthermore, the defective goods may have
caused harm to other goods of the buyer. Examples are costs incurred by the buyer to
remedy deficiencies or where the defective goods damage other property of the buyer. This
covers, in particular, cases where the defective goods are used to produce other products
which, as a consequence of the non-conformity, also become defective.
4. Burden of proof
In accordance with the general principles underlying the CISG, the burden of proof 25
for the existence of the right to cure is borne by the seller. By contrast, the buyer has to
prove the facts making any cure unreasonably inconvenient or expensive for the buyer,
as well as the prerequisites for any claim for damages.

The PICC (Art. 7.1.4) as well as the PECL (Art. 8:104) provide for a general right to 26
cure. Unlike the CISG, however, they make no distinction between the right to cure
before the time for delivery has expired and for the time thereafter, but contain a single
provision for both situations. Notwithstanding the absence of a direct equivalent to
Art. 37, the provisions on the right to cure can provide valuable guidance in relation to
the interpretation of Art. 37, given that it is based on the same rationale.36 In particular,
the various factors mentioned in Art. 7.1.4(1)(a)–d) PICC can be used in determining
what makes a cure unreasonable.
The DCFR contains a nearly identically worded provision in Art. IV.A.-2:203(1)(3). 27
32
33
Gruber, in: MünchKommBGB (2016), Art. 37 CISG para. 17; Ferrari, in: Ferrari et al., Internatio-
nales Vertragsrecht (2018), Art. 37 CISG para. 14; Bianca, in: Bianca/Bonell, Commentary (1987), Art. 37
para. 3.2; cf. Art. 80 para. 5.
35 Magnus, in: Staudinger Kommentar (2013), Art. 37 para. 17 who considers that in such cases the
cure would cause unreasonable inconveniences.

36 Keller, Comparison between the provisions of Article 37 CISG and the counterpart provisions of the
UNIDROIT Principles, in: Felemegas (ed.) An International Approach to the Interpretation of the United
Nations Convention on Contracts for the International Sale of Goods (1980) as Uniform Sales Law (2007)
174 (175 seq.) (Pace).
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Article 38
(1) The buyer must examine the goods, or cause them to be examined, within as
short a period as is practicable in the circumstances.
(2) If the contract involves carriage of the goods, examination may be deferred
until after the goods have arrived at their destination.
(3) If the goods are redirected in transit or redispatched by the buyer without a
reasonable opportunity for examination by him and at the time of the conclusion of
the contract the seller knew or ought to have known of the possibility of such
redirection or redispatch, examination may be deferred until after the goods have
arrived at the new destination.
Bibliography: Baasch-Andersen, The Duty to Examine Goods under the Uniform International Sales Law
– An Analysis of Article 38 CISG, 18 European Business Law Review (2007) 797; Benicke, Rügeobligen-
heit und Beweislast für Vertragswidrigkeit im UN-Kaufrecht, FS-Fachbereich Rechtswissenschaft zum
400jährigen Gründungsjubiläum der Justus-Liebig-Universität Gießen (2007) 377; Janssen, Untersu-
chungs- und Rügepflichten im deutschen, niederländischen und internationalen Kaufrecht (2001);
Ostendorf/Kluth, Probleme der Rügeobliegenheit bei vertragswidriger Ware im internationalen Streck-
engeschäft, IHR (2007) 104; Resch, Zur Rüge bei Sachmängeln nach UN-Kaufrecht, OJZ (1992) 470;
Schwenzer, The Noble Month (Articles 38, 39 CISG) – The Story behind the Scenery, European Journal of
Law Reform (2006) 353; Taschner, Die Darlegung von Mängeln und der richtige Mängeladressat, IHR
(2001) 61; CISG-AC Opinion no 2, Examination of the Goods and Notice of Non-Conformity: Articles 38
and 39, 7 June 2004. Rapporteur: Professor Eric E. Bergsten, Emeritus, Pace University School of Law,
New York (http://www.cisg-ac.org).
Outline
1. Content . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
2. Purpose of the duty to examine. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
3. Art. 38 as part of the CISG’s notification regime. . . . . . . . . . . . . . . . . . . . . . . . . . . 6
4. History of the provision and its character . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
1. General remarks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
2. Prevailing contractual agreements, practices and usages. . . . . . . . . . . . . . . . . . . 18
a) Contractual regulations of the examination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
b) Practices and usages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
3. Scope of the examination duty . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
4. Extent of the examination duty . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
a) The applicable contractual and legal standards . . . . . . . . . . . . . . . . . . . . . . . . . 34
b) Relevant objective and subjective factors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
aa) Factors connected to the goods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
bb) Parties’ relationship and expectations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
cc) Subjective factors of the buyer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
c) Examinations required pursuant to the standard . . . . . . . . . . . . . . . . . . . . . . . 49
aa) Basic visual examinations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
bb) Additional examination duties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
cc) Hidden or latent defects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
dd) Bulk sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
ee) Use of third parties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
5. Place of examination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
6. Time period for examination. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
a) General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
b) Length of the period: “as short a time as practical in the
circumstances” . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
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aa) The general standard . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
bb) Relevant factors in practice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84
(i) Extent and time of examination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85
(ii) Type of goods involved and intended use . . . . . . . . . . . . . . . . . . . . . . 91
(iii) Status of the buyer. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95
(iv) Other factors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99
c) Starting point for the period for examination pursuant to Art. 38(1). . 103
aa) Conforming Delivery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 103
bb) Pre-mature delivery/delivery at wrong place . . . . . . . . . . . . . . . . . . . . . . . . 106
cc) Additional duties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 110
dd) Partial deliveries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 111
ee) Hidden defects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 113
7. Examination in contract involving carriage: Art. 38(2) . . . . . . . . . . . . . . . . . . . . . 114
8. Art. 38(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 121
a) Redirection and redispatch . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 123
b) Awareness of the seller . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 127
c) Lack of a reasonable opportunity for examination . . . . . . . . . . . . . . . . . . . . . . 131
9. Costs of the examination duty . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 138
10. Sanctions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 139
11. Waiver of the examination duty . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 144
12. Burden of proof . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 146
III. Comparable Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 151
1. Content
Art. 38 imposes on the buyer – in the absence of an agreement to the contrary 1
between the parties – a duty (burden) to examine the goods and regulates the time in
which such examination should take place. Together with Arts 39, 40 and 44 it forms
part of a set of rules which provide the default regulatory framework for the buyer’s
conduct in case the buyer wants to hold the seller liable for the non-conformity of the
goods.1
Art. 38(1) provides as a general rule that the examination has to be done “within as 2
short a period as is practicable in the circumstances”. Paragraphs 2 and 3 respectively
contain special rules for examination in cases involving carriage of goods and the
redirection of the goods in transit or redispatch by the buyer without a reasonable
opportunity for examination. They defer the time for examination until the arrival of
the goods at their final destination. In this sense, Art 38 paras 2 and 3 deviate from the
idea underlying the general rule in para 1 that the examination should take place when
and where the seller performs his delivery obligations.2 In such cases, the place and time
for examination is separate from the technical place of delivery relevant for the
allocation of the risk of loss as determined by Arts 31, 67 et seq.
Art. 38 explicitly regulates only the place and timing of the examination duty. Other 3
important questions such as the scope and extent of examination duties, the type and
method of examination required and costs are not directly addressed. Furthermore,
Art. 38 does not provide for direct sanctions for a breach of the examination duty.
2. Purpose of the duty to examine

The primary purpose of the examination duty is to ensure that defects in the goods 4
are discovered and remedied as soon as possible to allow for the rapid processing of
1 Magnus, in: Honsell, Kommentar (2010), Art. 38 para. 1.
2 Landgericht Landshut (Germany) 5 April 1995 (sport clothing), CISG-Online 193 (Pace).
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commercial sales transactions. Its ultimate purpose, as seen in conjunction with the
duty to notify the seller in Art. 39, is to determine within a relatively short time
whether the seller has properly performed the contract and to give the seller a chance
to take necessary action(s).3 The short period for examination and notification duties
protects the seller from claims for defects which have their origin in the sphere of the
buyer.4
5 The act of examination as mandated by Art. 38, “rectifies the asymmetric levels of
information between buyer and seller”5 and sets the stage for the timely notice of non-
conformity, as required by Art. 39(1) for the preservation of the buyer’s remedies for
non-conformity. The purpose of such notice is in turn, to inform the seller about an
eventual lack of conformity of his delivery within a “reasonable time” and to enable him
to take the necessary steps to ascertain the non-conformity, remedy it where possible or
at least adjust his financial planning accordingly.6
3. Art. 38 as part of the CISG’s notification regime

6 The practical importance of Art. 38, evidenced by considerable case law, derives
primarily from its role for the buyer’s duty to notify the seller about existing deficiencies
stipulated in Art. 39. Pursuant to Art. 39(1), the buyer, in principle, loses all rights to rely
on a lack of conformity of the goods “if he does not give notice to the seller specifying the
nature of the lack of conformity with a reasonable time after he has discovered it or ought
to have discovered it.” Only cases where the seller either knew or could not have been
unaware of the lack of conformity (Art. 40) or the buyer has a reasonable excuse for his
failure to give notice in time (Art. 44) are excluded from this loss of rights.
7 Art. 38 is intimately connected with the time the buyer “ought to have discovered”
the non-conformity, which may be relevant for the start of the notification period in
Art. 39.7 It runs from the time when an orderly and timely examination as required by
Art. 38 would have revealed that the goods delivered lack conformity. In other words,
the duty to examine is “designed to set a time when, if no examination was conducted,
the buyer ‘ought to have discovered’ a lack of conformity”.8 In this sense, Art. 38 is
prefatory to the notification duty under Art. 399 and the breach of the examination duty
will only lead to sanctions if it affects this Art. 39 duty. Thus, as long as the required
notice is given in time, an eventual breach of the duty to examine remains without
sanction.10 The same also applies if a proper examination would not have revealed the
3 Baasch-Andersen, The Duty to Examine Goods under the Uniform International Sales Law – An
Analysis of Article 38 CISG, 18 European Business Law Review (2007) 797 (798).
5 Appellationshof Bern (Switzerland) 11 February 2004 (wire and cable), CISG-Online 1191 (Pace);
overruled on a different issue by Bundesgericht (Switzerland) 7 July 2004 (wire and cable), CISG-Online
848 (Pace) at 4.
6 Honnold/Flechtner, Uniform Law (2009), Art. 38 para. 252; Oberlandesgericht Oldenburg (Germany)
5 December 2000 (tiller (subsoiler)), CISG-Online 618 (Pace); Ferrari, in: Ferrari et al. (eds), Internatio-
nales Vertragsrecht (2018), Art. 38 CISG para. 2; for a detailed discussion of the purposes see Art. 39
paras 7 et seq.
7 Flechtner, Funky Mussels, a Stolen Car, and Decrepit Used Shoes: Non-Conforming Goods and
Notice thereof under the United Nations Sales Convention, Boston University International Law Journal
(2008) 1 (15) (Pace); Oberlandesgericht Oldenburg (Germany) 5 December 2000 (tiller (subsoiler)), CISG-
Online 618 (Pace).
8 See CISG-AC Opinion no 2, para. 4.1 et seq.
9 Secretariat Commentary on 1978 Draft, Art. 36 (now Art. 38) para. 2; Baasch-Andersen, The Duty to
Examine Goods under the Uniform International Sales Law – An Analysis of Article 38 CISG, 18
European Business Law Review (2007) 797 (798).
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lack of conformity.11 As a consequence, in practice, a single period for examination and
notification is often assumed.12
Arts 38 and 39 do not impose contractual obligations on the buyer. Namely, they 8
cannot be directly enforced by the seller and do not give rise to a claim for remedies.13
Systematically, the “duty” to examine the goods constitutes merely a burden for the
buyer, the non-fulfilment of which will often lead to a loss of all remedies for lack of
conformity pursuant to Art. 39. In light of this sanction, the buyer has a considerable
interest in fulfilling his burden.14
In addition to the duty to examine the goods under Art. 38, the CISG also provides, 9
in Art. 58(3), for a right to examine the goods before payment unless the parties have
agreed on payment conditions which would conflict with such a right.
4. History of the provision and its character

In light of diverging approaches in various national laws, the examination and 10
notification regime as such was one of the most controversial areas of the CISG’s
drafting process. While most of this focussed on relaxing sanctions for non-compliance
with the Art. 39 notification duty, the Art. 38 examination duty, which is central to the
notification regime, was affected as a result.
Art. 38 deviates in several respects from its predecessor in the ULIS, which may be due to 11
the fact that the drafters come from countries which take different approaches to the topic.
In particular, the strict time limit for the examination in Art. 38 ULIS, which required a
“prompt” examination,15 has been replaced by a more flexible and lenient requirement of
“as short a period as is practicable”. Additionally, the time for examination has been
deferred in Art. 38 paras 2 and 3 for goods sold in transit or resold shortly after arrival. In
conjunction with the inclusion of Art. 44, both changes, the first of which is particularly
evident in the English version of the CISG,16 are an answer to the criticism against the
examination and notification regime of the ULIS. This regime was considered to be too
seller-friendly, not taking into account business practices in large parts of the world.17

1. General remarks
Like other provisions of the CISG, Art. 38 is of a dispositive nature and the parties 12
may derogate from it.18 In the absence of specific contractual regulations or usages and
11 See also Baasch-Andersen, Reasonable Time in Article 39(1) of the CISG – Is Article 39(1) Truly a
Uniform Provision?, Pace Review of the Convention on Contracts for the International Sale of Goods
(1998) 69 (84 seq.) who correctly states “Only where a buyer can prove that a satisfactory examination
would not reasonably have revealed the lack of conformity is Article 38 not relevant to Article 39”.
13 Magnus, in: Honsell, Kommentar (2010), Art. 38 para. 2; Gruber, in: MünchKommBGB (2016),
Art. 38 para. 3.
14 Ferrari, in: Ferrari et al. (eds), Internationales Vertragsrecht (2018), Art. 38 CISG para. 3.
15 Which meant pursuant to Artice 11 ULIS “within as short a period as possible in the circumstances”.
16 For the differences between the various languages see, Magnus, in: Staudinger Kommentar (2013),
Art. 38 para. 6.
17 For other changes see Bianca, in: Bianca/Bonell, Commentary (1987), Art. 38 para. 1.1; see also the
extensive discussion of the drafting history by Reitz, A history of Cutoff Rules as a Form of Caveat
Emptor: Part I – The 1980 U. N. Convention on the International Sale of Goods, 36 American Journal of
Comparative Law (1988) 437 et seq. (Pace).
18 Oberlandesgericht Linz (Austria) 8 February 2012 (safety belts), CISG-Online 2444 (Pace), p. 12 –
where a transfer of examination duty to the seller assumed, as the seller had to provide with the goods a
certificate of examination.
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practices, it regulates the existence, the extent and the timing of the examination duty.
Art. 38(1) establishes a standard of “practicality” of the examination both in relation to
its extent as well as to its timing. This standard also applies in cases that fall under
Art. 38 paras 2 and 3.19 The suitability of the examination thereby depends on a number
of objective and subjective factors which are to be considered and weighed on a case-by-
case basis. These involve, in particular, the type and nature of the goods to be examined,
the extent of delivery, as well as the business and personal circumstance of the buyer.20
13 Notwithstanding the fact that Art. 38 only addresses the period of examination, the
first question to be answered in practice is that of the extent of the examination duty. It
is especially relevant in all cases where a particular non-conformity has not been
discovered until after the original examination.
14 In interpreting Art. 38, it has to be kept in mind that the provision, as part of the
examination and notification regime, primarily protects the interests of the seller.
Consequently, although the seller’s interest in speedy examination and resulting
certainty should be recognized, Art. 38 should not be interpreted in a way which, for
the most part, transfers the risk for non-conforming goods to the buyer by imposing
strict requirements as to the extent and timing of the examination.21
15 A considerable number of national sales laws contain comparable examination and
notification duties. Due to the use of broadly worded terms, there is an obvious danger
in courts resorting to their domestic concepts when determining what is “as short a
period as is practicable in the circumstances”. However, pursuant to Art. 7(1) the terms
used in Art. 38 must be given an autonomous meaning.22
16 Irrespective of Art. 7(1), practice reveals that national courts from legal systems
which require immediate examination, such as Germany, Austria or Switzerland, have
a tendency to favour a stricter application of Art. 3823 and to adopt shorter periods than
courts from countries which, in their domestic sales law, either provide for longer
examination periods or are unfamiliar with this concept at all.24 In this respect, it should
be noted that a large majority of the published decisions emanate from courts in
countries with legal systems following the strict approach.25 While this may fall in line
with the expectations of parties coming from such legal systems, it should nevertheless
be borne in mind when considering the case law concerning the length of the period.
17 In light of the differences between the various national systems, it is doubtful whether
Art. 38 can, in its totality, be considered to constitute a codified international trade usage.26
2. Prevailing contractual agreements, practices and usages

18 The parties may always regulate whether, when and to what extent the buyer has to
examine the goods delivered. Notwithstanding the fact that the explicit reference to the
19Honnold/Flechtner, Uniform Law (2009), Art. 38 para. 252.
20Oberster Gerichtshof (Austria) 14 January 2002 (cooling system), CISG-Online 643 (Pace); for a
detailed account see infra paras 37 et seq., 84 et seq.
22 Oberlandesgericht Köln (Germany) 21 August 1997 (aluminium hydroxide), CISG-Online 290
(Pace).
23 Oberlandesgericht Oldenburg (Germany) 5 December 2000 (tiller (subsoiler)), CISG-Online 618
(Pace), even doubting whether the CISG led to a change of standard in comparison to the ULIS;
Landgericht Landshut (Germany) 5 April 1995 (sport clothing), CISG-Online 193 (Pace).
24 Benicke, in: MünchKommHGB (2013), Vorb. zu Arts 38, 39 para. 3; for that observation see CISG-
AC Opinion no 2, para. 5.3 et seq.

25 For that observation see CISG-AC Opinion no 2, para. 5.1 et seq.
26 In favour of such as classification Arbitral Award, ICC 5713/1989, 1 January 1989 (goods not
specified), CISG-Online 3 imposing an examination duty pursuant to Art. 38 on a buyer in a sales

contract in principle not submitted to the CISG.
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role of the parties’ agreement and usages for the extent of the examination duty still
contained in Art. 38(4) ULIS has been abolished in Art. 38, their prevalence follows
from the general role accorded to party autonomy and trade usages in the CISG, i e.
Arts 6 and 9.27
a) Contractual regulations of the examination. In practice, it is not uncommon – 19
and in light of the different perceptions of what is required, also highly advisable – that
the parties regulate the required examination. Contracts often contain provisions as to
the time for examination, the numbers of samples to be taken, the type, duration and
output of trial runs and the provision of testing certificates. For example, clause A-5 of
the ICC Model International Sale Contract includes a provision for dealing with
inspections of the goods by the buyer.28
Occasionally, parties also agree on a completely different allocation of the duty to 20
examine the goods, or its complete exclusion. Contracts providing for Just-in-Time-
delivery are regularly considered to constitute at least an implicit contractual limitation
if not a complete exclusion of the buyer’s duty to examine the goods.29 Equally, clauses in
FOB-contracts providing for a binding pre-shipping examination and certification of the
quality of the goods by an independent expert appointed by both parties, have been
interpreted in such a way in practice.30 In light of the legal problems connected with such
an interpretation, courts should be reluctant to assume too easily that the parties
completely excluded any examination duty for the buyer, transferred it to someone else
or greatly extended the time for an examination. For that reason, contractual time periods
for bringing claims do not generally constitute deviations from the examination duty.31 By
contrast an obligation for the seller to deliver the goods in conjunction with the goods
examination certifications can be interpreted as a wide transferal of the examination duty
to the seller reducing the examination duty of the buyer to conduct spot checks.32
Often, such derogations from Art. 38 can be found in standard terms.33 Problems 21
may arise in this context where such clauses provide either for very short or extremely
long examination periods. Their validity is to be determined pursuant to Art. 4(a) by the
applicable national law. The relevant standard, however, as to whether an eventual
prolongation or shortening of the examination period constitutes an unreasonable
restriction of the rights of the other party is provided for by Art. 38. In particular, short
time limits also covering hidden defects have been deemed problematic,34 and on the
27 Bianca, in: Bianca/Bonell, Commentary (1987), Art. 38 para. 2.3; for the hierarchy see Oberster
Gerichtshof (Austria) 27 August 1999 (trekking shoes), CISG-Online 485 (Pace).

28 ICC, ICC Model International Sale Contract (1997), ICC-Publication No. 556.
Art. 38 para. 16.

30 For the possible problems associated with such an examination if not properly done see Arbitral
Award, ICC 9187, June 1999 (coke), CISG-Online 705, where it turned out that the pre-shipment
examination certifying the conformity of the goods was obviously wrong; for further examples from
case law see DiMatteo et al., International Sales Law (2005), p. 83.
31 Arbitral Award, ICC 7565/1994 (Coke), 6 ICC Bulletin Nov. 1995, 64 (64–6) (Pace).
32 Oberlandesgericht Linz (Austria) 8 February 2012 (safety belts), CISG-Online 2444 (Pace), pp. 12
seq.; assuming merely a restriction to spot checks Oberster Gerichtshof (Austria) 28 June 2012 (seat belts),
CISG-Online 2569 (Pace), paras 2 et seq.
33 See for example the contract underlying the decision of the Oberlandesgericht München (Germany)
11 March 1998 (cashmere sweaters), CISG-Online 310 (Pace) providing for a two years notice require-
ment; for the legal evaluation under German law see Freiburg, Die Rügeobliegenheit des Käufers bei
grenzüberschreitendem Warenverkehr, IHR (2005) 56 (60 seq.).
34 Oberlandesgericht Karlsruhe (Germany) 25 June 1997 (surface protective film), CISG-Online 263
(Pace) – standard term invalid which provides for a notification period of 8 days extending also to hidden
defects.
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other side of the scale, extremely long examination periods found in the buyer’s general
terms may be invalid.35
22 However, even when invalid, such clauses may be relevant in determining the scope
of the examination duty. They may, for example, constitute arguments against the
assumption of contradicting practices or usages.36 Equally, they may be relevant in
determining how the buyer has to examine the goods if their invalidity is solely due to
the shortness of the time for examination.
23 Unilateral post formation statements contained in invoices or other documents that
the goods have to be examined within a certain time are not relevant in determining the
time for examination.37
24 b) Practices and usages. The examination duty in Art. 38 can be superseded by
practices and usages established between the parties per Art. 9(1). Such practice may,
for example, be assumed where in the past the seller has also given reductions for
defects which were not notified in time.
25 Trade usages may also supersede the examination duty as defined in Art. 38 if they are
applicable pursuant to Art. 9(2).38 Trade usages exist in various industries and may
directly define the extent of the examination, its timing or whether the seller must be
invited to the examination.39 However, such usages often deal primarily with details of the
notification duty, in particular its timing, the type and the content of the notice. Whether
and to what extent such notification usages also have consequences for the examination
duty has to be determined in each particular case. For example, if according to an
applicable usage notice has to be given within 14 days from the delivery, that also affects
the examination period which naturally cannot extend beyond these 14 days.40
26 In particular, in the context of Art. 9(2) it has to be established in each case that the
trade usage is applicable.41 The existence, extent and timing of the duty to examine is, in
principle, not affected by “local” usages or rules applicable at the place of examination.42
They may only become relevant if they either constitute at the same time an “interna-
tional” usage in the sense of Art. 9(2) or provide for an excuse under Art. 44.43
3. Scope of the examination duty

27 The duty to examine under Art. 38 covers all aspects of conformity of the goods as
defined in Art. 35. Thus, the buyer has to examine whether the goods conform in
35 See for cases where German law is applicable Bundesgerichtshof (Germany) 10 October 1991, BGHZ
115, 324 (326) – while the decision is based on the national law, it is submitted that the same result may
be reached in contracts governed by the CISG.
36 Saarländisches Oberlandesgericht (Germany) 13 January 1993 (doors), CISG-Online 83 (Pace) –
alleged usage that examination is to be done at final user irrelevant as potentially invalid contractual
examination duty at least showed that the doors had to be examined by the buyer before being on-sold.
37 U.S. District Court Northern District Illinois Eastern Division (U.S.) 21 May 2004 (pork ribs), Chicago
Prime Packers, Inc. v Northam Food Trading Co., CISG-Online 851 (Pace).
38 Oberster Gerichtshof (Austria) 27 August 1999 (trekking shoes), CISG-Online 485 (Pace).
Arrondissementsrechtbank Zwolle (Netherlands) 5 March 1997 (fish), CISG-Online 545 (Pace).

39 E. g. Helsinki Court of Appeal (Finland) 29 January 1998 (steel plates), CISG-Online 1302 (Pace) where
the value of the examination carried out by the buyer was seriously affected by the lack of the seller’s presence.
40 Oberster Gerichtshof (Austria) 21 March 2000 (wood), CISG-Online 641 (Pace); the same applies
naturally for contractual provisions as to the time for notification.

41 Oberster Gerichtshof (Austria) 15 October 1998 (timber), CISG-Online 380 (Pace) case remitted to lower
court to determine whether local usages relied upon were also applicable and know in cross border trade.
42 In this respect misleading Thüringisches Oberlandesgericht (Germany) 26 May 1998 (live fish), CISG-
Online 513 (Pace) (“the law of the place of examination determines the fashion of the test”); also in
favour of a stronger role Herber/Czerwenka, Kommentar (1991), Art. 38 para. 3.
43 Benicke, in: MünchKommHGB (2013), Vorb. zu Arts 38, 39 para. 4.
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relation to quality, quantity, description and packaging to the contractual requirements
(Art. 35(1)) as well as to the standards imposed under Art. 35(2).44
The duty to examine extends to all goods delivered, whether they are delivered under 28
a first tender, as replacement for the originally delivered goods or in an effort to remedy
existing defects.45 The duty covers goods delivered prematurely as well as those
delivered belatedly, though in the former case different views exist as to when the duty
starts.46 Not covered by the duty to examine under Art. 38 are samples provided by the
seller in the sense of Art. 35(2)(c). A failure to complain about defects existing in the
sample may, however, have the consequence that goods containing the same defects are
conforming.
Different views exist as to whether the duty also extends to the question of whether 29
the goods are accompanied with relevant documentation. The CISG does not explicitly
provide for a duty to examine documents. Irrespective of this, the prevailing view is that
the examination duty in Art. 38 also extends to documents as, without an examination,
the seller’s right to cure defects would de facto be seriously affected.47
There are, however, authors who argue that systematically, and in light of the 30
consequences associated with an eventual breach of the duty to notify, Arts 38 and 39
should not be applied to documents in the sense of Art. 34. They submit that there is no
gap in the Convention and that the rationale underlying the balancing of interests
embodied in Arts 38 and 39 does not apply with the same force to documents as it
applies to other types of non-conformity. The lack of required documentation is often
easier to remedy and to prove. In their view, furthermore, the interests of the seller can
be adequately protected by a good faith limitation of the buyer’s remedies for insuffi-
cient documentation. Thus, the buyer may only invoke remedies for the lack of
documentation if he has notified the seller about it and has given him sufficient time
to remedy existing defects.48
The buyer is also not obligated to examine whether the goods are “legally defective” 31
in the sense of Arts 41 and 42. While Art. 43 provides for a duty to notify the seller
within a reasonable time after the buyer “ought to have discovered” the third party
claim or right, no duty to examine is stipulated. This takes account of the fact that such
“legal defects” are difficult to discover during an examination. Thus, an analogous
application of Art. 38 is also excluded.49
In instalment contracts the duty to examine – and eventually give notice for a lack of 32
conformity – exists for each instalment.50 At the same time, a failure to do so will only
lead to a loss of the remedies for this particular instalment. In particular, the right to
avoid the contract in relation to future instalments pursuant to Art. 73(2) is not
affected. Thus, a buyer who, due to a failure to timely examine the instalments already
delivered, does not give the required notice of non-conformity within a reasonable time
44 Magnus, in: Honsell, Kommentar (2010), Art. 38 para. 7; Ferrari, in: Ferrari et al. (eds), Internatio-
nales Vertragsrecht (2018), Art. 38 CISG para. 4; Obergericht des Kantons Luzern (Switzerland) 8 January
1997 (blood infusion devices), CISG-Online 228 (Pace) at 4 c.
47 Ferrari, in: Ferrari et al. (eds), Internationales Vertragsrecht (2018), Art. 38 CISG para. 6; Magnus,
in: Staudinger Kommentar (2013), Art. 38 para. 9; in favour also Gerechtshof Arnhem (Netherlands)
17 June 1997 (gas compressors), CISG-Online 547 (Pace).
48 Gruber, in: MünchKommBGB (2016), Art. 38 para. 13; Achilles, in: Ensthaler, HGB Kommentar
(2015), Art. 34 para. 7.

50 Magnus, in: Honsell, Kommentar (2010), Art. 38 para. 10; Oberster Gerichtshof (Austria) 27 August
1999 (trekking shoes), CISG-Online 485 (Pace); Oberlandesgericht Köln (Germany) 12 January 2007
(paperboard containers), CISG-Online 1581 (Pace).
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might lose his right to avoid the contract in relation to the parts already performed. He
may, however, rely on such instalments for the prognosis that future instalments will
also be non-conforming to such an extent that they justify an avoidance of the contract
for such instalments pursuant to Art. 73(2).51
33 Unlike with some national laws52 the “existence” of the duty to examine is indepen-
dent of the legal status of the buyer. This is because, for the existence of the duty, it is
irrelevant whether the buyer is a highly sophisticated merchant, a small trader or even a
consumer, provided that the application of the CISG is not excluded pursuant to
Art. 2(a). Only the “extent” of the duty may be affected. Consequently, mere traders,
in principle, also have to examine the goods and cannot merely rely on the examination
by their customers.53 In cases of redirection or reshipment in the sense of Art. 38(3), the
examination will de facto, however, normally be carried out by the customer and the
intermediate buyer will only transmit the latter’s findings.
4. Extent of the examination duty

34 a) The applicable contractual and legal standards. Art. 38 does not directly address
the extent of the examination required nor does it specify how the examination must be
performed. The Secretariat’s Commentary makes clear that, in the absence of an
agreement of the parties and practice and usages in the sense of Art. 9 to the contrary,
the extent of the examination duty is limited to examinations, which are reasonable in
light of the particular circumstances of the case.54 Art. 38 does not impose a burden on
the buyer to engage in an examination which would reveal any possible non-confor-
mity.55 In this sense, the standard of “practicability” applicable for the timing of the
duty also regulates its extent.
35 In determining the extent and mode of the examination, objective and subjective factors
of each particular case must be taken into account.56 As a general guideline, it can be said
that the examination has to be suitable and reasonable. The examination is suitable if it
allows the buyer to ascertain with a normal effort the conformity or non-conformity of the
goods. In particular, it should provide reliable information about the conformity of the
goods and reveal all obvious and regularly occurring defects.57 At the same time, the buyer
is only required to engage in examinations which are, in relation to the costs and the
efforts, reasonable in comparison to the likely results of the examination, including, in
particular, the likelihood of a lack of conformity as well as its consequences.58 Extensive
51 Arbitral Award, Exchange for farm products Vienna 10 December 1997 (barley), CISG-Online 351
(Pace) at VII 1.4.

52 E. g. Germany, where the obligation to examine the goods under §§ 377, 378 HGB only extends to
merchants.
53 Magnus, in: Staudinger Kommentar (2013), Art. 38 para. 11; Ferrari, in: Ferrari et al. (eds),

54 Secretariat Commentary on 1978 Draft, Art. 36 (now Art. 38) para. 3; see also Obergericht des
Kantons Luzern (Switzerland) 8 January 1997 (blood infusion devices), CISG-Online 228 (Pace) at 4 c
which refers to a “reasonable manner”.
55 Thomson, Buyer beware: German interpretation of the CISG has led to results unfavorable to buyers,
19 Journal of Law and Commerce (2000) 253 (254 seq.) (Pace); DiMatteo et al., International Sales Law
(2005), pp. 81 seq.
(Pace); Oberster Gerichtshof (Austria) 28 June 2012 (seat belts), CISG-Online 2569 (Pace), paras 2 et seq.
57 Magnus, in: Staudinger Kommentar (2013), Art. 38 para. 28; Obergericht des Kantons Luzern
(Switzerland) 8 January 1997 (blood infusion devices), CISG-Online 228 (Pace) at 4 c; Oberlandesgericht
Oldenburg (Germany) 5 December 2000 (tiller (subsoiler)), CISG-Online 618 (Pace).
58 Gruber, in: MünchKommBGB (2016), Art. 38 paras 25 seq.; Oberlandesgericht Köln (Germany)
12 January 2007 (paperboard containers), CISG-Online 1581 (Pace).
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examinations which may detect exceptional deficiencies are normally not required unless
there are indications in the particular case that such defects may exist.59
Thus, for example, a buyer of wine may be required to make a conventional chemical 36
analysis of the wine. By contrast, additional examination for the addition of water is
only required if there are specific grounds for suspicion.60 Equally, where a large
quantity of the goods has been delivered, the buyer normally only has to examine a
reasonable number of samples, with the amount required determined by the effects of
the examination on the future usability and the value of the goods. By contrast, in cases
of smaller quantities of high value goods, the buyer may be required to examine every
piece delivered, if this does not impede the future use of the goods.
b) Relevant objective and subjective factors
aa) Factors connected to the goods. The extent of the examination depends primar- 37
ily on objective factors directly connected with the goods in question, such as their type
and nature, their quantity, value and anticipated use as well as the resulting threat of
consequential damages.
For example, goods intended for human consumption or with a potential threat for 38
the user and third parties normally require a more extensive examination than goods
such as flowers, which do not pose such dangers even when they are non-conforming.
While for fabrics often a mere superficial examination as to their colour and quantity is
sufficient, complex technical machinery usually requires extensive trial runs. Not only
can defects in the latter constitute a threat to the health of its users, they may also give
rise to high consequential damages as the goods produced by such machinery may be
damaged or worthless. Moreover, additional costs associated with more extensive
examinations are more likely to be reasonable if they concern goods of high value.
The quantity of the goods delivered also influences the extent of the examination 39
duty. Additional costs associated with thorough examinations can be justified more
easily if spread over a larger quantity of goods.61 In addition, the quantity of goods
delivered often entitles the buyer to limit the examination to a number of representative
samples, excluding a duty to examine each single item.
Another important factor in this context is the packaging of the goods and the 40
general effect of such examinations on the further usability of the goods. The mode of
packaging may physically exclude certain examinations or lead to additional costs or
even a complete loss of the goods examined. At least for the amounts of samples to be
taken, it is relevant whether the examination merely requires the opening of a
container, which can easily be closed again, or the breaking of a customs seal resulting
in customs duties becoming payable or whether it even leads to complete non-
usability of the goods, as may be the case with medical equipment where sterile
packaging is required.
Depending on the contractual arrangements, examinations conducted by the seller or 41
third party may also influence the extent of the buyer’s examination duty. In the
absence of any contractual agreements to the contrary, examinations conducted by the
seller, whether as part of the normal production process or specifically for the contract,
do not affect the buyer’s obligation under Art. 38 to examine the goods. This is different
where the goods have to be delivered with certificates concerning such examinations.62
59 Landgericht Stuttgart (Germany) 31 August 1989 (shoes), CISG-Online 11 (Pace) – previous
deliveries of the same type of shoes had been defective.

60 Landgericht Trier (Germany) 12 Ocotober 1995 (wine), CISG-Online 160 (Pace).
62 Oberster Gerichtshof (Austria) 28 June 2012 (seat belts), CISG-Online 2569 (Pace), paras 2 et seq.
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Certificates issued by third parties may be treated differently, but in general this also
does not completely relieve the buyer from his obligations under Art. 38.63
42 bb) Parties’ relationship and expectations. The extent of the examination duty may
also be influenced by the parties’ earlier relationships. Where the seller has proven to be
fairly reliable in delivering conforming goods, the extent of the examination duty is
lower than with a seller whose previous deliveries were deficient.64 In this context, the
equities of a particular case play an important role to avoid a situation where the seller
benefits from his own previous breaches of contract by imposing stricter examination
requirements on the buyer.65 This should only occur in exceptional cases as it is
normally the buyer who has to bear the costs for the increased scrutiny.
43 Other breaches by the seller, particularly delay in delivery, can have a limiting effect
on the extent of the examination. They may not only shorten the time available for
examination, but can also generally limit the buyer’s ability to properly examine the
goods. For example, if, due to a delay in delivery, the goods can no longer be delivered
to the buyer’s premises where he has the appropriate testing facilities but have to be
delivered directly to the final customer, the buyer is only required to engage in the
examination possible there.66
44 Different views exist as to how far local traditions can be taken into account. On the
one hand, it is clear that Art. 38 provides for an autonomous standard so that a direct
application of local standards is excluded and conflict with the intended harmonization
is avoided.67 On the other hand, the parties’ expectations, which are regularly influenced
by their local traditions, cannot be completely excluded.
45 cc) Subjective factors of the buyer. In addition to objectives factors, the Secretariat’s
Commentary explicitly mentions that the subjective situation of the particular buyer,
such as the availability of the necessary technical facilities and expertise, can influence
the extent of the examination duty.68 The relevance of subjective factors is not
completely uncontroversial, but it is justified in light of the drafting history and the
principles underlying the CISG. In principle, an experienced seller of a certain size may
be expected to be able to carry out a thorough and expert examination of the goods,
possibly with the help of an outside expert.69 Special subjective circumstances, such as
the mentioned lack of expertise and testing facilities, may, however, lower the extent of
the examination duty required.
46 Notwithstanding the general relevance of the situation of the buyer, there are a
number of factors which have a limiting effect in this regard. First, it has to be taken
into account that the buyer is not required to examine the goods himself. In describing
the examination duty, Art. 38 explicitly refers to third party examinations (“causes them
63 Thüringisches Oberlandesgericht (Germany) 26 May 1998 (live fish), CISG-Online 513 (Pace).
64 Kantonsgericht Schaffhausen (Switzerland) 27 January 2004 (model locomotives), CISG-Online 960
(Pace); Oberster Gerichtshof (Austria) 28 June 2012 (seat belts), CISG-Online 2569 (Pace), paras 2 et seq.:
critical Ferrari, in: Ferrari et al. (eds), Internationales Vertragsrecht (2018), Art. 38 CISG para. 10;
Janssen, Untersuchungs- und Rügepflichten (2001), pp. 114 seq.
65 Janssen, Untersuchungs- und Rügepflichten (2001), pp. 114 seq; Magnus, in: Staudinger Kommentar
(2013), Art. 38 para. 33; in favour of stricter examination requirements Landgericht Stuttgart (Germany)
31 August 1989 (shoes), CISG-Online 11 (Pace).
66 Oberster Gerichtshof (Austria) 14 January 2002 (cooling system), CISG-Online 643 (Pace) where due
to the limited ability to examine the cooling system an important design defect could only tentatively be
discovered so that the notice of defect was not very specific.
69 Oberlandesgericht München (Germany) 11 March 1998 (cashmere sweaters), CISG-Online 310
(Pace).
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to be examined”). Thus, if an examination proves necessary in light of the circum-
stances, a buyer may not always be able to rely on a lack of his expertise or the non-
availability of technical facilities, but rather may be required to have the goods
examined by a third party.70 This is particularly so where indications of a lack of
conformity exist or the non-conformity of the goods may lead to serious consequences,
e. g. considerable consequential damages. For example, in a factual situation comparable
to that found in the vine wax decision of the German Supreme Court, the buyer – even
if he was a mere wholesaler of vine wax – could be required to have the wax examined
by a third party with the necessary expertise, if there were indications that the vine wax
may be dangerous given the damages which might occur from the use of the defective
goods, i. e. the destruction of whole vineyards.
The same applies to certain types of foodstuff or dangerous machinery, where the 47
buyer may not rely on his lack of expertise to check the suitability for consumption. The
threat posed by these goods to the health of the final customer is too great to make the
extent of an examination solely dependent on the buyer’s knowledge.
Second, in the context of Art. 38, only subjective factors which are known to the seller 48
or which the seller could not have been unaware of at the time of contracting may be
considered. One of the purposes of the examination and notification duty is to provide
certainty within a predictable time for the seller as to whether he has properly fulfilled
his contractual duties. Predictability, however, can only be attained, if the extent and the
timing of the buyer’s examination obligation is not made dependent on subjective
factors of which the seller could not have been aware. Such factors can be taken into
account in the context of Art. 44, for which the burden of proof rests with the buyer.71
c) Examinations required pursuant to the standard
aa) Basic visual examinations. In general, the buyer has to engage in an at least 49
superficial visual examination of the goods and their packaging,72 and count and
measure them to exclude apparent non-conformities. Thus textiles, shoes, chemicals or
other raw materials are always to be examined as to obvious mistakes in kind, size or
colour73, and food as to the provided production date.74
In case of bulk sales or larger quantities, examinations can be limited to an 50
appropriate number of samples.75 Often examinations can be done without incurring
additional costs, resulting e. g. from the breaking of customs seals, or without any effect
on the further usability of the goods. However, even where this is not the case, for
example where goods lose their required sterility through a superficial examination, the
buyer is normally not freed from his duty to engage in such examinations. Thus, a
(Pace), para. 4.9.4.

72 Oberlandesgericht Köln (Germany) 12 January 2007 (paperboard containers), CISG-Online 1581
(Pace); Landgericht Landshut (Germany) 5 April 1995 (sport clothing), CISG-Online 193 (Pace); Recht-
bank Rotterdam (Netherlands) 26 October 2016 (grapes), CISG-Online 2764; cf. DiMatteo et al., Interna-
tional Sales Law (2005), p. 82.
(Pace); by contrast it is not necessary to wash them to examine whether they shrink or not see:
Landgericht Landshut (Germany) 5 April 1995 (sport clothing), CISG-Online 193 (Pace).
679 (Pace).
75 Benicke, in: MünchKommHGB (2013), Art. 38 para. 4; Oberlandesgericht München (Germany)
11 March 1998 (cashmere sweaters), CISG-Online 310 (Pace); Oberlandesgericht Köln (Germany)
12 January 2007 (paperboard containers), CISG-Online 1581 (Pace); Handelsgericht Zürich (Switzerland)
30 November 1998 (lambskin coats), CISG-Online 415 (Pace); Oberster Gerichtshof (Austria) 28 June
2012 (seat belts), CISG-Online 2569 (Pace), paras 2 et seq.
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certain quantity of frozen fish may have to be defrosted to examine conformity76, sterile
medical equipment may have to be opened to verify its sterility77 or the plastic coating
and shrink wrap of doors delivered in slabs has to be removed.78 However, in such
cases, the detrimental consequences associated with the examination normally results in
a decreased number of samples required.
51 Only in exceptional cases, for example where the quantity delivered is fairly small and
each item is of high value, do the potential effects of an examination on the further
usability of a sample exclude any examination which goes beyond checking the
quantities or looking for obvious defects discoverable.79
52 In certain circumstances, the buyer’s examination duty under Art. 38 may be limited
to largely visual examinations, which only reveal the most obvious defects. For example,
the need to use or resell perishable goods within a short time may excuse the buyer from
any further extensive examinations.80 The same may also apply to durable goods which
are onsold within such a short time that a more thorough examination would not reveal
any result before the resale or re-use. For example, whether flowers blossom the whole
summer as agreed can only be established by the final customer.81 Equally, there is no
obligation for the buyer of adhesive foil to use samples of the foil to see whether upon
removal after several weeks the adhesive residues remains.82
53 In addition, if defects become apparent by the above mentioned visual examination,
the buyer is often not required to engage in further examinations which would normally
be required and could reveal additional defects.83 Thus, if the mere feeling of a cashmere
pullover reveals that the cashmere is below standard it is not necessary that the buyer
engage in sophisticated chemical testing to specify the extent of the deviations.84 By
contrast, where superficial examinations merely raise doubts as to the conformity of the
goods, they may mandate more comprehensive examinations.85
54 bb) Additional examination duties. Extensive examinations are normally required
where typical and likely defects cannot be discovered by superficial examinations.86
679 (Pace); cf. Arrondissementsrechtbank Roermond (Netherlands) 19 December 1991 (cheese), CISG-
Online 29 (Pace).
77 Obergericht des Kantons Luzern (Switzerland) 8 January 1997 (blood infusion devices), CISG-Online
228 (Pace); cf. Oberlandesgericht Köln (Germany) 13 November 2000 (plug-couplings), CISG-Online 657
(Pace).
78 Landgericht Saarbrücken (Germany) 23 March 1992 (doors), CISG-Online 60 (Pace) upheld on
appeal by Oberlandesgericht Saarbrücken (Germany) 13 January 1993 (doors), CISG-Online 83 (Pace).

79 Benicke, in: MünchKommHGB (2013), Art. 38 para. 4; Honnold/Flechtner, Uniform Law (2009),
Art. 38 para. 252, gives as an example the delivery of 500 gallon cans of chloride sealed in metal
containers where the buyer is required to examine the quantity but not the content of the containers
which would exclude the further use of the container examined.
81 Oberlandesgericht Innsbruck (Austria) 1 July 1994 (garden flowers), CISG-Online 107 (Pace).
82 Different Oberlandesgericht Karlsruhe (Germany) 25 June 1997 (surface protective film), CISG-
Online 263 (Pace) overruled on a different issue by Bundesgerichtshof (Germany) 25 November 1998
(surface protective film), CISG-Online 353 (Pace).
83 Magnus, in: Staudinger Kommentar (2013), Art. 38 para. 29; this limitation does, however, not
extend to other obvious defects which could also be discovered through the superficial examination; see
Danish Maritime and Commercial Court (Denmark) 31 January 2002 (fish (mackerel)), CISG-Online 679
(Pace).
84 Oberlandesgericht München (Germany) 11 March 1998 (cashmere sweaters), CISG-Online 310 (Pace).
85 Gruber, in: MünchKommBGB (2016), Art. 38 para. 27; Landgericht Stuttgart (Germany) 31 August
1989 (shoes), CISG-Online 11 (Pace); sceptical Janssen, Untersuchungs- und Rügepflichten (2001),
pp. 114 seq. who does not distinguish between “warnings” resulting from a previous behaviour of the
seller and those resulting from the appearance of the goods.
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For textiles and clothing delivered in greater numbers, the required visual examination 55
is in general supplemented by an obligation to wash at least a representative number of
samples to ensure that they are not shrinking or are not losing colour.87 Large quantities
of shoes, in particular if made for heavy duty use such as trekking, require a thorough and
professional examination by someone with expertise in shoe production or trade.88
Foodstuff has to be examined for its general fitness for consumption. This includes 56
checking its freshness and compliance with the normal requirements. In the absence of
indication to the contrary, the buyer can, however, assume that the seller did not act
fraudulently. Hence, he is under no duty to examine whether prohibited additives have
been used or the production process deviates from the one agreed upon. Thus, a buyer
of wine does not have to examine whether the seller added water or sugar to it.89
Equally, where the parties have agreed that the goods should not be irradiated, the
buyer in general does not have to engage in expensive checks to examine whether that
promise has been kept.90
Where the chemical composition is crucial for the further use of the goods, a chemical 57
analysis of the composition of the goods may be required. In light of costs and efforts
associated with such an analysis, it cannot be required as a matter of course.91 In
particular, in the absence of indications to the contrary, buyers are not required to engage
in extended versions of such examinations searching for particular defects.92
Where the conformity of the goods can only be verified with some degree of certainty 58
through their intended use, it is usually necessary to undergo test uses. For example, in a
purchase of self adhesive foil covers, steel samples of such foil must be used to verify not
only whether it fulfils its protective purpose but also whether it can be removed without
leaving any adhesive residues.93 Funnel covers have to be assembled according to their
intended use and tested as to their reaction to normal pressure.94
Equally, the examination of goods which are intended for reprocessing generally 59
includes a reprocessing test of samples where that is easily possible. This is normally the
case where the reprocessing is to take place at the buyer’s premises and does not require
major preparations. In relation to textiles bought for the production of clothing, this can
include verification by the buyer by washing and ironing the textiles to determine
whether the colours fade or they shrink.95
87 Magnus, in: Honsell, Kommentar (2010), Art. 38 para. 15; Landgericht Landshut (Germany) 5 April
1995 (sport clothing), CISG-Online 193 (Pace); Schwenzer, in: Schlechtriem/Schwenzer, Commentary
(2016), Art. 38 para. 14.
89 Landgericht Trier (Germany) 12 Ocotober 1995 (wine), CISG-Online 160 (Pace).
90 Bundesgerichtshof (Germany) 30 June 2004 (paprika), CISG-Online 847 (Pace).
91 Generally in favour for all cases where the chemical composition of the goods is relevant Ferrari, in:
Ferrari et al. (eds), Internationales Vertragsrecht (2018), Art. 38 CISG para. 11; denied Landgericht
Paderborn (Germany) 25 June 1996 (granulated plastic), CISG-Online 262 (Pace) – no quantitative
chemical analysis of granulated plastic used for the manufacture of rods for roll-down shutters for a
sufficient content of titanium dioxide.
92 Landgericht Trier (Germany) 12 Ocotober 1995 (wine), CISG-Online 160 (Pace) – no need for a
buyer of wine in the absence of any indications to go beyond the normal chemical analysis and to search
for the addition of water.
(Pace); but see the criticism by Thomson, Buyer beware: German interpretation of the CISG has led to
results unfavorable to buyers, 19 Journal of Law and Commerce (2000) 245 (253 seq.) (Pace); see also
supra at 4.3.1 for possible restrictions due to the timing of the resale.
94 Oberlandesgericht Dresden (Germany) 8 November 2007 (funnel covers), CISG-Online 1624 (Pace) –
excluding, however, the need for more sophisticated stress tests by experts.
95 Ferrari, in: Ferrari et al. (eds), Internationales Vertragsrecht (2018), Art. 38 CISG para. 13; Land-
gericht Berlin (Germany) 21 March 2003 (fabric), CISG-Online 785 (Pace); obiter also Kantonsgericht
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60 Vehicles and machinery have to be examined by test drives or trial runs as to their
general operability, as well as speed and output.96 Machines which are used for the
production of other goods have to be examined in a sample production simulating the
ordinary production process. Where the buyer merely intends to resell the goods such
trial runs may not be possible.
61 For some goods, the examination duty upon delivery is coupled with an examination
duty upon installation. Complex machinery only has to be tested as to its general
operability.97 If this is only possible through actual use of the machinery and no such
use is anticipated in the near future, the buyer may be required to make test runs if no
other means for examination is available.98 The buyer may, however, assume that the
goods delivered fulfil the basic safety standards. Thus, there is no need to examine the
basic electrical operational safety such as the essential grounding components in high
quality globes.99
62 cc) Hidden or latent defects. Different views exist as to the treatment of latent defects
which are not discoverable through an orderly examination at the time of delivery.
Some consider the duty to examine under Art. 38 as a discrete one-off duty which has to
be fulfilled only once and which is not revived if subsequent events suggest the existence
of latent defects. In such cases, a duty to examine the goods should be deduced directly
from Art. 39 and consequently is not subject to the standards in Art. 38. The basis for
such an implied duty to examine in Art. 39 is seen in the reference to “ought to have
been discovered”.100
63 The prevailing and more convincing view is that the duty to examine may involve
several stages of examination. Thus, whenever there are symptoms discovered which
should alert the buyer that the goods contain latent defects not discovered during the
initial examination, the buyer is requested to engage in a more sophisticated examina-
tion to verify whether such defects exist or not.101 That will often also entail the
obligation to engage an expert to determine the cause of the symptoms.102
64 Notwithstanding sometimes misleading terminology, such as a “revival” of the duty
to examine, this has to be distinguished from an “ongoing duty” to examine the goods.
The latter, which would require a more or less permanent examination of the goods,
cannot be deduced from Art. 38.103 The difference between the two is that under an
ongoing duty, additional steps may be required by a buyer even without any triggering
Schaffhausen (Switzerland), 27 January 2004 (model locomotives), CISG-Online 960 (Pace); controversial:
for a different view Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 38 para. 14.
96 Rechtbank van Koophandel Veurne (Belgium) 25 April 2001 (diesel tram), CISG-Online 765 – as to
operating speed.
(Pace).
(Pace), which, however, should have considered whether the delay in delivery justified the first use of
the machinery seven weeks after delivery.
99 Landgericht München I (Germany) 27 February 2002 (globes), CISG-Online 654 (Pace).
100 Flechtner, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2004), p. 377 (389 seq.).
101 Bundesgerichtshof (Germany) 3 November 1999 (machine for producing hygenic tissues), CISG-
Online 475 (Pace) with approving comment by Schlechtriem, EWIR (2000) 125; also Tribunale di
Vigevano (Italy) 12 July 2000 (sheets of vulcanized rubber used in manufacture of shoe soles), CISG-
Online 493 (Pace); Landgericht Düsseldorf (Germany) 23 June 1994 (engines for hydraulic presses and
welding machines), CISG-Online 179 (Pace).
102 See Thüringisches Oberlandesgericht (Germany) 26 May 1998 (live fish), CISG-Online 513 (Pace).
103 Piltz, Internationales Kaufrecht (2008), para. 5–84; Freiburg, Die Rügeobliegenheit des Käufers bei
grenzüberschreitendem Warenverkehr, IHR (2005) 56 (58); in so far also Flechtner, in: Ferrari/Flechtner/
Brand, Draft Digest and Beyond (2004), p. 377 (389 seq.).
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event leading to new doubts as to the conformity of the goods. In particular, the buyer
could be required to use them within a certain time, even though the initial examination
has not raised any doubts as to their conformity. By contrast, under a “revived” duty to
examine the goods, no use of the goods would be required, provided that such use is not
already part of the initial examination, if the initial examination or later events have not
raised any doubts as to the goods’ conformity.
dd) Bulk sales. In case of bulk sales, the seller is only required to examine a 65
representative number of samples.104 In bulk sales relating to goods which differ slightly
from each other, this requires taking samples from each kind of good. The number of
samples required may inter alia be influenced by previous deliveries between the parties.
If serious defects have frequently been found in the past, the number of samples needed
will be higher than in cases where the seller has proven very reliable.105 The existence of
a long lasting business relationship does not, however, completely free the buyer from
taking samples.106
If none of the samples reveal any deficiency, the buyer may assume that the rest of the 66
goods are also conforming. Even if defects are later discovered in the remaining goods,
the buyer has fulfilled his examination duty.107 Where all samples taken turn out to be
non-conforming, the buyer may assume that the whole delivery is non-conforming. The
buyer should not be required to examine every single piece as to its conformity.108
ee) Use of third parties. It can be deduced from the wording of Art. 38 (“cause them 67
to be examined”) that the buyer is not required to make the examination himself or
through his own personnel, but rather has the option to use the services of third parties.
These can be independent experts hired by the buyer particularly for this purpose, e. g. a
“measuring” firm with branches in all major ports. In particular, in cases falling under
Art. 38(3), this may be the buyer’s own customers. In this sense, the examination by the
buyer’s customers has a double function. It will fulfil both the customers’ examination
duty arising from their contract with the buyer as well as the buyer’s examination duty
in his relationship with the original seller.
Often the buyer may even need to engage a third party for the fulfilment of his 68
examination duty. This is the case where he either lacks the necessary expertise109 or an
examination by the buyer would be impractical because the goods are delivered directly
to the buyer’s customers. In either case, the buyer is obliged to ensure that the third
party properly performs the examination duty.110 Thus, if the expert hired does not
examine the goods within the time required and the buyer consequently does not
104 Ferrari, in: Ferrari et al. (eds), Internationales Vertragsrecht (2018), Art. 38 CISG para. 12;
Oberlandesgericht Köln (Germany) 13 November 2000 (plug couplings), CISG-Online 657 (Pace);
Thüringisches Oberlandesgericht (Germany) 26 May 1998 (live fish), CISG-Online 513 (Pace).
105 Landgericht Saarbrücken (Germany) 23 March 1992 (doors), CISG-Online 60 (Pace) upheld on
appeal by Oberlandesgericht Saarbrücken (Germany) 13 January 1993 (doors), CISG-Online 83 (Pace);

Landgericht Stuttgart (Germany) 31 August 1989 (shoes), CISG-Online 11 (Pace) requiring more
extended examination if previous deliveries had proven defective.
(Pace).
108 Oberlandesgericht Koblenz (Germany) 19 October 2006 (short sleeves t-shirts), CISG-Online 1407
(Pace) at II 3 aa; but see Landgericht Stuttgart (Germany) 31 August 1989 (shoes), CISG-Online 11 (Pace)
which assumed that defects in previous deliveries required an examination of nearly all shoes delivered.
(Pace), para. 4.9.4.

110 Oberlandesgericht Koblenz (Germany) 18 November 1999 (fiberglass fabric for filters), CISG-Online
570 (Pace).
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inform the seller about the non-conformity within a reasonable time, the buyer may lose
his remedies for non-conformity irrespective of any fault on his part.111 The buyer may
be able to rely on Art. 44 to excuse the delay if he has a reasonable excuse for his
failure,112 and in any case he will have a claim for contractual damages against the third
party.
69 The buyer will not be responsible for improper examinations by third parties where
they have either been selected by the seller or have been jointly agreed upon. The
same applies if such examinations have been left to a governmental authority.113 In such
cases, there is a presumed agreement between the parties that the buyer will be deemed
to have fulfilled his duty to examine the goods by engaging the third party.114
5. Place of examination
70 The place of examination is only directly regulated for contracts falling within the
ambit of Art. 38 paras 2 and 3. In all other cases, these provisions suggest that, in
principle, examination should occur at the place of delivery as determined by the
parties’ agreement or under Art. 31.115 For contracts involving carriage, which are the
most common in practice, Art. 38(2) provides that the goods must be examined at the
place of destination and not at the place of delivery. This is a considerable advantage for
the buyer as instead of organizing examination in a foreign country, he can often rely on
his own personnel and facilities for examination, at least when the goods have to be
delivered to the buyer’s place of business.
71 The parties may agree on a different place of examination, however, in light of the
consequences such an agreement will have on the buyer, this should not be assumed
lightly. Thus, just because an agreement provides that payment must be made when the
goods are placed at the disposal of the carrier does not necessarily mean that this place
of delivery shall at the same time become the place of examination.116
6. Time period for examination

72 a) General. Pursuant to the principle of party autonomy endorsed explicitly by
Art. 6, the parties are free to agree on a time for examining the goods. Express
agreements of this kind can be found in numerous contracts in practice, in particular
in connection with rules on trial runs. More often, however, the parties merely
regulate the time by which notice must be given, thereby indirectly fixing the time
for examination.117
73 Where the parties have not agreed on a time for examination and there are no
practices established between them or trade usages, Art. 38(1) stipulates that the
examination must be made in “as short a time as practical in the circumstances”.
Taking into account the diversity of goods and parties involved in international sales
111 DiMatteo et al., International Sales Law (2005), p. 81; Oberlandesgericht München (Germany)
8 February 1995 (polypropolene plastic granulate), CISG-Online 142 (Pace).

113 Ferrari, in: Ferrari et al. (eds), Internationales Vertragsrecht (2018), Art. 38 para. 8.
116 See also Magnus, Zum räumlich-internationalen Anwendungsbereich des UN-Kaufrechts und zur
Mängelrüge, IPRax (1993) 390 (392) case note to Oberlandesgericht Düsseldorf (Germany) 8 January 1993
(tinned cucumbers), CISG-Online 76 (Pace).
117 E. g. Arbitral Award, VIAC-Sch 4318, 15 June 1994 (rolled metal sheets), CISG-Online 120 (Pace) –
warranties subject to the condition that buyers examine the goods immediately after taking delivery;
Arrondissementsrechtbank Zwolle (Netherlands) 5 March 1997 (fish), CISG-Online 545 (Pace) short
notice period for frozen goods; for detail see supra at para. 25.
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contracts, the drafters of the CISG opted for a relatively short but fairly flexible time for
examination, referring to the practicability in the circumstances. In this sense, they tried
to balance the seller’s interest for prompt examination with the buyer’s interest in
avoiding costs and inconveniences.118
The intention to provide adequate protection of the buyer’s interest is also evident in 74
the differentiation contained in the various paragraphs of Art. 38 in relation to the start
of the examination period. In general, the examination period will start at the time of
delivery (Art. 38(1)), however an exception is provided for contracts involving carriage
(Art. 38(2)) and where the goods are redirected or redispatched (Art. 38(3)). To avoid a
situation in which the buyer has to incur additional costs and inconveniences in order
to examine the goods when risk passes, Art. 38 paras 2 and 3 defer the start of the
examination period until the goods arrive at their “final” destination.
In the absence of a direct sanction for non-compliance, the examination period 75
derives its importance primarily from being a crucial part of the notification regime set
out in Art. 39. As a consequence, the fairly strict standard for the timing of the
examination is partly mitigated by the more lenient standard in Art. 39 for the proper
notice. As long as the final notice is given within a reasonable time, any delay in
examination has no negative effect.119
b) Length of the period: “as short a time as practical in the circumstances”. In 76
practice, the determination of what is to be understood by “as short a time as practical
in the circumstances” is of crucial relevance. Notwithstanding the fact that failure to
give notice in time triggers a loss of remedies pursuant to Art. 39(1), this question is
usually determined by the length of the examination period. Once defects have been
discovered, they are normally communicated to the seller within the time available for
notification.
aa) The general standard. Particularly in older cases,120 courts from countries whose 77
national law requires an examination “without any delay” have also interpreted the
notion of “as short a time as practical in the circumstances” as requiring an immediate
examination upon delivery even with non-perishable goods.121
However, in light of the drafting history, it is clear that the notion of “as short a time as 78
practical in the circumstances” should not be equated with the Art. 38 ULIS notion of
“prompt examination”, essentially requiring an immediate examination.122 Art. 38 does
not refer to as short a time “as possible”. Instead it uses the term “as practical” which is
less strict and, to a certain extent, allows the court to take into account the subjective
situation of the buyer and other factors, which may justify delay. Moreover, it is suggested
that imposing an obligation of immediate examination on the buyer with strict sanctions
irrespective of such factors is not equitable. In the end, it is the seller who acted in breach
118Benicke, in: MünchKommHGB (2013), Art. 38 para. 6.

119For details see Art. 39 paras 58 et seq.
120 The general change in attitude, at least by German courts, is evidenced by the decision of the
Bundesgerichtshof in the tissue machine case, Bundesgerichtshof (Germany) 3 November 1999 (machine
for producing hygenic tissues), CISG-Online 475 (Pace).
121 Oberlandesgericht Düsseldorf (Germany) 10 February 1994 (shirts), CISG-Online 116 (Pace) –
immediate examination; Arbitral Award, ICC 8247, June 1996 (chemical compound), (Pace); Handelsger-
icht Zürich (Switzerland) 30 November 1998 (lambskin coats), CISG-Online 415 (Pace) – “in general no
more than one week”; Landgericht Landshut (Germany) 5 April 1995 (sport clothing), CISG-Online 193
(Pace) – one week for counting plus a few days for notice; see also Neumayer/Ming, Convention de
Vienne (1993), Art. 38 para. 3 who hold the view that the delay for examination is “exceptionnellement
court”; critical to such tendencies Ferrari, in: Ferrari et al. (eds), Internationales Vertragsrecht (2018),
Art. 38 CISG paras 16 seq.
122 In so far also the jurisprudence to Art. 38 ULIS is of little relevance for interpreting Art. 38.
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of the contract.123 Consequently, the examination duty should not serve the interests of
the seller in a way that in the end, in the majority of cases, the buyer has to shoulder the
burden of defective goods.124 In addition, one of the central arguments in favour of a very
short examination period, i. e. that the seller has to secure evidence, loses some of its
weight through the allocation of the burden of proof. In principle, it is the buyer who has
to prove the non-conformity of the goods and not the seller who has to prove their
conformity, thus the loss of evidence primarily affects the buyer.125
79 On the other hand, the wording of Art. 38, its purpose and the inclusion of Art. 44 to
protect the buyer, justifies a strict interpretation of the time granted for examination,
avoiding lengthy inspection periods. In comparison to Art. 39, which uses the notion of
“reasonable time”, the reference in Art. 38 to “as short a time as practicable” is
considerably stricter, emphasizing the shortness of the time granted.126
80 Beyond these interpretive tendencies, it is generally recognized that, as with the
extent of the examination, the time available depends on the circumstances of the
particular case.127 The reference to “as practical in the circumstances” leaves no doubt
that the drafters wanted to provide for the necessary flexibility in applying the CISG,
avoiding the fixing of a precise period as found in national laws and even interpretative
guidelines applicable to all cases as found in Art. 38 ULIS.128
81 Notwithstanding the generally recognized flexibility and variability of the period for
examination, courts have tried to establish presumptive time periods for the buyer’s
examination which can be corrected upwards or downwards as the particular case
requires. These range from three to four days129, over a week130 and ten to twelve days131
to one month.
82 Recognizing that in the majority of cases there will be objective or subjective factors
which justify a deviation from the presumptive time period, it is submitted that the
period of one to two weeks is a reasonable starting point depending on the type of
examination required and the necessary preparatory work associated with it.132 Periods
123 Magnus, in: Honsell, Kommentar (2010), Art. 38 para. 20; Ferrari, in: Ferrari et al. (eds), Inter-
nationales Vertragsrecht (2018), Art. 38 CISG para. 16.

125 Benicke, in: MünchKommHGB (2013), Art. 38 para. 7; for the burden of proof see above Art. 35,
paras 179 et seq.

126 In favour of a strict interpretation see also Bianca, in: Bianca/Bonell, Commentary (1987), Art. 38
para. 2.5; cf. Honnold/Flechtner, Uniform Law (2009), Art. 38 para. 252 discussing the various standards
used; a Canadian proposal to use also in Art. 38 the standard of reasonableness was explicitly rejected,
Offical Records 310 et seq.
(Pace) – suggesting a “median” time examination for durable goods of three to four days, which can be
corrected upwards or downwards as the particular case requires; Freiburg, Die Rügeobliegenheit des
Käufers bei grenzüberschreitendem Warenverkehr, IHR (2005) 56 (58); Oberlandesgericht Koblenz
(Germany) 18 November 1999 (fiberglass fabric for filters), CISG-Online 570 (Pace); Oberlandesgericht
Koblenz (Germany) 11 September 1998 (chemical substance (dryblend) used for production of plastic
(PVC) tubes), CISG-Online 505 (Pace); cf. as dicta Oberlandesgericht Schleswig (Germany) 22 August
2002 (live sheep), CISG-Online 710 (Pace).
130 Handelsgericht Zürich (Switzerland) 30 Novemeber 1998 (lambskin coats), CISG-Online 415 (Pace);
Oberster Gerichtshof (Austria) 14 January 2002 (cooling system), CISG-Online 643 (Pace) – approving the
lower court’s decision that an inspection period of one week (five working days) can be considered as a
rough guideline.
131 Janssen, Untersuchungs- und Rügepflichten (2001), pp. 133 seq.; for an overview on the jurispru-
dence see DiMatteo et al., International Sales Law (2005), pp. 78 et seq.
132 Benicke, in: MünchKommHGB (2013), Art. 38 para. 6; Magnus, in: Staudinger Kommentar (2013),
Art. 38 para. 40; Obergericht des Kantons Zug (Switzerland) 19 December 2006 (stove), CISG-Online 1427
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extending over a month before the examination starts or at least until necessary
preparatory works are undertaken will rarely be justified.133
Where the examination requires a time consuming test, e. g. chemical analysis or trial 83
productions, the time needed for such tests has to be added to determine the period for
examination. The notice period only starts to run when, on the basis of such tests, the
buyer ought to have discovered the lack of conformity. Thus, the period of examination
has de facto two components: first a kind of pre-examination period granted to the
buyer for taking the necessary decisions and organizing the examination in light of the
buyer’s capacities and second, the period needed to carry out the examination as
such.134
bb) Relevant factors in practice. What constitutes “as short a time as practical in the 84
circumstances” in a particular case largely depends on the same type of objective and
subjective factors, which are relevant for the extent of the examination.135 In addition to
the extent of the examination itself, factors of particular importance include the type of
the goods involved and the status of the buyer, i. e. his technical and financial capacity.
(i) Extent and time of examination. The length of the time period for examination is 85
largely dependent on the type of examination required. This applies to the time needed
for the examination process itself as well as the pre-examination time, in particular the
time needed for planning and organizing the examination. In a case of complicated
chemical or physical tests done with the help of outside experts, both may take several
weeks, while in the case of mere visual examination of the goods by an employee of the
buyer, this can be arranged within a short time and may be completed within minutes
or a few hours.
In determining the length of examination, it will also be relevant if the required 86
examination can be conducted in the ordinary course of business. Thus, non-business
days will not be included in the calculation for the period of examination.136 Further-
more, disruptions in the buyer’s business which are known to the seller have to be taken
into account.137 For example, the examination period for goods delivered during holiday
periods may be longer as the internal or external personnel required for the examina-
tion may not be available.
In general, the time available for organizing the examination can also influence the 87
length of the examination period. Longer periods between contract conclusion and
delivery normally allow the buyer sufficient time to make arrangements so that the
goods can be examined directly upon their arrival, at least if the arrival date can be
predicted with some certainty.138 By contrast, delivery shortly after contract conclusion
or short notice changes in the delivery date make planning the examination much more
difficult. This applies to all kinds of “untimely deliveries” (both pre-mature and
belated), which may result in a prolongation of the period for examination. If the buyer
(Pace); Landgericht Lübeck (Germany) 30 December 2010 (chairs), CISG-Online 2292, p. 5; critical to the
fixing of any average period Ferrari, in: Ferrari et al. (eds), Internationales Vertragsrecht (2018), Art. 38
CISG para. 17; Witz, A Raw Nerve in Disputes relating to the Vienna Sales Convention: The Reasonable
Time for the Buyer to Give Notice of a Lack of Conformity, 2 ICC Bulletin (2000) 15 (18).
134 See also Bundesgerichtshof (Germany) 3 November 1999 (machine for producing hygienic tissues),

135 For these factors see supra paras 37 et seq.
136 Oberlandesgericht Köln (Germany) 22 February 1994 (rare hard wood), CISG-Online 127 (Pace); in
this direction also Amtsgericht Riedlingen (Germany) 21 October 1994 (ham), CISG-Online 358 (Pace).
138 For that argument see also Landgericht Frankfurt (Germany) 11 April 2005 (used shoes), CISG-
Online 1014 (Pace).
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was expecting goods at a different time, he may have to rearrange his plans for
examination. The necessary personnel and machinery may not yet be or may no longer
be available.139 This is particularly relevant where the examination requires complex
tests or trial runs.
88 In some cases, even a short delay in delivery can result in a considerable extension of
the time for examination. For example, a delay of merely several days in the delivery of
a tiller used for the subsoil preparations of sport pitches may exclude a trial run, which
the buyer originally intended to make during his ordinary course of business, where the
pitches are only made once every several months. In such cases, the buyer may be
entitled to wait for several months to examine the goods until the next pitch has to be
made.
89 The type of the non-conformity also influences the time for examination. For obvious
defects, such as deviations in kind or quantity140, the time needed for discovering such
defects will be shorter than deficiencies which have to be determined by lengthy tests.141
By contrast, the pre-examination time, i. e. the period of time before the examination
actually starts, remains the same. Where the alleged non-conformity involves serious
allegations of fraud, e. g. where the goods are counterfeits, the examination period may
be longer as the buyer has to verify such allegations.142 The same may apply to complex
machinery where the buyer first has to exclude the possibility that defects are based on
an improper handling of the machine.143
90 In the absence of particular circumstances which give rise to shorter or longer
periods, basic examinations which require little organization, such as for the identity,
quantity and even basic operability of the goods, can be organized or even carried out
within an average period of one week to ten days.144
91 (ii) Type of goods involved and intended use. Another factor of considerable impor-
tance in determining the period for examination is the nature of the goods and their
intended use. Perishable goods, such as fresh fruits, flowers and fish, have to be
examined immediately or shortly after delivery as their condition might deteriorate
within a very short time.145 The same applies to livestock where inadequate supply of
water, nutrition or inappropriate conditions may seriously affect the physical condition
of the goods within days or even hours.146 A short examination period also exists for

140 Appellationshof Bern (Switzerland) 11 February 2004 (wire and cable), CISG-Online 1191 (Pace);
probably too strict applying the domestic German standard, Landgericht Tübingen (Germany) 18 June
2003 (computers and accessories), CISG-Online 784 (Pace) – not more than a few days.
141 Tribunale Civile di Cuneo (Italy) 31 January 1996 (sports clothes), CISG-Online 268 (Pace);
Amtsgericht Riedlingen (Germany) 21 October 1994 (ham), CISG-Online 358 (Pace); Oberlandesgericht
Koblenz (Germany) 18 November 1999 (fiberglass fabric for filters), CISG-Online 570 (Pace); Oberlan-
desgericht Köln (Germany) 21 August 1997 (aluminium hydroxide), CISG-Online 290 (Pace); Cour
d’appel Paris (France) 6 November 2001 (cables), CISG-Online 677 (Pace).
Online 475 (Pace).

144 Handelsgericht St. Gallen (Switzerland) 11 February 2003 (audio CDs), CISG-Online 900 (Pace);
Rechtbank van Koophandel Veurne (Belgium) 25 April 2001 (diesel tram), CISG-Online 765 – test drive.
145 Saarländisches Oberlandesgericht (Germany) 3 June 1998 (flowers), CISG-Online 354 (Pace);
Arrondissementsrechtbank Roermond (Netherlands) 19 December 1991 (cheese), CISG-Online 29 (Pace);

Arrondissementsrechtbank Zwolle (Netherlands) 5 March 1997 (fish), CISG-Online 545 (Pace); Amtsger-
icht Riedlingen (Germany) 21 October 1994 (ham), CISG-Online 358 (Pace); cf. albeit obiter, Appellation-
shof Bern (Switzerland) 11 February 2004 (wire and cable), CISG-Online 1191 (Pace) at 4.
146 Oberlandesgericht Schleswig (Germany) 22 August 2002 (live sheep), CISG-Online 710 (Pace) –
examination of living animals within a day after delivery.
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seasonal goods to allow for their use, either by the seller or the buyer, within the season
for which they were produced.147
The examination period is normally longer for durable goods. In particular, if the 92
goods are complex and the examination requires trial runs or complex mechanical or
chemical tests, the examination may extend beyond the two weeks mentioned.148
Irrespective of this, a basic examination for the existence of obvious mistakes by looking
at the goods, counting or weighing them or examining the accompanying documents
has to be made earlier.149
The intended use of the goods is of relevance as it may exclude any proper examination 93
after a certain time. For example, goods that are to be reprocessed or which are to be
mixed with other goods must be examined before that happens.150 Afterwards it may be
difficult to determine whether the goods were originally conforming. There may, how-
ever, be exceptions where the goods will be reprocessed in the near future and an
extensive examination would lead to considerable costs or delay in the use of goods or
would affect their usability. Given that the buyer has to prove the lack of conformity of
the goods, any increased difficulties in determining this conformity are borne by him.151
For this same reason, the buyer may be entitled to a slightly longer examination period 94
if the goods are to be used within the near future so that additional expenses for separate
inspections are not reasonable. It can, however, be expected that the buyer will not be able
to wait for two months to examine porcelain tableware to be used in his restaurant.152
(iii) Status of the buyer. The status of the buyer and in particular his size, expertise 95
and professionalism will also have an impact on the period of examination. A buyer of a
certain size is more likely to have the necessary personnel to engage in examinations
beyond mere visual inspections than a smaller company which then needs additional
time to hire outside experts for examinations. The same may be true with respect to the
availability of testing equipment, where the location of the buyer may also be relevant. A
buyer located in a developing country may need more time to organize an examination
by a third party than a buyer in a highly industrialized country.
In particular, where the contract provides for the training of the buyer’s personnel by 96
the seller, the parties may have implicitly recognized that the buyer will only be able to
examine the goods at the end of the training period.153
Local customs in the buyer’s country may also influence the timing. If goods are 97
delivered during holiday seasons where, as is known to the seller, the buyer’s company
147 Magnus, in: Staudinger Kommentar (2013), Art. 38 para. 42; Oberster Gerichtshof (Austria)
27 August 1999 (trekking shoes), CISG-Online 485 (Pace); see also Oberster Gerichtshof (Austria)
14 January 2002 (cooling system), CISG-Online 643 (Pace).
148 Ferrari, in: Ferrari et al. (eds), Internationales Vertragsrecht (2018), Art. 38 CISG para. 17; District
Court for the Western District of Michigan (U.S.) 17 December 2001 (thermoforming line equipment),
Shuttle Packaging Systems L. L. C. v Tsonakis, CISG-Online 773 (Pace); Landgericht Düsseldorf
(Germany) 23 June 1994 (engines for hydraulic presses and welding machines), CISG-Online 179 (Pace).
(Pace); Arrondissementsrechtbank Zwolle (Netherlands) 5 March 1997 (fish), CISG-Online 545 (Pace);
Gerechtshof ‘s Hertogenbosch (Netherlands) 15 December 1997 (furs), CISG-Online 552 (Pace); see also
resale of goods Pretore della giurisdizione di Locarno-Campagna (Switzerland) 27 April 1992 (furniture),
152 Tribunale di Rimini (Italy) 26 November 2002 (porcelain tableware), CISG-Online 737 (Pace) – the
notice given after 6 months after delivery was considered to be out of time.
153 See District Court for the Western District of Michigan (U.S.) 17 December 2001 (thermoforming
line equipment), Shuttle Packaging Systems L. L. C. v Tsonakis, CISG-Online 773 (Pace) allowing for an
overall notification period of more than a few weeks.
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is effectively closed, an extended time for examination may be justified. This does not
apply if the delivery took place at a time requested by the buyer who then failed to make
reservations for a longer examination period.
98 Purely personal factors such as illness, strike or mere absence are largely irrelevant in
the context of Art. 38154 unless the seller has been informed about them or their
likelihood at the time of contracting. In all other cases the buyer may always entrust
third parties with the examination overcoming such impediments. Such factors may,
however, result in a “reasonable excuse” under Art. 44.
99 (iv) Other factors. A Finnish court has held that the existence of a pre-delivery
inspection prolonged the amount of time the buyer had to examine the goods after
delivery.155 While the justification of such prolongation seems somewhat questionable, it
is clear that the lack of a pre-delivery inspection, irrespective of whether such an
inspection would have constituted diligent behaviour, does not in principle shorten the
time limit for examination.156
100 It has also been held that requests by the buyer for expedited delivery can shorten the
time for examination.157
101 The time for examination is also affected by the expectations of the parties. Thus, it
could make a difference if both parties come from countries where the national law and
the courts applying the CISG adopt a strict view about the time for examination.158
102 Problematic is the treatment of defects in previous deliveries. On the one hand, one
could argue that due to past experience, the buyer should have been alerted about
possible non-conformities and thus arrange for an examination shortly after delivery.159
On the other hand, such a view would seem to reward the seller for his breach of
contract in previous instalments. Thus, previous non-conformities should in principle
not affect the time for examination.
c) Starting point for the period for examination pursuant to Art. 38(1)
103 aa) Conforming Delivery. In all cases not covered either by an agreement or the
special rules of Art. 38 paras 2 and 3, the time for the buyer’s examination begins to run
upon actual delivery of the goods at the place of delivery.160 This corresponds, in
general, to the time when the risk of loss passes to the buyer.161 The place of delivery is,
in the absence of an agreement by the parties, determined pursuant to Art. 31.
154 Landgericht Landshut (Germany) 5 April 1995 (sport clothing), CISG-Online 193 (Pace) – absence
for participation in trade fair not relevant for length of examination period; Magnus, in: Honsell,
155 Helsinki Court of First Instance (Finland) 11 June 1995 (skin care product), confirmed by Helsinki
Court of Appeal (Finland) 30 June 1998 (skin care product), CISG-Online 1304 (Pace) – existence of a
pre-delivery test showing acceptable vitamin content for skin care products excused buyer from testing
for vitamin content immediately after delivery.
156 Not completely clear in this regard Tribunale di Rimini (Italy) 26 November 2002 (porcelain
tableware), CISG-Online 737 (Pace).

157 Landgericht Berlin (Germany) 21 March 2003 (fabric), CISG-Online 785 (Pace).
158 See Oberster Gerichtshof (Austria) 14 January 2002 (cooling system), CISG-Online 643 (Pace) where
for a contract between a German and an Austrian party an examination period of 1 week after delivery
was considered to be practicable even for a cooling system.
159 For such an argument see Handelsgericht des Kantons Zürich (Switzerland) 30 November 1998
(lambskin coats), CISG-Online 415 (Pace).

160 Oberster Gerichtshof (Austria) 14 January 2002 (cooling system), CISG-Online 643 (Pace); Land-
gericht Berlin (Germany) 21 March 2003 (fabric), CISG-Online 785 (Pace); Oberlandesgericht Düsseldorf
(Germany) 10 February 1994 (shirts), CISG-Online 116 (Pace); for further cases see UNCITRAL, Digest
of Case Law on the CISG, Art. 38 para. 12 footnote 41.
161 UNCITRAL, Digest of Case Law on the CISG, Art. 38 para. 12.
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It is presumed that the buyer examines the goods at the place of delivery.162 Whether 104
he actually does so, or examines them at a different place, does not affect the starting
date for the examination period. However, where a proper examination is not possible
at the place of delivery, the time needed for transporting the goods to the place where
they can be examined will influence the length of the examination period.
Where delivery of the goods has to occur by a certain date, the starting date for the 105
examination period will be referenced by the date of actual delivery and not the latest
possible date of delivery.163
bb) Pre-mature delivery/delivery at wrong place. Different views exist as to the 106
starting date for the examination period for goods delivered prematurely but accepted
by the buyer. The prevailing view is that the delivery date originally agreed upon
remains the relevant point in time from which the period for examination has to be
calculated.164
However, it is submitted that a buyer, who accepts prematurely delivered goods 107
without any reservations as to the timing of examination, should be held to his decision
to do so. Consequently, the time for examination starts to run from the time of
acceptance.165 This view fits better with the right to cure provided for in Art. 37. The
exercise of such a right requires, in most cases, that the notice of non-conformity is
given before the original date of delivery, which in turn presupposes that the examina-
tion occurred before that date.
The interests of the buyer can easily be accommodated through the flexible standard 108
of “practicality” of the examination. In particular, where premature delivery comes as a
surprise to the buyer, the buyer may need additional time to arrange for an examina-
tion. For example, required personnel may not be available, necessary machinery may
unavailable as it is being used for other purposes and outside experts may have been
hired for different dates on the basis of the originally agreed time for delivery. Thus,
particularly where outside experts have to be hired in order to conduct the examination,
the differences between the two different views in practice may be minor. The earlier
start of the examination period results in an increased length of the period, as
rearrangement of previously agreed examination dates will often not be possible.
The same principles apply where the goods are not delivered to the agreed place of 109
delivery, but are nonetheless accepted by the buyer for their further use.166 The length of
the period for examination may in such cases be affected by the lack of infrastructure
necessary for an examination. Without the buyer’s acceptance, delivery at the wrong
place will not start the period for examination as the buyer may be able to require
delivery at the correct place.167
cc) Additional duties. Under some contracts, the seller has to perform additional 110
duties, which might be necessary prerequisites for any meaningful examination. For
example, trial runs of a machine delivered may only be possible after the seller has
installed the machine, trained the buyer’s personnel or at least delivered the necessary
162
Ferrari, in: Ferrari et al. (eds), Internationales Vertragsrecht (2018), Art. 38 CISG para. 16.
163
165 In favour of this approach also Baasch-Andersen, The Duty to Examine Goods under the Uniform
International Sales Law – An Analysis of Article 38 CISG, 18 European Business Law Review (2007) 797
(800 seq.); Ferrari, in: Ferrari et al. (eds), Internationales Vertragsrecht (2018), Art. 38 CISG para. 4;
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manuals. In such cases, the time for examination only starts to run after the seller has
performed these additional duties.168
111 dd) Partial deliveries. In case of partial deliveries, the start of the examination period
depends on whether such deliveries were agreed upon between the parties or not. If
such an agreement has been made, in principle, the examination period will start to run
with each delivery, thus precluding the buyer from deferring examination until he has
received the final delivery. However, where the goods delivered in partial deliveries can
only be examined once all the deliveries have been made, e. g. when all deliveries are
needed to assemble one single good, the time for examination will start to run with the
final delivery. The same will apply if the time between the partial deliveries is fairly
short and a separate examination may result in a considerable increase in cost and time.
112 The examination may also be deferred until the buyer has received the final delivery
if partial deliveries have not been agreed upon. The burden associated with the
increased number of examinations justifies treating such a case differently than those
of a premature delivery or delivery at the wrong place.
113 ee) Hidden defects. In the event of hidden or latent defects which cannot be
discovered by conducting the required reasonable examination, the time period for
extended examination duties starts to run when the defects reveal themselves.169 The
examination period starts immediately if the problems encountered in the use of the
goods are clear signs that they contain a hidden defect. Where the delivered goods are
used in conjunction with other products, it may not always be clear from the outset
whether the defects discovered are due to a hidden non-conformity of the goods
delivered or have other causes. For example, the failure of machinery in which grinding
devices were installed may be due to deficiencies in the grinding devices or due to other
operating mistakes. In such cases, the buyer will have some time to decide whether he
wants to investigate or not. Normally, more extensive examinations, which may be
necessary to discover such latent defects, involve additional costs and possibly the
services of an outside expert.
7. Examination in contract involving carriage: Art. 38(2)

114 International sales contracts often involve the carriage of goods.170 For such contracts
Art. 38(2) defers the starting date for examination until the goods have arrived at their
destination. This also involves shifting the place of examination to this location. Art. 38(2)
takes account of the fact that applying Art. 38(1) to contracts involving carriage would
unduly burden the buyer and lead to avoidable costs. Pursuant to Art. 38(1) the examina-
tion period for such contracts will normally start when the seller hands over the goods to
the first carrier, as this is the point the seller will be deemed to have fulfilled his duty to
deliver the goods under Art. 31(a).171 At this time, however, the buyer is not usually in the
position to examine the goods due to a lack of physical possession of the goods.172
Furthermore, in contracts involving carriage the seller is normally obliged to make the
168 Gruber, in: MünchKommBGB (2016), Art. 38 para. 38; Obergericht des Kantons Zug (Switzerland)
19 December 2006 (stove), CISG-Online 1427 (Pace).

Online 475 (Pace); Witz, A Raw Nerve in Disputes relating to the Vienna Sales Convention: The
Reasonable Time for the Buyer to Give Notice of a Lack of Conformity, 2 ICC Bulletin (2000) 15 (18).
170 In so far Art. 38(2) – though formulated as an exception to Art. 38(1) – constitutes the rule in
practice; for a detailed analysis of the meaning of that notion see Art. 31 paras 13 et seq.
171 See Magnus, in: Staudinger Kommentar (2013), Art. 38 para. 51.
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goods ready for transportation. The buyer may be substantially deprived of the economic
benefits of the seller’s packaging obligations if he were obligated to examine the goods
before transportation of the goods to their destination, as an examination often involves
removal of the transport packaging.173
The protection of the buyer’s interest as provided for by the deferral of examination 115
in Art. 38(2) is also justified in so far as, in the end, the examination duty primarily
serves to protect the seller. The seller normally knows the destination of the goods and
can therefore evaluate whether such a deferral of examination is acceptable or whether it
is necessary to agree on a different rule.
The parties may exclude the application of the rule in Art. 38(2) by agreeing, for 116
example, that the buyer or the carrier has to examine the goods for their conformity
before or during loading.174 Unless the examination at the agreed place turns out to be
impossible or factors or subsequent events beyond the parties’ contemplation make
such an examination unreasonable, the parties’ agreement should be respected. Thus,
the fact that it would make more commercial sense to examine the goods upon their
arrival is irrelevant in light of the parties’ express agreement.175
Art. 38(2) applies only to contracts involving the carriage of goods in the sense of 117
Art. 31(a)176 as well as to sales of goods in transit.177 Consequently, it covers contracts
submitted to INCOTERMS belonging to the F and C group regardless of the fact that
technical delivery for the purpose of risk allocation may take place earlier.178 By
contrast, where clauses from the D group are chosen, the place of delivery and the
place of destination will often be the same. Thus, according to Art. 38(1), the duty to
examine will only arise upon arrival at the place of destination.
Where the contract involves carriage,179 the application of Art. 38(2) is not dependent 118
on whether the seller or the buyer has selected the carrier. Even if the buyer has selected
the carrier, the latter’s role remains the same, i. e. that of a conveyor of the goods from
the seller to the buyer. The buyer still does not have the physical possession of the goods
normally required for their examination. This may not be the case where transport is
undertaken by the buyer’s personnel. In such cases, the time for examination starts to
run when the goods are placed at the disposal of the buyer’s personnel.180 Application of
Art. 38(2) requires the use of an independent carrier.181
Destination in the sense of Art. 38(2) is the place to which the goods are to be 119
delivered pursuant to the parties’ agreement.182 This is often the place of the buyer, but
173Heuzé, Vente Internationale (2000), para. 306; Benicke, in: MünchKommHGB (2013), Art. 38 para. 10.
174Oberlandesgericht Düsseldorf (Germany) 8 January 1993 (tinned cucumbers), CISG-Online 76
(Pace) with note by Magnus, Zum räumlich-internationalen Anwendungsbereich des UN-Kaufrechts
und zur Mängelrüge, IPRax (1993) 390.
175 For a different view relying on the principle of reasonableness to override the parties’ agreement see
Commerce and Industry (Russia) 24 January 2000 (goods not specified), 54/1999, CISG-Online 1042
(Pace); with critical comment by Saidov, Cases on CISG decided in the Russian Federation, 7 Vindobona
Journal of International Commercial Law and Arbitration (2003) 1 (28 et seq.) (Pace).
176 For the non-application in cases of Art. 31 (b) Oberlandesgericht Brandenburg (Germany) 3 July
2014 (plants), CISG-Online 2543 (Pace), para. 27 – examination at place where buyer picks up the goods.
179 See Rechtbank Breda (Netherlands) 16 January 2009 (watermelon), CISG-Online 1769 (Pace) at. 3.10
for a case not involving carriage where the examination consequently has to take place before the transport.
180 The same applies in cases of Art. 31 (b) Oberlandesgericht Brandenburg (Germany) 3 July 2014
(cuttings), CISG-Online 2543 (Pace), para. 27.

182 Landgericht Frankfurt (Germany) 11 April 2005 (used shoes), CISG-Online 1014 (Pace); Gruber, in:
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may also be the place of one of the buyer’s customers to whom the goods are delivered
directly. In CIF or FOB contracts this is the port of destination.183
120 Pursuant to the contract of carriage, the carrier may be required to examine the goods
at least superficially. Such examination has, in principle, no effect on the relationship
between the buyer and the seller. Where the carrier has noted an obvious defect in the
goods on the transport documents, which are nevertheless accepted by the buyer,
different views exist as to the start date of the notice period. According to one view,
the notice period will start when the transport documents are handed over.184 This
would, however, require that the documents specify the deficiency in sufficiently precise
detail in order to allow the buyer to meet the notice requirements of Art. 39, which is
rarely the case. Consequently, the better view, which avoids the need to differentiate
between the different types of comments on the transport documents, is that such
remarks do not affect the start of the examination period. Under this view, the
examination period will still start when the goods arrive at their destination. Comments
by the carrier may, however, affect the extent of the examination and the length of the
period, reducing the time available before an examination has to be made.185
8. Art. 38(3)
121 Art. 38(3) contains a further deferral of the examination period for cases – not so rare
in practice – where the buyer either redirects the goods in transit or redispatches them
after their arrival. In such cases, the examination only has to take place when the goods
reach their new destination. Prerequisites for the application of Art. 38(3) are, however,
that the seller ought to have known the possibility of such a redirection or a redispatch
and that the buyer had no reasonable opportunity to examine the goods before their
arrival at the final destination.
122 This provision takes into account the buyer’s interest in the facilitated and cost
effective handling of goods already prepared for transportation, which may be redir-
ected or redispatched without the need for reloading or even repackaging. In principle,
Art. 38(3) only defers the start of the examination period but not its length. In
determining what is reasonable, however, the circumstances at the place of final
destination have to be taken into account. In this sense, while the examination will
often be carried out by the buyer’s customers, it is still the buyer who is responsible to
ensure that it is conducted properly and without delay.186
123 a) Redirection and redispatch. Redirection in transit occurs when the buyer, or any
person authorized by him, changes the destination before the delivery of the goods at
the originally agreed destination. The reason for such a redirection is irrelevant. The
buyer, or any person authorized by him, may order redirection because the goods are to
be delivered to a different customer or merely because the buyer wants to use them at
this new destination.
124 The notion of “redispatch” refers to cases where the buyer, after having received the
goods, sends them off to a different destination.187 Redispatch may occur via the same
carrier without having the goods unloaded or through a different carrier. The restriction

184See Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 38 para. 21.
185 See also Gruber, in: MünchKommBGB (2016), Art. 38 para. 43 – upon delivery of the goods but
with a very short period; Magnus, in: Staudinger Kommentar (2013), Art. 38 para. 54.
186 Oberlandesgericht München (Germany) 8 February 1995 (polypropolene plastic granulate), CISG-
Online 142 (Pace); see supra paras 67 et seq.

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of Art. 38 ULIS which excluded transhipment has been abolished.188 In principle, it is
the lack of the opportunity to examine the goods, which justifies the deferral, and not
how they are redispatched. However, the de facto likelihood that such an opportunity
exists is smaller in cases where the goods are redispatched with the same carrier without
unloading them.
Art. 38(3) may, in principle, also be applied in cases of multiple redirections or 125
redispatches. In such cases, however, the seller’s knowledge may pose a problem.189 A
comparable factual situation to that regulated in Art. 38(3) – i. e. the lack of a reasonable
opportunity to examine the goods – also exists in cases where a customer of the buyer
immediately takes delivery at the place of delivery and then ships the goods at his own
risk to his place of business. Thus, provided that the other requirements are met,
Art. 38(3) can be applied by analogy.190 To require an examination of the goods in such
cases before they are taken over by the buyer’s customer may lead to exactly the type of
costs for a repackaging Art. 38(3) wants to avoid. The seller’s interests are adequately
protected by the additional requirement of awareness.
By contrast, Art. 38(3) is not applicable to mere resales, i. e. where the buyer stores 126
the goods at his premises and sells them over time.191 This instead falls within the scope
of Art. 38(1). Strong indications of a resale are when the goods are repackaged and then
sold in smaller quantities or to a large variety of customers, the identity of which will
only determined after the delivery of the goods.
b) Awareness of the seller. A deferral of the examination until arrival at the final 127
destination under Art. 38(3) also requires that the seller knew or ought to have known
of the possibility of their redirection in transit or redispatch. The extension of the time
for raising claims associated with such a deferral of examination is to the disadvantage
of the seller, who has an interest in knowing as soon as possible whether he has fulfilled
his duties as to the conformity of the goods. Thus, it is only justified if the seller knows
or at least ought to have known at the time of contracting that the goods will be
redirected and redispatched. In the absence of an agreement to the contrary he can then
be treated as if he has accepted the prolonged uncertainty.
As a consequence, it is not sufficient for a deferral of the examination that the buyer 128
informs the seller after the conclusion of the contract that the goods are eventually to be
redirected or redispatched.192 Furthermore, the mere abstract possibility that the goods
may be redirected or redispatched, which can rarely be excluded, is also not sufficient.193
Either the buyer must have explicitly informed the seller about such an intention or it
must have been a likely option, e. g. when the buyer is an international trading house.194
The type of packaging required by the buyer may also provide an indication that the
goods will be redirected. Thus, the requirement of seaworthy packaging where the goods
are to be delivered to the buyer via truck demonstrates that the buyer probably wants to
redispatch the goods. The same will apply to agreements between the parties that the
188
189
Art. 38 para. 47; for a different view Bianca, in: Bianca/Bonell, Commentary (1987), Art. 38 para. 3.1.
191 Saarländisches Oberlandesgericht (Germany) 13 January 1993 (doors), CISG-Online 83 (Pace);
Oberlandesgericht Dresden (Germany) 8 November 2007 (funnel covers), CISG-Online 1624 (Pace);
Obergericht des Kantons Luzern (Switzerland) 8 January 1997 (blood infusion devices), CISG-Online 228
(Pace); Magnus, in: Staudinger Kommentar (2013), Art. 38 para. 58.
192 Landgericht Frankfurt (Germany) 11 April 2005 (used shoes), CISG-Online 1014 (Pace);

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goods have to meet the relevant standards of a country different from the one to which
the goods are to be shipped.
129 By contrast, the mere fact that the buyer has its place of business in a different country
than the place of performance has not been considered sufficient.195 It is, however, at least
a relevant factor in determining whether the seller ought to have known that the goods
were intended for use in a different country. In combination with other factors, such as
the language of labelling or manuals, this may be sufficient to demonstrate that the seller
had constructive knowledge.
130 In most cases covered by Art. 38(3), the examination will be undertaken not by the
original buyer himself but by his customers. Irrespective of this, the buyer may not rely on
being informed belatedly by his customers but rather is liable for any breach of the
examination duty, not only in relation to timing but also in relation to the extent of the
duty.196 Here, the subjective situation of the buyer and not that of his customers is relevant.
If the buyer has the necessary expertise to examine the goods within a particular time and
to discover existing defects, it is irrelevant that the buyer’s customers lack such capacity.
131 c) Lack of a reasonable opportunity for examination. The examination can only be
deferred until arrival at the new destination if the buyer had no “reasonable opportunity
for examination” before this time. This requirement is, in general, met in all cases of
redirection of goods. By contrast, in cases of redispatch, fulfilment of this requirement may
be problematic and has to be ascertained on the basis of the particular facts of each case.
132 The existence of a reasonable opportunity to examine the goods in cases of redispatch
is strongly influenced by the time the goods remain at the buyer’s premises before their
redispatch and packing.197 Goods which are stored for some time at the buyer’s premises,
or elsewhere with his approval, normally have to be inspected for conformity.198 Any
longer storage without even a superficial examination for obvious defects conflicts with
one of the primary purposes of the examination duty, which is to provide for certainty as
to the conformity of the goods within as short a period as possible to allow the seller to
react to complaints. The same applies, where the buyer is not sure about the time for
resale. By contrast, where the goods are effectively immediately redispatched, the buyer is
normally deprived of a chance to examine them.
133 The second relevant factor in determining whether there was an opportunity to
examine is the packaging. The need to remove or even destroy boxes, containers or
other packaging materials required to protect and transport the goods is a factor in
favour of deferring examination until the arrival of the goods at their final destination,
even if there is sufficient time for an examination. This is, however, no reason to
exclude an examination if the goods are stored for a longer or indefinite time.199 In this
regard, the value of the packaging and costs associated with its removal and replacement
play an important role. The same applies where the examination would require the
breaking of customs seals with the consequence that customs duties have to be paid.
195 See Landgericht Frankfurt (Germany) 11 April 2005 (used shoes), CISG-Online 1014 (Pace) which
is, however, generally very restrictive.

196 Benicke, in: MünchKommHGB (2013), Art. 38 para. 14; Oberlandesgericht Düsseldorf (Germany)
23 January 2004 (stainless steel plates), CISG-Online 918 (Pace).

197 Bianca, in: Bianca/Bonell, Commentary (1987), Art. 38 para. 2.7; Obergericht des Kantons
Luzern (Switzerland) 8 January 1997 (blood infusion devices), CISG-Online 228 (Pace) at 4 c.
198 Magnus, in: Staudinger Kommentar (2013), Art. 38 para. 60; Handelsgericht Zürich (Switzerland)
30 November 1998 (lambskin coats), CISG-Online 415 (Pace) at 4 a,bb; Rechtsbank (Belgium) 6 January
2004 (polo shirts), CISG-Online 829 (Pace) – 6 weeks sufficient for examination of shirts.
199 Saarländisches Oberlandesgericht (Germany) 13 January 1993 (doors), CISG-Online 83 (Pace); for a
different view see Rechtsbank Koophandel Hasselt (Belgium) 6 January 2004 (polo shirts), CISG-Online
829 (Pace).
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Another factor in favour of a deferral is where the goods require assembly before a 134
proper examination can be done. It makes little economic sense to assemble and
disassemble the goods at the buyer’s premises to test their conformity if they are re-
dispatched within a short period of time.200
In principle, most factors which influence the time needed for an examination are 135
also relevant in determining whether such an examination should have been done
before the redispatch.
Irrespective of the wording of Art. 38(3), which allows for a deferral of any examina- 136
tion until the arrival of the goods at their final destination, the buyer may be required to
engage in basic examinations sufficient to reveal obvious defects. In other words, only
examinations of a more extensive nature should be deferred until final arrival.201
Consequently, while the buyer of textiles may be required to examine a limited number
of samples as to their colour and size before redispatching them, pursuant to Art. 38(3)
he may be able to defer complex examinations as to the physical characteristics and
durability of the textiles until the goods have arrived at their final destination.
The requirements of Art. 38(3), in particular whether the buyer had a reasonable 137
opportunity to examine the goods, should not be interpreted too strictly. Short delays
resulting from postponements which, due to the non-perishable nature of the goods, do
not affect the seller’s position should not force the buyer to engage in physically possible
but commercially unreasonable examinations before the redispatch of the goods, where
such redispatch is foreseeable.202
9. Costs of the examination duty

The costs of the examination are to be borne by the buyer, unless the parties have 138
agreed otherwise.203 Should the goods turn out to be defective, the buyer has, in most
cases, a claim for damages against the seller for the costs incurred pursuant to
Arts 45(1)(b), 37 second sentence and 48(1) second sentence.204 Unless the lack of
conformity merely results in a price reduction, the costs incurred for the examination
are either frustrated because of an avoidance of the contract or because the seller’s
efforts to remedy defects necessitate an additional examination.
10. Sanctions
Unlike contractual obligations that give rise to Art. 61 remedies for the seller, the 139
Art. 38 examination duty merely imposes a burden (incumbency/duty) on the buyer,
the non-fulfilment of which may lead to a loss of rights.205 This kind of an indirect
sanction can also be found in Arts 39(1) and 49(2)(b). Although neither provision
explicitly refers to the non-fulfilment of the examination duty as its triggering event, it

201Gruber, in: MünchKommBGB (2016), Art. 38 para. 53; Janssen, Untersuchungs- und Rügepflichten
(2001), p. 125.
202 In so far too strict Landgericht Frankfurt (Germany) 11 April 2005 (used shoes), CISG-Online 1014
(Pace) where the delay of several days for the examination of used shoes caused by the foreseen
redispatch of the goods to the buyer’s place of business in the end let to a loss of all rights; highly critical
of the decision also Flechtner, Funky Mussels, a Stolen Car, and Decrepit Used Shoes: Non-Conforming
Goods and Notice thereof under the United Nations Sales Convention, Boston University International
Law Journal (2008) 1 (26 seq.)(Pace).
205 Bianca, in: Bianca/Bonell, Commentary (1987), Art. 38 para. 2.1; Magnus, in: Staudinger Kommen-
tar (2013), Art. 38 para. 12; Witz, A Raw Nerve in Disputes relating to the Vienna Sales Convention: The
Reasonable Time for the Buyer to Give Notice of a Lack of Conformity, 2 ICC Bulletin (2000) 15.
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may be the cause for the belated notification about the lack of conformity or the belated
notice of avoidance. Without a proper examination the buyer is in most cases de facto
unable to give Art. 39 notification for lack of conformity or Art 49 notice of avoid-
ance.206
140 Irrespective of the above and the close connection between the examination duty and
the notification duty, the triggering event for the loss of remedies will always be the
breach of the latter. As long as the buyer fulfils his duty to notify under Art. 39, any
breach of the antecedent duty to examine the goods will be irrelevant,207 as the
examination period is merely a factor to be considered when calculating the time period
in which the notice has to be given. Consequently, in determining whether notice is late
in the sense of Art. 39(1), the periods for examination and notice are often treated as a
single period. As long as notice is given within a “reasonable time”, it is thus irrelevant
how the time is allocated between examination and notification. In this sense, a buyer
who is two days late in fulfilling his examination duty may remedy this by ensuring
notice is provided before the final date for notification.208
141 In the event of a hidden defect, non-fulfilment of the examination duty remains
without sanctions. The notification period under Art. 39 will not start to run if the
buyer “ought [not to] have discovered” the lack of conformity through an orderly
conducted examination.209
142 In some cases, the non-conformity of the goods delivered may not be wholly obvious.
To take an example given by Honnold,210 a delivery of 400 gallon cans of chlorine sealed
in metal containers instead of the 500 gallon cans agreed may be obvious in relation to
the lack of quantity, but that the gas in 200 containers does not conform with the gas
ordered may be a hidden defect which is only discoverable during the use of the gas. In
such cases, every type of non-conformity has to be treated separately. Thus, the buyer
may not be able to rely on the lack of conformity with respect to the lack of quantity (as
this could have been discovered on proper examination), but he may still be able to rely
on it with respect to the lack of quality, which would not have been revealed by a proper
examination.
143 If a buyer, through his actions, indicates acceptance of the non-conforming goods,
despite the fact that he should have discovered their non-conformity if he had properly
examined them, he will be estopped from relying on their non-conformity.211 Equally, a
buyer who has accepted defective goods in return for a price reduction may not revoke
206 UNCITRAL, Digest of Case Law on the CISG, Art. 38 para. 2; Honnold/Flechtner, Uniform Law
(2009), Art. 38 para. 249.

207 Tribunale di Rimini (Italy) 26 November 2002 (porcelain tableware), CISG-Online 737 (Pace); but
see for the opposite view Landgericht Frankfurt (Germany) 11 April 2005 (used shoes), CISG-Online
1014 (Pace); for details see Art. 39 paras 59 et seq.
(2008) 1 (22 seq.)(Pace); Benicke, in: MünchKommHGB (2013), Vorb. zu Arts 38, 39 para. 2; Ferrari, in:
Ferrari et al. (eds), Internationales Vertragsrecht (2018), Art. 38 CISG para. 2.
210 Honnold/Flechtner, Uniform Law (2009), Art. 38 para. 252; Witz, A Raw Nerve in Disputes relating
to the Vienna Sales Convention: The Reasonable Time for the Buyer to Give Notice of a Lack of
Conformity, 2 ICC Bulletin (2000) 15 (18).
211 Landgericht Saarbrücken (Germany) 26 March 1996 (furnishings for ice-cream parlor), CISG-
Online 391 (Pace) where the buyer issued bills of exchange after delivery of the furnishing and was
therefore precluded from asserting that only parts of the goods had been delivered; but see Tribunale
d’appello Cantone del Ticino (Switzerland) 15 January 1998 (cocoa beans), CISG-Online 417 (Pace) –
acceptance of a pre-shipment certificate testifying the conformity of the goods for purposes of drawing on
a letter of credit did not deprive the buyer of the right to examine the goods after delivery and to contest
their quality.
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such a settlement if he later discovers additional defects, which would have been
obvious if he had conducted a proper examination.212
11. Waiver of the examination duty

In addition to contractual exclusions or modifications of the duty to examine the goods, 144
the seller may also waive his rights or be estopped from relying on any failure to examine.
Any conduct by the seller, which implies that he recognizes in principle his liability for the
lack of the conformity and does not intend to rely on the buyer’s failure to examine or a
resulting breach of the notification duty, can form the basis for either a waiver of the right
to rely on this failure or an estoppel.213 Examples include offers to remedy defects, which
were notified belatedly due to an untimely examination or negotiations concerning the
amount of damages due without invoking the delayed examination of the goods. However,
neither a waiver nor estoppel should be assumed lightly. In particular, in longer lasting
business relationships, parties rarely reject claims on the basis of purely formal arguments
without any discussion. Often it makes more commercial sense for the seller to remedy
minor defects than to rely on formal defences.214
The principle of good faith may also exclude the examination duty, limit its extent or 145
at least exclude reliance on its non-fulfilment. This may be the case where the seller has
behaved in such a way that the buyer can rely on the conformity of the goods. Mere
statements that the goods are conforming are not sufficient for such exclusion.215 The
same applies for certificates or other statements as to the conformity of the goods, such
as reports from the seller’s quality control. They may limit the extent of the buyer’s duty
to examine but will not completely free him from examining the goods.216 Such
documents only confirm the status of the goods at the time the third party examined
them. This is sufficient if such examination takes place at the time risk passes. Where
the documents refer to an earlier stage, however, there is always the possibility that the
goods became non-conforming at a later stage but before the time of delivery.
12. Burden of proof

In practice the question of whether the goods have properly been examined normally 146
only becomes relevant if the seller alleges that the buyer has lost his remedies for non-
conformity pursuant to Art. 39(1). Irrespective of this, as the orderly notice constitutes a
prerequisite for the buyer’s remedies, the buyer has to prove that he has notified the
seller within a reasonable time, which involves proving that on the basis of a reasonable
examination he should not “ought to have known of the lack of conformity” at an
earlier time.217
In such a situation the buyer has to prove either that the goods were examined “within 147
as short a time as practical” under the circumstances or that an orderly examination
212 See Landgericht Darmstadt (Germany) 9 May 2000 (video recorders and other electrical appliances),

213 Bundesgerichtshof (Germany) 25 November 1998 (surface protective film), CISG-Online 353 (Pace);
Arbitral Award, VIAC-Sch 4318, 15 June 1994 (rolled metal sheets), CISG-Online 120 (Pace).
216 See Thüringisches Oberlandesgericht (Germany) 26 May 1998 (live fish), CISG-Online 513 (Pace);
Oberster Gerichtshof (Austria) 28 June 2012 (seat belts), CISG-Online 2569 (Pace), paras 2 et seq.
Art. 38 para. 72; Handelsgericht Zürich (Switzerland) 30 November 1998 (lambskin coats), CISG-Online
415 (Pace) at 3 b; Oberlandesgericht Köln (Germany) 12 January 2007 (paperboard containers), CISG-
Online 1581 (Pace); U.S. District Court Northern District Illinois Eastern Division (U.S.) 21 May 2004
(pork ribs), Chicago Prime Packers, Inc. v Northam Food Trading Co., CISG-Online 851 (Pace).
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would not have revealed the defects. The first alternative entails proof of the facts leading
to the start of the period for examination, i. e. the delivery of the goods218, as well as that it
would not have been practical to examine the goods in a shorter time, if that is alleged by
the seller. Where the buyer, however, has taken longer than normally necessary, the buyer
has to prove that the time was nevertheless justified.219
148 Different views exist as to who bears the burden of proof for the fact that defects were
not discoverable via an orderly examination. The prevailing view is that the buyer who
wants to rely on the non-discoverability of the defects has to prove it.220 In such cases,
the period for notification starts to run from time the buyer has actual knowledge about
the non-conformity or could no longer have been unaware of it. This has to be proven
by the seller.
149 The buyer also has to prove the prerequisites of Art. 38 paras 2 and 3 if he wants to
rely on one of the exceptions from the general rule justifying a deferral of the
examination. In the context of Art. 38(2) this requires proof that the contract is one
involving carriage and that the goods are transported by an independent carrier.
Furthermore, the buyer has to prove the time when the goods arrived at their place of
destination and that they were examined there “within as short a time as practical”.221
150 In the context of Art. 38(3), the buyer has to prove that the other goods were sold in
transit or redispatched without an opportunity for examination. Furthermore, the buyer
has to prove that the seller knew and could not have been unaware of the fact that the
goods would be resold or redispatched when he entered into the contract.222 For this, it
will normally be sufficient to prove facts which indicate the option of transport to a new
destination.
III. Comparable Provisions

151 Due to their focus on general contract law, the PICC and the PECL do not contain
comparable provisions. By contrast, the PEL-Sales and the DCFR contain provisions
which are near-identically worded as Art. 38. The minor deviations primarily clarify the
question of sanctions and also contain slight differences in the applicable standards,
which may become important in practice depending on the interpretation given to such
standards. In both cases, however, such provisions are contained in the section dealing
with remedies and not in the section setting out the parties’ obligations. In these
instruments it is even more obvious that failure to examine will not give rise to remedies
but merely impose a burden, non-compliance of which will result in loss of remedies.
152 Art. 4:301 PEL-Sales and IV. A. – 4:301 DCFR both stipulate a duty for the buyer to
examine the goods “within as short a period as is reasonable in the circumstances”
referring to the general standard of reasonableness and not the standard of practicability
used in Art. 38. Furthermore, both state explicitly that a failure to examine the goods
“may result in the buyer losing [under the provisions for notification of defects] the
right to rely on the lack of conformity”. This leaves no doubt that there is no separate

220 Tribunale di Vigevano (Italy) 12 July 2000 (sheets of vulcanized rubber used in manufacture of shoe
soles), CISG-Online 493 (Pace); Landgericht Saarbrücken (Germany) 1 June 2004 (pallets), CISG-Online
1228 (Pace); Benicke, in: MünchKommHGB (2013), Art. 38 para. 17; for the opposite view Magnus, in:
222 Landgericht Frankfurt (Germany) 11 April 2005 (used shoes), CISG-Online 1014 (Pace); Magnus,
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sanction for non-compliance with the duty to examine the goods but rather that it may
be sanctioned in the context of the duty to notify the seller. In addition, the standard for
the seller’s knowledge about the redirection of the goods in Art. 38(3) (“ought to have
known”) is replaced by the standard of “could reasonably be expected to have known”.
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Article 39
(1) The buyer loses the right to rely on a lack of conformity of the goods if he does
not give notice to the seller specifying the nature of the lack of conformity within a
reasonable time after he has discovered it or ought to have discovered it.
(2) In any event, the buyer loses the right to rely on a lack of conformity of the
goods if he does not give the seller notice thereof at the latest within a period of two
years from the date on which the goods were actually handed over to the buyer, unless
this time-limit is inconsistent with a contractual period of guarantee.
Bibliography: Baasch-Andersen, Reasonable Time in Article 39(1) of the CISG – Is Article 39(1) Truly a
Uniform Provision?, Review on the Convention on Contracts for the International Sale of Goods (1998)
63 (Pace); Behr, Dealing with Non-Conformity-A Transaction Test Analysis of CISG Regulations on
(2008), p. 429; Flechtner, Buyer’s obligation to give notice of lack of conformity (Articles 38, 39, 40 and
44), in: Ferrari/Flechtner/Brand (eds), The Draft Digest and Beyond (2004), 377; Freiburg, Die Rügeo-
bliegenheit des Käufers bei grenzüberschreitendem Warenverkehr, IHR (2005) 56; Girsberger, The Time
Limits of Article 39 CISG, 25 Journal of Law and Commerce, (2005/2006) 241; Reitz, A History of Cutoff
Rules as a Form of Caveat Emptor: Part I – The 1980 U. N. Convention on the International Sale of
Goods, 36 American Journal of Comparative Law (1988) 437 (Pace); Schwenzer, The Noble Month
(Articles 38, 39) – The Story Behind the Scenery, 7 European Journal of Law Reform (2006) 353; Witz, A
Raw Nerve in Disputes relating to the Vienna Sales Convention: The Reasonable Time for the Buyer to
Give Notice of a Lack of Conformity, ICC Bulletin (2000/2) 15; CISG-AC Opinion no 1, Electronic
Communications under CISG, 15 August 2003. Rapporteur: Professor Christina Ramberg, Gothenburg,
Sweden (http://www.cisg-ac.org); CISG-AC Opinion no 2, Examination of the Goods and Notice of Non-
Conformity: Articles 38 and 39, 7 June 2004. Rapporteur: Professor Eric E. Bergsten, Emeritus, Pace
University School of Law, New York (http://www.cisg-ac.org).
Outline
1. General remarks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
2. Drafting history . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
3. Purpose of the notice requirement. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
4. Art. 39 as part of the CISG’s examination and notification regime. . . . . . . 10
1. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
3. Scope of application. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
4. Notice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
a) Form . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
b) Content of the notice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
aa) The notion of “notice” . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
bb) General considerations for the application of the specificity
requirement. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
cc) The standard as applied in practice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
dd) The seller’s good faith duty to enquire . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
c) Addressee and transmission . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
d) Timing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
aa) Single period or two periods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
bb) Start of the notice period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
(i) Discovery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
(ii) Hypothetical discovery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
(iii) Hidden defects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
(iv) Premature delivery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
(v) Discovery of defects before delivery . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
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cc) The length of the notice period: the notion of “reasonableness” . . 76
(i) General considerations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
(ii) Perishable and seasonal goods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
(iii) Other goods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79
(iv) Other relevant factors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
(v) Instalments contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
5. The two years cut-off date in Art. 39. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94
6. Consequence of a failure to give notice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100
7. Exceptions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 104
8. Waiver and exclusions of the right to invoke belated notice . . . . . . . . . . . . . . . 105
a) Explicit or implicit waivers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 106
b) Exclusion of the rights under good faith consideration . . . . . . . . . . . . . . . . . 116
9. Relationship with statutes of limitation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 119
10. Acceptance of the goods as conforming . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 123
11. Burden of proof . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 124
a) Dispatch of a proper notice. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 125
b) Timeliness of notice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 128

1. General remarks
Art. 39 is, by the number of published decisions, probably one of the most litigated 1
and thus practically relevant provisions of the CISG. This is primarily due to two
factors. First, Art. 39 relies on a number of broadly worded concepts, such as “reason-
able time” or “ought to have discovered”, which are prone to differing views in
practice.1 Second, buyers may have more problems in accepting the possible conse-
quences of Art. 39 than those of other provisions: to pay the full price for defective or
even non-usable goods2 may appear an unfair solution to many buyers, in particular if
they are not legally trained.
Art. 39 (1) makes the existence of remedies for the buyer for a lack of conformity 2
dependent upon proper notification to the seller, i. e. a notice “specifying the nature of
the lack of conformity within a reasonable time”. Thereby, Art. 39(1) de facto
establishes a duty for any buyer to properly notify the seller if he does not want to
lose his remedies. Art. 39(2) sets an absolute period of two years for notice under
Art. 39.
The harshness of the notice rule in Art. 39 is mitigated by Arts 40 and 44. They 3
contain exceptions from the general rule in Art. 39 and jointly with the latter embody
the delicate compromise reached during the drafting process in relation to the weight
given to the conflicting interests of the parties to a sales transaction. Pursuant to Art. 40
the seller may not rely on a failure to give notice if “the lack of conformity relates to
facts of which he knew or could not have been unaware and which he did not disclose
to the buyer”. Furthermore, where the buyer has a “reasonable excuse” for his failure to
give notice, pursuant to Art. 44, at least a reduction of the price to be paid or a claim for
certain damages may still be possible.
1
Flechtner, in: Ferrari/Flechtner/Brand, The Draft Digest and Beyond (2004), 377 (377 seq.).
2
See for example Landgericht Frankfurt (Germany) 11 April 2005 (used shoes), CISG-Online 1014
(Pace) where the used shoes bought and paid for even had to be destroyed at the expenses of the buyer
due to their bad quality.
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2. Drafting history
4 The notification regime, and in particular the sanction for any non-compliance with
the duty to notify contained in Art. 39, was one of the most controversial issues at the
diplomatic conference.3
5 This is largely due to the fact that national sales laws differ considerably on this issue.
On one side of the spectrum, Germanic systems impose strict requirements as to the
specificity and the timing of the notice, which has to be given immediately or without
delay and result in a complete loss of remedies.4 The other side of the spectrum is
marked by systems which do not provide for any examination or notification duty.
Systems such as the French system5 make up the middle ground, where claims have to
be brought within a short period of time (bref délai), but which lack a specific duty to
notify. The English system is another example, where the notification duty only exists
for certain remedies, i. e. avoidance.6 Under the UCC, notice has to be given within a
reasonable time and a loss of remedies only occurs where the belated notice is
prejudicial to the seller.7 To a large extent, these approaches reflect the difference in
weight given to the legitimate but conflicting interests of the parties. On the one side,
the seller has an interest in the finality of the transaction, and on the other the buyer has
an interest in being compensated for the seller’s failure to deliver conforming goods.
6 The conflict which arose during the drafting of the CISG is often represented as one
between developing and developed countries, however, more accurately, it is suggested
that it was one between countries whose legal systems contained a fairly strict notifica-
tion requirement and those which did not.8 Representatives from the latter states were
afraid that buyers established in their countries would not be aware of the notice
requirement and therefore would be unduly penalized for not giving notice by losing
their rights concerning the non-conforming goods. The proposal by Ghana to abolish
the examination and notification regime with its harsh sanction for non-compliance
was rejected. As a compromise, Art. 44 was included, preserving for buyers with a
“reasonable excuse for the failure to give notice” the right to reduce the price or to claim
damages, excluding those for loss of profit. As a result, the notification regime as
regulated in Arts 39, 40, 44 does not reproduce the provisions of a single system but is
an amalgam of elements from different systems.9
3. Purpose of the notice requirement

7 Art. 39 is primarily intended to protect the seller’s interest in not being submitted to
claims by the buyer for the non-conformity of the goods a considerable time after
3 Reitz, A History of Cutoff Rules as a Form of Caveat Emptor: Part I – The 1980 U. N. Convention on
the International Sale of Goods, 36 American Journal of Comparative Law (1988) 437 (441 seq.) (Pace).
4 See §§ 377, 378 German and Austrian Commercial Code (“without undue delay”); Art. 201 Swiss
Code of Obligations; the limit for giving notice is considered to be in normal cases three to five days.
5 France, Art. 1648 Civil Code; that was in part interpreted to mean two to three years; see the reference
at Schwenzer, The Noble Month (Articles 38, 39) – The Story Behind the Scenery, 7 European Journal of
Law Reform (2006) 353 (355).
6 S. 35(1) Sale of Goods Act.
7 US, UCC § 6–607(3)(a); for the different approaches see CISG-AC Opinion no 2, paras 2.1 et seq.
8 CISG-AC Opinion no 2, para. 3.4; Schwenzer, The Noble Month (Articles 38, 39) – The Story Behind
the Scenery, 7 European Journal of Law Reform (2006) 353 (356); for a detailed account of the drafting
history see Reitz, A History of Cutoff Rules as a Form of Caveat Emptor: Part I – The 1980
U. N. Convention on the International Sale of Goods, 36 American Journal of Comparative Law (1988)
437 (453 et seq.) (Pace).
9 Honnold/Flechtner, Uniform Law (2009), Arts 39, 40, 44 para. 255 footnote 2.
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delivery.10 The seller has, for various reasons, a substantial interest in being informed as
early as possible about the lack of conformity of the goods delivered. First, a prompt
notice facilitates for the seller the inspection and testing of the goods to ascertain
whether a claim raised is justified. The seller may wish to prepare himself for disputes
about the alleged non-conformity of the goods with the buyer or with his own suppliers
and secure necessary evidence for such disputes.11 At the same time, the notice
requirement limits the danger that the buyer bases his claims on defects which arose
after the passing of the risk and for which the seller is not liable, but which may, for
example, be due to an incorrect handling of the goods.12
Second, when the goods are defective, the requirement of an early notice should 8
enable the seller to take measures necessary to cure the existing deficiencies by sending
replacement goods, delivering missing parts or documents or repairing the goods.13
Furthermore, this notice gives the seller the opportunity to adjust his financial planning
in order to compensate for the alleged non-conformity. For example, costs resulting
from price reductions, claims for damages or efforts to cure existing defects have to be
reflected in the seller’s internal and external accounting.
While these considerations underlie the general inclusion of the notification regime, 9
the duty to notify the seller in a particular case exists, in principle, irrespective of
whether it is necessary to fulfil one of the above purposes.14 As for the CISG, in general,
the ultimate goal of the notification regime is to “validate the reasonable expectations of
the parties”.15 One of these is the seller’s expectation as to the finality of the transaction
after a certain time. This is recognized by the inclusion of Art. 39 without any
requirement of prejudice to the seller. Thus, the mere fact that a belated or insufficiently
specific notification has not led to any negative effects on the seller’s position does not,
as such, prevent the seller from relying on Art. 39.16 The absence of such negative effects
may, however, become a relevant factor in determining what constitutes a “reasonable
time” in a particular case or when time begins to run.
4. Art. 39 as part of the CISG’s examination and notification regime

As already indicated, Art. 39 is a central part of the CISG’s examination and 10
notification regime for the non-conformity of goods, comprising of the Arts 38, 39, 40
and 44. Its interpretation and application in practice should always occur in light of
these other provisions and vice versa.17 What constitutes a reasonable time for notice
Art. 38 para. 2; for a critical analysis of the functional arguments underlying Art. 39 see Reitz, A History
of Cutoff Rules as a Form of Caveat Emptor: Part I – The 1980 U. N. Convention on the International
Sale of Goods, 36 American Journal of Comparative Law (1988) 437 (443 et seq.) (Pace).
11 Benicke, in: MünchKommHGB (2013), Vorb. zu Arts 38, 39 para. 1; Oberlandesgericht Oldenburg
(Germany) 5 December 2000 (tiller (subsoiler)), CISG-Online 618 (Pace).

12 Honnold/Flechtner, Uniform Law (2009), Arts 39, 40, 44 para. 255; Magnus, in: Staudinger Kom-
mentar (2013), Art. 39 para. 3; cf. Oberster Gerichtshof (Austria) 27 August 1999 (trekking shoes), CISG-
Online 485 (Pace).
13 Oberlandesgericht Oldenburg (Germany) 5 December 2000 (tiller (subsoiler)), CISG-Online 618 (Pace).
14 Benicke, in: MünchKommHGB (2013), Vorb. zu Arts 38, 39 para. 1; Benicke, Rügeobligenheit und
Beweislast für Vertragswidrigkeit im UN-Kaufrecht, FS-Fachbereich Rechtswissenschaft zum 400jährigen

Gründungsjubiläum der Justus-Liebig-Universität Gießen (2007), 377 (382).
15 Flechtner, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 377 (385).
16 But see for such a proposition as the second step in a two step process Flechtner, in: Ferrari/
Flechtner/Brand, Draft Digest and Beyond (2003), p. 377 (387 seq.); see also U.S. Bankruptcy Court for the
District of Oregon (U.S.) 29 March 2004 (Christmas trees), In re Siskiyou Evergreen, Inc., CISG-Online
1174 (Pace) belated notice irrelevant as seller could not have remedied defects in Christmas trees.
17 See also Honnold/Flechtner, Uniform Law (2009), Arts 39, 40, 44 para. 254.
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depends in part on the interpretation of the examination requirement in Art. 38, which
largely determines when the buyer “ought to have known” about the non-conformity. A
strict interpretation of the former justifies a more lenient interpretation of the latter and
vice versa. Despite the clear division between the two periods in the text of the CISG,
the only period that is relevant for the notification duty is the overall period between
delivery and notice. Furthermore, the more the determination of what constitutes a
“reasonable time” under Art. 39 is influenced by subjective factors, the less the excep-
tion in Art. 44 needs to be considered.
11 Art. 39 is often criticized for its reliance on the vague concept of “reasonable time”.
This criticism is, however, hardly justified. As a comparison with the various national
sales laws shows, the diversity of potential factual settings requires the use of broad
concepts to allow for flexibility.18 Consequently, with few exceptions,19 the national sales
laws also rely on fairly broad concepts to determine the length of the notification
period.20 Moreover, the parties are always free, and normally in a much better position,
to provide for the required certainty by agreeing on a specific time for notification.
1. Introduction
12 The primary purpose of Art. 39 is to protect the interests of the seller in the finality of
transactions. Irrespective of that, in interpreting the various elements of Art. 39 it must
be remembered that justified claims of the buyer should not be excluded through overly
burdensome formalities. Art. 39 should not be transformed into an instrument to
restrict the buyer’s rights within a short period of time. In particular, judges should
resist the temptation to turn Art. 39 into an easy way to clear their docket by excluding
the buyer’s claims instead of entering an often tedious process of fact finding to
determine whether the goods are non-conforming or not.21 In the end, it is the seller
who has breached his contractual obligations and has delivered defective goods.
Consequently, it is not possible (although this can be seen in early German jurispru-
dence22) to adopt the same time periods or requirements as to the specificity of the
notice as under the ULIS or national law.23
13 The various concepts of Art. 39 have to be interpreted autonomously in accordance
with the requirements of Art. 7(1). Therefore, references to comparable concepts in
18 Flechtner, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 377; Behr, Dealing with
Non-Conformity – A Transaction Test Analysis of CISG Regulations on Examination and Notice under
Articles 38 through 44, in: Flechtner/Brand/Walter, Drafting Contracts (2008), p. 429 (438).
19 E. g. Article 1495 Italian Civil Code, according to which notice has to be given within 8 days.
20 US: § 2–602(1) UCC “reasonable time”; Germany: § 377 Commercial Code “without undue delay”;
Switzerland: § 201 Law of Obligations “without undue delay”; see also Behr, Dealing with Non-
Conformity-A Transaction Test Analysis of CISG Regulations on Examination and Notice under
Articles 38 through 44, in: Flechtner/Brand/Walter, Drafting Contracts (2008), p. 429 (437 seq).
21 Magnus, in: Staudinger Kommentar (2013), Art. 39 para. 4; see also Flechtner, in: Ferrari/Flechtner/
Brand, The Draft Digest and Beyond (2003), 377 (382 seq.) according to whom courts often used the
Art. 39 defence in cases where they had doubts as to the credibility of the buyer’s allegations as to the
non-conformity of the goods.
22 Oberlandesgericht Düsseldorf (Germany) 10 February 1994 (shirts), CISG-Online 116 (Pace); Ober-
landesgericht Oldenburg (Germany) 5 December 2000 (tiller (subsoiler)), CISG-Online 618 (Pace); fairly
short 14 days also Kantonsgericht Schaffhausen (Switzerland), 27 January 2004 (model locomotives),
CISG-Online 960 (Pace); for a criticism on such cases see Schwenzer, The Noble Month (Articles 38, 39)
– The Story Behind the Scenery, 7 European Journal of Law Reform (2006) 353 (357 seq.).
23 Cf. Ferrari, in: Ferrari et al. (eds), Internationales Vertragsrecht (2018), Art. 39 CISG para. 1.
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national laws should be treated with the outmost caution, in particular where this
national law adopts fixed deadlines for notices.24
This does not mean that usages and practices developed in certain countries cannot 14
be taken into account. This is particularly relevant in determining what constitutes a
“reasonable time” in the sense of Art. 39 or when the buyer “ought to have discovered”
the non-conformity. It is largely undisputed that subjective factors relating to the
particular parties involved play a role in interpreting and applying Art. 39. However,
practices developed in a completely different legal system, i. e. one which requires
immediate notice or notice without undue delay, cannot be imputed onto the CISG.
Such an approach would either be directly in contradiction with Art. 7 or would at least
defy the objective pursued by Art. 7. Irrespective of this, the background of the parties
and their expectations naturally play a role in applying the broad standards of Art. 39.

The notice requirement is subject to party autonomy, meaning that the parties may, 15
through their contractual provision, derogate from it.25 They may even completely
exclude any notification duty, which is not per se unfair or unreasonable.26 In light of
the seller’s interest in legal certainty, however, such a complete exclusion should not be
assumed lightly. Unless both parties come from legal systems which are unfamiliar with
notification duties, complete exclusion will usually require considerable bargaining
power by the buyer. In addition, the complete exclusion of a notification duty does not
at the same time exclude reliance on the duty to mitigate loss in Art. 77 in cases of
“belated” notice.
More often, the parties will fix time limits for the notification, deviating from those 16
under Art. 39, or impose requirements as to the form and the content of the notice.27
This is partly done through explicit regulation in the contract, or partly through
references to standard terms prepared for certain industries, such as the CO-
FREUROP-Rules for the European fruit and vegetable trade, which regulate the time
for examination and notification.28
The validity of such clauses should be determined on the basis of the applicable national 17
law. In particular, where stricter requirements are contained in standard terms, consider-
ably restricting the buyer’s rights for the delivery of non-conforming goods, courts may be
reluctant to enforce such rights. The standard against which such restrictions have to be
measured to determine whether they are unjustified is provided by Art. 39.29
Notice requirements arising from practices established between the parties or from 18
trade usages also supersede the regime of Art. 39.30 In particular, in the context of
24 In so far not convincing Juzgado Primero Civil de Primera Instancia del Distrito Judicial de Lerma de
Villada (Mexico) 3 October 2006 (foil trading cards), CISG-Online 1357 (Pace).
25 For unilateral waivers by the seller see infra paras 105 et seq.
(2008), p. 429 (451).
27 See for example: Landgericht Coburg (Germany) 12 December 2006 (plants), CISG-Online 1447
(Pace); Oberlandesgericht München (Germany) 11 March 1998 (cashmere sweaters), CISG-Online 310
(Pace) – 14 days; Appellationsgericht des Kantons Tessin (Switzerland) 8 June 1999 (wine bottles), CISG-
Online 497 (Pace); for a possible extension of the cut-off period in Art. 39(2) see Oberster Gerichtshof
(Austria) 19 December 2007 (laminated glass), CISG-Online 1628 (Pace).
28 See e. g. Oberster Gerichtshof (Austria) 30 June 1998 (pineapples), CISG-Online 410 (Pace) dealing
with the 12 hours notice period in the COFEUROP.

30 Oberster Gerichtshof (Austria) 21 March 2000 (wood), CISG-Online 641 in relation to the Tegern-
seer-Bräuche for the wood trade which provide for a 14 day notification period.
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usages in the sense of Art. 9(2), it always has to be verified that it is not merely a local
custom but one observed in international trade.
3. Scope of application
19 The notice requirement applies to any type of non-conformity in the sense of Art. 35
and in relation to every single non-conformity.31 Consequently, the buyer has to give
notice about any deviation in quality, quantity, nature and packaging upon which he
wants to rely. That applies irrespective of the extent of the deviation, whether the non-
conformity is obvious or whether it constitutes a hidden defect only discovered at a later
stage after extensive examinations. Thus, in principle, obvious deviations in the nature
of the goods also have to be notified.32 In such cases, however, the buyer may often be
able to rely on the exception of Art. 40, as the seller could not have been unaware of the
lack of conformity of the goods. In case of hidden defects, the duty to notify arises with
their actual or potential discovery.
20 The notice requirement also applies to cases where a larger quantity was delivered
than agreed upon.33 The failure to give notice in such cases may result in an obligation
to pay for the excess quantity pursuant to Art. 52(2) second sentence.
21 The notice requirement equally extends to goods delivered in replacement of non-
conforming goods and other efforts of the seller to cure an originally existing lack of
conformity.34
22 Notwithstanding the fact that the wording of Art. 39 only refers to the “lack of
conformity of the goods”, it is suggested that it also applies to the non-conformity of
documents.35 In cross-border transactions documents play a crucial role. Often the goods
will be delivered by way of documents representing title to the goods, such as bills of
lading, or their value and usability will be affected by documents, such as certificates of
origin. Consequently, an extensive interpretation of Art. 39 covering defects in documents
seems justified. Additionally, such an interpretation would strengthen the seller’s right to
cure provided for in Art. 34. Such a right would be of little value if the buyer were not
under an obligation to inform the seller about the lack of conformity of the documents.36
23 Not covered by Art. 39 are other breaches of contract by the seller beyond the
delivery of non-conforming goods. Examples are belated delivery, breach of exclusivity
obligations or delivery at the wrong place.37 For defects in title, Art. 43 contains a
comparable notice requirement.
31 Oberlandesgericht Linz (Austria) 23 January 2006 (car), CISG-Online 1377 (Pace); Oberlandesgericht
München (Germany) 8 February 1995 (polypropolene plastic granulate), CISG-Online 142 (Pace);
Oberlandesgericht Celle (Germany) 10 March 2004 (commercial vehicles), CISG-Online 824 (Pace) aliud;
see also Bundesgericht (Switzerland) 13 November 2003 (used laundry machine), CISG-Online 840
(Pace), where a list of defects given by the buyer was interpreted to be exhaustive so that the general
reference to the “unusable machine” was not sufficient to cover other problems with the machine’s
functionality.
33 Oberlandesgericht Rostock (Germany) 25 September 2002 (frozen food), CISG-Online 672 (Pace).
34 Ferrari, in: Ferrari et al. (eds), Internationales Vertragsrecht (2018), Art. 39 CISG para. 4; Land-
gericht Oldenburg (Germany) 9 November 1994 (lorry platforms and belts), CISG-Online 114 (Pace);
Oberlandesgericht Koblenz (Germany) 3 June 2013 (ice cream), CISG-Online 2469 (Pace), p. 8.
35 Honnold/Flechtner, Uniform Law (2009), Arts 39, 40, 44 para. 256; Magnus, in: Staudinger Kom-
mentar (2013), Art. 39 para. 10; Ferrari, in: Ferrari et al. (eds), Internationales Vertragsrecht (2018),
Art. 39 CISG para. 5; Bundesgericht (Switzerland) 2 April 2015 (steel coils), CISG-Online 2592 (Pace),
para. 5.5; Amtsgericht Geldern (Germany) 17 August 2011 (corn), CISG-Online 2302 (Pace), para. I.2.d. –
concerning an invoice not complying with tax requirements; for the opposite view see supra Piltz in this
commentary), Art. 34 para. 4.
36 Honnold/Flechtner, Uniform Law (2009), Arts 39, 40, 44 para. 256.
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The notification duty applies to all sales contracts covered by the CISG. Conse- 24
quently, buyers in non-commercial sales transactions, which fall within the scope of
application of the CISG due to Art. 2(a), may also lose their rights if they do not give
notice in time. In determining what a reasonable time for notice is, however, the buyer’s
experience (or better inexperience) in such transactions can be taken into account.38
The various instalments of an instalment contract are treated, for the purpose of the 25
examination and notice requirements, as separate contracts. Consequently, the notice
requirement exists for every instalment. At the same time, a failure to give notice about
defects existing in a particular instalment will, in principle, only result in loss of
remedies for that instalment.39
The notice requirement has also been extended to concurrent remedies for tortious 26
liability which are based on the non-conformity of the goods. For example, claims for
damages under national law for the spread of an infection of fish introduced into the
existing stock of the buyer have been rejected as the buyer did not give notice within a
reasonable time as required by Art. 39.40
4. Notice
a) Form. The parties are in principle free to specify in which form a notice must be 27
given. However, courts may be reluctant to enforce form requirements agreed upon by
the parties where they are considered to be unreasonable.
In the absence of parties’ agreement to the contrary or equivalent usages and 28
practices in the sense of Art. 9, the notice may be given in any form.41 This can include
oral notices.42 This further applies in cases where both parties have their places of
business in countries which have declared a reservation under Art. 96 requiring form
for certain declarations. In other words, the notice in Art. 39 is not covered by Art. 96.43
For reasons of proof, it is advisable that the notice is given in written from, especially 29
in countries such as Serbia, where the translated national versions of the CISG (and for
that matter arbitral tribunals44) seem to require a notice in writing. In principle, notice
can be given orally or via telephone.45 However, in the latter cases the buyer may face

39Ferrari, in: Ferrari et al. (eds), Internationales Vertragsrecht (2018), Art. 39 CISG para. 6; in
exceptional situations the failure to notify the seller about existing defects may, however, also be
considered to constitute an amendment of the conformity requirements; see Art. 35 paras 58 et seq.
40 Thüringisches Oberlandesgericht (Germany) 26 May 1998 (live fish), CISG-Online 513 (Pace); for
that issue see also Köhler, Die Haftung nach UN-Kaufrecht im Spannungsverhältnis zwischen Vertrag
und Delikt (2003), pp. 135 et seq.
41 Ferrari, in: Ferrari et al. (eds), Internationales Vertragsrecht (2018), Art. 39 CISG para. 9; U.S.
Bankruptcy Court for the District of Oregon (U.S.) 29 March 2004 (Christmas trees), In re Siskiyou
Evergreen, Inc., CISG-Online 1174 (Pace); Oberster Gerichtshof (Austria) 15 October 1998 (timber),
CISG-Online 380 (Pace); Oberlandesgericht Linz (Austria) 23 January 2006 (car), CISG-Online 1377
(Pace); Appellationshof Bern (Switzerland) 11 February 2004 (wire and cable), CISG-Online 1191 (Pace).
42 Oberlandesgericht Graz (Austria) 11 March 1998 (timber), CISG-Online 670 (Pace) describing the
necessary content of such notices; Kingspan Environmental Ltd et al v Borealis A/S et al (United Kingdom)
[2012] EWHC 1147 (Comm) 1 May 2012 (borecene, polymer), CISG-Online 2391 (Pace), para. 994.
43 Ferrari, in: Ferrari et al. (eds), Internationales Vertragsrecht (2018), Art. 39 CISG para. 9; contro-
versial for a different view see Freiburg, Die Rügeobliegenheit des Käufers bei grenzüberschreitendem
Warenverkehr, IHR (2005) 56 (62).
44 Critical and with reference to arbitral case law under the arbitration rules of the Foreign Trade Court
of Arbitration attached to the Serbian Chamber of Commerce, Pavic/Djordjevic, Application of the CISG
before the Foreign Trade Court of Arbitration attached to the Serbian Chamber of Commerce – Looking
back at the latest 100 cases, 28 Journal of Law and Commerce (2009) 1 (37 seq.).
45 See also, albeit obiter dicta Oberster Gerichtshof (Austria) 15 October 1998 (timber), CISG-Online
380 (Pace); Landgericht Frankfurt (Germany) 9 December 1992 (shoes), CISG-Online 184 (Pace);
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difficulties in proving the notice if it is contested by the seller. The buyer may be
obligated to submit and eventually prove the date of the telephone call, the person with
whom it was conducted and the content of the notice.46
30 The notice has to be in the language of the contract. It may also be given in the
seller’s language or any other language which the seller understands.47 The person
giving the notice must be authorized to do so.48
b) Content of the notice
31 aa) The notion of “notice”. The notion of “notice” has to be understood literally.
Therefore, a mere notification of the non-conformity is in principle sufficient, as long as it
is clear that the buyer wants to object to the lack of conformity, i. e. had an intention to
make the seller aware of the non-conformity of the goods.49 In this sense, the buyer’s
declarations and behaviour have to be interpreted in light of Art. 8. This includes the
buyer’s subsequent behaviour, which may often be indicative of whether a certain
declaration was intended to constitute a notice of non-conformity or not. Where a buyer
has given notice of non-conformity, it can normally be assumed that he will make use of
remedies available to him rather than discussing methods of postponing his own payment
obligation or announcing payment.50 A mere order for new goods – as a consequence of
damages to goods delivered previously – will not be deemed sufficient to establish notice
if the seller cannot deduce from the information provided that the reason for the new
order is the result of a non-conformity, e. g. insufficient packaging.51 Equally insufficient is
the mere fact that the buyer refrains from further orders originally anticipated.52
32 The buyer is not required to determine within the notice period his choice of remedy
or whether to file proceedings. Also, unlike Art. 39(2) ULIS, there is no requirement for
the buyer to invite the seller to examine the goods.
33 bb) General considerations for the application of the specificity requirement.
Pursuant to Art. 39, the buyer has to specify “the nature of the lack of conformity”.
The requirements concerning the content of the notice in each particular case will be
Tribunale di Vigevano (Italy) 12 July 2000 (sheets of vulcanized rubber used in manufacture of shoe
soles), CISG-Online 493 (Pace).
46 Landgericht Frankfurt (Germany) 13 July 1994 (shoes), CISG-Online 118 (Pace); Landgericht
Stuttgart (Germany) 31 August 1989 (shoes), CISG-Online 11 (Pace); Landgericht Kassel (Germany)
22 June 1995 (clothes), CISG-Online 370 (Pace); for the requirements in case of an oral notice see also
Rechtbank Breda (Netherlands) 16 January 2009 (watermelon), CISG-Online 1769 (Pace) at. 3.12.
48 Oberlandesgericht München (Germany) 26 October 2016 (shoes), CISG-Online 2799, at I.3 where
such an authorization was probably lacking.

49 Oberlandesgericht Karlsruhe (Germany) 8 February 2006 (Hungarian wheat), CISG-Online 1328 (Pace)
where the particular lack of conformity was mentioned in passing in one letter but not pursued in the
following communications concerning the non-conformity; too far reaching in this regards Landgericht
München (Germany) 8 February 1995 (standard software), CISG-Online 203 (Pace) where the buyer’s
request for assistance in solving a problem with the software was not considered to be sufficient.
50 See Kantonsgericht Zug (Switzerland) 30 August 2007 (GMS Modules), CISG-Online 1722 (Pace)
where the subsequent email exchange showed that the buyer at the time did not consider the goods to be
non-conforming so that it was unlikely that he had notified the seller about the non-conformity in an
earlier email upon which he relied; see also Oberlandesgericht München (Germany) 10 January 2017
(shoes), CISG-Online 2800, where the alleged notice was contradicted by the announcement of further
payments.
Online 1642 (Pace); see also Hof van Beroep Gent (Belgium) 28 January 2004 (breeding sows and cages),
CISG-Online 830 (Pace) – information about medication for the sows delivered is no complaint about
their conformity.
52 Oberlandesgericht Koblenz (Germany) 3 June 2013 (ice cream), CISG-Online 2469 (Pace), p. 8.
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determined in light of the purpose of the notification duty.53 Its main function is to
inform the seller about the non-conformity and to give him the opportunity to verify
the claims raised, preserve necessary evidence and cure deficiencies. In particular, in
order to determine which steps should be taken to remedy deficiencies, the seller needs
information which goes beyond a mere statement that the goods are defective.54
Consequently, generic notices, which merely express discontent with the quality of 34
the goods or state their non-conformity without specifying at least the symptoms are
not sufficiently precise. Notices that are limited to general expressions such as referring
to the goods as a product of “poor workmanship,”55 or that they “do not conform to the
contractual specifications,”56 or “cannot be used”57 have been considered to be insuffi-
cient. Such formulations do not put the seller into a position to decide which steps have
to be taken. Often, they may even raise doubts as to whether the buyer is seriously
alleging that the goods are non-conforming or merely trying to avoid full payment. By
imposing a requirement regarding the specificity of the notice, the drafters of the CISG
made it clear that, at least in cases of a completely vague notice, it is not the seller’s duty
to ask for the necessary information once he has been informed about the non-
conformity. In principle, the onus is on the buyer.
On the other hand, the specificity requirements should not be overly onerous. This 35
has been clearly stated in Opinion No. 2 of the CISG Advisory Council and regularly
confirmed in case law.58 The specificity requirement must not be turned into a
formalistic trap to deprive the buyer of his claims for defective goods. Namely, it is not
always necessary to describe the exact nature and cause of the problem or give notice
which is “specific enough for the seller to identify the asserted defect without further
53 Honnold/Flechtner, Uniform Law (2009), Arts 39, 40, 44 para. 256; Landgericht Saarbrücken
(Germany) 26 March 1996 (furnishings for ice-cream parlor), CISG-Online 391 (Pace); Taschner, Die
Darlegung von Mängeln und der richtige Mängeladressat, IHR (2001) 61 (61 seq.).
54 Kantonsgericht Zug (Switzerland) 30 August 2007 (GMS Modules), CISG-Online 1722 (Pace) at 3.1;
Oberlandesgericht Graz (Austria) 11 March 1998 (timber), CISG-Online 670 (Pace); Landgericht Erfurt
(Germany) 29 July 1998 (shoe soles), CISG-Online 561 (Pace); Landgericht Stuttgart (Germany) 15 Oc-
tober 2009 (printing machine), CISG-Online 2019 (Pace); Oberlandesgericht München (Germany)
10 January 2017 (shoes), CISG-Online 2800; Kingspan Environmental Ltd et al v Borealis A/S et al
(United Kingdom) [2012] EWHC 1147 (Comm) 1 May 2012 (borecene, polymer), CISG-Online 2391
(Pace), para. 996.
55 Landgericht München (Germany) 3 July 1989 (fashion textiles), CISG-Online 4 (Pace); cf. Land-
gericht Coburg (Germany) 12 December 2006 (plants), CISG-Online 1447 (Pace) – reference to “poor
quality” in connection with plants not sufficient; Saarländisches Oberlandesgericht (Germany) 13 January
1993 (doors), CISG-Online 83 (Pace) – “miserable condition” not sufficient; Oberlandesgericht Frankfurt
(Germany) 18 January 1994 (shoes), CISG-Online 123 (Pace) – “defective in all makings” not sufficient.
56 Handelsgericht des Kantons Zürich (Switzerland) 30 November 1998 (lambskin coats), CISG-Online
415 (Pace); Bundesgericht (Switzerland) 2 April 2015 (wire rod), CISG-Online 2592 (Pace), para. 7.2.1.1.;
cf. for other insufficient notices of a comparable character Kantonsgericht Nidwalden (Switzerland)
3 December 1997 (furniture), CISG-Online 331 (Pace) “did not fulfil the obligations”, “wrong parts”,
“full of breakages”; Landgericht Saarbrücken (Germany) 26 March 1996 (furnishings for ice-cream
parlor), CISG-Online 391 (Pace); for further examples see DiMatteo et al., International Sales Law
(2005), p. 90.
57 Oberlandesgericht Oldenburg (Germany) 28 April 2000 (furniture), CISG-Online 683 (Pace); see also
Oberlandesgericht Brandenburg (Germany) 3 July 2014 (plants), CISG-Online 2543 (Pace), para. 31;
Oberlandesgericht Hamburg (Germany) 15 July 2010 (medical equipment), CISG-Online 2448 (Pace),
para. 1.a. – show problems; Oberlandesgericht München (Germany) 26 October 2016 (shoes), CISG-
Online 2799 at I.10 – generic references.
58 CISG-AC Opinion no 2, para. 5.14; Oberster Gerichtshof (Austria) 31 August 2010 (old timber),
CISG-Online 2236 (Pace), p. 12; Kingspan Environmental Ltd et al v Borealis A/S et al (United Kingdom)
[2012] EWHC 1147 (Comm) 1 May 2012 (borecene, polymer), CISG-Online 2391 (Pace), paras 996 seq.;
Bundesgericht (Switzerland) 2 April 2015 (wire rod), CISG-Online 2592 (Pace), para. 7.2.1.2.
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investigation.”59 Normally, pointing out the “symptoms” should be sufficient.60 If this

was not the case, buyers would be forced to carry the heavy burden of dissecting specific
problems of the non-conformity in matters where they lack technical knowledge. The
result would be that the risk of non-conforming goods, for which the seller is liable,
would be largely transferred to the buyer.61
36 In practice, courts – particularly in German speaking countries – have had a tendency
to impose specificity requirements that are too strict. This may in part be due to the
official German translation of the CISG which, although it should yield to the official
language versions, is stricter in its wording.62 Consequently, statements such as the
fabrics delivered “billow out after washing and do no longer hang properly,” or the
facade stones were “not properly labelled in relation to their size” should be sufficient.63
It is equally sufficient if the buyer, who has often only examined samples, gives a rough
estimate as to the number of defective goods, even if this estimate in the end turns out
to be wrong.64 The buyer is only required to inform the seller about the type and scope
of the non-conformity in a way which allows him to understand roughly what is non-
conforming. However, the buyer must keep in mind that the notice will not cover
additional defects not referenced in the original notice.65
37 cc) The standard as applied in practice. The standard for determining the required
specificity of the notice is a mixed one comprising of objective and subjective
components.66 The main objective factors are the nature of the goods in question
and the existing non-conformity. Relevant subjective elements are the goods in
question, in particular, the buyer’s knowledge and experience with the goods in
question. A more detailed description of the defects may be required from a buyer
who is experienced in the business and produces comparable goods himself, than from
a mere trader.67 The seller’s status is also relevant. A producer of goods will more
likely be in the position to deduce the probable causes of the deficiency from a simple
description of the symptoms than a seller who is a mere intermediary. Cultural
differences may also play a role.68
59 For such a requirement Landgericht Saarbrücken (Germany) 2 July 2002 (tiles), CISG-Online 713 (Pace).
60 Oberlandesgericht Koblenz (Germany) 14 September 2006 (bottles), CISG-Online 1408 (Pace) –
information that the foil used for sterile packaging had been torn considered to be sufficient; Kingspan
Environmental Ltd et al v Borealis A/S et al (United Kingdom) [2012] EWHC 1147 (Comm) 1 May 2012
(borecene, polymer), CISG-Online 2391 (Pace), paras 998 et seq.
62 See Bundesgericht (Switzerland) 13 November 2003 (used laundry machine), CISG-Online 840
(Pace), which nevertheless then opted for a very restrictive interpretation as correctly criticized by
Mohs, IHR (2004) 219 (Pace).
63 Ferrari, in: Ferrari et al. (eds), Internationales Vertragsrecht (2018), Art. 39 CISG para. 14; for a
different view Landgericht Regensburg (Germany) 17 December 1998 (cloth), CISG-Online 514 (Pace);
Landgericht Köln (Germany) 30 November 1999 (stones for facades), CISG-Online 1313 (Pace); cf.
Bundesgericht (Switzerland) 28 May 2002 (lumber), CISG-Online 676 (Pace).
415 (Pace) at 4 b, aa.

66 Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 39 para. 7; Ferrari, in: Ferrari et al.
(eds), Internationales Vertragsrecht (2018), Art. 39 CISG para. 12; Kantonsgericht Zug (Switzerland)
30 August 2007 (GMS Modules), CISG-Online 1722 (Pace).
67 Obergericht des Kantons Zug (Switzerland) 19 December 2006 (stove), CISG-Online 1427 (Pace);
Kantonsgericht Zug (Switzerland) 30 August 2007 (GMS Modules), CISG-Online 1722 (Pace); Kingspan
Environmental Ltd et al v Borealis A/S et al (United Kingdom) [2012] EWHC 1147 (Comm) 1 May 2012
(borecene, polymer), CISG-Online 2391 (Pace), para. 997.
68 Brunner, Kommentar (2014), Art. 39 para. 4; Schwenzer, in: Schlechtriem/Schwenzer, Commentary
(2016), Art. 39 para. 7; see also Oberlandesgericht Schleswig (Germany) 22 August 2002 (live sheep),
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Where an examination has taken place, the buyer normally has to inform the seller 38
about the relevant findings of the examination.69 The requirement as to the specificity
depends on the extent of the examination required.70 The requirements are naturally
lower where a representative of the seller has been present during the examination.71 In
such cases, the seller is, in general, sufficiently informed about the non-conformity and
thus the main purpose of the specificity requirement is fulfilled.
The requirements as to the specificity may be higher for obvious defects, which are 39
easy to describe, such as the complete lack of documentation, than for complex goods.72
For the latter, it is generally sufficient if the buyer informs the seller about the
symptoms discovered. By contrast, the buyer will not be required to notify the seller of
the underlying cause of such symptoms.73 This goes beyond the technical capacity of
numerous buyers and would unduly burden the buyer.
Where the defective goods form part of a larger delivery, the buyer may be required 40
to specify them further where that is necessary for the seller to determine which steps to
take. For example, where a particular delivery contains comparable goods of a different
design, the buyer may have to specify which of those goods are non-conforming.74 In
such cases, however, the seller often has a duty of good faith to ask for further
specification in order to determine details such as the exact serial number of the non-
conforming goods.75 A notice given in relation to a specific quantity does in general not
cover the remainder of the goods.76 In relation to bulk sales or the delivery of a larger
quantity of identical goods, a rough estimate as to the quantity of defective goods is
sufficient. Requiring the specification of the exact amount of defective goods would
unduly burden the buyer.77
69 Landgericht Erfurt (Germany) 29 July 1998 (shoe soles), CISG-Online 561 (Pace); Kingspan Environ-
mental Ltd et al v Borealis A/S et al (United Kingdom) [2012] EWHC 1147 (Comm) 1 May 2012
(borecene, polymer), CISG-Online 2391 (Pace), para 996.
70 Oberster Gerichtshof (Austria) 14 January 2002 (cooling system), CISG-Online 643 (Pace), where due
to the seller’s delay in delivery the examination still made it only possible for the buyer to tentatively
describe the defect in design.
71 Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 39 para. 8; for a different view,
giving insufficient weight to the purpose of the specificity requirement see Bundesgericht (Switzerland)
13 November 2003 (used laundry machine), CISG-Online 840 (Pace), correctly criticized in this respect in
the comment to the decision by Mohs, IHR (2004) 219 (Pace).
72 Bundesgerichtshof (Germany) 4 December 1996 (printing system and software), CISG-Online 260
(Pace) very strict but explainable on the basis of the particular facts.
73 CISG-AC Opinion no 2, para. 5.14; Bundesgerichtshof (Germany) 3 November 1999 (machine for
producing hygienic tissues), CISG-Online 475 (Pace); Bundesgericht (Switzerland) 13 November 2003
(used laundry machine), CISG-Online 840 (Pace); Tribunal Cantonal du Valais (Switzerland) 21 February
2005 (CNC machine), CISG-Online 1193 (Pace); Kingspan Environmental Ltd et al v Borealis A/S et al
(United Kingdom) [2012] EWHC 1147 (Comm) 1 May 2012 (borecene, polymer), CISG-Online 2391
(Pace), paras 998 et seq.
74 Oberlandesgericht Koblenz (Germany) 31 January 1997 (acrylic blankets), CISG-Online 256 (Pace);
critical to that decision Magnus, in: Staudinger Kommentar (2013), Art. 39 para. 24; Oberlandesgericht
Hamburg (Germany) 15 July 2010 (medical equipment), CISG-Online 2448 (Pace), para. 1.a.; for the
requirements if goods are delivered in several instalments Cour de cassation (France) 27 November 2012
(cooktops), CISG-Online 2403 (Pace), p. 4.
75 For such a requirement Landgericht Marburg (Germany) 12 December 1995 (agricultural machine),
CISG-Online 148 (Pace); critical to that decision Flechtner, in: Ferrari/Flechtner/Brand, The Draft Digest
and Beyond (2003), 377 (382).
76 Oberlandesgericht Koblenz (Germany) 3 June 2013 (ice cream), CISG-Online 2469 (Pace), p. 9.
77 Taschner, Die Darlegung von Mängeln und der richtige Mängeladressat, IHR (2001) 61; too strict
Landgericht Köln (Germany) 30 November 1999 (stones for facades), CISG-Online 1313 (Pace).
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41 By contrast, a notice in relation to a lack of quantity must contain the exact number
or amount missing,78 otherwise, the seller would not know how much more has to be
delivered. In principle, the same applies to the delivery of an excess quantity which the
buyer does not want to keep.79
42 The standard of specificity may be lower, if, due to the specific characteristics of the
goods, a cure is for the most part impossible and the seller is most likely aware of the
non-conformity.80 In these cases, the sole purpose of a notice is to inform the seller that
the buyer may invoke remedies, for which the seller might want to secure evidence.
43 It follows from the specificity requirement that a detailed notice about a particular
lack of conformity will not preserve the buyer’s remedies for other non-conformities.
The buyer has to give notice about each particular deficiency upon which he wants to
rely.81 Thus, complaints about the quality of the goods do not preserve remedies arising
from defective packing and vice versa.82 Questions as to the content of the notice may
arise in cases where a detailed list of particular defects is supplemented by a general
reference that the machine is unusable. In such cases, the notice of non-conformity has
to be interpreted on the basis of Art. 8 to determine whether the list of defects given is
meant to be exhaustive, or is merely exemplary.83 Even in the latter, a broad reference
will probably not be sufficiently specific to cover other completely different defects not
listed.
44 Ambiguities within the notice are to the detriment of the party giving the notice.84
Often, however, where the initial notice is ambiguous, the seller will be under a good
faith duty to ask the buyer for clarification.
45 In instalment contracts, in principle, every instalment has to be treated separately in
relation to the non-conformity of the goods delivered and the notification thereof.85
Irrespective of this, it has to be acknowledged that notifications for later instalments do
not occur in a vacuum. In particular, where the goods delivered come from the same
78 Ferrari, in: Ferrari et al. (eds), Internationales Vertragsrecht (2018), Art. 39 CISG para. 15; rough
percentage sufficient Oberlandesgericht Brandenburg (Germany) 3 July 2014 (plants), CISG-Online 2543
(Pace), para. 30.
79 Landgericht Köln (Germany) 5 December 2006 (plastic faceplates for mobile telephones), CISG-
Online 1440 (Pace).

80 U.S. Bankruptcy Court for the District of Oregon (U.S.) 29 March 2004 (Christmas trees), In re
Siskiyou Evergreen, Inc., CISG-Online 1174 (Pace).

81 Ferrari, in: Ferrari et al. (eds), Internationales Vertragsrecht (2018), Art. 39 CISG para. 16; Oberlan-
desgericht Celle (Germany) 10 March 2004 (commercial vehicles), CISG-Online 824 (Pace) notice about
delivery of a “wrong” vehicle does not preserve the remedies for other defects relating to the quality of the
vehicle; Oberlandesgericht Düsseldorf (Germany) 30 June 2015 (jeans), CISG-Online 2731, at II. 4. a. bb;
Oberlandesgericht Linz (Austria) 23 January 2006 (car), CISG-Online 1377 (Pace); cf. Oberster Gerichtshof
(Austria) 27 August 1999 (trekking shoes), CISG-Online 485 (Pace); Bundesgericht (Switzerland) 13 No-
vember 2003 (used laundry machine), CISG-Online 840 (Pace), however, giving not sufficient weight to
the fact that in the case there had been a joint examination of the machine which should have made the
seller aware of the other defects which were not notified.
82 Bundesgerichtshof (Germany) 8 March 1995 (New Zealand mussels), CISG-Online 144 (Pace); see
also Landgericht Stuttgart (Germany) 15 October 2009 (printing machine), CISG-Online 2019 (Pace);
Danish Maritime and Commercial Court (Denmark) 31 January 2002 (fish (mackerel)), CISG-Online 679
(Pace) notice concerning the type of goods does not cover the production date and quality; Bundesgericht
(Switzerland) 2 April 2015 (wire rod), CISG-Online 2592 (Pace), para. 7.2.2 notice referring to broken
packing bands does not extend to defects in the goods.
83 Bundesgericht (Switzerland) 13 November 2003 (used laundry machine), CISG-Online 840 (Pace).
84 Bundesgerichtshof (Germany) 4 December 1996 (printing system and software), CISG-Online 260
(Pace) – the notice given that the documentation for the “printer” was missing could either refer to the
whole printing unit sold, composed of four components, or to the printer as such as a single component.
85 For separate deliveries see also Oberlandesgericht München (Germany) 10 January 2017 (shoes),
CISG-Online 2800 – specification required which shoes in which delivery were non-conforming.
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source and are affected by the same type of non-conformity, a notice has to be
interpreted in light of previous notifications relating to earlier instalments. Thus,
notifications which by themselves would not meet the specificity requirements can do
so if read in conjunction with earlier notices.
dd) The seller’s good faith duty to enquire. The inclusion of the specificity require- 46
ment into Art. 39 clarifies that, in principle, the onus for giving a sufficiently specific
notice is on the buyer. At the same time, the seller is, pursuant to Art. 7, under a general
duty to act in good faith. Consequently, sellers faced with a notice which is not limited
to a general expression of discontent with the goods but gives indications as to the type
of non-conformity may not just sit back and do nothing.86 Such notices fulfil the
primary purpose pursued with the notice requirement: they inform the seller that the
buyer seriously considers the goods to be non-conforming. To consider such notices as
being void of any legal consequence in preserving the buyer’s remedies would render
the notice requirement an end initself, constituting a formalistic obstacle to justified
claims for non-conforming goods. Hence, in such cases the seller is under a duty of
good faith to ask the buyer for further details concerning the lack of conformity. This is
even more so where a cure is an option, as the seller normally knows much better which
information is needed in order to take the necessary actions. A failure to do so will
prevent the seller from relying on the failure to sufficiently specify the notice.87
This is not contrary to the allocation of tasks and risk under Art. 39 or the 47
notification regime in general. The inherent flexibility of the standard allows the
consideration of the developments of the information technology since the drafting of
the CISG While in 1980 such enquiries may have constituted a burden for the seller and
therefore could not be required under good faith, this is no longer the case. Telephone,
fax and Internet are now readily available to nearly every seller active in international
business and allow, in most cases, easy and immediate communications. The CISG, in
Art. 7, acknowledges a general duty for the seller to act in good faith. However, as
required by Art. 39, in the end, the risk for the lack of specificity remains with the
buyer. The buyer will lose his remedies for non-conformity under Art. 39 if – upon
request of the seller – the necessary information is not provided within due time.88
Thus, contrary to a widely held view,89 a buyer who has not sufficiently specified the 48
non-conformity in his original timely notice may rectify that lack of specificity within a
short time, even after the date for notice has passed.90
c) Addressee and transmission. The notice has to be addressed to the seller or any 49
other person entitled to receive notices for the seller. Which persons fulfil that
requirement is not regulated in the CISG and should be determined on the basis of the
applicable national law.91 In general, giving notice to the seller’s local representatives or
other persons who the seller uses to fulfil his contractual duties should be sufficient.
86Flechtner, in: Ferrari/Flechtner/Brand, The Draft Digest and Beyond (2003), 377 (381).
87Bundesgericht (Switzerland) 13 November 2003 (used laundry machine), CISG-Online 840 (Pace);
see also Behr, Dealing with Non-Conformity – A Transaction Test Analysis of CISG Regulations on
(2008), p. 429 (456 seq.).
88 Oberlandesgericht Oldenburg (Germany) 28 April 2000 (furniture), CISG-Online 683 (Pace).
90 Flechtner, in: Ferrari/Flechtner/Brand, The Draft Digest and Beyond (2003), 377 (380 seq.).
91 Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 39 para. 14; Taschner, Die Darle-
gung von Mängeln und der richtige Mängeladressat, IHR (2001) 61 (62) with the correct approach under
Art. 7; for a different view see Freiburg, Die Rügeobliegenheit des Käufers bei grenzüberschreitendem
Warenverkehr, IHR (2005) 56 (62).
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50 Notices to independent commercial agents who have been involved in the transaction
are problematic. These agents can only be considered to be an authorized addressee
where their involvement goes beyond the contract formation phase and extends to the
performance phase. By contrast, an independent carrier or the seller’s driver will not
normally be considered to be entitled to receive notices for the seller. They can only be
used as messengers, which then raises the question of whether they constitute “appro-
priate means”.
51 Equally, notices to the producer or companies belonging to the same group of
companies may not be sufficient unless the seller receives the information from them
within a reasonable time under Art. 39.92
52 The notice, in the sense of Art. 39, falls within the ambit of Art. 27.93 Consequently,
whenever it is made by means appropriate in the circumstances, the recipient bears the
risk of loss, delay or corruption during the transmission process.94 In the absence of an
agreement to the contrary or other special circumstances, appropriate means comprise
telex, fax and emails.95 Where the seller fails to communicate his new address, a delay
resulting from the sending of the notice to the old address is covered by Art. 27.96
53 In order to comply with the notice period, it is both sufficient and necessary for the
notice to be sent in a way, as to allow its arrival on time under normal circumstances.
Notices sent before the expiry of the time limit, but not sent so as to arrive on time
under the normal circumstances, will not be sufficient.97
54 d) Timing. Art. 39(1) requires that notice be given “within a reasonable time” after
the buyer has discovered the defects or ought to have discovered them. The standard
presents a compromise between the more rigorous standard, primarily found in the
Germanic legal systems (without delay) and the more lenient standard, found in
numerous other systems.98 What constitutes a “reasonable time” in the sense of
Art. 39 depends on the circumstance of each particular case.
55 These circumstances may include practices established between the parties as well as
usages in the sense of Art. 9, which exist in a number of industries.99 On a proper
analysis, however, such usages often will not only constitute factors to be considered in
determining what is “reasonable” under the Art. 39(1) standard, but will also replace
92 Landgericht Bielefeld (Germany) 15 August 2003 (strapping machine), CISG-Online 906 (Pace);
Hoge Raad (Netherlands) 4 February 2005 (panels for construction of green house), CISG-Online 1003
(Pace).
93 Ferrari, in: Ferrari et al. (eds), Internationales Vertragsrecht (2018), Art. 39 CISG para. 18; Schwen-
zer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 39 para. 11; Oberster Gerichtshof (Austria)
24 May 2005 (grinding stock), CISG-Online 1046 (Pace); Oberlandesgericht Koblenz (Germany) 19 Octo-
ber 2006 (short sleeves t-shirts), CISG-Online 1407 (Pace); Oberlandesgericht München (Germany)
17 November 2006 (dust ventilator case), CISG-Online 1395 (Pace); Appellationshof Bern (Switzerland)
11 February 2004 (wire and cable), CISG-Online 1191 (Pace).
94 Oberster Gerichtshof (Austria) 30 June 1998 (pineapples), CISG-Online 410 (Pace) – failure to receive
fax allegedly sent; Oberlandesgericht Graz (Austria) 11 March 1998 (timber), CISG-Online 670 (Pace).
95 For telefax see Oberlandesgericht Koblenz (Germany) 19 October 2006 (short sleeves t-shirts), CISG-
Online 1407 (Pace); for the use of email see CISG-AC Opinion no 1, para. 39.1 seq.
96 Oberlandesgericht München (Germany) 17 November 2006 (dust ventilator), CISG-Online 1395
(Pace).
415 (Pace) at 4 a, cc; Landgericht Düsseldorf (Germany) 25 August 1994 (fashion goods), CISG-Online
451 (Pace); controversial: for a different view – time of sending is relevant see Kantonsgericht Schaffhau-
sen (Switzerland) 27 January 2004 (model locomotives), CISG-Online 960 (Pace).
the International Sale of Goods, 36 American Journal of Comparative Law (1988) 437 (462 seq.) (Pace).
99 Tribunale di Rimini (Italy) 26 November 2002 (porcelain tableware), CISG-Online 737 (Pace);
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this standard.100 Depending on the trade involved, such usages may require notice
within hours, as is the case in the trade of fresh fruit; within a day, as is required in the
international flower trade; or after 14 days, as is required in the wood trade between
Germany and Austria.101
In principle, the time available for giving notice has to be determined for each defect 56
separately. This applies for the start of the period as well as its length. Thus, the expiration
of a time limit for a particular defect, which is for example obvious at the time of delivery,
does not necessarily mean that the buyer can no longer invoke remedies for other defects
which can only be discovered after a more thorough examination.102
The determination of what is reasonable in a particular case involves, to a certain extent, 57
the balancing of two competing interests.103 On the one hand, the buyer should not be
deprived of its remedies by imposing a very short period upon him. On the other hand, by
including Art. 39 into the CISG, the drafters recognized and legitimized the seller’s interest
in “clarifying the legal relationship between the parties as quickly as possible”.104
aa) Single period or two periods. The CISG clearly distinguishes between the period 58
for examination on the one hand and the period for giving notice on the other.105
They are regulated in different articles and their length is defined by different terms
(as short a period as is practicable v. reasonable time). In addition, Art. 39(1) states
that the notification period starts with the buyer’s knowledge of the non-conformity,
irrespective of whether the examination period already expired. This excludes, in
principle, the assumption of a single period for examination and notification, the
length of which is determined by an addition of the periods for examination and for
notification.
At the same time, the CISG does not provide for a separate sanction for non- 59
compliance with the duty to examine the goods within as short a time as practicable.
Consequently, in cases of belated examination the two different periods of examination
and notification may de facto be treated as a single period. As long as the buyer gives
notice within the timeframe determined by the addition of the two periods, he does not
lose his remedies.106 Hence he can cure a failure to examine the goods in time by an
immediate notification.107 Such treatment does not infringe the legitimate expectations
100 See for a thorough analysis of the relationship between the different standards Oberster Gerichtshof
(Austria) 21 March 2000 (wood), CISG-Online 641 relating to the Tegernseer Bräuche under which
notice has to be given within 14 days after examination.
101 See for the fruits, Oberster Gerichtshof (Austria) 30 June 1998 (pineapples), CISG-Online 410 (Pace);
Saarländisches Oberlandesgericht (Germany) 3 June 1998 (flowers), CISG-Online 354, 1 day in interna-
tional flower trade; Oberster Gerichtshof (Austria) 21 March 2000 (wood), CISG-Online 641.
102 See Appellationshof Bern (Switzerland) 11 February 2004 (wire and cable), CISG-Online 1191
(Pace).
103 Benicke, Rügeobligenheit und Beweislast für Vertragswidrigkeit im UN-Kaufrecht, FS-Fachbereich
Rechtswissenschaft zum 400jährigen Gründungsjubiläum der Justus-Liebig-Universität Gießen (2007),

377 (383 seq.).
104 Bundesgerichtshof (Germany) 8 March 1995 (New Zealand mussels), CISG-Online 144 (Pace).
105 Witz, A Raw Nerve in Disputes relating to the Vienna Sales Convention: The Reasonable Time for
the Buyer to Give Notice of a Lack of Conformity, 2 ICC Bulletin (2000) 15 (19); see also Oberlandesger-
icht München (Germany) 26 October 2016 (shoes), CISG-Online 2799, at I.11.
106 Oberlandesgericht Graz (Austria) 11 March 1998 (timber), CISG-Online 670 (Pace); but see for the
opposite view Landgericht Frankfurt (Germany) 11 April 2005 (used shoes), CISG-Online 1014 (Pace);
critical comment by Flechtner, Funky Mussels, a Stolen Car, and Decrepit Used Shoes: Non-Conforming
Goods and Notice thereof under the United Nations Sales Convention, Boston University International
Law Journal (2008) 1 (22 seq.) (Pace).
107 Bundesgerichtshof (Germany) 3 November 1999 (machine for producing hygienic tissues), CISG-
Online 475 (Pace); critical on the mere addition of the two periods Schlechtriem, Einheitskaufrecht in der
Rechtsprechung des Bundesgerichtshof, FS Bundesgerichtshof (2000), p. 407 (439 seq.) (Pace).
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of the seller. He is normally not aware of the buyer’s internal examination process and
therefore has to organize his planning on the basis of the expiration date of the
combined examination and notification period.
60 On a strict legal analysis, the requirement of “reasonable time” refers directly only to
the notice period as such. In practice, the term is often used in a way which covers the
complete time span from delivery of the goods until notice, including not only the
notice period as such but also the examination period under Art. 38.108 This is due to
the fact that the expiry of the latter is the relevant starting point for the notice period,
determining de facto also the date until which the notice has to be given at least in all
the cases where no proper examination took place. On such a broad understanding,
looking primarily at the result of fixing a point in time until which notice has to be
given, the “reasonable time” for giving notice is normally composed of the period for
examination under Art. 38 and a period for the buyer to notify the seller of the non-
conformity.109 In exceptional cases, where the defect is so obvious that it is apparent
even without any examination, no additional period for examination is granted.110
61 bb) Start of the notice period. The notice period starts to run when the buyer
“discovered or ought to have discovered” the non-conformity. It is always the earlier of
the two dates which is decisive, so that the actual discovery of the non-conformity may
not be relevant if it occurred belatedly. In principle, the start of the notice period must
be determined for each delivery separately.111
62 (i) Discovery. “Discovery” occurs when the buyer can be sufficiently sure about the lack
of conformity, so much so that a reasonable buyer would start legal actions to pursue his
rights.112 This is also the case where the symptoms discovered could only reasonably be
due to non-conformity. There is no need for absolute certainty. Thus, where the buyer has
already discovered, through his own examinations, that the goods are most likely defective,
he does not need to wait until an external expert has confirmed that view.113 The same
applies where the accompanying documents show that the goods delivered are not in
conformity with the contractual agreement. In the absence of indications to the contrary, a
buyer can normally assume that the documents reflect the goods delivered.
63 It is sufficient if the buyer is aware of the non-conformity as such. It is not required
that he also draws the necessary legal conclusions or is aware that the non-conformity
of the goods has detrimental effects.114
64 Questions as to the start of the notice period, or de facto its length, arise in the rare cases
where the buyer has discovered the lack of conformity before the expiry of the normal
examination period under Art. 38. This may be due to previous information as to a
108 Critical on this tendency Girsberger, The Time Limits of Article 39 CISG, 25 Journal of Law and
Commerce (2005/2006) 241 (241 seq.).

109 Tribunale di Rimini (Italy) 26 November 2002 (porcelain tableware), CISG-Online 737 (Pace).
110 Freiburg, Die Rügeobliegenheit des Käufers bei grenzüberschreitendem Warenverkehr, IHR (2005)
56 (58).
111 Cour de cassation (France) 27 November 2012 (cooktops), SMEG v. Rothelec, CISG-Online 2403
(Pace) p. 4.
112 Magnus, in: Staudinger Kommentar (2013), Art. 39 para. 32; Appellationshof Bern (Switzerland)
11 February 2004 (wire and cable), CISG-Online 1191 (Pace).

113 Landgericht Düsseldorf (Germany) 23 June 1994 (engines for hydraulic presses and welding
machines), CISG-Online 179 (Pace). However, the mere fact that an external expert is hired to examine
the goods is normally an indication that there were still considerable doubts as to the reasons for a failure
of the goods.
114 Gerechtshof Arnhem (Netherlands) 18 July 2006 (potting soil), CISG-Online 1266 (Pace) where the
non-conformity was apparent from the relevant documents which clearly stated that the soil did not
contain the agreed upon amount of clay.
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potential lack of conformity or because the buyer examined the goods before their arrival at
the place of destination, even though he benefited from an extension in Art. 38(2).
According to Art. 39, the notice period always starts with the discovery of the defect. 65
Consequently, a buyer who has discovered the non-conformity of the goods several days
before the expiry of the examination period may not add these days to the length of his
notification period. The unequivocal wording of Art. 39 leaves no room to extend the
position adopted for the opposite situation (i. e. the belated discovery of defects) to these
cases and to focus solely on the end date at which notice under normal circumstances
must be given.115 As the law clearly distinguishes between the two periods, it is not
possible to add time gained through a “pre-mature” examination to the notice period.
The de facto treatment of both periods as a single period in the opposite situation is
justified by the lack of a separate sanction for a belated examination. Moreover, there is
also no need for additional protection of the buyer. He is expected to give notice within
a reasonable time after he discovers the defects.116
The same applies where the non-conformity is discovered before the seller has fully 66
delivered the goods. For example, the buyer may realize that the machinery to be
installed is non-conforming before the seller has actually installed it.117
An exception should be made for cases where the buyer “pre-maturely” discovers 67
that a certain quantity is missing, but has not yet had a possibility to examine the goods
for their quality. The notice period should only start to run after the buyer has had the
chance to examine the goods within the normal period granted by Art. 38 for their
quality. It makes little sense for the seller to deliver the missing goods if they suffer from
the same defects as the goods delivered, which could probably be better remedied at the
seller’s place of business.
(ii) Hypothetical discovery. For the second alternative, i.e. “ought to have discovered”, 68
the start of the notice period depends on whether the non-conformity was discoverable
through the required examination or not, for example, where the goods suffer from
hidden defects. If the non-conformity was discoverable, in principle, the notice period
starts directly after the expiry of the examination period under Art. 38. This is when the
buyer, through a proper examination, should have discovered the existing non-con-
formity. This alternative is primarily relevant in all cases where the buyer has either not
examined the goods at all or has done so insufficiently or belatedly.
The time of hypothetical discovery is also relevant in cases where the buyer, after 69
having notified obvious defects, did not make the necessary further examinations which
would have led to the discovery of other defects.118
(iii) Hidden defects. In case of hidden defects, i. e. defects which are not discoverable 70
through the required orderly examination at the time of delivery, the notice period
starts either with the subsequent discovery of such defects or when they ought to have
115 In favour Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 39 para. 19; Ferrari, in:
Ferrari et al. (eds), Internationales Vertragsrecht (2018), Art. 39 CISG para. 20; Behr, Dealing with Non-
Conformity – A Transaction Test Analysis of CISG Regulations on Examination and Notice under
Articles 38 through 44, in: Flechtner/Brand/Walter, Drafting Contracts (2008), p. 429 (439); Tribunal
Supremo (Spain) 17 January 2008 (used automobiles), CISG-Online 1640 (Pace).
116 Behr, Dealing with Non-Conformity-A Transaction Test Analysis of CISG Regulations on Exam-
ination and Notice under Articles 38 through 44, in: Flechtner/Brand/Walter, Drafting Contracts (2008),
p. 429 (439).
117 For a different view Freiburg, Die Rügeobliegenheit des Käufers bei grenzüberschreitendem Ware-
nverkehr, IHR (2005) 56 (59) who requires completion of delivery for the start of the notice period as
until that time the seller may still cure the defects.
118 The buyer may, however, in certain circumstances be able to rely on Art. 44; for details see Art. 44.
para. 23.
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been discovered.119 The reason for the discovery or the constructive discovery is
irrelevant. In practice, it is mainly due to either the use of the goods by the buyer or
complaints by the latter’s customers.120
71 In relation to hidden defects, it is necessary to distinguish between the discovery of
the non-conformity as such and the discovery of its symptoms. Notwithstanding that
the latter will often imply the former, this is not always the case. There may be cases
where the symptoms discovered, i. e. the relevant event or defect, may at the time of
their discovery have several potential causes. For example, it may not be certain whether
the failure of a machine is due to an operating mistake by the buyer’s personnel or to a
hidden defect in the machine or parts delivered. In such cases, the failure of the
machine cannot automatically be equated with the discovery of the hidden non-
conformity. Thus, this discovery will trigger the start of the examination period rather
than the notice period.121 The same applies where subsequent events merely raise
doubts as to the conformity of the goods and do not yet prove it. Examples include
general articles in newspapers alleging health risks or the use of inappropriate compo-
nents or production processes or generally accusing the seller of fraudulent behaviour.
Such reports only set in motion the examination period under Art. 38 and not the
notice period.122 The same applies for complaints by customers.123
72 By contrast, once the actual non-conformity has been discovered, i. e. the hidden or
latent defect has turned into an obvious non-conformity, there is no additional
examination period.
73 (iv) Premature delivery. In cases of premature delivery by the seller, the prevailing
view is that the notice period only starts with the agreed date of delivery. The under-
lying rationale is that the buyer should not be deprived of existing rights due to the
premature delivery, for which he was not prepared. This is especially so as the seller is
granted the right to cure defects.124
74 (v) Discovery of defects before delivery. In the context of sales contracts requiring
installation of the goods, the buyer may discover the non-conformity of the goods
before the final installation, i. e. before the passing of the risk which is relevant for the
conformity of the goods. In such cases, the start of the notification period depends on
whether the buyer could reasonably expect that the seller would remedy the existing
deficiency before delivery or not.
75 It is not uncommon that the buyer first makes a superficial examination for obvious
defects before shipment and then have the goods thoroughly examined after their
arrival. In such cases, the notice period for obvious defects which should have been
119 Arbitral Award, Arbitration Court attached to the Hungarian Chamber of Commerce and Industry,
5 December 1995 (waste-containers), CISG-Online 163 (Pace); controversial; see the discussion at Art. 38
paras 62 et seq.
120 For the latter case, Oberlandesgericht München (Germany) 26 October 2016 (shoes), CISG-Online
2799, at I.11.
Online 475 (Pace); see also Handelsgericht des Kantons Bern (Switzerland) 17 January 2002 (grapefruit
seed extract), CISG-Online 725 (Pace).
122 Bundesgerichtshof (Germany) 30 June 2004 (paprika), CISG-Online 847 (Pace); cf. Landgericht
Saarbrücken (Germany) 1 June 2004 (pallets), CISG-Online 1228 (Pace) – report by customs authorities
that the goods were of a different origin than alleged.
123 Oberlandesgericht München (Germany) 26 October 2016 (shoes), CISG-Online 2799, at I.12 –
examination as to the reasons why th shoes lost colours.

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discovered by the initial examination starts with the end of this examination. In such
cases Art. 38(2) applies only to defects discoverable by a thorough examination.125
cc) The length of the notice period: the notion of “reasonableness”
(i) General considerations. The “reasonableness” of the time for notice depends on a 76
number of objective and subjective factors.126 The type of the goods involved and the
parties concerned are of primary relevance. In addition, various other factors which
influence the time for examination may become relevant. The differences in the length
of the notification period resulting from such factors are, however, much smaller than
within the context of examination. The activities required for giving notice, i. e.
composing a notice describing the defects and transmitting it, are much less diversified
than for an examination, where they range from a mere visual inspection to complicated
chemical and physical tests or trial runs. Consequently, the subjective abilities of the
buyer and the surrounding circumstances are of lesser importance to the composition
and transmittal of the notice than to the examination. In light of the fact that giving
notice entails, in most cases, a largely comparable activity by the buyer, it is much easier
to provide for a median time for notices than for examinations.
(ii) Perishable and seasonal goods. For perishable goods, such as fresh fruits, vegetables 77
or livestock the notice must often occur within hours or a few days to be reasonable.127
The seller will only have a chance to cure defects, prevent further deterioration or make
further use of the goods if notified within a very short time. Moreover, due to the
perishable nature of the goods, any longer delay may even make it impossible for the
seller to verify whether the alleged non-conformity existed at the time risk passed.
A fairly short notice period also applies to seasonal goods, such as Christmas trees or 78
fashion, which may perish economically.128 The length of the period may, in such cases,
also be dependent on when the goods are delivered, i. e. whether the relevant event or
the end of the season is still some time away or not.
(iii) Other goods. By contrast, the notice period is normally longer for durable 79
goods.129 In this sense, the short notice periods initially adopted by courts from
Germanic legal systems should be rejected, as they invoked even for such durable goods
“a common assumption that [the notice period] should be short … normally be not
more than a few days”.130 These decisions are regularly based on the much stricter
125Tribunal Supremo (Spain) 17 January 2008 (300 second-hand automobiles), CISG-Online 1640 (Pace).
126Oberster Gerichtshof (Austria) 31 August 2010 (old timber), CISG-Online 2236 (Pace), p. 11 –
mentioning economic and personal situation of buyer’s business, characteristics of goods, size of delivery
and type of remedy.
127 Rechtbank Breda (Netherlands) 16 January 2009 (watermelon), CISG-Online 1769 (Pace) at 3.11;
see also Thüringisches Oberlandesgericht (Germany) 26 May 1998 (live fish), CISG-Online 513 (Pace) –
eight days after examination report; Audiencia Provincial de las Palmas (Spain) 16 February 2012
(margarine), CISG-Online 2516 (Pace), p. 2 – several days, at most several weeks but five months too
long; but see Audiencia Provincial de Asturias (Spain) 29 September 2010 (anchovies), CISG-Online 2313
(Pace) – where notice after four month was considered to be in time.
128 Vestre Landsret (Denmark) 10 November 1999 (Christmas trees), CISG-Online 704 (Pace); Cour
d’appel de Lyon (France) 18 October 2012 (Christmas trees), CISG-Online 2402 (Pace) – notice in
February too late; cf. Oberster Gerichtshof (Austria) 27 August 1999 (trekking shoes), CISG-Online 485
(Pace) – the buyer considered the trekking shoes to be seasonal; see also Landgericht München (Germany)
20 February 2002 (shoes), CISG-Online 712 (Pace).
129 E. g. two months and seven days considered to be reasonable for steel rods/billet used for the
production of axes by Audiencia Provincial de Navarra (Spain) 30 July 2010 (billets – steel rods), CISG-
Online 2315 (Pace).
130 Landgericht Tübingen (Germany) 18 June 2003 (computers and accessories), CISG-Online 784
(Pace) relating to a shortfall in delivery; Oberlandesgericht München (Germany) 8 February 1995
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notice regimes in the respective national laws, which require an immediate notice or
notice without undue delay. In their reasoning, the courts often pay lip service to the
requirements of Art. 7, but clearly do not comply with the mandated mode of
interpretation.
80 Thus, while in principle the available case law constitutes part of what should be
taken into account in determining what is a reasonable period,131 such decisions should
largely be disregarded or at least be given little weight.
81 The German Bundesgerichtshof in its “moist tissue machine” decision stipulated a
notice period of four weeks after discovery of the non-conformity to be normal.132 Since
that decision, the majority of German decisions start from a presumption that, in
absence of special circumstances, a buyer has, after the expiry of the examination
period, a so-called “noble month” to give notice about the non-conformity.133 The
“noble month” has also found support from a number of other courts in different
countries134 as well as in the literature.
82 By contrast the Austrian Oberster Gerichtshof still considers a time span of two weeks
for examination and notification to be generally sufficient and therefore reasonable in
the sense of Art. 39.135 This has equally found support in some of the literature in the
German speaking world.136 Others, including in particular authors from the common
law world, are generally critical to any type of fixed rule as to the reasonableness of the
time for notice.137 In rejecting a presumptive period, Flechtner has instead proposed a
test that makes the reasonableness of the time for notice dependent on whether the
seller has suffered substantial prejudice from the buyer’s delay in giving notice.138
(polypropolene plastic granulate), CISG-Online 142 (Pace) – eight days for notice; cf. Handelsgericht des
Kantons Zürich (Switzerland) 30 November 1998 (lambskin coats), CISG-Online 415 (Pace) “one week
up to fourteen days”; Kantonsgericht Appenzell Ausserhoden (Switzerland) 9 March 2006 (fitness equip-
ment), CISG-Online 1375 (Pace) – one week; see also Oberster Gerichtshof (Austria) 14 January 2002
(cooling system), CISG-Online 643 (Pace) two weeks for an examination of a complex machinery; critical
on that approach Flechtner, in: Ferrari/Flechtner/Brand, The Draft Digest and Beyond (2003), 377 (379
seq.); Schwenzer, The Noble Month (Articles 38, 39) – The Story Behind the Scenery, 7 European Journal
of Law Reform (2006) 353 (357 seq.).
131 Gabriel, Sale of Goods (2004) p. 135, footnote 607.
132 Bundesgerichtshof (Germany) 3 November 1999 (machine for producing hygienic tissues), CISG-
Online 475 (Pace); for the development of the “noble month” see Schwenzer, The Noble Month
(Articles 38, 39) – The Story Behind the Scenery, 7 European Journal of Law Reform (2006) 353.
133 See for examples Oberlandesgericht Düsseldorf (Germany) 30 June 2015 (jeans), CISG-Online 2731,
at II. 4. a. aa.
134 Bundesgericht (Switzerland) 13 November 2003 (used laundry machine), CISG-Online 840 (Pace);
Obergericht des Kantons Luzern (Switzerland) 8 January 1997 (blood infusion devices), CISG-Online 228
(Pace) but see for a different view from Switzerland Kantonsgericht Appenzell Ausserhoden (Switzerland)
9 March 2006 (fitness equipment), CISG-Online 1375 (Pace) – one week; Tribunale di Reggio Emilia
(Italy) 12 April 2011 (ceramic materials), CISG-Online 2229 (Pace), p. 3–1 month.
135 Oberster Gerichtshof (Austria) 15 October 1998 (timber), CISG-Online 380 (Pace); confirmed
Oberster Gerichtshof (Austria) 14 January 2002 (cooling system), CISG-Online 643 (Pace); Oberster
Gerichtshof (Austria) 31 August 2010 (old timber), CISG-Online 2236 (Pace), p. 12; see also Kantonsger-
icht Schaffhausen (Switzerland), 27 January 2004 (model locomotive), CISG-Online 960 (normally overall
period for examination and notification of two weeks); that was also the view adopted by some of the
older German decisions; e. g. Oberlandesgericht Koblenz (Germany) 11 September 1998 (chemical sub-
stances), CISG-Online 505 (Pace).
136 Magnus, in: Honsell, Kommentar (2010), Art. 39 para. 22 (14 days up to a month for examination
and notification); from recent case law see also Oberlandesgericht Brandenburg (Germany) 3 July 2014
(plants), CISG-Online 2543 (Pace), para. 29.
137 Critical towards the noble month Honnold/Flechtner, Uniform Law (2009), Arts 39, 40, 44
para. 257.1; see also in the context of Art. 43, Flechtner, Funky Mussels, a Stolen Car, and Decrepit Used
Shoes: Non-Conforming Goods and Notice thereof under the United Nations Sales Convention, Boston
University International Law Journal (2008) 1 (17 et seq.) (Pace).
138 Flechtner, in: Ferrari/Flechtner/Brand, The Draft Digest and Beyond (2003), 377 (387 seq.).
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It is beyond doubt that the determination of what constitutes a reasonable time for 83
giving notice depends, in the end, on the circumstances of each particular case.
Irrespective of this and in light of the divergent approaches adopted by the courts139,
the need for predictability in international transactions militates strongly in favour of
establishing a kind of presumption as to what is the reasonable period. This fixed period
provides a starting point for an eventual thorough analysis on the basis of the specific
facts of each case. It is then for the party alleging either a longer or a shorter period to
plead and prove factors which justify such an amendment.140
Moreover, at least for durable goods, it is much easier to determine a median time for 84
the notice period as opposed to the examination period. While there may be differences
depending on the particular facts of the case, i. e. the means of communication, the type
of notice required and its specificities etc., the differences are much smaller than with
regard to the examination period.
At first sight, a median period of four weeks for notifying the seller about the defects 85
discovered appears fairly long. Any reasonable buyer would normally inform the seller
about the defects discovered rather quickly, in a time not exceeding two weeks. As is
evidenced by the case law, once the non-conformity is discovered, parties act fast. It is
usually the belated examination that leads to delays.
Irrespective of this, it is suggested that a period of four weeks should normally be 86
considered to be a good starting point for determining what is reasonable. This approach
is justified in cases where the notice is given through a series of communication.141 Also,
where notice consists of a single discrete act, it appears justified to be generous in relation
to the notice period to compensate to a certain extent for the fairly short examination
period. In line with the purpose of the notice requirement, the relevant issue is the time at
which notice is given, not how the time span between delivery and the date of notice is
calculated. Additionally, in light of the differences between the various legal systems, a
longer period has a much greater chance of being accepted worldwide. In this sense, it is
in line with the purposes of Art. 7(1) to ensure a uniform interpretation.142
(iv) Other relevant factors. In light of the purpose of the notice requirement, another 87
important factor in determining the length of the notice period is the type of the defect.
Defects which may have been caused through a mere mishandling or mere deterioration
of the goods may have to be notified within a shorter period of time, as the seller may
otherwise no longer be able to secure evidence or take appropriate actions. By contrast,
in relation to defects in design, there is generally no need to shorten the time for notice.
For the same reason, i. e. the seller’s interest in securing evidence, the period for 88
giving notice will be shortened by an imminent use of the goods, which may affect their
characteristics. This is particularly so when the goods are to be reprocessed or where
they are to be mixed with other goods.143
139For that see DiMatteo et al., International Sales Law (2005), pp. 84 et seq.
140For this approach see in particular Schwenzer, The Noble Month (Articles 38, 39) – The Story
Behind the Scenery, 7 European Journal of Law Reform (2006) 353 (365); also Girsberger, The Time
Limits of Article 39 CISG, 25 Journal of Law and Commerce (2005/2006) 241 (243 seq.); Witz, A Raw
Nerve in Disputes relating to the Vienna Sales Convention: The Reasonable Time for the Buyer to Give
Notice of a Lack of Conformity, 2 ICC Bulletin (2000) 15 (19 seq.).
141 Flechtner, in: Ferrari/Flechtner/Brand, The Draft Digest and Beyond (2003), 377 (380 seq.) gives the
series of communications as one of the arguments in favour of longer notice periods.

142 Witz, A Raw Nerve in Disputes relating to the Vienna Sales Convention: The Reasonable Time for
the Buyer to Give Notice of a Lack of Conformity, 2 ICC Bulletin (2000) 15 (20).
(Pace); Gerechtshof Arnhem (Netherlands) 18 July 2006 (potting soil), CISG-Online 1266 (Pace) – shortly
after delivery before use by the seller.
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89 To a limited extent, the remedies sought may influence the notice period irrespective
of the fact that, normally, the notice requirement should be treated independently from
the decision about the remedies.144 Where the buyer wants to return the goods, the
period may be shorter than for claims of damages. The seller’s interest to cure in order
to avoid a fundamental breach and the costs associated with taking the goods back are
normally higher in the former case. In addition, the seller has to make arrangements
either for the transport of the goods or their further use.145
90 A shorter period for notice can also result from deadlines which the seller has to meet
and of which the buyer is aware.146 The most obvious example is a deadline for possible
recourse against the seller’s suppliers, of which the buyer knows because they are based
on industry standards or because the buyer has access to the contracts concluded with
those suppliers.
91 By contrast, the need for training the buyer’s personnel, particularly if it is provided
by the seller under the sales contract, may lead to a de facto prolongation of the notice
period. As long as the seller’s personnel is still on site and providing training services on
the machine delivered, the buyer may assume that the seller, with his superior knowl-
edge, will notice existing defects. Consequently, the notice period may actually only start
after the training period ends.147
92 The relationship of the parties may also constitute a relevant factor in determining
what is reasonable. Even where it has not yet reached the status of an established practice
in the sense of Art. 9(1), the fact that parties normally react swiftly can shorten the time
for notice as the other party will expect a quick reaction. As a consequence, an arbitral
tribunal acting under the rules of the Chamber of Commerce and Industry in Budapest de
facto held that for the same type of defect notification periods of a different length may
apply in relation to different customers.148 In this sense, requests by the buyer for quick
delivery are relevant if they create the impression that the buyer will use the goods
immediately and therefore also discover existing non-conformities within a short time.
93 (v) Instalments contracts. It follows from Art. 73(1) that for the purpose of remedies,
every instalment is treated separately. Therefore, in principle, the notice period will start
anew for each instalment with the delivery.149 However, in some cases, the failure to
notify the seller about the non-conformity of a previous instalment may lead to a
change in the standard itself.
144 Correctly emphasized by Honnold/Flechtner, Uniform Law (2009), Arts 39, 40, 44 para. 257; see
Oberster Gerichtshof (Austria) 31 August 2010 (old timber), CISG-Online 2236 (Pace), p. 11.
145 Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 39 para. 16; Witz, A Raw Nerve
in Disputes relating to the Vienna Sales Convention: The Reasonable Time for the Buyer to Give Notice
of a Lack of Conformity, 2 ICC Bulletin (2000) 15 (19); Kantonsgericht Zug (Switzerland) 30 August 2007
(GMS Modules), CISG-Online 1722 (Pace); for a different view Honnold/Flechtner, Uniform Law (2009),
Arts 39, 40, 44 para. 257.
146 Girsberger, The Time Limits of Article 39 CISG, 25 Journal of Law and Commerce (2005/2006) 241
(243).
147 See for example District Court for the Western District of Michigan (U.S.) 17 December 2001
(thermoforming line equipment), Shuttle Packaging Systems L. L. C. v Tsonakis, CISG-Online 733 (Pace).
148 Arbitral Award, Arbitration Court attached to the Hungarian Chamber of Commerce and Industry,
5 December 1995 (waste-containers), CISG-Online 163 (Pace).

(Pace), at paras 128 seq.; cf Cour de cassation (France) 27 November 2012 (cooktops), SMEG v. Rothelec,
CISG-Online 2403 (Pace) p 4.
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5. The two years cut-off date in Art. 39

Art. 39(2) provides a final cut-off date for any notice of non-conformity, irrespective 94
of when the defect was discovered or discoverable.150 At the cut-off date, the risk of
latent defects is transferred to the buyer. The function of Art. 39(2) is to provide for
legal certainty and it has to be taken into account ex officio. Consequently, in cases
where the buyer ought not to have discovered the lack of conformity earlier, the notice
must be sent so that, given the selected means of communication, under normal
circumstances, it would arrive within the two year period.151
The cut-off period starts to run when the goods are “actually handed over to the 95
buyer”. Making the act of handing over the goods the relevant starting point, and not
the time when risk passes, takes into account the fact that examination for goods sold in
transit under Art. 38(2) starts to run when they have reached their final destination. The
time needed for transportation should not shorten the two years available to the buyer.
By contrast, the mere fact that the defect could, for objective reasons, only be discovered
later does not affect the start of the cut-off period.152
The expiry of the cut-off period is not regulated in the CISG. In this sense, it is the 96
applicable national law which regulates questions such as what happens if the end of the
two year period is a public holiday in one of the countries concerned.
Pursuant to the last part of Art. 39(2), the time limit will not apply if it “is 97
inconsistent with a contractual period of guarantee”. In this sense, party autonomy in
the form of the longer contractual guarantee prevails. This is in line with the general
policy of the CISG.153 For an inconsistency, it is not necessary that the contractual
guarantee be longer than two years. Also, where a two year guarantee has been made, a
party may be entitled to give notice shortly after the expiry of the time period, should
the lack of conformity only be discovered shortly before the expiry of the period.154
Party autonomy also prevails if a shorter time period has been agreed.155 Thus, where 98
the contract provides that a lack of conformity has to be notified within 60 days of
delivery, such a clause, provided that it is valid, leads to a shorter cut-off time for all
claims, excluding the application of Art. 39(2). In such cases, however, it always has to
be determined via interpretation whether there is actually an inconsistency between the
contractual stipulations and the two years cut-off period. For example, no inconsistency
exists with a provision that a machine would produce a certain output within the first
year. If such output is not produced, the lack of conformity may be notified within the
two years period of Art. 39(2), provided that it is done within a reasonable time after
discovery.
De facto the time limit also does not apply to sellers who knew about the lack of 99
conformity or could not have been unaware of it. Art. 40 excludes any reliance on
Art. 39 for such sellers. By contrast, the existence of a reasonable excuse for not giving
notice in the sense of Art. 44 does not affect the application of the cut-off date.156
150 See also Oberlandesgericht Linz (Austria) 24 September 2007 (laminated glass), CISG-Online 1583
(Pace); Cour de cassation (France) 27 November 2012 (cooktops), SMEG v. Rothelec, CISG-Online 2403
(Pace) p 4; Cour de cassation (France) 21 June 2016 (engines), CISG-Online 2742.
151 For its relationship with short period in the applicable statutes of limitation see infra at para. 121.
152 Cour de cassation (France), 8 April 2009 (floor tiles), Société Bati-Seul v Société Ceramiche Marca
Corona, CISG-Online 1977 (Pace) overruling the lower instance which had held that the period only
started after the defect (tiles were not frost-resistant) was discovered.
153 Oberster Gerichtshof (Austria) 19 December 2007 (laminated glass), CISG-Online 1628 (Pace).
156 Oberlandesgericht Linz (Austria) 24 September 2007 (laminated glass), CISG-Online 1583 (Pace).
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6. Consequence of a failure to give notice

100 The consequence of a failure to give notice within a reasonable time is, pursuant to
Art. 39(1), the loss of “the right to rely on a lack of conformity”. In other words, the buyer
loses all of his remedies under Art. 45 for the breach of contract associated with a delivery
of non-conforming goods. This includes claims for damages (Art. 45(1)(b)), the right to
ask for performance (Art. 46), the right to declare the contract avoided (Art. 49) and the
right to reduce the price (Art. 50). Such loss also covers situations where the buyer wants
to set off the seller’s claim for payment with any of these rights or wants to use them as a
counterclaim or as a basis for a right of retention.157 The buyer is obligated to pay the full
price irrespective of the non-conformity of the goods or the lack of quantity.158
101 If the seller has delivered a greater quantity than originally agreed, the buyer has to
pay for such excess-quantity pursuant to Art. 52(2). Where the goods have a higher
quality than agreed in the contract, Art. 52(2) should in principle be applied by
analogy.159 In the latter case, however, the seller may be prevented by Art. 40 from
relying on the failure to give notice within time.
102 In instalment contracts, a failure of the buyer to comply with the notice requirement
of Art. 39 only affects his rights for that particular instalment. The buyer is not
prevented from avoiding the contract on the basis of Art. 73(2) for future instalments
on the basis of the non-conformity.160
103 Different views exist as to whether Art. 39 also excludes remedies existing under
national law for torts or mistake. Some authors consider such remedies to be generally
excluded.161 Others are more cautious. They limit the exclusion to cases where the interests
protected by the national tort law do not go beyond the interests protected by Arts 35 et
seq. Whenever further interests are protected, a buyer may rely on the national tort law.162
7. Exceptions
104 The rigidity of Art. 39 is mitigated by two exceptions. Pursuant to Art. 40, the seller
may not rely on the buyer’s failure to give notice if he could not have been unaware of
the non-conformity of the goods. In this sense, the two year cut-off period in Art. 39(2)
does not prevent the buyer from bringing his claims arising out of the non-conformity
of the goods. Furthermore, pursuant to Art. 44, the buyer retains his right to price
reductions and damages with the exception of those for a loss of profit, where he has a
“reasonable excuse” for the failure to give notice.163
8. Waiver and exclusions of the right to invoke belated notice

105 In addition to the exceptions provided for directly in the CISG, the seller may also lose
his right to rely on the belated notice through his subsequent behaviour. The seller may,
157 Amtsgericht Geldern (Germany) 17 August 2011 (corn), CISG-Online 2302 (Pace), paras I.2.d,
I.3.a. – claim for payment due despite incorrect invoice.

158 E. g. Oberlandesgericht Düsseldorf (Germany) 8 January 1993 (tinned cucumbers), CISG Online 76
(Pace); comment by Magnus, Zum räumlich-internationalen Anwendungsbereich des UN-Kaufrechts

und zur Mängelrüge IPRax (1993) 390.
159 In favour of such an analogous application Schwenzer, in: Schlechtriem/Schwenzer, Commentary
(2016), Art. 39 para. 32.

160 Arbitral Award, Schiedsgericht der Börse für landwirtschaftliche Produkte – Wien 10 December
1997 (barley), CISG-Online 351 (Pace).

162 For a good overview on the discussion see Supreme Court (Israel) 17 March 2009 (tiles), Pamesa
Ceramica v Yisrael Mendelson Ltd, CISG-Online 1980 (Pace) at paras 42 et seq.

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either contractually or ad hoc, waive the right to rely on a breach of the notification duty
or may be prevented from doing so under considerations of good faith or estoppel.
a) Explicit or implicit waivers. A waiver can occur explicitly or implicitly, but always 106
requires the will of the seller to renounce existing rights. Consequently, the seller may
not be presumed to have waived rights of which he was not aware.164
Explicit waivers of the rights under Art. 39(1) are rare in practice. In most cases, waivers 107
have to be deduced from the seller’s more or less clear conduct or declarations. These have
to be interpreted on the basis of Art. 8, taking into account all relevant circumstances. The
relevant question is, therefore, whether the buyer could reasonably understand the seller’s
conduct as a waiver of the latter’s right to rely on the buyer’s delay in giving notice.
The seller’s behaviour in relation to the notification of defects or the non-conforming 108
goods as such is relevant for the question of implicit waivers. Conduct which implies
that the seller assumes a liability for the non-conformity of the goods, despite the
belated notice, can often be interpreted as an implicit waiver of the right to rely on the
notice requirement. This may, at the very least, prevent reliance on Art. 39(1) under
good faith considerations.
Thus, a seller who unconditionally takes back defective goods or engages in efforts to 109
cure deficiencies without reserving the rights under Art. 39 can, in general, be con-
sidered to have implicitly waived his right to rely on a belated notice.165 That applies,
however, only in relation to the defects which were remedied but not in relation to other
defects.166 Equally, declarations by the seller that he “takes responsibility for” defects
discovered in the course of reprocessing the goods after a belated notice and that such
defects will be handled properly will normally constitute an implicit waiver. In the case
of instalment contracts, such waivers may even extend to future belated notices if they
occur in comparable circumstances, i. e. in the reprocessing of the goods.167
Also, negotiations about remedies for a period of 15 months without reserving the 110
right to rely on Art. 39 can constitute a waiver if the party was at all times legally
represented.168 Even in cases without legal representation, while it may be difficult to
determine a positive will to waive Art. 39 rights by a mere failure to explicitly reserve
these rights, reliance on the notice requirement after long negotiations, in general, will
be contrary to good faith.
In principle, the seller’s consent to the appointment of experts to examine the goods 111
without any reservation will constitute an implicit waiver of the right to rely on the
notice requirement.169 This applies irrespective of the fact that such consent may be part
of the seller’s settlement strategy to convince the buyer that the goods were not defective
at all. In light of the costs associated with the appointment of an expert, the seller can be
considered to be obligated to reserve his right to rely on Art. 39 if he does not want to
164Bundesgerichtshof (Germany) 25 November 1998 (surface protective film), CISG-Online 353 (Pace).
165Oberster Gerichtshof (Austria) 5 July 2001 (Intel Pentium computer parts), CISG-Online 652 (Pace)
– taking back of allegedly forged microprocessors; Bundesgerichtshof (Germany) 25 November 1998
(surface protective film), CISG-Online 353 (Pace); cf. Oberster Gerichtshof (Austria) 2 April 2009 (boiler),
CISG-Online 1889, where the buyer was procedurally barred to rely on such a waiver as it was not
pleaded in time; but see Handelsgericht Zürich (Switzerland) 30 November 1998 (lambskin coats), CISG-
Online 415 (Pace) where the offer to take back goods was not considered to be a binding waiver.
166 Handelsgericht St. Gallen (Switzerland), 14 June 2012 (organic juices and organic oil), CISG-Online
2468 (Pace), para. III.8.e; confirmed by Bundesgericht (Switzerland) 26 March 2013 (organic juices and
organic oil), CISG-Online 2434 (Pace), para. 3.2.1.
167 Bundesgerichtshof (Germany) 25 June 1997 (stainless steel wire), CISG-Online 277 (Pace).
168 Bundesgerichtshof (Germany) 25 November 1998 (surface protective film), CISG-Online 353 (Pace);
the mere start of negotiations is, however, not sufficient Oberlandesgericht Düsseldorf (Germany) 30 June
2015 (jeans), CISG-Online 2731, at II. 4. a. dd.
169 Handelsgericht Zürich (Switzerland) 30 November 1998 (lambskin coats), CISG-Online 415 (Pace).
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waive it. Only then can the buyer make an informed decision of whether it is worth
spending the money for the expert.
112 The waiver may be limited to a particular non-conformity or may relate to the non-
conformity in general. In the latter case, it has to be ensured that the seller’s behaviour in
relation to a particular defect can truly be extended to other non-conformities, which can
be doubtful.170 It may also be limited to certain remedies. Thus, a willingness to provide
missing certificates despite the expiry of the notice period does not necessarily imply that
reliance on Art. 39(1) is also waived against subsequently raised damage claims.171
113 In the end, the evaluation of such behaviour depends on the circumstances of each
particular case. However, in principle, and contrary to a tendency found in some
decisions, implicit waivers of the right to rely on Art. 39(1) through the seller’s
behaviour should not be assumed too lightly. Taking into account all relevant circum-
stances in the sense of Art. 8(2), it must be reasonable for the buyer to deduce from the
seller’s conduct a definite intention to waive Art. 39(1) rights. Even where the seller
does not explicitly reserve his rights under Art. 39(1), such an initial non-reliance on a
delay in notification may be part of on-going negotiations between the parties, driven by
business objectives, without amounting to a waiver.172 In the interest of facilitating an
amicable settlement of a dispute, a seller may be hesitant to invoke from the outset
arguments which may be perceived as formal. A too generous assumption of waivers on
the basis of the mere fact that the parties negotiated with each other could interfere with
“the public policy goal of keeping sellers willing to negotiate.”173
114 Thus, the lack of an immediate rejection of the notice as belated and the mere
entering into negotiations about the defects is generally not sufficient to assume an
implicit waiver. The same applies to examinations of the goods by the seller.174 The fact
that the examination involves taking back the goods or even provisionally crediting
certain amounts to the buyer does not lead to a different conclusion.175 In light of the
difficult factual and legal questions involved, parties must be given sufficient time to
determine their legal position with certainty. Even when the seller does not immediately
reject the notice after he has examined the goods, his conduct is by no means
necessarily a waiver of his rights under Art. 39. He may be driven by the desire to
find, for business purposes, an amicable solution instead of relying on a formal position.
In this regard, the type of relationship, its economic importance for the seller and its
170 For such a case see Saarländisches Oberlandesgericht (Germany) 13 January 1993 (doors), CISG-
Online 83 (Pace); denied in Bundesgericht (Switzerland) 26 March 2013 (organic juices and organic oil),
CISG-Online 2434 (Pace), para. 3.2.1.
171 Bundesgericht (Switzerland) 26 March 2013 (organic juices and organic oil), CISG-Online 2434
(Pace), para. 3.2.1 confirming the earlier decision by Handelsgericht St. Gallen (Switzerland), 14 June 2012
(organic juices and organic oil), CISG-Online 2468 (Pace), para. III.8.e.
172 See Oberlandesgericht Düsseldorf (Germany) 12 March 1993 (textiles), CISG-Online 82 (Pace) which
considers it to be a “principle of national and international commerce that also in case of delayed
notifications of deficiencies the attempt of a conciliatory solution between the parties is desirable and that
the seller must therefore be allowed a certain discretion to act without fearing a loss of its objection of
lapse of notification period”; Oberlandesgericht Düsseldorf (Germany) 30 June 2015 (jeans), CISG-Online
2731, at II. 4. a. dd.; cf. Handelsgericht Zürich (Switzerland) 30 November 1998 (lambskin coats), CISG-
Online 415 (Pace) at 4 e, bb; Arbitral Award, VIAC-Sch 4318, 15 June 1994 (rolled metal sheets), CISG-
Online 120 (Pace); left open in Oberster Gerichtshof (Austria) 21 March 2000 (wood), CISG-Online 641.
173 Schlechtriem, Einheitskaufrecht in der Rechtsprechung des Bundesgerichtshofs, FS Bundesgericht-
shof (2000), p. 407 (437) (Pace).

174 Handelsgericht Zürich (Switzerland) 30 November 1998 (lambskin coats), CISG-Online 415 (Pace)
at 4 e, aa; see also Oberlandesgericht München (Germany) 11 March 1998 (cashmere sweaters), CISG-
Online 310 (Pace).
175 Oberlandesgericht Düsseldorf (Germany) 12 March 1993 (textiles), CISG-Online 82 (Pace) where the
need to issue pro-forma credits was explained by the requirements of Italian foreign exchange law.
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duration are all factors which have to be taken into account when interpreting the
seller’s conduct.
Equally, no waiver can be assumed where the seller offers to send his personnel for 115
training purposes on the allegedly non-conforming machinery. All this demonstrates is
that the seller attributes the underperformance to the lack of qualified personnel and
not to defects in the machinery.176 If the seller is unaware of his Art. 39 rights, his
behaviour will not reveal any intention to waive such rights.
b) Exclusion of the rights under good faith consideration. Even if it cannot be 116
positively established that the seller has an intention to waive his rights, his behaviour in
a number of the above situations may also justify an exclusion of these rights under the
principles of good faith and estoppel.177 This is particularly relevant in negotiations
stretching over a considerable time.
In general, however, an exclusion of the seller’s right to rely on a belated notice under 117
any of these concepts requires not only contradictory behaviour by the seller, but also
that the buyer has relied on the seller’s previous behaviour and has acted accordingly.
Such reliance may, for example, consist of not taking any legal actions to protect the
buyer’s rights against his own customers or another deterioration of the buyer’s
evidentiary position.178 In practice, there seems to be a tendency to neglect the second
requirement, i. e. the buyer’s reliance on the seller’s behaviour, and to assume a venire
contra factum proprium too lightly.
Good faith considerations exclude any right of the seller to rely on a belated notice if 118
he has been informed about the non-conformity through other channels, such as by
third party notices. This is because the purpose of the notice requirement in Art. 39, i. e.
that the seller is informed about the lack of conformity, can be deemed to have been
met. Consequently, there is no justification to deprive the buyer of his remedies for the
non-conformity of the goods.179
9. Relationship with statutes of limitation

Technically distinct from the notice requirement are limits on the time for instituting 119
legal proceedings. Such limitation periods are either governed by the Convention on the
Limitation Period in the International Sale of Goods180 or national laws.181 National
laws differ considerably, not only concerning the length of the limitation period but also
as to its characterization (i. e. procedural versus substantive).182
(Pace) where the offer was even against payment.

177 See Arbitral Award, VIAC-Sch 4318, 15 June 1994 (rolled metal sheets), CISG-Online 120 (Pace);
with a critical comment by Schlechtriem, RIW (1990) 592 (594) who raises concerns whether in light of
the detailed regulation in Arts 40, 44 there is truly a gap to be filled by general principles; accepting the
principle but denying is application in the case Bundesgericht (Switzerland) 26 March 2013 (organic juices
and organic oil), CISG-Online 2434 (Pace), para. 3.3.
178 For a more detailed discussion of the requirements see the case note by Schlechtriem, RIW (1990)
592 (594).
180 On the Convention see Smit, Convention on the Limitation Period: UNCITRAL’s First Born, 23
American Journal of Comparative Law (1975) 337.

181 For the interplay with national law see Oberster Gerichtshof (Austria) 14 January 2002 (cooling system),
CISG-Online 643 (Pace) – 6 month limitation period under the old German law starts with notice of non-
conformity; cf. Rechtbank Rotterdam (Netherlands) 2 June 2010 (adapters for water treatment plant), XL
Insurance Company v. Italian Industrial Agency, CISG-Online 2340 (Pace), paras 5.3. et seq.
182 For the existing difference concerning the length of the period see Schwenzer, in: Schlechtriem/
Schwenzer, Commentary (2016), Art. 39 para. 30 footnote 161.
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120 In principle, rules governing the limitation period do not affect the time limits for
giving notice. This applies, in particular, where such rules provide for a longer period.
Thus, despite the four year period provided for in the Limitation Convention, the buyer
is required to give notice for a lack of conformity within a reasonable time (Art. 39(1))
or at least within two years (Art. 39(2)).
121 Cases where the statute of limitations rules provide for periods shorter than the two
year cut-off date set out in Art. 39(2) are more difficult. In general, the rules of the CISG
should prevail,183 but different approaches have been adopted in practice. Some courts
have resolved the conflict by replacing the shorter limitation period for claims of non-
conformity by the longer one for other claims; some have merely extended the shorter
time limit in the national rules to the two year period provided for in Art. 39(2).184
122 Others consider the notice as the starting point for the short period provided for in
the statute of limitations, notwithstanding that normally the period should have started
with the delivery of the goods.185
10. Acceptance of the goods as conforming

123 In addition to a belated notice of non-conformity, the buyer may also be prevented
under good faith considerations from invoking his remedies for the delivery of non-
conforming goods. This may, for example, be the case where the buyer, after an
examination, has accepted the goods as conforming and the seller has acted on such
acceptance, by shipping the goods. In such a situation, if a second examination reveals
defects which could have been discovered during the first examination, the buyer may
be prevented from relying on such defects, even if the notice would have met the
requirements of Art. 39.186
11. Burden of proof

124 In general, the buyer bears the burden of proof that he has complied with his duty to
notify the seller about the non-conformity of the goods.187 Notwithstanding the
183 Girsberger, The Time Limits of Article 39 CISG, 25 Journal of Law and Commerce (2005/2006) 241
(249 seq.); Bundesgericht (Switzerland) 18 May 2009 (packaging machine), CISG-Online 1900 (Pace),
para. 10.; Witz, Der neueste Beitrag der französischen Gerichte zur Auslegung des CISG, IHR 2014, 89
(94 seq.) commenting on Cour de cassation (France) 13 February 2013 (bags), Solodem v. Codefine,
CISG-Online 2435 (Pace) where the one year limitation period under Swiss law was considered to be
relevant; Hachem, Verjährungs- und Verwirkungsfragen bei CISG-Verträgen, IHR 2017, 1 (16 seq.); for
the relevance of the national prescription periods Schlechtriem/Schröter, Internationales UN-Kaufrecht
(2016), para. 428.
184 Cour de Justice de Genève (Switzerland) 10 October 1997 (acrylic cotton), CISG-Online 295 (Pace).
185 Handelsgericht des Kantons Bern (Switzerland) 30 October 2001 (H-F-A (machine)), CISG-Online
956 (Pace); Handelsgericht des Kantons Bern (Switzerland) 17 January 2002 (grapefruit seed extract),
CISG-Online 725 (Pace), with note Janssen, IPRax (2003) 369 (371); that was also the solution adopted by
the German legislator to reconcile the shorter time period under the old German law (six months) with
the two year period of Art. 39(2); on the issue see Girsberger, The Time Limits of Article 39 CISG, 25
Journal of Law and Commerce (2005/2006) 241 (249 seq.); Schwenzer, in: Schlechtriem/Schwenzer,
186 For such a case see Oberlandesgericht Düsseldorf (Germany) 8 January 1993 (tinned cucumbers),
CISG-Online 76 (Pace) with note by Magnus, Zum räumlich-internationalen Anwendungsbereich des

UN-Kaufrechts und zur Mängelrüge, IPRax (1993) 390 (392); see also Rechtbank Rotterdam (Nether-
lands) 26 October 2016 (grapes), CISG-Online 2764 where the grapes examined were accepted despite a
non-suitable packaging.
187 Oberster Gerichtshof (Austria) 21 March 2000 (wood), CISG-Online 641; Rechtbank van Koophandel
Veurne (Belgium) 25 April 2001 (diesel tram), CISG-Online 765; Rechtbank Breda (Netherlands)
16 January 2009 (watermelon), CISG-Online 1769 (Pace) at. 3.11; Oberlandesgericht München (Germany)
26 October 2016 (shoes), CISG-Online 2799, at I.1, I.9.
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misleading and – in light of the drafting history – inconclusive wording of Art. 39,188
this is in line with the general principles of ei incumbit underlying the allocation of the
burden of proof in the CISG. An orderly notice constitutes a requirement of the buyer’s
claims for non-conforming goods. It is not, as the reference to the loss of the buyer’s
right seems to indicate, a restriction of the seller’s liability for which the seller would
bear the burden of proof.189 To comply with his burden of proof, the buyer has to prove
first, that proper notice was given and second, that it was given in time.190
a) Dispatch of a proper notice. In case of written notices, the buyer has to prove the 125
existence of the notice as well as that it was dispatched to the seller or persons
authorized to receive notices for the seller.191 In light of Art. 27, there is no need to
prove receipt of the notice by the seller.
If notice has been given by fax, a fax report together with the original will normally be 126
sufficient. The same applies to emails, which have to be printed out. Where the notice
has been sent by post, a post receipt is normally sufficient.192
Difficult to prove in practice is the existence of oral notices, especially if the notice is 127
contested by the seller and there were no other witnesses present.193 For oral notice by
telephone, the buyer has to give detailed information as to the date and the name of the
person on the other side of the phone.194 Contrary to the view prevailing in practice,195
the buyer does not have to prove the exact content of the notice. While the required
specificity of the notice is part of an orderly notice, in a telephone conversation, the
seller can be considered to have enquired immediately if he was not sufficiently satisfied
as to its specificity.
b) Timeliness of notice. In principle, the buyer also has to prove that the notice was 128
given within a reasonable time.196 In this regard, the buyer merely has to prove that the
notice was dispatched with appropriate means and in a way that it would, under normal
circumstance, arrive in time. In light of Art. 27, the buyer does not have to prove that
such notice was also received in time.197 The date displayed on the notice is nothing but
188Antweiler, Beweislastverteilung im UN-Kaufrecht (1995), pp. 128 et seq.

189For a more detailed discussion on the allocation of the burden of proof in light of Art. 27 and the
general structure of Art. 39 see Antweiler, Beweislastverteilung im UN-Kaufrecht (1995), pp. 128 et seq.
190 Gerechtshof Arnhem (Netherlands) 18 July 2006 (potting soil), CISG-Online 1266 (Pace); see also
Cour de cassation (France) 27 November 2012 (cooktops), SMEG v. Rothelec, CISG-Online 2403 (Pace).
191 See Oberlandesgericht Linz (Austria) 23 January 2006 (car), CISG-Online 1377 (Pace) where reliance
on some defects was excluded as they were notified to non-authorized dealers.

192 Hof van Beroep Gent (Belgium) 28 January 2004 (breeding sows and cages), CISG-Online 830 (Pace).
193 Tribunale di Rimini (Italy) 26 November 2002 (porcelain tableware), CISG-Online 737 (Pace);
Rechtbank Breda (Netherlands) 16 January 2009 (watermelon), CISG-Online 1769 (Pace) at. 3.12; Hof
van Beroep Gent (Belgium) 28 January 2004 (breeding sows and cages), CISG-Online 830 (Pace);
Obergericht des Kantons Zug (Switzerland) 19 December 2006 (stove), CISG-Online 1427 (Pace); see
also Oberlandesgericht Frankfurt (Germany) 23 May 1995 (shoes), CISG-Online 185 (Pace) where the
witness presented was not admitted as he had in the meantime become a managing director of a party.
194 Bundesgericht (Switzerland) 2 April 2015 (wire rods), CISG-Online 2592 (Pace), para. 7.2.1; Land-
gericht Frankfurt (Germany) 13 July 1994 (shoes), CISG-Online 118 (Pace); Kantonsgericht Zug (Switzer-
land) 30 August 2007 (GMS Modules), CISG-Online 1722 (Pace).
195 In favour of such stricter requirements: Landgericht Stuttgart (Germany) 31 August 1989 (shoes),
CISG-Online 11 (Pace); Kantonsgericht Appenzell Ausserhoden (Switzerland) 9 March 2006 (fitness

equipment), CISG-Online 1375 (Pace); Ferrari, in: Ferrari et al. (eds), Internationales Vertragsrecht
(2018), Art. 39 CISG para. 40.
196 This may entail proving when the goods were delivered as the starting point from which time is
calculated Cour de cassation (France) 27 November 2012 (cooktops), SMEG v. Rothelec, CISG-Online
2403 (Pace).
197 Oberster Gerichtshof (Austria) 30 June 1998 (pineapples), CISG-Online 410 (Pace); Oberster Ger-
ichtshof (Austria) 24 May 2005 (grinding stock), CISG-Online 1046 (Pace).
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a weak indication of whether the notice was sent in a reasonable time (as it can easily be
backdated). If contested, the sending of the notice at that date has to be proven.198
129 In situations where the defects were not discovered until the lapse of a long period of
time, the buyer must prove that the defects could not have been discovered by an
orderly examination of the goods, but rather were hidden.199 Furthermore, the buyer has
to prove when it obtained knowledge about the defects, in particular when he obtained
examination reports discovering the defect.200
130 A party relying on contractual provisions or trade usages to deviate from the Art. 39
notice requirement has to sufficiently establish the territorial, temporal, personal and
factual sphere of application of that usage to the case.201
131 Equally, allegedly agreed deviations from the cut-off time have to be proven by the
party relying on them. Thus, the buyer has to prove extensions while the seller has to
prove that a shorter cut-off time has been agreed.

132 The PICC and the PECL, due to their focus on general contract law, do not contain
comparable provisions. By contrast, the PEL-Sales and the DCFR contain provisions which
are in their content largely comparable, irrespective of the different drafting technique used,
in particular, in the DCFR.202 The relevant provision dealing specifically with the notifica-
tion duty for sales contracts, IV. A. – 4:302 DCFR, merely regulates the deviation from the
general duty to notify the non-conformity with the debtor’s obligations in III. – 3:107.
133 The PEL-Sales contain, in Art. 4:302, a largely comparable provision, with an addition
for consumer sales in Art. 4:302(2). Art. 4:302(1) requires the buyer to notify the seller
about the non-conformity of the goods within “a reasonable time after the buyer
discovered or ought to have discovered it”, specifying the nature of the lack of conformity.
The sanction for non-compliance with that duty is a loss of the right to rely on the lack of
conformity. Art. 4:302(3) provides for a cut-off date of two years, which may be extended
if longer running guarantees of durability are given. This provision does not apply to
defects in title. Unlike under the CISG, Art. 1:302 PECL defines which factors have to be
taken into account in determining the reasonableness of a time for notice.
134 The national sales laws differ considerably as to the existence of the notice require-
ments, the time limit for notice and the consequences.203 Legal systems belonging to the
“Germanic law family”, i. e. Germany, Austria and Switzerland require – at least for
commercial sales – immediate notice.204 A failure to give such notice will lead to a loss
of rights. Other laws, such as the Italian, Portuguese or Mexican law require notice
within a certain number of days.205 The American UCC as well as several other laws
198 Rechtbank van Koophandel Veurne (Belgium) 25 April 2001 (diesel tram), CISG-Online 765.
199 Oberster Gerichtshof (Austria) 27 August 1999 (trekking shoes), CISG-Online 485 (Pace); Thürin-
gisches Oberlandesgericht (Germany) 26 May 1998 (live fish), CISG-Online 513 (Pace).
200 Handelsgericht Zürich (Switzerland) 18 June 2012 (antique statue), CISG-Online 2660 (Pace),
para. 4.2.1.(d).
201 Saarländisches Oberlandesgericht (Germany) 13 January 1993 (doors), CISG-Online 83 (Pace).
202 The same applies for Directive 1999/44 as explicitly mentioned in the opinion of the AG Szpunar
delivered on 6 April 2017 (1) Case C-133/16 (Christian Ferenschild vJPC Motor SA), para. 57. CISG
Online (2850).
203 For an overview see Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 39 para. 4.
204 Germany, § 377 HGB (Commercial Code); Austria §§ 377, 378 HGB (Commercial Code) (“un-
verzüglich”); Switzerland, Art. 201 OR (Civil Code) (“sofortig”).

205 See Italy, Art. 1495 (1) CC; Portugal, Art. 472 Código de Comercio both 8 days; Mexico, Art. 383
Código de Comercio, five days for open defects, 30 days for hidden defects; Spain, Art. 336 Código de
Comercio: 4 days for open defects, Art. 342, 30 days for hidden defects.
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require notice within a “reasonable time”.206 The English Sale of Goods Act only
requires notice when the buyer wants to terminate the contract.
By contrast, the French law only requires that the buyer brings his claims for non- 135
conformity within a two years period, without stipulating a particular notice period.207
Comparable rules can be found in several other laws belonging to the French family,
where reference is made to a “bref délai”.208 Other systems do not impose any
restrictions on the right to raise claims for non-conformity, but do have general
limitation periods.
206 US, § 2–607(3)(a) UCC; Netherlands, Art. 7:23.1 BW.
207 Art. 1648 Cc.
208 Belgium, Art. 1648 Cc.
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Article 40
The seller is not entitled to rely on the provisions of articles 38 and 39 if the lack of
conformity relates to facts of which he knew or could not have been unaware and
which he did not disclose to the buyer.
Bibliography: Baasch-Andersen, Exceptions to the Notification Rule – Are They Uniformly Interpreted,
9 Vindobona Journal (2005) 17 (Pace); Garro, The Buyer’s “Safety Valve” Under Article 40: What is the
Seller Supposed to Know and When?, 25 Journal of Law and Commerce (2006) 253 (Pace); Müller,
Die Beweislastverteilung für die Bösgläubigkeit des Verkäufers im Rahmen des Art. 40 CISG, IHR
(2005) 16.
Outline
1. General remarks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
4. Seller’s actual or constructive knowledge. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
a) Actual knowledge . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
b) Constructive knowledge . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
c) Instalment contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
d) Timing of the knowledge. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
5. Disclosure to the buyer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
6. Legal consequences and contractual modifications. . . . . . . . . . . . . . . . . . . . . . . . . 27
7. Burden of proof . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28

1 Art. 40 constitutes an exception to the rule in Art. 39 that a buyer loses his right to
rely on the non-conformity of the goods if he has not given proper notice to the seller
within a “reasonable time”. It adopts Art. 40 ULIS1 almost literally and codifies a special
aspect of the general principle of good faith2 as enshrined in Art. 7(2). A seller who
could not have been unaware of the non-conformity of the goods does not require any
protection through examination and notification duties of the buyer. It would be
contrary to good faith to allow such a seller to rely on the buyer’s failure to comply
with such obligations under Arts 38 and 39.3
1 Sono, in: Bianca/Bonell, Commentary (1987), Art. 40 para. 1; for the different stages see Honnold,
Documentary History (1989), pp. 98, 105, 126, 145, 333.

2 Eiselen, in: Kritzer/Vanto/Vanto/Eiselen, International Contract Manual, Vol. IV § 89:93; Garro, The
Buyer’s “Safety Valve” Under Article 40: What is the Seller Supposed to Know and When?, 25 Journal of
Law and Commerce 25 (2006) 253; Arbitral Award, SCC, 5 June 1998 (4,000 ton rail press), Beijing Light
Automobile Co. Ltd. v Connell Limited Partnership, CISG-Online 379 (Pace) (“Art. 40 is an expression of
the principles of fair trading…and it is by its very nature a codification of a general principle” at 6.2);
Oberster Gerichtshof (Austria) 14 February 2012 (paprika powder), CISG-Online 2308 (Pace), para. 2.2.
3 For an extensive discussion of the rationale underlying Art. 40 see Supreme Court (Israel) 17 March
2009 (tiles), Pamesa Ceramica v Yisrael Mendelson Ltd, CISG-Online 1980 (Pace).
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Consequently, while Art. 40 may in practice result in a “dramatic weakening of the 2
seller’s position”,4 it ensures a proper balance between the legitimate interests of both
parties.

1. General remarks
Dogmatically, the application of Art. 40 presupposes that the seller delivered non- 3
conforming goods and that the buyer did not comply with his notification duty under
Art. 39. In this situation, Art. 40 excludes any reliance on Art. 39(1) if two require-
ments are met: first, the seller must have had actual or constructive knowledge about
the non-conformity of the goods and second, the buyer must not have been informed
about such non-conformity. As Art. 40 constitutes an exception to the notification
rule in Art. 39, a seller friendly narrow interpretation of these two requirements has
been suggested in practice.5 However, it has to be kept in mind that the rule in Art. 39
itself constitutes a limitation on the general liability stipulated in Arts 35 et seq.
Therefore, notwithstanding the fact that a broad interpretation of Art. 40 – in
particular of the constructive knowledge requirement – might seriously limit the
seller’s ability to rely on Art. 39(1), the need for a narrow interpretation should not
be overemphasized.

Art. 40 is subject to party autonomy and any prevailing practice or usage in the sense 4
of Art. 9. Taking into account that Art. 40 is de facto a codification of the principle of
good faith, neither should be assumed lightly.
For contractual restrictions to the application of Art. 40, explicit language should be 5
required. Mere contractual modifications to the notice requirement, such as different
time limits or cut-off dates, do not in principle exclude the application of Art. 40.6
Moreover, given the good faith background of Art. 40, its complete exclusion – even if
done explicitly – would most likely be invalid under the national law governing the
validity of the provisions. Contractual restrictions of the seller’s liability with respect to
cases of bad faith are normally prohibited.7
4 Arbitral Award, SCC, 5 June 1998 (4,000 ton rail press), Beijing Light Automobile Co. Ltd. v Connell
Limited Partnership, CISG-Online 379 (Pace).

5 According to the Arbitral Award, SCC, 5 June 1998 (4,000 ton rail press), Beijing Light Automobile
Co. Ltd. v Connell Limited Partnership, CISG-Online 379 (Pace) at 6.3(a) Art. 40 should only be applied
in “special circumstances”; Kingspan Environmental Ltd et al v Borealis A/S et al (United Kingdom)
[2012] EWHC 1147 (Comm) 1 May 2012 (polymer), CISG-Online 2391 (Pace), para. 1028; cf. Supreme
Court (Israel) 17 March 2009 (tiles), Pamesa Ceramica v Yisrael Mendelson Ltd, CISG-Online 1980
(Pace) in relation to Art. 40 ULIS.
6 Sono, in: Bianca/Bonell, Commentary (1987), Art. 40 para. 2.2; Arbitral Award, SCC, 5 June 1998
(4,000 ton rail press), Beijing Light Automobile Co. Ltd. v Connell Limited Partnership, CISG-Online 379
(Pace).
7 Baasch-Andersen, Exceptions to the Notification Rule – Are They Uniformly Interpreted, 9 Vindo-
bona Journal (2005) 17 (20) (Pace); Arbitral Award, SCC, 5 June 1998 (4,000 ton rail press), Beijing Light
Automobile Co. Ltd. v Connell Limited Partnership, CISG-Online 379 (Pace); Garro, The Buyer’s “Safety
Valve” Under Article 40: What is the Seller Supposed to Know and When?, 25 Journal of Law and
Commerce 25 (2006) 253 (259); see also Art. 1.106(2) PECL and Art. 1.7(2) PICC which explicitly
prohibit an exclusion of the principle of good faith.
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6 Art. 40 only relates to the non-conformity of goods in the sense of Art. 35. A failure
to inform the seller in time about the legal deficiency of the goods in the sense of
Arts 41 and 42 is, by contrast, governed by Art. 43(2). Unlike Art. 40, Art. 43(2)
requires actual knowledge.
7 Furthermore, Art. 40 only relates directly to the examination and notification duties
of Arts 38 and 39. Whether it also applies in cases where such duties have been replaced
by contract or usage is a question of interpretation. Often such duties apply irrespective
of the seller’s knowledge and require notifications from the buyer primarily to clarify
the legal situation. In such cases, the seller’s knowledge is irrelevant for the existence of
the notification duty.8
4. Seller’s actual or constructive knowledge

8 Art. 40 requires that the seller “knew or could not have been unaware” of the facts
which result in the non-conformity of the goods. The relevant objects of knowledge are
the mere facts and not their legal classification, i. e. their relevance for a characterisation
of the goods as non-conforming. Thus, as long as the seller knows that the goods
delivered deviate slightly from the contractually agreed standard, it is irrelevant if he
considered this deviation to be permissible under the contract.
9 Knowledge must always pertain to the particular goods delivered and the non-con-
formity in question. A general knowledge by the seller that some of the goods produced
and sold are not of the best quality is not sufficient.9 Equally, knowledge about the lack of
quality does not justify the application of Art. 40 in relation to lack of quantity.10
10 a) Actual knowledge. Knowledge can always be assumed when the seller has actively
contributed to the non-conformity. Examples include sellers who have added water to
wine or who have adopted a prohibited production method.11
11 Unlike seller friendly national sales laws12, Art. 40 clearly does not require that the
seller acts in bad faith or wilfully deceives the buyer about the non-conformity.13 Mere
previous knowledge of the defects, such as the impurity of the goods or their contamina-
tion14, or of the risk of a defect – where that already constitutes non-conformity – is
sufficient. That does, however, not apply where known defects may have different causes,
i. e. may also be due to a defective production process or bad handling.15 Equally, national
8 Oberster Gerichtshof (Austria) 21 March 2000 (wood), CISG-Online 641.
9 Supreme Court (Israel) 17 March 2009 (tiles), Pamesa Ceramica v Yisrael Mendelson Ltd, CISG-
Online 1980 (Pace) at para. 45.
10 Landgericht Landshut (Germany) 5 April 1995 (sport clothing), CISG-Online 193 (Pace); cf.
Oberlandesgericht Zweibrücken (Germany) 2 February 2004 (milling equipment), CISG-Online 877

(Pace) applying Art. 40 in relation to the wrong origin of the spare parts but not for another existing
lack of quality of which the seller was not aware.
11 Landgericht Trier (Germany) 12 October 1995 (wine), CISG-Online 160 (Pace); see also DiMatteo
et al., International Sales Law (2005), p. 89 with further references.

12 See Germany and Austria, § 377(5) Commercial Code; Switzerland: Art. 203 OR; cf. UCC § 1–201
(25)(c) “has reason to know”.

13 Oberster Gerichtshof (Austria) 14 February 2012 (paprika powder), CISG-Online 2308 (Pace),
para. 3.2; but see Oberlandesgericht Zweibrücken (Germany) 2 February 2004 (milling equipment),
CISG-Online 877 (Pace) which seems to require bad faith.
14 See Bundesgerichtshof (Germany), 26 September 2012 (clay), CISG-Online 2348 (Pace), para. II.2(a)
– knowledge that the clay contained dioxin which had to be washed off before goods treated with it could
be used.
15 Kingspan Environmental Ltd et al v Borealis A/S et al (United Kingdom) [2012] EWHC 1147
(Comm) 1 May 2012 (polymer), CISG-Online 2391 (Pace), paras 1027 et seq.
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rules that assume that commercial sellers always have knowledge about the non-con-
formity of the goods are not applicable.16
b) Constructive knowledge. Different views exist about the interpretation of “could 12
not have been unaware”. According to certain commentary and case law, the lack of
conformity must be obvious and thus gross negligence will not be sufficient.17 The
reference has been interpreted as a mere facilitation of the difficulty in proving actual
knowledge, rather than as an alleviation of the required standard of knowledge to gross
negligence. Thus, constructive knowledge is limited to cases of major and obvious
defects, which the seller would have known applying a minimum standard of dili-
gence.18
The prevailing and better view is to interpret the notion as to include cases of gross 13
negligence.19 In light of the rationale of Art. 39, i. e. to give a seller the chance to
adequately react to a previously unknown lack of conformity, it seems appropriate to
deny a seller the benefit of relying on Art. 39 in all cases where his lack of necessary
information about the non-conformity is due to his own gross negligence.
Whether the seller could not have been unaware of the lack of conformity depends 14
largely on two factors. The first is the type of non-conformity, in particular its
obviousness and the extent of the non-conformity. The second factor is the role of the
seller in the overall transaction.
A grossly negligent lack of knowledge can be assumed in most cases where the non- 15
conformity consists of the delivery of an aliud, i. e. goods of a different type than the
one agreed on.20 Unless the wrong delivery is merely the result of a negligent mix up, a
seller can in general be expected to know that he delivered different goods than those
contracted for.21 An exception may be an intermediary seller who resells originally
packaged goods relying on the information from the producer. Art. 40 is also applicable
in most cases where the non-conformity consists of substantial deviations in the
quantity of the goods.22
More problematic are the cases where the goods lack the necessary quality. Only in 16
exceptional cases will the seller admit knowledge of the defects. In determining whether
the seller “ought to have known” about the defects in quality, the role of the seller in the
transaction becomes important. In general, sellers who are also the producers of the
16 Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 40 para. 6 referring to such a rule
in the French sales law.

17 Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 40 para. 5; Heilmann, Mängelge-
währleistung im UN-Kaufrecht, p. 340 seq.; Arbitral Award, SCC, 5 June 1998 (4,000 ton rail press),
Beijing Light Automobile Co. Ltd. v Connell Limited Partnership, CISG-Online 379 (Pace) requiring
“conscious disregard of facts that meet the eyes and are of evident relevance to the non-conformity”; in
this direction also Oberlandesgericht Zweibrücken (Germany) 2 February 2004 (milling equipment),
CISG-Online 877 (Pace); Oberlandesgericht Karlsruhe (Germany) 25 June 1997 (surface protective film),
CISG-Online 263 (Pace); Kingspan Environmental Ltd et al v Borealis A/S et al (United Kingdom) [2012]
EWHC 1147 (Comm) 1 May 2012 (polymer), CISG-Online 2391 (Pace), paras 1021 seq.
18 Bundesgericht (Switzerland) 2 April 2015 (steel coils), CISG-Online 2592 (Pace), para. 7.2.2.3 (denied
in relation to defects of the goods despite a knowledge of defective packing).

19 Ferrari, in: Ferrari et al. (eds), Internationales Vertragsrecht (2018), Art. 40 para. 2; Oberlandesgericht
Celle (Germany) 10 March 2004 (commercial vehicle), CISG-Online 824 (Pace); Oberlandesgericht
Düsseldorf (Germany) 23 January 2003 (stainless steel plates), CISG-Online 918 (Pace); Kantonsgericht
Schaffhausen (Switzerland), 27 January 2004 (model locomotives), CISG-Online 960 (Pace); Arbitral
Award, ICC 9187, June 1999 (coke), CISG-Online 705.
20 Bundesgericht (Switzerland) 2 April 2015 (wire rod), CISG-Online 2592 (Pace), para. 7.2.2.3.
21 See Oberlandesgericht Zweibrücken (Germany) 2 February 2004 (milling equipment), CISG-Online
877 (Pace) delivering Russian components instead of the agreed German components.
22 But see Landgericht Landshut (Germany) 5 April 1995 (sport clothing), CISG-Online 193 (Pace)
where knowledge of the seller was denied.
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goods have a much better knowledge about the conformity of the goods than sellers
who have the goods produced or are mere intermediaries.
17 A seller who is the producer of the goods ought to have known not only about the
obvious defects, but also about all defects, which would have been revealed by a
superficial examination. For certain goods, such as cars, a producer-seller may even
have an obligation to monitor the use of the goods in the market. In such cases, he can
be expected to know about defects, which have arisen with other customers of the
goods. Also previous defects resulting from the same production process may fall into
the category of defects about which the seller ought to have knowledge.23
18 For an intermediary who re-sells originally packaged goods relying on information
provided by the producer, gross negligence can only be assumed if there were already
indications about the non-conformity of the goods and the seller nevertheless failed to
have samples examined.24 Such indications can arise, for example, from complaints by
other customers or reports in the specialized press about the lack of quality. By contrast,
the mere fact that such an intermediary breached his own examination duties towards
his supplier is not sufficient to assume the he was grossly negligent in his lack of
knowledge.25
19 There is no general duty for every seller to examine the goods before delivery.26
Where a duty exists, however, under the rules governing the production of the goods
the seller can be assumed to know the results of such examinations.27 Furthermore,
unless explicitly informed, the seller need not to be aware of the particularities of the
buyer’s production process and in particular the age of the machinery used.28
20 There may be cases where the seller knows the actual condition of the goods, but, due
to a misinterpretation of his obligations as to the conformity of the goods, considers
them to be conforming. In such cases, Art. 40 only applies if the seller’s mistake was
grossly negligent.29
21 The knowledge of the seller’s personnel or their grossly negligent lack of knowledge is
in principle attributable to the seller. The same applies to auxiliary personnel used by
the seller to perform his duties.30 The seller should not be able to evade the application
of Art. 40 by using third parties to fulfil his obligations. This is also demonstrated in
Art. 79(2). By contrast, the knowledge of suppliers or independent experts who
examined the goods in the interest of both parties cannot be attributed to the seller.31
23 Oberlandesgericht Düsseldorf (Germany) 30 June 2015 (jeans), CISG-Online 2731, at II. 4. a. ee where
such presumed knowledge was rejected due to the facts of the case.
24 See also Ferrari, in: Ferrari et al. (eds), Internationales Vertragsrecht (2018), Art. 40 para. 3.
25 Gruber, in: MünchKommBGB, (2016), Art. 40 para. 6; Oberlandesgericht Oldenburg (Germany)
28 April 2000 (furniture), CISG-Online 683 (Pace).

26 Garro, The Buyer’s “Safety Valve” Under Article 40: What is the Seller Supposed to Know and
When?, 25 Journal of Law and Commerce (2006) 253 (258); Schwenzer, in: Schlechtriem/Schwenzer,
Commentary (2016), Art. 40 para. 6; Oberlandesgericht Oldenburg (Germany) 28 April 2000 (furniture),
27 Cour d’appel de Bordeaux (France) 12 September 2013 (tiles), Wolseley France Bois v Ceramiche
Marca Corona, CISG-Online 2552 (Pace) – the non-production of the examination reports was
considered to be an indication that the seller had constructive knowledge.
28 Oberlandesgericht Koblenz (Germany) 11 September 1998 (chemical substances), CISG-Online 505
(Pace).
29 In this direction also Oberlandesgericht Schleswig (Germany) 22 August 2002 (live sheep), CISG-
Online 710 (Pace).

30 Arbitral Award, ICC 9187, June 1999 (coke), CISG-Online 705 invoking in so far an analogy to
Art. 79(2).
31 For the supplier see Gruber, in: MünchKommBGB, (2016), Art. 40 para. 7; for the independent
expert, Arbitral Award, ICC 9187, June 1999 (coke), CISG-Online 705 – an independent expert had been
engaged by both parties.
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c) Instalment contracts. In the case of instalment contracts, the seller’s knowledge 22
has to be determined for each instalment separately. Consequently, in cases where the
goods come from the same source, notifications about the non-conformity of previous
instalments can result in an obligation for the seller to examine the goods to be
delivered in later instalments. The violation of this duty may lead to a grossly negligent
lack of knowledge on behalf of the seller. At the same time, the acknowledgement by the
seller that a certain instalment of goods is defective does not imply knowledge that also
earlier instalments were defective.32
d) Timing of the knowledge. The relevant point in time when the seller must have 23
had actual or constructive knowledge is not explicitly regulated in Art. 40. It should be
determined in light of the purposes of Art. 39. Consequently, the relevant time for
knowledge is the expiry of the “reasonable time” under Art. 39.33 The purpose of the
duty to notify the seller about the lack of conformity is primarily to serve the
information interest of the seller. If the seller, however, already knew about the lack of
conformity when notice should have been given, in principle there would be no need for
a further notice. The purpose of Art. 40 does not require that the knowledge exists at the
time of delivery or at the time of passing of risk.34
5. Disclosure to the buyer

The second requirement for an application of Art. 40 is that the seller has not 24
informed the buyer about the non-conformity. In light of Art. 35(3) and the rationale
underlying the buyer’s duty to give notice, the relevance of the non-disclosure require-
ment is limited in practice. In most cases where the seller informs the buyer about the
non-conformity of the goods there is no need to rely on Art. 40. A seller who informs
the buyer at the time of contracting about existing defects in the goods is, pursuant to
Art. 35(3), not liable for the non-conformity of the goods. By contrast, any information
about the non-conformity given to the buyer after the conclusion of the contract but
before delivery appears to exclude any need for the buyer to give notice about the lack of
conformity to the seller, who is clearly aware of it.35 Irrespective of this knowledge of the
seller, considerations of good faith may require the buyer to notify the seller that he
does not accept the delivered non-conforming goods.36
De facto, Art. 40 imposes on the seller, who could not have been unaware of the non- 25
conformity, a duty to disclose the non-conformity if he wants to rely on Art. 39. Unlike
in some national laws, it is not required that the seller acted fraudulently in not
informing the buyer about the non-conformity.37 Thus, a seller who knows that a
sample provided to the buyer is below the ordinary standard expected pursuant to
32
Cour d’appel de Lyon (France) 18 October 2012 (Christmas trees), CISG-Online 2402 (Pace).
33
Honnold/Flechtner, Uniform Law (2009), Arts 39, 40, 44 para. 260; Gruber, in: MünchKommBGB,
(2016), Art. 40 para. 8; Kingspan Environmental Ltd et al v Borealis A/S et al (United Kingdom) [2012]
EWHC 1147 (Comm) 1 May 2012 (polymer), CISG-Online 2391 (Pace), para. 1023.
34 For a different view: Landgericht Landshut (Germany) 5 April 1995 (sport clothing), CISG-Online
193 (Pace).
36 Such a duty was for example assumed without further discussion in Arbitral Award, ICC 9083/1999,
1 August 1999 (books), CISG-Online 706; for other examples see Garro, The Buyer’s “Safety Valve”
Under Article 40: What is the Seller Supposed to Know and When?, 25 Journal of Law and Commerce
(2006) 253 (255).
37 Arbitral Award, ICC 9083/1999, 1 August 1999 (books), CISG-Online 706.
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international usages, is not only prevented from invoking an agreement on the sample-
quality, but can also not rely on the buyer’s failure to give notice in time.38
26 Different views exist as to what happens where the non-conformity of the goods is
obvious from the accompanying documents, which, for example, evidence that the
goods delivered are of a different kind or quantity. The prevailing view seems to be that
this is not sufficient, but there are good opposing arguments39. The wording of Art. 40,
which does not positively state an obligation of the seller to inform the buyer about any
non-conformity he is aware of, makes it difficult to deduce such a general duty from
Art. 40.
6. Legal consequences and contractual modifications

27 The result of an application of Art. 40 is that the buyer’s failure to give appropriate
notice in the sense of Art. 39 will not deprive him of his remedies. Consequently, the
two year time limit in Art. 39(2) will be irrelevant.40 It has, however, been submitted
that the expiry of the cut-off time may result in an alleviation of the evidentiary burden
for the seller.41
7. Burden of proof
28 Under the general principles of the CISG, the burden of proof for the seller’s actual or
constructive knowledge lies with the buyer.42
29 In particular, for cases of constructive knowledge the buyer usually only has to prove
the facts from which the required knowledge can then be inferred. For example, where
the non-conformity consists of the delivery of a different good than contracted for, the
buyer only has to prove that such an aliud was delivered. The seller’s constructive
knowledge can then normally be presumed unless the seller can prove that exceptional
circumstances existed which rebut such a presumption. Equally, in cases of extreme
deviations from the required quality, it may be assumed that the seller could not have
been unaware of the non-conformity if it occurred in the seller’s domain.43 Apart from
that, however, there is no presumption that the seller was aware of the defects.44
38 Oberster Gerichtshof (Austria) 27 February 2003 (frozen fish), CISG-Online 794 (Pace) with note
Huber, IPrax (2004) 358 (359) – the seller did not disclose to the buyer that contrary to the usage in trade
the sample and the subsequent deliveries of fish where not of the catch from the present season.
39 Arbitral Award, SCC, 5 June 1998 (4,000 ton rail press), Beijing Light Automobile Co. Ltd. v Connell
Limited Partnership, CISG-Online 379 (Pace).

40 Sono, in: Bianca/Bonell, Commentary (1987), Art. 40 para. 2.2; Arbitral Award, SCC, 5 June 1998
(4,000 ton rail press), Beijing Light Automobile Co. Ltd. v Connell Limited Partnership, (4,000 ton rail
press), CISG-Online 379 (Pace); but see Arbitral Award, CIETAC, 30 March 1999 (flanges), CISG-Online
1170 (Pace) – despite the application of Art. 40 a cut-off time of two years was assumed.
41 Baasch-Andersen, Exceptions to the Notification Rule – Are They Uniformly Interpreted, 9 Vindo-
bona Journal (2005) 17 (26) (Pace).

42 Garro, The Buyer’s “Safety Valve” Under Article 40: What is the Seller Supposed to Know and
When?, 25 Journal of Law and Commerce (2006) 253 (254); Bundesgerichtshof (Germany) 30 June 2004
(paprika), CISG-Online 847 (Pace) at II 2(a); Oberster Gerichtshof (Austria) 14 February 2012 (paprika
powder), CISG-Online 2308 (Pace), para. 3; Arrondissementsrechtbank Roermond (Netherlands) 19 De-
cember 1991 (cheese), CISG-Online 29 (Pace); Handelsgericht Zürich (Switzerland) 30 November 1998
(lambskin coats), CISG-Online 415 (Pace) at 4 c, aa; cf. Ontario Superior Court of Justice (Canada)
31 August 1999 (picture frame mouldings), CISG-Online 433 (Pace) implicitly based on such an
allocation.
43 Bundesgerichtshof (Germany) 30 June 2004 (paprika), CISG-Online 847 (Pace) at II 2(b).
44 Hof van Beroep Gent (Belgium) 28 January 2004 (breeding sows and cages), CISG-Online 830 (Pace)
– no presumption against professional sellers; Cour de cassation (France) 4 November 2014 (Christmas
trees), CISG-Online 2563 (Pace) – no presumption that producer of Christmas trees knows the non-
conformity.
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The buyer’s burden of proof may be alleviated under the principle of proof proximity 30
where the actual or constructive knowledge depends on information about the seller’s
internal production processes. The seller may be able to provide the necessary informa-
tion, which the buyer often lacks, without great effort. Such alleviations may become
relevant in cases where the buyer provides information that demonstrates that the non-
conformity either occurred in the domain of the seller, in which case due to the nature
of the non-conformity the seller could not have been unaware of it, or it occurred in the
domain of the seller’s supplier, in which case constructive knowledge cannot be
assumed. In such cases, the seller has to provide the necessary information about his
own production process in order to demonstrate that the non-conformity did not occur
in his domain.45 The failure to provide existing reports about examinations may result
in the presumption that the seller had knowledge.46
Where the buyer has established actual or constructive knowledge, the seller bears the 31
burden of proof that the non-conformity has been disclosed to the buyer.47

Article 4:304 PEL-Sales and the IV. A. – 4:304 DCFR are largely identical to Art. 40 32
CISG48. However, they differ in their wording as the standard of the seller’s constructive
knowledge is expressed positively, i. e. that the seller “could reasonably be expected to
have known” the facts relating to the non-conformity. The different wording largely
excludes any discussion about whether a grossly negligent lack of knowledge is sufficient
to meet the standard or not.
45 Bundesgerichtshof (Germany) 30 June 2004 (paprika), CISG-Online 847 (Pace); Oberster Gerichtshof
(Austria) 14 February 2012 (paprika powder), CISG-Online 2308 (Pace), paras 2.2, 4.
46 Cour d’appel de Bordeaux (France) 12 September 2013 (tiles), Wolseley France Bois v Ceramiche
Marca Corona, CISG-Online 2552 (Pace) where the non-production of the examination reports was
considered to be an indication that the seller had constructive knowledge.
47 Landgericht Landshut (Germany) 5 April 1995 (sport clothing), CISG-Online 193 (Pace); Garro, The
Buyer’s “Safety Valve” Under Article 40: What is the Seller Supposed to Know and When?, 25 Journal of
Law and Commerce (2006) 253 (255); Baasch-Andersen, Exceptions to the Notification Rule – Are They
Uniformly Interpreted, 9 Vindobona Journal (2005) 17 (38) (Pace).
48 See also for remedies in general III. – 3:107 (3).
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Article 41
The seller must deliver goods which are free from any right or claim of a third
party, unless the buyer agreed to take the goods subject to that right or claim.
However, if such right or claim is based on industrial property or other intellectual
property, the seller’s obligation is governed by article 42.
Bibliography: Kiene, Rechtsmängel im UN-Kaufrecht und das Verhältnis von Art. 30 CISG zu Art. 41, 43
CISG, IHR (2006) 91; Metzger, Die Haftung des Verkäufers für Rechtsmängel gem. Artt. 41, 42 CISG, 73
RabelsZ (2009) 842; Su, Die Rechtsmängelhaftung des Verkäufers nach UN-Kaufecht und im chine-
sischen Recht, IPRax (1997) 284; Zhang, Die Rechtsmängelhaftung des Verkäufers nach UN-Kaufrecht
im Vergleich mit deutschem, englischem, US-amerikanischem und Haager Einheitlichem Kaufrecht
(1994) (Diss-Tübingen).
Outline
1. General remarks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
2. Third party rights and claims . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
a) Rights of third parties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
b) Claims of third parties. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
c) Rights of the seller . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
d) Public law encumbrances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
3. Time of the defects in title . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
4. Exclusion of liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
a) The buyer’s consent exception. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
b) Contractual restrictions of liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
5. Remedies for defects in title . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
a) Performance: Art. 46 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
b) Damages: Arts 74 et seq. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
c) Avoidance: Art. 49 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
6. Art. 41 and domestic rules providing for nullity of the contract . . . . . . . . . . 44
7. Burden of proof . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46

1 Art. 41 sets outs the seller’s obligations in relation to the transfer of title, providing
for a non-fault based system of strict liability of the seller for defects in title. In this
sense, it has largely the same function in relation to title as Art. 35 for questions of
conformity of the goods.1
2 The first sentence of Art. 41 specifies and supplements the seller’s general obligation
in Art. 30 to deliver goods and transfer the property in the goods by stipulating that the
goods must be “free from any right or claim of a third party”. The seller must not only
transfer unencumbered property in the goods but also unencumbered possession.2 This
1 In practice it is easier to differentiate between the obligation to deliver goods and any duty as to their
conformity than between the obligation to transfer property and that of the lack of third party rights and
claims. The existence of a third party ownership right at the same time entails a breach of the obligation
to transfer ownership under Art. 30, which could be classified as non-delivery see below at para. 11.
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reflects the buyer’s basic expectation that – in the absence of an agreement to the
contrary – he will receive goods unencumbered by any third party right or claim.
The second sentence of Art. 41 states that a special liability regime exists for rights 3
and claims based on intellectual or industrial property. This is set out in Art. 42 and is
more favourable to the seller than the general regime in Art. 41 first sentence. The
seller’s liability for breach of this obligation is made dependent on the fulfilment of
additional requirements. The intellectual property rights or claims must exist under a
particular law and it is necessary that the seller could not have been unaware of their
existence.
The first sentence of Art. 41 is derived from Art. 52 ULIS, which directly regulated 4
the notice requirement but presupposed the seller’s obligation. By contrast, the special
rules for rights and claims based on intellectual and industrial property rights have no
equivalent in the ULIS.3
Art. 41 does not address the transfer of property or any proprietary rights in the 5
goods sold. These questions are, pursuant to Art. 4(b), outside the scope of the CISG
and are governed by the applicable domestic law. Art. 41 also does not deal with the
relationship between the buyer and the third party, i. e. the justification of the asserted
claims and rights.4 The existence and legal consequences of such rights are governed by
the applicable national law. National law will in particular determine whether property
rights of third parties (or the seller) have been lost due to a transfer to a good faith
buyer.5
In principle, any breach of the obligation entitles the buyer to invoke the remedies 6
listed in Art. 45. However, pursuant to Art. 43(1) – which is the equivalent to Art. 39(1)
– buyers lose their rights to rely on a breach of Art. 41 when they do not make a timely
notification to the seller about the actual or alleged defects in title.6 Just as in the context
of non-conformity, no such loss of rights will occur if the seller could not have been
unaware of the defects in title (Art. 43(2)) or the buyer is excused from not giving notice
(Art. 44). Unlike Art. 39(2), there is no cut-off period of two years within which the
notice about a defect in title has to be given.

1. General remarks
Art. 41 requires that the goods delivered are “free from any right or claim of a third 7
party”. Liability for a breach of the obligation under Art. 41 does not require any
knowledge of the seller or even fault concerning the existence of the third party’s rights
or claims.
In the majority of cases, third party rights and claims will be based on the law of the 8
seller’s place of business. Unlike with industrial or intellectual property rights in Art. 42,
there is no territorial limitation as to the law upon which such rights and claims must be
based. Art. 41 covers rights and claims based on any law and not only those existing
3 For an overview on the drafting history Date-Bah, in: Bianca/Bonell, Commentary (1987), Art. 41
para. 1; Magnus, in: Staudinger Kommentar (2013), Art. 41 paras 3 seq.; with a special focus on the
inclusion of the separate regime in Art. 42, Prager, Verkäuferhaftung und ausländische gewerbliche
Schutzrechte (1987) pp. 121 et seq.
4 Enderlein/Maskow, International Sales Law (1992), Art. 41, para. 4.
5 See e. g. Landgericht Freiburg (Germany) 22 August 2002 (stolen automobile), CISG-Online 711
(Pace); Oberlandesgericht Dresden (Germany) 21 March 2007 (stolen automobile), CISG-Online 1626
(Pace).
6 For example, Bundesgerichtshof (Germany) 26 January 2006 (automobile), CISG-Online 1200 (Pace).
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under the law of the seller’s or buyer’s place of business or the law of the country where
the goods are to be used.7 Consequently, there is also no requirement as to the seller’s
awareness of the rights.8
2. Third party rights and claims

9 Art. 41 defines the seller’s obligation concerning the transfer of property and posses-
sion of the goods very broadly, referring to “rights” as well as “claims” of a third party.
It is clear from the second sentence of Art. 41 that this reference must be read as a right
or claim of a third party, excluding industrial or intellectual property rights. The notion
of “right” refers to actually existing rights while “claim” covers merely asserted rights.
10 a) Rights of third parties. Art. 41 covers – with the exception of the specifically
regulated industrial or intellectual property rights – all rights of proprietary or
contractual nature which a third party has against the buyer. The decisive factor is
solely whether the third party can exercise control over the goods or restrict the buyer in
his use or disposal of the goods. Third party rights which have been granted pre-
delivery by the buyer are, however, outside the scope of Art. 41. An example are security
interests in the goods granted by the buyer in order to obtain the necessary credit to
acquire the goods.9
11 Art. 41 covers, in particular, cases where the third party is the rightful owner of the
goods because neither the seller was authorized to transfer the property in the goods nor
did the buyer acquire ownership of the goods bona fide. In many jurisdictions, goods
which have been stolen cannot be acquired bona fide and can be reclaimed by the
original owner even from a bona fide buyer. Notwithstanding the fact that the seller has
not fulfilled his general obligation in Art. 30 to transfer the property in the goods,
Art. 41 remains applicable. Thus, the buyer may only invoke his remedies if he has
complied with the notice requirement of Art. 43. To classify such behaviour merely as a
breach of Art. 30, akin to a non-delivery and therefore not subject to any notice
requirements for remedies under Art. 43, would not be consistent with the underlying
scheme of the CISG. The drafters considered such cases to be covered by Art. 41, as
otherwise its scope of application would have been severely limited.10 The CISG
distinguishes between the act of delivery and efforts to transfer ownership on the one
hand and additional obligations stipulated in Arts 35 and 41 on the other.
12 Security interests in the goods are of considerable practical importance. It is not rare
that the goods serve as security for the seller’s suppliers or other creditors. Equally,
storage and carriage of the goods can lead to liens on the goods. The applicable national
laws differ considerably with respect to security interests in movables. In some cases,
liens will prevent the delivery of the goods or they will be lost due to the good faith
acquisition of the buyer free from encumbrances. In all other cases, liens constitute third
party rights in the sense of Art. 41, especially if the seller is responsible for their
existence. By contrast, liens created as a result of storage or carriage which has to be
paid for by the buyer do not qualify as third party rights in the sense of Art. 41.
7 Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 41 para. 18; Gruber, in: Münch-
KommBGB (2016), Art. 41 para. 5; see also Oberster Gerichtshof (Austria) 6 February 1996 (propane gas),
CISG-Online 224 (Pace) – the restriction on the resale of the gas resulted from a supplier of the seller.
8 Eiselen, in: Kritzer/Vanto/Vanto/Eiselen, International Contract Manual (2008), Vol. 4 § 89:106.
9 Magnus, in: Staudinger Kommentar (2013), Art. 41 para. 11; Schwenzer, in: Schlechtriem/Schwenzer,

10 Kiene, IHR (2006) 93 (94); but see for a different view Oberlandesgericht Dresden (Germany)
21 March 2007 (stolen automobile), CISG-Online 1626 (Pace).
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In addition to rights of a proprietary nature, i. e. rights in rem, contractual rights are 13
also covered in so far as they can be asserted by a third party against the buyer. Such
contractual rights may arise from leasing contracts when the third party lessee is, for
example, entitled to use the goods or buy them after the termination of the leasing
contract. By contrast, where the contractual right only exists in relation to the seller but
not against the buyer, it does not constitute a “third party right” in the sense of Art. 41.
Claims based on such contractual obligations against the buyer, however, may consti-
tute “third party claims” and are thereby also covered by Art. 41.
Equally covered, but as “third party rights”, are rights to challenge the transfer of 14
property to the buyer. Such rights exist in many insolvency laws11, but may also be
based on contractual agreements or legislation. Art. 41 is, for example, applicable to
statutory extensions of liability which may result from the acquisition of goods under
some national laws. Under Austrian law, for example, when the goods purchased
constitute a major part of the seller’s assets such an extension exists pursuant to
§ 1409 ABGB.
b) Claims of third parties. The express reference to a “claim of a third party” rather 15
than just a “right”, clarifies that the seller’s obligations concerning clean title under
Art. 41 are broader than those found in numerous national laws. In contracts governed
by the CISG, a seller not only breaches his delivery obligation under Art. 41 if the claims
asserted are valid, i. e. a third party has a right, but also does so in cases of unjustified
claims.12 In particular, liability under Art. 41 is not excluded by the fact that the buyer
has acquired the goods bona fide or free of encumbrances under the applicable national
law.13 Whenever previous owners or lien holders assert their formerly existing rights
against the buyer this constitutes a “claim of a third party” in the sense of Art. 41.
The extension of the seller’s liability in Art. 41 to claims of third parties is based on 16
the principle that the buyer shall enjoy unencumbered possession and use of the goods
“unprejudiced and undisturbed by such third party claims”.14 The burden for protracted
litigation and the ensuing uncertainty is to be borne by the seller and not by the buyer.
In this sense, Art. 41 protects the normal expectations of buyers, i. e. that they are not
purchasing a lawsuit with the goods.15
For a buyer, it is often difficult and costly to evaluate the merits of third party claims. 17
In international transactions such claims are frequently governed by a law with which the
buyer is not familiar. Furthermore, contesting claims may bind resources and interfere
with the buyer’s normal course of business. It is the seller’s obligation to remove such
burdens from the buyer. The application of Art. 41 will be justified if such claims are
asserted with sufficient firmness to impair the use of the goods. It is not a requirement
that the third party has already initiated proceedings for their enforcement.16
Different views exist as to whether Art. 41 also covers frivolous or unreasonable third 18
party claims. The issue may become relevant in cases where costs associated with
defending such claims are for whatever reasons not recoverable. The Secretariat
Commentary and several commentators deny the application of Art. 41 to these
11
E. g. Germany, §§ 129 et seq. Insolvency Act (Insolvenzordnung).
12
Secretariat Commentary on 1978 Draft, Art. 39 (now Art. 41) para. 3.
13 For a different view Neumayer/Ming, Convention de Vienne (1993), Art. 41 para. 4.
on Contracts for the International Sale of Goods (1984), para. 6–30 (Pace); see also Date-Bah, in: Bianca/
Bonell, Commentary (1987), Art. 41 para. 2; Schlechtriem/Butler, CISG (2009), para. 165.
16 Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 41 para. 12; Benicke, in: Münch-
KommHGB (2013), Art. 41 CISG, para. 6.
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frivolous and unreasonable claims.17 It is argued that application of Art. 41 in this sense
goes beyond the risk assumed by the seller. Rather, it is argued that Art. 41 should only
apply when the claim is substantial. Thus, all costs associated with such frivolous claims
must be borne by the buyer.
19 However, it is suggested that the better view is to make no distinction between
substantial and frivolous claims.18 In addition to uncertainty resulting from making this
difficult distinction, the seller is normally in a much better position to evaluate the
unreasonable and frivolous nature of the claim raised and defend against it. The principle
of asymmetric information upon which the seller’s liability for defects in title is predicated
also applies where the claims raised are frivolous. Consequently, the risk should in
principle be allocated to the seller. He is sufficiently protected by the fact that such claims,
which can be easily defeated, normally do not constitute a fundamental breach and that
claims for damages are limited to foreseeable damages pursuant to Art. 74.19
20 As such, pursuant to Art. 41, in principle the seller has to fight off all claims at his
own expense. Good faith and the duty to preserve the goods in Art. 86 may, however,
require the buyer to take urgent steps in defending claims to protect the interests of the
seller. Examples include filing defences to prevent deadlines from expiring or objecting
to confiscation measures.
21 c) Rights of the seller. Cases where the use of the goods is encumbered by rights and
claims of the seller, are not directly covered by the wording of Art. 41. Where such claims
are contrary to the contract between the parties, the question arises as to whether the seller
has fulfilled his general duties under Art. 30.20 For example, unless authorized by the
contract, if the seller retains the title to the goods he will not be deemed to have complied
with his duty to transfer the property in the goods. These cases should be treated as non-
delivery and not as delivery of goods with defects in title in the sense of Art. 41.
22 In all other cases of mere assertions of claims, Art. 41 is applicable by analogy.21 This
may arise, for example, when the seller, after conclusion of the contract, prohibits the
use or re-export of the goods to certain countries although the contract did not provide
for such a limitation.22
23 On the other hand, the buyer’s denial of the existing rights of the seller provided for
in the contract may itself constitute a breach of contract.23
24 d) Public law encumbrances. Different views exist as to whether encumbrances on
the use of the goods by public authorities can be considered a defect in title in the sense
17 Secretariat Commentary on 1978 Draft, Art. 39 (now Art. 42) para. 4; in this direction also
Neumayer/Ming, Convention de Vienne (1993), Art. 41 para. 4; Schlechtriem, The Seller’ Obligations
Under the United Nations Convention on Contracts for the International Sale of Goods, in: Galston/Smit
(eds), International Sales: The United Nations Convention on Contracts for the International Sale of
Goods (1984), p. 6–31.
18 In favour Magnus, in: Staudinger Kommentar (2013), Art. 41 para. 17; Benicke, in: Münch-
KommHGB (2013), Art. 41 CISG, paras 7 seq.

19 Sue, Die Rechtsmängelhaftung des Verkäufers nach UN-Kaufrecht und im chinesischen Recht,
IPRax (1997) 283 (286).

20 Benicke, in: MünchKommHGB (2013), Art. 41 CISG, para. 5; Gruber, in: MünchKommBGB (2016),
Art. 41 para. 11; the prevailing view is to apply Art. 41 also to these cases, but one should distinguish
between cases where the seller tries to transfer property but no such transfer occurs due to a third party
rights, and cases where he does not even try to transfer unencumbered property, for which Art. 30 is the
appropriate provision.
21 Against the application of Art. 41, Piltz, Internationales Kaufrecht (2008), para. 5–119.
22 Oberster Gerichtshof (Austria) 6 February 1996 (propane gas), CISG-Online 224 (Pace).
23 Federal Court, South Australian District, Adelaide (Australia) 28 April 1995 (tent hall structures),
Roder Zelt- und Hallenkonstruktionen GmbH v Rosedown Park Pty Ltd et al., CISG-Online 218 (Pace),
para. 58 where the denial of a retention of title clause was considered to be a fundamental breach.
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of Art. 41 or are generally to be characterized as a non-conformity in the sense of
Art. 35. This is relevant, as the requirements for liability under Arts 35 and 41 differ in
some important aspects, e. g. with regards to the relevance of the buyer’s actual knowl-
edge or negligent unawareness of existing deviations.24 In light of the drafting history
and the Secretariat’s Commentary,25 some commentators consider all public law
encumbrances, including taxes and confiscations, to be outside the scope of Art. 41.26
It is suggested that the better view, however, is to make a differentiation according to 25
the underlying reason for the restriction on the use of the goods by the public
authorities. Restrictions which are in the end related to the characteristics of the goods,
such as their non-compliance with public health or safety regulations, are not covered
by Art. 41, but may lead to non-conformity in the sense of Art. 35.
By contrast, restrictions by public authorities which are based on third party rights or 26
are intended to enforce such rights, e. g. confiscation of allegedly stolen goods, should be
treated as defects in title pursuant to Art. 41.27 Exceptions to this rule are restrictions
intended to enforce industrial or intellectual property rights, which are covered by Art. 42.
Contrary to a widely held view,28 Art. 41 may also apply to encumbrances based on 27
the non-payment of taxes or customs duties. It is correct that the question of which
party has to pay unexpected customs duties or taxes is not a question of defect in title
but one of risk transfer. By contrast, the consequences of a failure to pay may result in
third party claims. For example, claims that are covered by Art. 41 include situations
where the seller had to pay customs duties because the contract provided for delivery
DDP (Incoterms 2000) buyer’s place of business, yet failed to do so resulting in the
authorities either asking payment from the buyer or confiscating the goods.29
Export and import restrictions are, by contrast, simply issues of risk allocation. In 28
particular, where such restrictions result from unexpected events, such as flooding or
the like, the relevant question is, which party has to bear the risk for the existence of
export or import permissions under the contract.
3. Time of the defects in title

Pursuant to the wording of Art. 41, the relevant time for the existence of third party 29
rights and claims is the time of delivery as determined by Art. 31. It is, however, not
necessary that the third party has already asserted its rights or claims at this time.30 It is
24 Eiselen, in: Kritzer/Vanto/Vanto/Eiselen, International Contract Manual (2008), Vol. 4 § 89:104;
Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 41 para. 5; Schlechtriem/Butler, CISG

(2009), para. 165; for a more detailed discussion see pre Arts 35–44 para. 5.
Art. 41 paras 14 seq.; Neumayer/Ming, Convention de Vienne (1993), Art. 41 para. 6.

27 Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 41 paras 6 seq.; Kiene, IHR (2006)
93 (94); courts in such cases often make no distinctions between the right as such and the confiscation see
e. g. Landgericht Freiburg (Germany) 22 August 2002 (automobile case), CISG-Online 711 (Pace).
Art. 41 para. 14.

29 Benicke, in: MünchKommHGB (2013), Art. 41 CISG, para. 4; Salger, in: Witz/Salger/Lorenz, Kom-
mentar (2016), Art. 41, para. 9; Su, Die Rechtsmängelhaftung des Verkäufers nach UN-Kaufrecht und im
chinesischen Recht, IPRax (1997) 284 (286); cf. Arbitral Award, Tribunal of International Commercial
Arbitration at the Russian Federation Chamber of Commerce, 99/1997, 21 January 1998 (bus), CISG-
Online 1246 (Pace) where the customs status as a “temporary import” prevented the further use of the
bus sold in Russia on DDU basis. The restrictions imposed via that customs status were considered to be
“third party claims” of Russia.
30 For a general relevance of the time of delivery see Enderlein/Maskow, International Sales Law (1992),
Art. 41, para. 5.
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suggested that it must be sufficient if the facts upon which the claim is based were
already present at the time of delivery. Otherwise, the buyer would not be protected
against costs incurred through unjustified claims raised after the time of delivery.31
30 In connection with sales contracts involving carriage in particular, the buyer must
also be protected against rights created by the seller after the delivery has occurred but
before the goods are received by the buyer. Consequently, Art. 41 should also apply to
these cases.32
31 Both the time of contract conclusion and the time when the third party asserts its
rights or raises the claim are irrelevant for the application of Art. 41.
4. Exclusion of liability
32 a) The buyer’s consent exception. Pursuant to the second half of the first sentence of
Art. 41, the seller is relieved from his obligation to deliver goods of good title if the
buyer has agreed to receive goods which are subject to a third party right or claim. The
provision merely states the obvious following from the principle of party autonomy
underlying the CISG.
33 The wording makes clear that – unlike under Arts 35(3) or 42(2)(a) – actual or even
constructive knowledge of possible rights or claims is not sufficient. For an exclusion
of liability actual consent is necessary.33 Notwithstanding that actual consent may in
principle also be declared impliedly,34 it should not be assumed lightly.35 The fact that
the buyer will receive the goods unencumbered by rights and claims of a third party
(and in particular ownership rights) is one of the most fundamental expectations of
the buyer. Thus, while such agreements are submitted to the general rules on
interpretation in Art. 8, in practice specific and clear language or behaviour are
normally necessary to justify the assumption of such consent. There should be no
doubt that the buyer had the intention to renounce existing rights for defects in title.
Thus, the mere acceptance of delivery with the knowledge that the title to the goods is
defective is normally not sufficient to assume such consent.36 Equally, the buyer’s
knowledge that the owner of the warehouse where the goods are stored has a lien over
them for storage costs is not sufficient to assume such an implicit consent.37 Unless
the lien is reflected in the price of the goods, the buyer may expect the seller to
discharge the lien before delivery.
34 Consent may be assumed where the buyer has accepted the goods without raising any
objections even though the seller has explicitly mentioned the third party rights and that
they will not be discharged before delivery. The seller, for example, may inform the
buyer that the goods are in possession of a third party from which the buyer has to
recover the goods. In such cases, the buyer cannot rely on Art. 41 if the seller is not able
31 Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 41 para. 16; Ferrari, in: Ferrari
et al. (eds), Internationales Vertragsrecht (2018), Art. 41 para. 7.

32 Gruber, in: MünchKommBGB (2016), Art. 41 para. 17; Brunner, Kommentar (2014), Art. 41
para. 17; Magnus, in: Honsell, Kommentar (2010), Art. 41 para. 12.
34 See Schlechtriem/Butler, CISG (2009), para. 163; Secretariat Commentary on 1978 Draft, Art. 39 (now
Art. 41) para. 2.

35 Honnold/Flechtner, Uniform Law (2009), Art. 41 para. 266.1.
36 Magnus, in: Staudinger Kommentar (2013), Art. 41 para. 22; Ferrari, in: Ferrari et al. (eds),
Internationales Vertragsrecht (2018), Art. 41 para. 10; different Neumayer/Ming, Convention de Vienne
(1993), Art. 41 para. 7.
on Contracts for the International Sale of Goods (1984), para. 6–30 (Pace).
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to transfer possession.38 It can then be assumed that the rights are reflected in the price
for the goods, which always points towards consent. Another factor which may also
facilitate the assumption of consent in cases where the buyer has accepted the goods
without objections, is that the buyer can easily overcome existing third party rights or
claims. For example, that may be the case where the buyer and the third party belong to
the same group of companies and are thus prevented from asserting rights against each
other, or where the buyer can for other reasons put pressure on the third party to
renounce his rights or claims.
Where a reservation according to Art. 96 has been declared, the consent must be in 35
writing.39
b) Contractual restrictions of liability. It follows from Art. 6 that the parties may in 36
their contract also exclude any liability for defects in title or otherwise modify the
liability arising under Art. 41. Whether and to what extent such exclusions are valid is
in principle determined by the applicable national law (Art. 4(a)). However, particu-
larly in connection with standard terms, these national laws often make the validity of
exclusion clauses dependent on general and open textured concepts such as unfairness
or deviations from the non-mandatory provisions of law. In the context of applying
these concepts, the liability scheme provided in Arts 41 seq. may then become
relevant. For example, under German law, standard terms are invalid if they put the
other party at an “unreasonable disadvantage”. This will be presumed if a standard
term cannot be reconciled with “basic principles of the statutory rule from which it
deviates” (§ 307(2) BGB). Given that the second part of the first sentence of Art. 41
expressly provides for an exclusion of liability, parties can broadly exclude any liability
for defects in title in the standard terms, at least if the validity of the latter is governed
by German law.40
Limits may be reached where the third party relies on its ownership of the goods. 37
Notwithstanding that such cases fall within the scope of Art. 41, an exclusion of the
seller’s main obligation to transfer ownership of the goods seems to be problematic by
CISG standards.41
5. Remedies for defects in title

A breach of the obligation set out in Art. 41, in principle, entitles the buyer to invoke 38
the remedies listed in Art. 45. Thus, the buyer may claim performance under Art. 46(1)
as well as damages pursuant to Arts 74 et seq. or – in case of a fundamental breach –
avoid the contract pursuant to Art. 49. According to the prevailing view,42 the fact that
Arts 46(2)(3) and 5043 refer solely to non-conformity exclude their application in the
38 See the facts underlying the decision in the harvesting combines case by the Arbitration Court
[Appellate Court] for the Western Siberia Circuit (Russia) 6 August 2002 (harvesting combines),
O. I. L. Otto International Leasing AG v Zernopererabatyvayuschy kombinat Barnaulskaya melnitsa
(Pace); reversed later by High Arbitration Court for Presidium of Supreme Arbitration Court (Russia)
28 January 2003 (harvesting combines), CISG-Online 835 (Pace).
40 Ferrari, in: Ferrari et al. (eds), Internationales Vertragsrecht (2018), Art. 41 para. 9; Magnus, in:

41 See also Gruber, in: MünchKommBGB (2016), Art. 41 para. 18 – discussing the possible invalidity of
exclusions in the context of German law; Oberlandesgericht Dresden (Germany) 21 March 2007 (stolen
automobile), CISG-Online 1626 (Pace); see also the limits imposed by Art. 7.1.6 PICC on exemption
clauses relating to the liability for non-performance.
43 See in favour of the application of Art. 50 Magnus, in: Staudinger Kommentar (2013), Art. 41 para. 26;
Brunner, Kommentar (2014), Art. 41 para. 2, 28; for a detailed analysis see Art. 50 paras 12 et seq.
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context of defects in title. All remedies require, however, that the buyer has notified the
seller about the defects in title within the time set out in Art. 43(1) or that he is excused
for a failure to do so under Art. 44, or that the seller knew about the defects (Art. 43(2)).
39 a) Performance: Art. 46. The claim for performance encompasses both the delivery
of goods without any defects in title and efforts by the seller to remedy the defects in
title.44 The seller may, for example, be required to pay the third party to discharge liens
or remove any right to withhold the transfer of ownership. Performance may also
consist of defending a buyer against claims by the third party. Only where it is
impossible for the seller to provide goods with good title45 will the buyer not be able to
claim for specific performance. According to the prevailing view, the limitations in
Art. 46(2)(3), which exist for specific performance in the form of delivery of substitute
goods or repair if the goods are non-conforming, do not apply to defects in title.
Art. 46(2)(3) only refers to goods which “do not conform with the contract” but not to
goods affected by “third party rights or claims”.46
40 b) Damages: Arts 74 et seq. The buyer’s right to damages pursuant to Art. 74 covers
all costs incurred in connection with the third party right or claim. This includes, first,
all costs associated with freeing the goods from the third party right, i. e. in particular
payments made for discharging security interests in the goods. Second, it encompasses
losses, which are associated with the restricted usability of the goods due to the rights of
a third party. An example of this is the loss of profit, which may arise because the goods
cannot be resold or used in certain countries. All reasonable costs associated with
defending against such rights and claims, and in particular non-recoverable legal costs,
are also covered by Art. 74.
41 Notwithstanding the fact that liability under Art. 41 does not require fault of the
seller, the claim for damages may be excluded pursuant to Art. 79.47 However, the mere
lack of knowledge about the third party right or claim is not sufficient.48 By contrast,
Art. 79 may be applicable in cases of clearly unjustified claims raised by third parties.
These are usually not foreseeable for the seller and are often outside his sphere of
influence.
42 The buyer is in principle obligated to mitigate the losses through appropriate
measures. However, the duty to mitigate damages does not require the buyer to accept
a favourable offer to acquire property in the goods if they have previously been stolen.49
43 c) Avoidance: Art. 49. Defects in title to the goods only justify avoidance of the
contract if such defects constitute a fundamental breach in the sense of Art. 49(1)(a).
Reliance on Art. 49(1)(b) is not possible since – irrespective of the existing performance
claim under Art. 46 – defects in title do not, in principle, constitute a “non-delivery”.50
44 Gruber, in: MünchKommBGB (2016), Art. 41 para. 21; Walt, For Specific Performance Under the
United Nations Sales Convention, 26 Texas International Law Journal (1991) 211 (215 seq.).
46 Metzger, Die Haftung des Verkäufers für Rechtsmängel gem. Artt. 41, 42 CISG, 73 RabelsZ (2009)
842 (848).
47 Magnus, in: Staudinger Kommentar (2013), Art. 41 para. 25; for a different view Benicke, in:
MünchKommHGB (2013), Art. 41 CISG paras 9 seq.

48 Magnus, in: Honsell, Kommentar (2010), Art. 41 para. 16; for a different view see Landgericht
Freiburg (Germany) 22 August 2002 (stolen automobile), CISG-Online 711 (Pace) however rejecting
reliance on Art. 79 in the particular case since the seller could have been aware of the third party right.
49 Oberlandesgericht Dresden (Germany) 21 March 2007 (stolen automobile), CISG-Online 1626
(Pace).
50 Magnus, in: Honsell, Kommentar (2010), Art. 41 para. 16; for exceptions concerning rights of the
seller see above para. 21; for details see Art. 49 para. 41.
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A breach is fundamental when, due to the right or claim of the third party, the use of
the goods by the buyer is prevented and the buyer cannot discharge the right or the
claim.51 By contrast, a fundamental breach is normally excluded where the buyer can
secure the use of the goods within a reasonable time by discharging the rights and
claims and the seller provides sufficient security to compensate the buyer or the buyer
can set-off such payments with the purchase price. Also, the mere inconvenience and
costs associated with proceedings brought by third parties do not normally justify the
avoidance of the contract if the further use of the goods is not impaired and the seller
promises to indemnify the buyer and provides sufficient security for that.
6. Art. 41 and domestic rules providing for nullity of the contract

Some national laws, such as Art. 1599 of the French Code Civil, contain provisions in 44
which defects in title, i. e. the lack of ownership of the goods, can render the contract
void or justify rescission of the contract for mistake.52 In light of Art. 4(a), according to
which national law governs the issue of validity of the contract, the question arises as to
what effect such national rules have on the application of Arts 41 et seq. Is the buyer
able to rely on the remedies provided for by such national rules even if he has not
complied with the requirements of Arts 41 et seq. (e. g. the buyer has not given notice of
the lack of good title within the time prescribed by Art. 43)?
It is submitted that Art. 4(a) should be interpreted narrowly53 and that the carefully 45
designed system of Arts 41 et seq. should prevail over the domestic law. Art. 41 and the
relevant provisions of the national law have, in this sense, the same objective: to provide
a remedy when the seller fails to deliver goods without defects in title. Art. 41 thereby
provides for a special remedial system, which is appropriate for international sales
contracts. Furthermore, the application of domestic law provisions may endanger the
potential harmonization intended by the CISG.54 However, national provisions are
applicable where the ultimate reason for the invalidity of the contract is not the mere
existence of the right but the bad faith behaviour of the seller.
7. Burden of proof
The burden of proof is allocated according to the general principles of the CISG. 46
Reliance on a breach of an Art. 41 obligation requires the buyer to prove that the goods
delivered were not free of third party rights or claims. A seller defending against liability
has to prove that either the buyer consented to the delivery of the goods despite the
existing defects or that the parties agreed to exclude any liability. The seller also has to
prove that the claims raised are frivolous, if he wants to deny liability for that reason.55
51 Ferrari, in: Ferrari et al. (eds), Internationales Vertragsrecht (2018), Art. 41 para. 12; Metzger, Die
Haftung des Verkäufers für Rechtsmängel gem. Artt. 41, 42 CISG, 73 RabelsZ (2009) 842 (849).
52 As is the case in Swiss Law pursuant to Art. 24(1) no. 4 OR (Code of Obligations), Bundesgericht
(Switzerland) 25 October 1983, BGE 109 II 319 (322) at E.2; see also Brunner, Kommentar (2014), Art. 41
para. 34.
53 That means Art. 4(a) should be interpreted to refer to the domestic law only in cases where the CISG
is also not concerned with the issue underlying the domestic provision on validity. That is clearly not the
case concerning defects in title dealt within the CISG in Art. 41. For details see Art. 4 paras 13 et seq.
54 Honnold/Flechtner, Uniform Law (2009), Art. 41 para. 266; Gruber, in: MünchKommBGB (2016),
Art. 41 para. 25; for a different view see the publications quoted in Eiselen, in: Kritzer/Vanto/Vanto/
Eiselen, International Contract Manual (2008), Vol. 4 § 89:108.
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47 Due to their different focus on general contract law, neither the PICC nor the PECL
contain comparable provisions dealing specifically with defects in title. Such provisions
are, however, contained in the PEL-Sales as well as in the DCFR. Under both, the
difference between the liability regimes for the non-conformity of goods and for defects
in title is smaller than under the CISG and is largely limited to the non-application of
the cut-off defence for legal defects.
48 Art. 2:205 PEL-Sales and the nearly identically worded IV. A. – 2:305 DCFR provide
for a comparable regime of liability for defects in title, excluding those based on
intellectual property rights, which are regulated separately. As with Art. 41, they adopt
a broad concept of defects in title referring to both “right and claim”. The notes to PEL-
Sales make clear, however, that obviously unjustified claims are not covered, defining
the notion “claim” as “an asserted right that is reasonably well founded”.56
49 Of even greater practical relevance is that Art. 2:205 PEL and IV. A. – 2:305 DCFR do
not require an agreement by the buyer to exclude the seller’s liability for defects in title.
As becomes clear from Art. 2:207 PEL and IV. A. – 2:307 DCFR, the buyer’s actual or
presumed knowledge is sufficient in this respect.
50 Comparable provisions exist in a number of national laws, such as in § 2–312 UCC,
§ 12 of the English Sale of Goods Act 1979 or §§ 433, 435 of the German BGB.57 The
national systems of liability, however, deviate considerably from the CISG in important
details, such as the inclusion of claims or additional requirements as to derogations.
56
Hondious et al., Principles of European Law – Sales (PEL S)(2008), Art. 2:205 Comments B.
57
For further examples see Schlechtriem/Butler, CISG (2009), para. 163; Hondious et al., Principles of
European Law – Sales (PEL S)(2008), Art. 2:205 notes 1.
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Article 42
(1) The seller must deliver goods which are free from any right or claim of a third
party based on industrial property or other intellectual property, of which at the time
of the conclusion of the contract the seller knew or could not have been unaware,
provided that the right or claim is based on industrial property or other intellectual
property:
(a) under the law of the State where the goods will be resold or otherwise used, if
it was contemplated by the parties at the time of the conclusion of the
contract that the goods would be resold or otherwise used in that State; or
(b) in any other case, under the law of the State where the buyer has his place of
business.
(2) The obligation of the seller under the preceding paragraph does not extend to
cases where:
(a) at the time of the conclusion of the contract the buyer knew or could not
have been unaware of the right or claim; or
(b) the right or claim results from the seller’s compliance with technical draw-
ings, designs, formulae or other such specifications furnished by the buyer.
Bibliography: Beline, Legal Defect Protected by Article 42 of the CISG: A Wolf in Sheep’s Clothing, 7
University of Pittsburgh Journal of Technology Law and Policy (Spring 2007) 6; Janal, The Seller’s
Responsibility for Third Party Intellectual Property Rights under the Vienna Sales Convention, FS Kritzer
(2008), p. 203; Langenecker, UN-Einheitskaufrecht und Immaterialgüterrechte (1993); Metzger, Die
Haftung des Verkäufers für Rechtsmängel gem. Artt. 41, 42 CISG, 73 RabelsZ (2009) 842; Rauda/Etier,
Warranty for Intellectual Property Rights in the International Sale of Goods, 4 Vindobona Journal of
International Commercial Law and Arbitration (2000) 30; Raynard, Champs d’application de la garantie
du vendeur dans la vente internationale de marchandises, La Semaine Juridique (2003) 193; Schwerha IV,
Warranties against Infringement in the Sale of Goods: A Comparison of U.C.C. § 2–312(3) and Article 42
of the U. N. Convention on Contracts for the International Sale of Goods, 16 Michigan Journal of
International Law (1995) 441; Shinn, Liabilities Under Article 42 of the U. N. Convention on the
International Sale of Goods, 2 Minnesota Journal of Global Trade (1993) 115; Smythe, Clearing the
Clouds on the CISG’s Warranty of Title, (2016) 36 Nw. J. Int’l L. & Bus. 509, Van Duzer, A Seller’s
Responsibility for Third Party Intellectual Property Claims: Are the UN Sales Convention Rules Better?, 4
Canadian International Lawyer (2001) 187; Vida, Garantie du vendeur et propriété industrielle: les “vices
juridiques” dans la vente international de marchandises (Convention de Vienne), Revue trimestrielle de
droit commercial et de droit économique (1994) 21.
Outline
1. General remarks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
2. Third party rights and claims . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
3. Based on industrial property or other intellectual property . . . . . . . . . . . . . . . . 12
4. Territorial limitations. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
a) State of contemplated use: Art. 42(1)(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
b) Buyer’s state: Art. 42(1)(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
c) Intellectual property rights or claims under the law of other states . . . . 20
5. Relevant time. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
6. Seller’s actual or constructive knowledge . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
a) Knowledge . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
b) Constructive knowledge: “could not have been unaware” . . . . . . . . . . . . . . 28
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7. Exceptions from liability under Art. 42(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
a) Buyer’s knowledge or culpable lack of knowledge . . . . . . . . . . . . . . . . . . . . . . 36
b) Compliance with technical specifications by the buyer . . . . . . . . . . . . . . . . . 41
c) Remedies of the seller for infringing specifications from the buyer . . . 44
d) Other exemptions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
8. Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
9. Burden of proof . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54

1 Art. 42 defines the seller’s1 delivery obligations and liabilities in respect to third party
intellectual property rights and claims. It contains a special rule for this subspecies of
defective title, which tries to provide an appropriate solution to the complex problems
posed by such rights and claims in international transactions. The buyer’s legitimate
expectations to receive goods, which are not impaired by intellectual property rights or
claims of a third party, have to be balanced with the seller’s equally legitimate interest in
limiting his liability to problems he can foresee and handle in practice.2 As a conse-
quence, the first part of the first sentence of Art. 42(1) stipulates a general duty for the
seller to deliver goods that are free of intellectual property rights and claims of third
parties. This is, however, subject to significant limitations set out in the remaining parts
of Art. 42(1) and (2).
2 Art. 42 has no predecessor in the ULIS. Such claims were considered to be covered by
the general rules on liability for defects in title,3 the primary focus of which were defects
in ownership. The increasing importance of intellectual property rights in general and
the specific problems posed by them convinced the drafters of the CISG of the necessity
of a special regime for such claims. With the advent of the “information age”, the
“digital revolution” and the ever growing relevance of intellectual property rights it can
be assumed that the provision will gain even greater practical importance.4
3 The purpose of the inclusion of Art. 42 as a separate rule is to limit the seller’s
liability in this respect.5 It is in several respects more favourable to the seller than
Art. 41.6 Unlike Art. 41, Art. 42(1) contains territorial limitations as to the relevant
1 The regime in Art. 42 applies to all sales covered by the CISG and not only to particular experienced
sellers as is the case with the liability regime of the UCC, § 2–312(3), which only applies to sellers
“dealing regularly in goods of the kind”; on that see Schwerha IV, Warranties against Infringement in the
Sale of Goods: A Comparison of U.C.C. § 2–312(3) and Article 42 of the U. N. Convention on Contracts
for the International Sale of Goods, 16 Michigan Journal of International Law (1995) 441 (445 et seq.).
2 See for the drafting history and the changing concerns and emphasis put on the information
asymetries, Smythe, Clearing the Clouds on the CISG’s Warranty of Title, (2016) 36 Nw. J. Int’l L. &
Bus. 509 (519 et seq.).
3 For this proposition see Supreme Court (Israel) 22 August 1993, Eximin v Itel Style Ferrari Textile and
Shoes (jeans boots), CISG-Online 1082 (Pace) which, however, then applied Art. 52 ULIS with the
limitations of the CISG; see also the references by Magnus, in: Staudinger Kommentar (2013), Art. 42
para. 3.
4 See Honnold/Flechtner, Uniform Law (2009), Art. 42 para. 267 according to whom the developments
of the last two decades have “increased exponentially the complexity and importance of such issues”; see
also Smythe, Clearing the Clouds on the CISG’s Warranty of Title, (2016) 36 Nw. J. Int’l L. & Bus. 509
(514 et seq.) mentioning as a further ground patent “trolls” and trademark “squatters”.
5 Janal, The Seller’s Responsibility for Third Party Intellectual Property Rights under the Vienna Sales
Convention, FS Kritzer (2008), p. 203 (p. 204) (Pace).

842 (850); Sue, Die Rechtsmängelhaftung des Verkäufers nach UN-Kaufrecht und im chinesischen Recht,
IPRax (1997) 283 (286 seq.); cf. Shinn, Liabilities Under Article 42 of the U. N. Convention on the
International Sale of Goods, 2 Minnesota Journal of Global Trade (1993) 115 (120 seq.).
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rights and requires that the seller could not have been unaware of their existence. In
addition, the buyer’s actual or constructive knowledge of the intellectual property rights
or claims is sufficient to exclude liability. As a consequence, the liability regime in
Art. 42 whenever it is applicable excludes any reliance by the buyer on the general
liability regime for defective title in Art. 41.7
Art. 42 only regulates the relationship between the seller and the buyer, i. e. questions 4
of who has to bear the risk of third party intellectual property rights. The existence of
such intellectual property rights, the remedies available and the question of acquiring
goods free of any encumbrances in good faith are outside the scope of the CISG. In
particular, the limitations contained in Art. 42 in no way restrict the rights a third party
may have against the seller or buyer.8 These relationships with the third party are
governed by the intellectual property law of the country in question.
Art. 42 only contains a rudimentary regime for the increasingly important problem 5
of third party intellectual property rights and claims. Moreover, it was drafted before
the unpredictable developments of the last two decades in information technology.
Thus, parties are well advised to deal with the problems resulting from third party
intellectual property rights in their contract instead of relying solely on the regime
under Art. 42.9
Any non-compliance with the obligation in Art. 42 constitutes a breach of contract 6
which entitles the buyer to remedies provided for in Art. 45. In principle, the seller’s
liability under Art. 42 is excluded pursuant to Art. 43 if the buyer does not inform the
seller about the intellectual property rights or claims within a reasonable time. In
practice, however, due to the limitations on the seller’s liability in Arts 42 and 43(2),
this notice requirement only becomes relevant in cases where the seller, while not being
positively aware of the intellectual property right (which would exclude reliance on the
failure to give notice under Art. 43(2)), ought to have known about it (which is a
requirement for the seller’s liability under Art. 42(1)).10

1. General remarks
The need for a special liability regime for third party intellectual property rights and 7
claims results from a combination of two facts: first, the territorial limitations of most
intellectual property rights and second, the differences, which exist between the various
systems. Inventions, improvements, processes or designs, which may enjoy protection in
one country may not do so in other countries and vice versa. This makes it very difficult
for a seller to guarantee that the goods delivered do not infringe the intellectual property
rights of a third party in any other country worldwide. Consequently, the approach taken
by the ULIS as well as by national sales laws, which treat defects in title resulting from
intellectual property rights like any other defect in title is inappropriate in international

9 See for such advice Honnold/Flechtner, Uniform Law (2009), Art. 42 para. 270.5; see also Beline, Legal
Defect Protected by Article 42 of the CISG: A Wolf in Sheep’s Clothing, 7 University of Pittsburgh
Journal of Technology Law and Policy (Spring 2007) 6 (IV) with sample clauses.
on Contracts for the International Sale of Goods (1984), pp. 6–34 (Pace); Janal, The Seller’s Responsibility
for Third Party Intellectual Property Rights under the Vienna Sales Convention, FS Kritzer (2008), p. 203
(p. 223) (Pace).
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transactions and unduly burdensome on the seller.11 Such national rules are based on the
assumption that the seller can be considered to be aware of the third party intellectual
property rights existing in a particular country. Unlike with national transactions, such an
assumption is, for the above reasons, not justified in international transactions. There, the
goods will be used in foreign countries which are often only determined by the buyer after
delivery.12
8 These particularities of international transactions are reflected in the territorial
limitations to intellectual property rights and claims and in the additional knowledge
requirement imposed on the seller.
2. Third party rights and claims

9 Art. 42 provides that the seller has to deliver goods which are “free from any right or
claim of a third party based on industrial or intellectual property”. The reference to “right
or claim” makes clear that – in parallel with Art. 41 but unlike under some national laws13
– not only justified claims (rights) are covered. The buyer expects to receive undisturbed
possession and ownership of the goods and thus unjustified claims (claims) are also
covered. As liability in these issues boils down to the question of who has to deal with
such claims, the Austrian Supreme Court has rightly stated that it “is part of the seller’s
sphere of risk to deal with the third party in such cases”.14 This also applies to obviously
unjustified claims. The seller is normally in a much better position than the buyer to
determine whether a claim is made in bad faith and defend against such claims.15 In
addition, the seller is adequately protected even if the liability under Art. 42 is extended to
such claims. Obviously unjustified claims will in general not entitle the buyer to avoid the
contract as they clearly do not constitute a fundamental breach in the sense of Art. 25.
Moreover, claims for damages will often be excluded by Art. 79 as clearly unjustified
claims can be considered to be outside the seller’s sphere of risk.
10 At the same time, it is not necessary that the third party has already claimed its
existing rights. The uncertainty associated with the existence of such a right will often
prevent the anticipated use of the goods by the buyer, such as a reprocessing of the
goods.16 The abovementioned legitimate expectations of the buyer, which are protected
under Art. 42, justify a further extension of the provision. Art. 42 also covers cases
where it is not yet certain whether the goods actually infringe the intellectual property
Convention, FS Kritzer (2008), p. 203 (pp. 204 seq.) (Pace).

12 Secretariat Commentary on 1978 Draft, Art. 40 (now Art. 42) para. 4; for the drafting history see also
Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 42 paras 1 seq.

13 For example, U.S.: § 2–312(3) UCC (rightful claims); Germany: § 435 BGB; for a more detailed
discussion of the notion “claim” see Art. 41 paras 15 et seq.

14 Oberster Gerichtshof (Austria) 12 September 2006 (CD media), CISG-Online 1364 (Pace); see also
Bundesgericht (Switzerland) 17 April 2012 (EAS tags), CISG-Online 2346 (Pace), para. 2.3.
Convention, FS Kritzer (2008), p. 203 (p. 208) (Pace); Rauda/Etier, Warranty for Intellectual Property
Rights in the International Sale of Goods, 4 Vindobona Journal of International Commercial Law and
Arbitration (2000) 30 (37) (Pace); in favour of an additional “good faith” requirement Schwerha IV,
Warranties against Infringement in the Sale of Goods: A Comparison of U.C.C. § 2–312(3) and Article 42
of the U. N. Convention on Contracts for the International Sale of Goods, 16 Michigan Journal of
International Law (1995) 441 (457); for a more detailed discussion of the issue see Art. 41 paras 16 et seq.
16 Schwerha IV, Warranties against Infringement in the Sale of Goods: A Comparison of U.C.C. § 2–
312(3) and Article 42 of the U. N. Convention on Contracts for the International Sale of Goods, 16
Michigan Journal of International Law (1995) 441 (458); Rauda/Etier, Warranty for Intellectual Property
Rights in the International Sale of Goods, 4 Vindobona Journal of International Commercial Law and
Arbitration (2000) 30 (36) (Pace) – referring also to the threat that in case of an insolvency of the seller
the third party may seek recourse with the buyer.
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of a third party and where the third party has yet to raise a claim. Given the problems
associated with court proceedings (and in particular eventual damage to the buyer’s
reputation), for Art. 42 to apply it must be sufficient that proceedings for the infringe-
ment of the right are fairly likely. The buyer cannot be expected to wait until the third
party has threatened such proceedings or even initiated them before he may invoke the
remedies for a breach of the obligation under Art. 42.17 This may be the case where the
seller, who had previously produced goods that were sold under the licence of a third
party, continues to deliver the goods, even though the licence agreement has been
terminated due to a dispute about the validity of the patent. Even if the third party has
not yet approached the buyer about an alleged violation of its intellectual property
rights, the threat of such claims being brought is so imminent, that it in itself already
prevents the unfettered use of the goods.
Although this deviates from the strict wording of the provision (i. e. it does not 11
involve third party rights), Art. 42 also provides protection against any impairment of
the contractually agreed use by the seller’s own rights.18 However, in such cases it
always has to be determined first whether or not the restricted use was contemplated at
the time of contracting and reflected in the contract. For example, a buyer who has only
received a licence for one market may not invoke Art. 42 if the seller prevents the use of
the goods in different markets for which no licence has been granted.
3. Based on industrial property or other intellectual property

The second – and decisive – requirement for the application of the special liability 12
regime in Art. 42 is that the claim or right must be based on “industrial property or
other intellectual property”. The wording and drafting history make clear that the
inclusion of the notion of “industrial property” is merely to provide clarification. The
drafters wanted to avoid any doubts that claims based on all kinds of patents or
processes were included.19 In the absence of an explicit definition of what constitutes
“intellectual property” in the sense of Art. 42, its meaning has to be determined in
accordance with Art. 7(1). Taking into account the “international character” of the
CISG and “the need to promote uniformity in its application”, reference to “intellectual
property” in Art. 42 should be understood in the broad sense adopted in various
international conventions, evidencing a broad international consensus. As defined in
Art. 2 (viii) of the 1967 Convention Establishing the World Intellectual Property
Organization,20 it covers all “… rights resulting from intellectual activity in the
industrial, scientific, literary of artistic field”. It is the substantive concept of intellectual
property right, which is relevant and not the more formal aspects of registration, mode
of protection or form of the right in a particular country.21
17 For a more restrictive view, at least where the existence of the right is contested, see Janal, The
Seller’s Responsibility for Third Party Intellectual Property Rights under the Vienna Sales Convention, FS
Kritzer (2008), p. 203 (p. 210) (Pace).
18 For a more detailed discussion in the context of Art. 41 see there para. 22.
19 Secretariat Commentary on 1978 Draft, Art. 40 (now Art. 42) para. 1 footnote 1; Rauda/Etier,
Warranty for Intellectual Property Rights in the International Sale of Goods, 4 Vindobona Journal of
International Commercial Law and Arbitration (2000) 30 (31) (Pace); for the inclusion of patents of a
particular production process see Oberster Gerichtshof (Austria) 12 September 2006 (CD media), CISG-
Online 1364 (Pace).
20 Signed at Stockholm on 14 July 1967, as amended on 28 September 1979.
21 Rauda/Etier, Warranty for Intellectual Property Rights in the International Sale of Goods, 4
Vindobona Journal of International Commercial Law and Arbitration (2000) 30 (34 seq.) (Pace);
Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 42 para. 4; Magnus, in: Staudinger
Kommentar (2013), Art. 42 para. 9; Maley, The Limits to the Conformity of Goods in the United Nations
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13 Consequently, third party claims based on patents, trademarks, service marks,

commercial names and designations, appellation of origin and copyrights fall within
the scope of Art. 42. It is irrelevant whether such rights are protected under special rules
relating to intellectual property or general rules of tort law, restitution or unfair
competition. The decisive factor is whether the third party right is of such a nature to
impair the contractually agreed use of the goods.22 The right of name and personality
rights are also covered by Art. 42 in so far as they are affected by the use of the goods
and give their holder rights against the buyer.23
4. Territorial limitations
14 A qualification to the seller’s duty to deliver goods free of third party intellectual
property rights arises from the territorial limitations of the rights and claims concerned.
Broadly speaking, the seller’s liability under Art. 42 is limited to intellectual property
rights and claims arising under legal systems, which were in the contemplation of the
seller.24 The rationale for this limitation is that the seller, while not able to guarantee the
absence of third party intellectual property claims on a world-wide level, should at least
do so for the states in which the goods are most likely to be used. This means either the
state of contemplated use (Art. 42(1)(a)) or the state of the buyer’s place of business
(Art. 42(1)(b)). At the same time the buyer is adequately protected despite such
limitation. Due to the territoriality of intellectual property rights, his primary interest
is limited to receive goods, which are free of intellectual property rights in the countries
of the likely use.25
15 a) State of contemplated use: Art. 42(1)(a). Art. 42(1)(a) obligates the seller to
deliver goods which are not affected by third party intellectual property claims in the
“State where the goods will be resold or otherwise used” according to the contemplation
of the parties. In this sense, it has the same function and underlying rationale as
Art. 35(2)(b) which obligates the seller to deliver goods, which are fit for a particular
purpose communicated by the buyer. Whenever the seller does not object to a particular
use made known to him, the buyer is protected in his legitimate expectations that the
goods can be used for this purpose.26 This means that in relation to intellectual property
rights, the buyer should be able to use or resell the goods without any impairment of
third party rights or claims. The buyer should also be protected from any possible
recourse by his own customers resulting from the resale of the goods. As a consequence,
where the buyer has informed the seller that he will resell the goods to customers who
will then use them in a third country, the use of the goods in that third country must
also not be impaired by third party intellectual property rights.
16 The use must have been contemplated by the parties at the time of the conclusion of
the contract. It is irrelevant for liability under Art. 42(1)(a) whether the goods are
actually used in the contemplated state or not.27 “Contemplated” in the sense of
Convention on Contracts for the International Sale of Goods (CISG), 12 International Trade and Business
Law Review (2009) 82 (89 seq).
23 Magnus, in: Staudinger Kommentar (2013), Art. 42 para. 12; different Rauda/Etier, Warranty for
Intellectual Property Rights in the International Sale of Goods, 4 Vindobona Journal of International
Commercial Law and Arbitration (2000) 30 (34) (Pace).
24 Date-Bah, in: Bianca/Bonell, Commentary (1987), Art. 42 para. 2.1.
25 Magnus, in: Staudinger Kommentar (2013), Art. 42 para. 14; Janal, The Seller’s Responsibility for
Third Party Intellectual Property Rights under the Vienna Sales Convention, FS Kritzer (2008), p. 203
(p. 205) (Pace).
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Art. 42(1)(a) does not require an express agreement on the state of use. It is sufficient if
the seller can identify the prospective use from the circumstances, and in particular
from the communications by the buyer. An example of where the seller may be able to
contemplate the buyer’s use is where the buyer requests delivery to a different state than
where his place of business is located28 or for user manuals or other documentations in
a different language. By contrast, the mere knowledge of the seller that the buyer is
doing business in certain states is not sufficient.
Notwithstanding the use of the singular in the wording of Art. 42(1)(a), it is 17
suggested that the parties’ contemplated use in several “states” will also be relevant.29
b) Buyer’s state: Art. 42(1)(b). Art. 42(1)(b) contains a fall-back provision for cases 18
in which the parties did not contemplate a particular country of use. In this situation,
the goods must be free from any third party intellectual property rights “under the law
of the State where the buyer has his place of business”. The underlying rationale of this
rule is that in the absence of indications to the contrary, it can be assumed that the
buyer will use the goods in the country where he has his place of business. In so far as
this constitutes a kind of “ordinary use” of the goods, Art. 42(1)(b) can be considered to
be the intellectual property equivalent to Art. 35(2)(a).30
For the purposes of Art. 42(1)(b), the place of business at the time of contract 19
conclusion will be relevant. Any subsequent changes to the buyer’s place of business
will not affect the seller’s liability under Art. 42(1)(b). If a buyer has more than one
place of business, in principle, the relevant place of business will be determined in
accordance with Art. 10 unless it is clear that the goods will be used at a different place
of business.31
c) Intellectual property rights or claims under the law of other states. In principle, 20
the existence of intellectual property rights or claims under the law of states other than
those mentioned in Art. 42(1)(a),(b) does not give rise to liability under Art. 42. Due to
the fact that intellectual property rights have a limited territorial reach, “foreign” rights
and claims do not in general affect the use by the buyer in the state of contemplated use
or the state of his place of business.
This will be different in cases where such “foreign” intellectual property rights and 21
claims are recognized in the states listed in Art. 42(1) either under an international
instrument32 or according to the conflict of laws rules of such states. The consequence
of such recognition is that those “foreign” intellectual property rights and claims will
28 Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 42 para. 11; critical Magnus, in:
Staudinger Kommentar (2013), Art. 42 para. 17 who requires additional indicators; Rauda/Etier, War-
ranty for Intellectual Property Rights in the International Sale of Goods, 4 Vindobona Journal of
International Commercial Law and Arbitration (2000) 30 (51) (Pace).
Vindobona Journal of International Commercial Law and Arbitration (2000) 30 (52) (Pace); Beline, Legal
Defect Protected by Article 42 of the CISG: A Wolf in Sheep’s Clothing, 7 University of Pittsburgh
Journal of Technology Law and Policy (Spring 2007) 6 (at footnote 54); Metzger, Die Haftung des
Verkäufers für Rechtsmängel gem. Artt. 41, 42 CISG, 73 RabelsZ (2009) 842 (858); but see Shinn,
Liabilities Under Article 42 of the U. N. Convention on the International Sale of Goods, 2 Minnesota
Journal of Global Trade (1993) 115 (128 et seq.).
Vindobona Journal of International Commercial Law and Arbitration (2000) 30 (53) (Pace).
32 For example, Art. 64(1) European Patent Convention; Art. 4(1) Madrid Trademark Convention; for
further international instruments see the list provided by WIPO on its website at http://www.wipo.int/
treaties/en/; for Europe see Regulation (EC) 207/2009 of 26 February 2009 on the Community trade
mark, EC Official Journal, L 78/1, 24 March 2009, and its amendment by Regulation (EU) 2015/2424 of
16 December 2015, OJ, L 341/21, 24 December 2015 (now EU Trade Mark).
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lead to the same type of encumbrances of use in the states from which Art. 42 wanted to
protect the buyer. In such cases, a narrow interpretation of the wording of Art. 42
(“under the law of”) would unduly favour the seller who would then not be liable under
Art. 42. Consequently, the notion of “under the law of” should be understood to also
cover cases where the intellectual property rights or claims do not originate from this
law, i. e. when the rights are merely recognized by the law of the countries mentioned in
Art. 42.
22 Of particular relevance in this respect is where the intellectual property rights exist
either under the law of the state of the seller or in states through which the goods have
to be transported. In certain cases, i. e. where the goods are confiscated either at the
seller’s premises or in a state of transit before they reach the contractually agreed place
of delivery, the seller has already breached his Art. 30 obligation to deliver the goods. In
such cases, the seller is not liable under Art. 42 for the delivery of goods with defective
title, but may be liable for non-delivery. In all other cases, provided that third parties
can exercise their intellectual property rights on goods in transit, the liability of Art. 42
will depend on whether there is a “contemplated use” of the goods in the transit country
in the sense of Art. 42(1)(a).
5. Relevant time
23 The relevant time for the fulfilment of the seller’s obligation to deliver goods free of
third party claims is, in principle, the time of delivery.33 The time of contract conclusion
is only relevant for the question of the seller’s knowledge about such rights. Thus, a
seller who has discharged third party intellectual property claims existing at the time of
contract conclusion but before delivery has not breached his obligation under Art. 42.
Such discharge may occur, for example, by obtaining a licence from the third party or
by receiving an undertaking that assures that the use of the goods will not be impaired.
24 However, in light of the territorial nature of intellectual property rights, Art. 42 liability
will arise as long as the factual basis, which in the end led to the intellectual property
rights or claims, was present at the time of delivery. It is irrelevant if the claims, as such,
only arose or were raised after delivery, when the goods were transported to the place of
contemplated use where the territorially limited right exists. Liability under Art. 42 is
dependent on the place of use and not on the place of performance.34
6. Seller’s actual or constructive knowledge

25 The seller is only liable for intellectual property rights of which he “knew or could
not have been unaware”. In this respect, the seller’s liability under Art. 42 differs
considerably from his liability for non-conforming goods in Art. 35 and other defects
in title in Art. 41. Under both the Art. 35 and 41 regimes, the seller’s liability is not
dependent on any element of fault, although under Art. 42 such an element is
introduced by the requirement of knowledge.35
26 a) Knowledge. Knowledge can be assumed in all cases where third parties have either
contacted the seller directly before delivery or have, at an earlier occasion, asserted their
Vindobona Journal of International Commercial Law and Arbitration (2000) 30 (40 seq.) (Pace).

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rights against other buyers who have informed the seller about this. Due to the reference
in Art. 42 to “claims”, it is irrelevant for the seller’s knowledge whether he believes the
claims to be rightful or on the basis of a legal opinion considers the claims to be
unjustified.
It is not required that the seller must be aware of the exact nature of the intellectual 27
property rights or claims of the third party. It is sufficient, in this respect, that the seller
is aware of the facts leading to the claims as well as of the possibility that these facts
might result in such claims. In other words, this means that on the basis of the facts
known to the seller, third party intellectual property claims should have been reasonably
foreseeable.36
b) Constructive knowledge: “could not have been unaware”. Situations where the seller 28
“could not have been unaware” of the existence of third party property rights are more
difficult to determine. This is in part due the different understandings of the standard,
which is also used in Arts 35(3) and 40, to be applied for constructive knowledge.37 Several
commentators consider this standard to be close to actual knowledge, which – unlike the
standard of “ought to have known” – requires more than gross negligence. Contrary to the
standard of “gross negligence”, the standard of “could not have been unaware” should not
in principle entail a duty to inquire into the existence of defects. This view is also
supported by commentators in relation to intellectual property rights.38
In the context of Art. 42, the rejection of any duty for the seller to inquire whether 29
the goods may be affected by intellectual property rights, however, would largely deprive
the liability for such rights of any practical relevance.39 The Secretariat’s commentary
seems to be based on the assumption that the seller must at least inquire with the
relevant registers or other publications in the country in question, when it states that the
seller is liable for claims based on “a patent application or a grant which had been
published in the country in question”.40
Whether the seller is under a duty to investigate the existence of intellectual property 30
rights and the extent of such a duty depends on the circumstances of the particular case.
Relevant factors are, in particular, the status of the seller, the mode of contract
conclusion and the nature of the rights concerned.
Sellers, who are at the same time the producers of the goods and, due to their size, 31
have either their own legal department or outside lawyers dealing regularly with
intellectual property questions, are normally required to investigate the existence of

37 For a detailed discussion see Art. 35 paras 157 et seq.
38 Shinn, Liabilities Under Article 42 of the U. N. Convention on the International Sale of Goods,
2 Minnesota Journal of Global Trade (1993) 115 (125 seq.) limiting it to information “readily available” to
the seller; but see Rauda/Etier, Warranty for Intellectual Property Rights in the International Sale of
Goods, 4 Vindobona Journal of International Commercial Law and Arbitration (2000) 30 (44) (Pace)
deducing an obligation to enquire from the standard; for a detailed account of the different views in the
context of Art. 42 see Metzger, Die Haftung des Verkäufers für Rechtsmängel gem. Artt. 41, 42 CISG,
73 RabelsZ (2009) 842 (850 et seq); Janal, The Seller’s Responsibility for Third Party Intellectual Property
Rights under the Vienna Sales Convention, FS Kritzer (2008), p. 203 (pp. 213 et seq.) (Pace); for a narrow
interpretation see also Smythe, Clearing the Clouds on the CISG’s Warranty of Title, (2016) 36 Nw. J.
Int’l L. & Bus. 509 (538 seq.).
39 Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 42 para. 15 who is otherwise one
of the most prominent supporters of a strict interpretation of the standard excluding any obligation to
enquire.
40 Secretariat Commentary on 1978 Draft, Art. 40 (now Art. 42) para. 8; but see for the criticism that
the Commentary does not reflect the discussions during the drafting history Shinn, Liabilities Under
Article 42 of the U. N. Convention on the International Sale of Goods, 2 Minnesota Journal of Global
Trade (1993) 115 (124).
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such rights.41 Such sellers “ought to have been aware” of all intellectual property claims
which could have been discovered by a search in the relevant registers or other relevant
publications. The same applies in principle to non-registered intellectual property
rights, which are of a common occurrence, such as copyrights. The burden imposed
on producer-sellers to investigate is not unreasonable. It is limited to the countries in
question, i. e. the countries where the goods are to be used or the country where the
buyer has his place of business. Additionally, the task is or will increasingly be facilitated
by the availability of the relevant data via the Internet.42 The seller knows the particular
features of the goods and therefore is in a much better position than the buyer to
evaluate potential conflicts with intellectual property rights. Moreover, such sellers have
a general interest in clarifying the legal situation, which goes beyond the particular
transaction. Information acquired by an investigation may not only be relevant for
future sales or the future development of the goods, it may also be required to exclude
the seller’s liability towards the third party under the relevant law.43
32 Primarily in relation to smaller sized sellers, the mode of contracting may lead to a
different evaluation. If there have been no previous contacts with the particular market,
it may not be reasonable for a seller to spend time and money on research when it is still
highly doubtful whether a contract will ever be concluded. If the whole contractual
relationship is based on an offer and there are no further negotiations during which the
seller should have made inquiries or there are no other indicators for the existence of
such rights, the seller will be deemed to have lacked the necessary constructive knowl-
edge of the intellectual property rights.44
33 Comparable economic considerations may limit the obligation to inquire for sellers who
are mere intermediaries. The intermediary seller can only be expected to “ought to have
been aware” of registered intellectual property rights easily discoverable by a search in the
relevant registers, unless the goods are regularly imported into the particular market or the
seller, due to his size or business, has his own legal department that deals with intellectual
property rights.45 Intermediary sellers should, in principle, not be required to incur the
cost associated with an investigation of non-registered rights. However, where such rights
are well known, constructive knowledge may be assumed.
34 In addition, a seller may always rely on the trustworthy information that in the
relevant state no intellectual property rights exist, which may impede an unrestricted
use of the goods, if it is from a lawyer of the country in question.46
7. Exceptions from liability under Art. 42(2)

35 Pursuant to Art. 42(2) the seller’s liability is excluded when the buyer either had
actual or constructive knowledge of the intellectual property claims affecting the goods
or such claims are based on his own instructions. In both cases the rationale underlying
41 In favour of largely imposing a duty on such seller on the basis of an economic analysis Metzger, Die
Haftung des Verkäufers für Rechtsmängel gem. Artt. 41, 42 CISG, 73 RabelsZ (2009) 842 (853 seq).
42 Honnold/Flechtner, Uniform Law (2009), Art. 42 para. 270.1.
842 (856 seq).

44 Cf. Janal, The Seller’s Responsibility for Third Party Intellectual Property Rights under the Vienna
Sales Convention, FS Kritzer (2008), p. 203 (pp. 215 et seq.) (Pace).

45 Magnus, in: Staudinger Kommentar (2013), Art. 42 para. 22; for a more detailed account of potentially
relevant factors Rauda/Etier, Warranty for Intellectual Property Rights in the International Sale of Goods, 4
Vindobona Journal of International Commercial Law and Arbitration (2000) 30 (46 seq.) (Pace).
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the liability pursuant to Art. 42, i. e. to protect the buyer’s expectations to receive goods
which are free of third party intellectual property rights, is not met or does not merit
protection.47
a) Buyer’s knowledge or culpable lack of knowledge. The buyer has knowledge 36
about the existence of a third party intellectual property right if he knows that the goods
delivered are counterfeit.48
In principle, it is sufficient for the exclusion of liability that the buyer has knowledge 37
about the existence of a claim, irrespective of whether he considers it to be justified or
not. Thus, a buyer who, on the basis of a legal opinion, considers an existing claim to be
without merit and concludes the contract without any reservation cannot hold the seller
liable under Art. 42 if the third party claim later turns out to be justified.49
In addition to actual knowledge, the seller’s liability is also excluded if the buyer 38
could not have been unaware of the relevant third party rights or claims. While the
standard is in principle the same as for the seller, there is a major difference in its
practical application: unlike the seller the buyer has in principle no duty to investigate
the existence of even registered rights unless he has contractually assumed such a duty.
The buyer often lacks information concerning the composition of the goods and the
processes involved in their production to determine, on a reliable basis, whether they
may infringe third party intellectual property rights. Contrary to a tendency in the
French jurisprudence,50 even experienced buyers cannot be assumed to know of all
relevant intellectual property rights in their home country.
However, the buyer could not have been unaware of the third party intellectual 39
property rights if such rights are internationally known, as in the case of a well known
trademark.51 The standard may also be fulfilled if the price charged for the goods is low
enough to leave doubt that they may not be originals.
The relevant time for the buyer’s knowledge is the time of contract conclusion. 40
Subsequently acquired knowledge by the buyer may trigger the start of the notice period
but does not exclude the seller’s liability under Art. 42(2).
b) Compliance with technical specifications by the buyer. Art. 42(2)(b) excludes the 41
seller’s liability in all cases where the third party intellectual property right or claim is
the direct result of the seller’s compliance with technical specifications by the buyer. It is
a general principle of the CISG, codified primarily in Art. 80, that a party who, by his
conduct, has caused a breach of contract by the other party must bear the risk of his
own behaviour and will not be able to hold the other party liable for the breach.
The exclusion of liability under Art. 42(2)(b) requires, however, that the specifica- 42
tions were sufficiently detailed and that the third party intellectual property claims were
actually caused by compliance with such specification. General information provided or
47See also Gabriel, Sale of Goods (2004), Art. 42 p. 142.

48See Tribunal de grande instance Versailles (France) 23 November 2004 (counterfeit furniture), CISG-
Online 93 (Pace).
49 On this point see also Eiselen, in: Kritzer/Vanto/Vanto/Eiselen, International Contract Manual
(2008), Vol. 4 § 89:130 at a.

50 For example, Cour de cassation 19 March 2002 (footwear), CISG-Online 662 (Pace); Cour d’appel de
Colmar, 13 November 2002 (printed textile fabric), CISG-Online 792 (Pace) which deduced from the
“professional capacity” of the buyer that he could not have been unaware of existing third party
intellectual property rights; in favour of a basic economic analysis of the “superior cost bearer” also
Metzger, Die Haftung des Verkäufers für Rechtsmängel gem. Artt. 41, 42 CISG, 73 RabelsZ (2009) 842
(862).
51 See Supreme Court (Israel) 22 August 1993 (jeans boots), Eximin v Itel Style Ferrari Textiles and
Shoes, CISG-Online 1082 (Pace); relating to the “Levi’s trademark” for jeans; although the ULIS was
applicable, the court referred to the CISG by analogy.
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wishes expressed concerning the future use of the goods are in principle not sufficient
when they leave the seller room to select an alternative, which would not trigger such
third party intellectual property claims.52 The fact that the buyer knows that his
specification may trigger a third party intellectual property right or claim is not required
for an exclusion of liability.
43 A seller who is aware of the fact that the buyer’s specification may lead to an
infringement of third party intellectual property rights may be obligated, under the
principle of good faith, to inform the buyer about the possible infringement in case the
buyer is not aware of this.53 A failure to comply with such an ancillary duty may lead to a
claim for damages, notwithstanding the exclusion of the seller’s liability under Art. 42.54
44 c) Remedies of the seller for infringing specifications from the buyer. Art. 42(2)(b)
does not address the question of which remedies the seller may have against the buyer if
the specification given by the buyer will or has resulted in infringements of the
intellectual property rights of a third party. Where the parties have not explicitly
provided for such situations in their contract, the existing remedies can be derived
from Arts 61–65.
45 The obligation to provide technical specification or the like is an ancillary obligation
of the buyer. It is supplemented by an obligation to give such specifications in a way,
which does not cause any harm to the seller complying with them. Therefore, a seller
who realizes that the buyer’s instructions will lead to a violation of third party
intellectual property rights is not bound to comply with them. Rather, under Art. 62,
the seller may require the buyer to comply with his specification obligation in a way
which avoids infringement. In absence of a clear contractual agreement to the contrary,
the seller will not be required to deliberately infringe third party intellectual property
rights and expose himself to eventual liability and/or damage his reputation. In such
cases, any insistence by the buyer on the infringing specifications constitutes a funda-
mental breach, which will entitle the seller to avoid the contract under Art. 64(1)(a).
However, these remedies only exist if the specification would actually lead (or at least
have a high probability of leading) to an infringement of a third party intellectual
property right. The likelihood of claims, which in the end will not be substantiated, is
not sufficient. In such cases, the seller may require the buyer to give an undertaking to
hold the seller free from all liability.
46 Where the seller has not been aware of the resulting infringements of third party
intellectual property rights and has consequently been subject to infringement actions
by the third party, the seller may claim damages from the buyer for a breach of the
abovementioned ancillary duty (Art. 74).55
47 d) Other exemptions. In addition to the exclusions of liability in Art. 42(2), the buyer
may also lose his right to rely on a breach of the seller’s obligations under Art. 42(1) due
to a failure to comply with the notice requirement in Art. 43(1), unless one of the
exceptions or excuses in Arts 43(2) or 44 applies.
52 Magnus, in: Staudinger Kommentar (2013), Art. 42 para. 29; Schwenzer, in: Schlechtriem/Schwenzer,
Commentary (2016), Art. 42 para. 21; see also for such a proposition under the ULIS Supreme Court
(Israel) 22 August 1993 (jeans boots), Eximin v Textile and Footwear, CISG-Online 1082 (Pace).
53 Rauda/Etier, Warranty for Intellectual Property Rights in the International Sale of Goods,
4 Vindobona Journal of International Commercial Law and Arbitration (2000) 30 (58 seq.) (Pace).
54 In this direction but with a faulty reliance on domestic law Supreme Court (Israel) 22 August 1993
(jeans boots), Eximin v Textile and Footwear, CISG-Online 1082 (Pace); for a differentiation between the
case where the seller was aware of the likely infringement at the time of contract conclusion (liability
under Art. 42) and subsequent awareness before delivery (damages for breach of an ancillary duty) see
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In principle, the parties may also limit the seller’s liability through contractual 48
exemption clauses. In so far as such exemption clauses only relate to liability for third
party intellectual property claims, their validity under the applicable national law should
not be problematic. National law often limits liability to the actual infringement of
intellectual property rights and considers mere claims not to be sufficient. By contrast,
where the exclusion of liability also extends to infringement of rights, the validity of such
exclusion clauses may be doubtful under the relevant national laws. Liability under
Art. 42 only arises if the seller has actual knowledge of the third party intellectual
property rights or at least could not have been unaware of them. Therefore, any exclusion
of such liability comes close to an exemption for one’s own deceit or gross negligence.56
8. Remedies
Any violation of the seller’s obligations under Art. 42(1), which do not fall under the 49
Art. 42(2) exemptions, entitles the buyer to the remedies available for breach of contract
under Art. 45. This encompasses, undisputedly, all remedies which are available for all
other defects in title under Art. 41, i. e. specific performance (Art. 46 (1)), damages
(Arts 74 seq.) and avoidance (Art. 49), provided that the additional requirements are
met. Furthermore, the buyer is entitled to retain performance of his obligations (in
particular payment) until the seller performs his obligations properly or it is beyond
doubt that the third party will not make use of his rights.57
It is controversial whether the provisions explicitly linked to the non-conformity of 50
the goods, i. e. Arts 46(2),(3) and 50, apply to third party intellectual property rights or
claims. In favour of such an application, it can be argued that liability under Art. 42, in
its structure and from the interests involved, is more similar to the liability regime for
the non-conformity of goods under Art. 35 than to that for defects in title under Art. 41.
As a consequence, within the limits of Art. 46(2) and (3), the buyer of generic goods
may be able to ask for repair or substitute goods not affected by third party intellectual
property rights or claims.
The prevailing view is, however, that the remedies and limitations of Arts 46(2),(3) 51
and 50 do not apply to breaches of the obligation to deliver goods free of third party
intellectual property rights under Art. 42. It can rely on the clear wording and the
legislative history. These make it unlikely that the opposing view will ever gain sufficient
support to promote uniformity in the application of the CISG as required by Art. 7.58
Irrespective of this the underlying rationale, Art. 46(2),(3) justifies the application of
these limitations to breaches of Art. 42 obligations.59
If no licence can be obtained for using the goods, the existence of a third party 52
intellectual property right will frequently constitute a fundamental breach and allow for
the avoidance of the contract. A buyer will generally not be expected to target different
markets other than those originally contemplated to avoid being affected by third party
intellectual property rights.60
The liability regime in Art. 42 excludes all remedies under domestic law which are in 53
one way or another primarily based on the existence of third party intellectual property
56 Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 42 para. 26 who does not distin-
guish between exemptions for rights and claims in this regards.

57 Oberster Gerichtshof (Austria) 12 September 2006 (CD media), CISG-Online 1364 (Pace), however,
without the limitations as to the temporary nature of the right of retention.

Convention, FS Kritzer (2008), p. 203 (pp. 225 et seq.) (Pace).

Convention, FS Kritzer (2008), p. 203 (pp. 228 et seq.) (Pace).
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rights. Thus, irrespective of the fact that the validity of the contract is in principle
outside the scope of the CISG, the parties are prevented from relying on provisions of
domestic law according to which a mistake about the existence of such third party
intellectual property rights renders the contract invalid. Equally excluded are domestic
remedies for negligent misrepresentation.61 By contrast, the buyer may still invoke
remedies for deceit under national law.
9. Burden of proof
54 In general, the burden of proof is allocated according to the principle that each party
has to prove the factual prerequisites of a provision it intends to rely upon.62 Thus, after
taking delivery, the buyer bears the burden of proof for the existence of third party
intellectual property rights or claims under the relevant law63 as well as for the seller’s
knowledge64 about them.
55 Notwithstanding the buyer’s obligation to prove the existence of a right or claim, a
differentiation has to be made in relation to determining the relevant legal system under
which the right or claim exists. If the buyer wants to rely on rights or claims under the
law of a country of contemplated use pursuant to Art. 42(1)(a), the buyer has to prove
that the parties actually contemplated a specific state for use of the goods. By contrast, if
the buyer invokes liability under Art. 42(1)(b), the seller has to prove that the parties
contemplated a state of use different than that of the buyer’s place of business. In both
cases, actual delivery by the seller to a state other than the state of the buyer’s place of
business is a strong indicator for contemplated use. However, the actual delivery is by
no means conclusive. The relevant time for the contemplated use is that of contract
conclusion. Thus, in the absence of contractual provisions to the contrary, the other
party can always argue that the actual use was only contemplated at a later time.
56 With respect to the seller’s actual or assumed awareness of such third party rights or
claims, the buyer only has to prove the facts from which a constructive knowledge can
be deduced.
57 The seller bears the burden of proof for the requirements of the exceptions under
Art. 42(2) if he wants to rely on them. Thus, in connection with Art. 42(2)(a) he has to
prove that the buyer knew or could not have been unaware of the existence of such
third party rights or claims. This can be done, for example, by proving that the seller
has informed the buyer about discussions with a third party concerning intellectual
property rights.
58 Reliance on Art. 42(2)(b) requires proof that the encumbrances by intellectual
property claims were the direct consequence of the buyer’s instructions.

59 The PICC and PECL, with their focus on general contract law, do not explicitly
address the issue of the seller’s liability for rights and claims of third parties based on
intellectual property rights. Special rules for that question are, however, contained in the
PEL-Sales and the DCFR, which are worded identically. The drafters of both have
61 Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 42 paras 29 seq.
62 Oberster Gerichtshof (Austria) 12 September 2006 (CD media), CISG-Online 1364 (Pace); generally
on the allocation of burden of proof see Art. 4 paras 34 et seq.
63 Bundesgericht (Switzerland) 17 April 2012 (EAS tags), CISG-Online 2346 (Pace), para. 2.3.
64 See Hof Arnhem (Netherlands) 21 May 1996 (knitwear), Maglificio Esse v Wehkamp, CISG-Online
1290 (Pace) confirming the earlier decision of the Rechtsbank Zwolle (Netherlands) 1 March 1995
(textiles), CISG-Online 372 (Unilex) in this matter.
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adopted the basic decision of the CISG to provide for a special and seller friendly
liability regime for intellectual property rights, deviating from the general regime of
strict liability for defects in title. It should be noted that unlike these instruments, the
national laws of most European States do not provide for a separate regime.65
According to Art. 2:206 PEL-Sales and IV. A. – 2:306 DCFR, liability for intellectual 60
property rights only exists for rights, which “the seller knew or could reasonably be
expected to have known”. The strict liability existing under Art. 2:205 PEL-Sales for
other defects in title is limited by a fault element comparable to the one in Art. 42 CISG.
Equally, the reservation as to compliance with the buyer’s specification and orders can
be found in Art. 2:206 PEL-Sales and IV. A. – 2:306 DCFR. However, neither instru-
ment provides for the territorial limitations contained in Art. 42.
National laws often do not contain a special liability regime for intellectual property 61
rights, which is more lenient than the general regime for defects in title. Where such
separate regimes exist, they usually do not deviate to a great extent from the general
regime, as is the case with § 2–312(3) UCC. That prevalence of a strict system of liability
in national laws may be relevant to the interpretation of the CISG under Art. 7. A strict
interpretation of the various limitations of Art. 42, which results in a liability closer to
that contained in the national laws, is more likely to promote “uniformity” in the
application of the CISG than one deviating even more from the strict liability systems.66
65
Hondious et al., Principles of European Law – Sales (PEL S) (2008), Art. 2:206 Notes 1.
66
Metzger, Die Haftung des Verkäufers für Rechtsmängel gem. Artt. 41, 42 CISG, 73 RabelsZ (2009)
842 (850 et seq).
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Article 43
(1) The buyer loses the right to rely on the provisions of article 41 or article 42 if he
does not give notice to the seller specifying the nature of the right or claim of the
third party within a reasonable time after he has become aware or ought to have
become aware of the right or claim.
(2) The seller is not entitled to rely on the provisions of the preceding paragraph if
he knew of the right or claim of the third party and the nature of it.
Bibliography: See selected bibliographies of Arts 39, 41 and 42.
Outline
1. General remarks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
2. Notice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
a) Content . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
b) Form, transmission and addressee of the notice . . . . . . . . . . . . . . . . . . . . . . . . 12
3. Notice period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
a) Start of the notice period: actual or constructive awareness . . . . . . . . . . . 14
b) Length of the notice period: reasonable time . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
c) Lack of cut-off time/statute of limitation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
4. Legal consequences of a failure to give notice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
5. Exclusion of reliance on a failure to give notice in time: Art. 43(2) . . . . . . 25
6. Burden of proof . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27

1 Art. 43(1) stipulates a duty for the buyer to notify the seller about defects in the title
within a reasonable amount of time if he does not want to lose his remedies for such
defects. Reliance on a failure to notify is, however, excluded pursuant to Art. 43(2),
where the seller knew about the right or claim of the third party and its nature.
Furthermore, pursuant to Art. 44, in exceptional circumstances the buyer may be
excused for a failure to give notice with the effect that at least some remedies will be
preserved for the buyer.
2 Art. 43 is the defects in title equivalent to the “reasonable time” notice requirement in
Arts 39 and 40 for the non-conformity of goods.1 The regimes differ in two respects to
take account of the differences between defects in title and non-conformity of the goods.
The first difference concerns the exclusion of reliance on a failure to give notice.
Art. 43(2) requires actual knowledge of the claims while under Art. 40 it is sufficient
that the seller could not have been unaware of the non-conformity. The second relates
to the latest time when notice must be given. For a defect in title, there is no equivalent
to the two-year cut-off time in Art. 39(2). Additionally, there is also no equivalent to the
duty to examine in Art. 38 as such an examination would probably not reveal defects in
title.2
1Sono, in: Bianca/Bonell, Commentary (1987), Art. 43 para. 2.1.
2For the differences see also Ferrari, in: Ferrari et al. (eds), Internationales Vertragsrecht (2018),
Art. 43 paras 2 et seq.; Magnus, in: Honsell, Kommentar (2010), Art. 43 para. 1.
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The underlying rationale for Art. 43(1) and the primary purpose of the notice 3
requirement is, however, the same as in Art. 39: to inform the seller about existing
defects in title and to allow him to take appropriate action.3 This may consist of either
trying to discharge existing rights, refuting claims raised or, if cure is not possible,
seeking redress from his suppliers. Additionally, the notice requirement also protects
the seller’s interest in the speedy finalization of projects.4
The basic principles of the regulation in Art. 43 were already contained in the 4
provision’s predecessor, Art. 52 ULIS.

1. General remarks
Art. 43 makes the buyer’s remedies for defects in title of the goods delivered 5
dependent on the fulfilment of a notice requirement, the content and timing of which
are set out in general terms. In applying and interpreting these general terms, and in
particular in determining what constitutes a “reasonable time” for notice, the abundant
case law on Arts 39 and 40 may provide valuable guidance.5 The notice regime for non-
conformity serves the same purpose and has a comparable structure as the one in
Art. 43. It is thus suggested that the “reasonableness” of time will be dependent on the
same factors.
Taking into account the grave consequences associated with a failure to notify the 6
seller, i. e. loss of all remedies, Art. 43 should not be interpreted too strictly. This is
further supported by the fact that the seller is only excluded from relying on a failure to
give notice in time when he knew about the claim. Unlike in the context of Art. 40,
mere constructive knowledge is not sufficient for the application of Art. 43. This creates
an imbalance between the standard for buyer and seller, i. e. for the starting of the notice
period it is sufficient if the buyer “ought to have been aware” of the defect.
The notice requirement exists for all defects in title in the sense of Arts 41 and 42. It 7
also covers any further liability for defect in title assumed by the seller, e. g. liability for
the complete absence of intellectual property rights of third parties on a worldwide
basis.6
In stipulating a duty to inform the seller about defects in title, Art. 43 clarifies that the 8
buyer is in principle not required to defend against third party rights or claims.
Irrespective of this, if immediate action is necessary to protect the seller’s interests in
the goods, the buyer may be required to take the necessary actions under good faith
considerations (Art. 7(1)) or to mitigate losses (Art. 77).7
2. Notice
a) Content. Art. 43 requires the buyer to give notice “specifying the nature of the 9
right or claim of the third party”. The requirements as to the specificity of the notice
follow from the purpose of the notice requirement. The notice should inform the seller
about the existence of a right and at the same time allow him to take immediate action
to defend his rights. In particular, the seller should be enabled to contact the third party
3 See Bundesgerichtshof (Germany) 26 January 2006 (automobile), CISG-Online 1200 (Pace) para. 13;
Eiselen, in: Kritzer/Vanto/Vanto/Eiselen, International Contract Manual (2008), Vol. 4 § 89:117.

4 Benicke, in: MünchKommHGB (2013), Art. 43 CISG, para. 1.
5 See also Honnold/Flechtner, Uniform Law (2009), Art. 43 para. 271.
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to either discharge existing rights or to refute claims raised.8 This requires that the third
party is sufficiently specified, normally by name and address. Furthermore, the buyer
has to specify the nature of the right or claim raised and the steps taken so far by the
third party in a way which will allow the seller to take appropriate action.9 This does not
require the buyer to give details about the date or the terms of a registration.10 On the
other hand, general information that the goods are subject to third party claims is not
sufficient.
10 In principle, a transfer of the relevant letters, faxes, emails or other documents
including the claims raised will be sufficient to comply with the specificity require-
ment.11 In general, it is not incumbent on the buyer to investigate the claims any further
or to make their content more accessible to the seller. Only where additional informa-
tion, which may be necessary for the seller to take action, has been passed orally may
the buyer be required to do more than merely transmit the documents received. The
buyer is not required to evaluate the chances of success of the claims raised or set out
the steps he wants to undertake to defend against the claim.
11 In cases where the goods suffer from several defects in title, the buyer has to give
notice about every defect upon which he wants to rely.12
12 b) Form, transmission and addressee of the notice. The CISG does not prescribe a
particular form for the notice, thus it may be given in any form: e. g. in writing,
electronically or even orally. Pursuant to Art. 27, the seller bears the risk of delay and
non-delivery of the notice if the buyer has selected appropriate means of communica-
tion. The addressee of the notice is the seller.13
3. Notice period
13 Art. 43(1) requires the buyer to give notice about existing defects in title “within a
reasonable time after he has become aware or ought to have become aware of the right
or claim”. The start, but in particular the length of the notice period, i. e. what
constitutes a reasonable time, depends on the facts of each particular case.14 These
may include any usages or practices established between the parties insofar as they have
not already determined a more precise time for notice.
14 a) Start of the notice period: actual or constructive awareness. The reasonable time
of Art. 43(1) begins to run when the buyer becomes aware or ought to become aware of
the legal defect.15 Awareness can be assumed whenever the rights or claims have been
raised or asserted directly towards the buyer or his relevant employees. The buyer may,
however, also become aware of the existence of third party rights before they have been
asserted against him, for example by press reports about actions against other parties
using the same goods. In such cases, the notice period starts to run once the buyer has
8Ferrari, in: Ferrari et al. (eds), Internationales Vertragsrecht (2018), Art. 43 para. 5.
9Bundesgerichtshof (Germany) 26 January 2006 (automobile), CISG-Online 1200 (Pace) para. 21;
Janal, The Seller’s Responsibility for Third Party Intellectual Property Rights under the Vienna Sales
Convention, FS Kritzer (2008), p. 203 (p. 223) (Pace); Magnus, in: Honsell, Kommentar (2010), Art. 43
para. 5.
10 Too far in this respect Beline, Legal Defect Protected by Article 42 of the CISG: A Wolf in Sheep’s
Clothing, 7 University of Pittsburgh Journal of Technology Law and Policy (Spring 2007) 6 (at footnote 71).
14 See also Bundesgerichtshof (Germany) 26 January 2006 (automobile), CISG-Online 1200 (Pace)
which held that “a schematic fixing of the time for notice of defect is impossible”.
15 Bundesgerichtshof (Germany) 26 January 2006 (automobile), CISG-Online 1200 (Pace).
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become aware of the existence of such actions. However, any time needed to clarify
whether the third party will make use of his rights may be taken into account in
determining the length of the period.
Determining when the buyer “ought to have become aware” of defects in title is more 15
problematic. In light of the fact that the provision merely serves the interests of the
seller and applies different standards of knowledge for the buyer and the seller, the
requirements for assuming constructive knowledge of the buyer should be high. The
indications that the third party has rights or will raise claims against the buyer must be
so clear that a diligent buyer would either draw the necessary conclusions or investigate
the issue further. In this respect, it has to be kept in mind that the buyer can normally
rely on the absence of third party rights and has no general duty to make inquiries.16
There is no equivalent provision to Art. 38, which, particularly in relation to intellectual
property rights, could form the basis for such a general duty to search the relevant
registers. It is even not always sufficient that a third party has previously raised claims
against other customers.17 In the meantime the third party may have changed its view
about its claims or its strategy. In particular, where the seller is aware of previous
instances where the third party has raised claims and delivers the goods without any
reservations, a buyer may assume that the problems have been resolved.
Indications of third party rights can be foreign trade marks or names printed on the 16
goods.18 Equally the seizure of goods by the police or customs office is generally
sufficient to assume at least constructive knowledge of a third party claim.
The notice period under Art. 43 will only start to run with the delivery of the goods. 17
However, in exceptional circumstances the buyer may be required under the principle
of good faith to inform the seller about third party rights or claims of which he is aware
even before delivery. This is because these third party rights may seriously affect the
seller’s position, e. g. they may lead to a confiscation of the goods during transport.19
b) Length of the notice period: reasonable time. The primary factors for determin- 18
ing the length of the notice period, i. e. what constitutes a “reasonable time”, are the
type of the right asserted and the consequences which may be associated with the claim
of the third party.
A factor which shortens the time period is the threat of a deterioration of the seller’s 19
legal position if no immediate actions are taken. The initiation of proceedings by the
third party with resulting time limits to be met by the seller is one example. The threat
to the sellers’ rights resulting from such proceedings is much greater than the one
flowing from a mere assertion of rights outside judicial proceedings. Without the time
to prepare a meaningful defence, the seller may lose an existing right due to the res
judicata effect of a resulting decision. The seller’s ability to refute claims may also be
affected through an imminent loss of evidence which can only be prevented by swift
action. The same applies where the claims raised by the third party and the actions
threatened may result in a loss of possession of the goods. This is especially so where a
transfer of the possession of the goods to the third party is imminent, with the threat
that such goods will be moved out of the reach of the seller. The seller often has greater
chances in defending against de-possession than petitioning for repossession.
16Magnus, in: Honsell, Kommentar (2010), Art. 43 para. 8.

17Oberster Gerichtshof (Austria) 12 September 2006 (CD media), CISG-Online 1364 (Pace).
19 Magnus, in: Honsell, Kommentar (2010), Art. 43 para. 9; see also Gruber, in: MünchKommBGB
(2016), Art. 43 para. 10 who seems, however, to subsume such cases under Art. 43 which will lead to
differences concerning the burden of proof.
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20 Irrespective of the above and for the purpose of legal certainty, in absence of special
circumstances a notice period of one month should be considered reasonable.20 In such
“normal cases” where the third party asserts its rights, one month should in general be
sufficient for the buyer to get an approximate picture of the legal situation. Unlike with
most national laws, the liability of the seller under Arts 41 and 42 is not dependent on
the existence of a right but rather is triggered by a claim of a third party – even a
frivolous one.21 Consequently the buyer is not required to investigate the justification of
the claims raised in detail, particularly because their merits often depend on a complex
interplay of several judicial systems with whom the buyer is not familiar. It follows,
however, that the time which would be needed for ascertaining the legal position in
detail will not be factored in when determining the length of the period for giving
notice.22 On the other hand, the buyer must be given some time to get an approximate
picture of the legal situation in order to give a meaningful notice about the rights and
claims raised.23
21 A longer period may be required in the rare cases where the buyer’s complaint is not
the consequence of being contacted by a third party asserting its rights but instead
results from the buyer’s own investigations. In such cases, where third party claims in
the sense of Art. 43 do not exist, the buyer can only rely on the existence of a third party
right, the verification of which may take some time because it may, for example, require
looking into relevant registers.24
22 c) Lack of cut-off time/statute of limitation. Unlike Art. 39(2) in the context of non-
conformity of the goods, Art. 43 does not provide for a maximum time in which claims
concerning defects in title have to be notified. A proposal for the inclusion of a
comparable cut-off date was expressly rejected during the deliberation of the CISG.
Contrary to non-conformity of the goods, defects in title will often only be discovered
after a longer time (although they will be easier to prove). In particular, in connection
with intellectual property rights it may take some time until the third party has become
aware of the use of the goods by the buyer and only then asserts its own rights.
23 Like all other remedies, remedies for defect in title are subject to the general rules of
prescription. These are not regulated by the CISG but are instead determined on the
basis of the applicable conflict of laws rules.
4. Legal consequences of a failure to give notice

24 Pursuant to Art. 43(1), a failure to give notice about the defects in title will lead to a
loss of “the right to rely on the provisions of article 41 and article 42”. This means that
the buyer, who remains bound to perform under the contract, loses all remedies for the
breach of the seller’s duty to deliver goods with good title. These harsh consequences are
only excluded if the seller has either waived the notice requirement or one of the
statutory exceptions in Arts 43(2) or 44 applies. These exceptions require the seller to
have known about the defects (Art. 43(2)) or the buyer to have a reasonable excuse for
20 Benicke, in: MünchKommHGB (2013), Art. 43 CISG, para. 3; Schwenzer, in: Schlechtriem/Schwen-

21 For details see Art. 41 paras 15 et seq.; Art. 42 para. 9.
22 Benicke, in: MünchKommHGB (2013), Art. 43 CISG, para. 3; Ferrari, in: Ferrari et al. (eds),
Internationales Vertragsrecht (2018), Art. 43 para. 11; Schlechtriem/Butler, CISG (2009), para. 168.
23 Magnus, in: Honsell, Kommentar (2010), Art. 43 para. 10; too far in this respect Beline, Legal Defect
Protected by Article 42 of the CISG: A Wolf in Sheep’s Clothing, 7 University of Pittsburgh Journal of
Technology Law and Policy (Spring 2007) 6 (at footnote 73) who requires that the buyer must have
received “all the information from the third party”.
24 Gruber, in: MünchKommBGB (2016), Art. 43 paras 11 seq.
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his failure to give notice in time (Art. 44). If the Arts 43 or 44 exceptions can be
established, some of the buyer’s remedies will be preserved.25
5. Exclusion of reliance on a failure to give notice in time: Art. 43(2)

The wording of Art. 43(2), particularly if compared with Art. 40, leaves no doubt that 25
only actual knowledge of the seller will prevent him from relying on failure to give
notice in time. Proving the seller’s knowledge may in practice create considerable
evidentiary problems for the buyer. Consequently, the standard should not be set too
high. It is suggested that the buyer should not be required to establish that the seller
knew the legal details of the claim.26 By contrast, knowledge of the facts upon which the
third party’s right or claim is based may be sufficient.
The relevant time for knowledge is neither the conclusion of the contract nor the 26
time of delivery; rather it is the time when notice of the defective title should have been
given.27 Art. 43(2) constitutes an exception from Art. 43(1), based on the idea that no
notice to the seller is necessary if he is aware of the defects in title. Consequently, the
latest time when notice should have been given is relevant to determine whether it was
necessary or not.
6. Burden of proof
The buyer has to prove that the notice was given within a reasonable time and with 27
the required specificity. This requires that the buyer pleads and – if contested – proves
all facts which are relevant for the “reasonableness” of the time for notice, and in
particular when he acquired knowledge about the third party right or claim. In light of
Art. 27, it is sufficient, that the buyer proves that the notice has been sent in time by
appropriate means.
If the buyer wants to rely on the exception in Art. 43(2) he has to prove that the seller 28
knew about the third party rights and claims.28 Proving the facts from which such
knowledge can reasonably be inferred is sufficient. In this context, considerations of
proof proximity or spheres of risk may lead to a reversal of the burden of proof or at
least the burden of pleading.29

The PICC does not contain a comparable general notice requirement for defects in title. 29
It has, however, been submitted that the doctrine of good faith and fair dealing enshrined
in Art. 1.7(1) PICC may impose such an obligation in appropriate circumstances.30
Art. 4:302 PEL-Sales contains a largely comparable provision. The main difference is 30
the drafting technique. The notice requirements for non-conformity and defects in title
are regulated in a single provision which only distinguishes between the two for the issue
of the two-year cut-off period – which does not apply to defects in title (Art. 4:302(5)).
25 For details, in particular whether the buyer may also reduce the price see Eiselen, in: Kritzer/Vanto/
Vanto/Eiselen, International Contract Manual (2008), Vol. 4 § 89:119; Art. 44 paras 27 et seq.
29 Magnus, in: Honsell, Kommentar (2010), Art. 43 para. 21; see also Oberster Gerichtshof (Austria)
12 September 2006 (CD media), CISG-Online 1364 (Pace).

30 Gabriel, Sale of Goods (2004) p. 143.
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Article 44
Notwithstanding the provisions of paragraph (1) of article 39 and paragraph (1) of
article 43, the buyer may reduce the price in accordance with article 50 or claim
damages, except for loss of profit, if he has a reasonable excuse for his failure to give
the required notice.
Bibliography: Birch, Article 44 of the U. N. Sales Convention (CISG): A possible divergence in

interpretation by courts from the original intent of the framers of the compromise, 4 Regent Journal of
International Law (2006) 1; Martı́nez Can ~ellas,, The Scope of Article 44 CISG, 25 Journal of Law and
Commerce (2005/2006) 261 (Pace); CISG-AC Opinion no 2, Examination of the Goods and Notice of
Non-Conformity: Articles 38 and 39, 7 June 2004. Rapporteur: Professor Eric E. Bergsten, Emeritus, Pace
University School of Law, New York (http://www.cisg-ac.org).
Outline
1. General remarks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
3. Reasonable excuse . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
a) The notion of “reasonable excuse” . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
b) Seriousness of buyer’s failure to meet the notice requirements . . . . . . . . 17
c) Origin of the buyer and type of business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
d) Other subjective factors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
4. Legal consequences. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
a) Overview of available remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
b) Price reduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
c) Damages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
d) Further limitations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
5. Burden of Proof . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37

1 Art. 44 preserves certain remedies for buyers who have not notified the seller within
the required time about a lack of conformity, provided they have a “reasonable excuse”
for their failure. It relieves these buyers of some of the consequences stipulated in Arts
39(1) and 43(1) for failing to give timely notice.
2 Art. 44 was included at the Diplomatic Conference in Vienna. It is a crucial part of
the compromise between delegates who wanted to abolish notice requirements and
sanctions for non-compliance and delegates who wanted to preserve the fairly strict
regime of the ULIS.1 After efforts of the former group failed by a narrow margin in the
preparatory stages of the Conference, Art. 44 was included to take into account their
serious dissatisfaction with the 1978 Draft Convention.
1 For a more detailed account of the drafting history see Birch, Article 44 of the U. N. Sales Convention
(CISG): A possible divergence in interpretation by courts from the original intent of the framers of the
compromise, 4 Regent Journal of International Law (2006) 1 (3 et seq.); Martı́nez Can ~ellas, The Scope of
Article 44 CISG, 25 Journal of Law and Commerce (2005/2006) 261 seq. (Pace); Honnold/Flechtner,
Uniform Law (2009), Arts 39, 40, 44 para. 261; Garro, Reconciliation of Legal Traditions in the
U. N. Convention on Contracts for the International Sale of Goods, 23 International Lawyer (1989) 443
(468 et seq.) (Pace).
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On the one hand, Art. 44 mitigates the harsh sanctions in Arts 39(1) and 43(1) in 3
cases where it would seem inequitable to deprive the particular buyer of all remedies.
On the other hand, the seller’s interest in a speedy notice is sufficiently protected by the
limited scope of the excuse, i. e. the preservation of only two remedies (price reduction
and certain damage claims). The loss of all other remedies, which may occur with any
failure to comply with the notice requirement even when a reasonable excuse exists
under Art. 44, provides sufficient incentive for the buyer to act swiftly. This regime
largely excludes the risk of buyers waiting with their notice and speculating on the
market at the seller’s expense.2
Due to its inclusion in a later stage of the Diplomatic Conference, Art. 44 is not well 4
integrated with the other notice requirements and has attracted considerable criticism.3
In particular, the vagueness of the central notion “reasonable excuse” has been
castigated as leaving too many issues unresolved. Despite this criticism, Art. 44 has
proven to be a valuable tool for taking into account the particular situation of each
specific buyer and has not led to confusion in practice.4
Art. 44 has no direct equivalent in the ULIS. Irrespective of this, the question has 5
been raised as to whether the inclusion of Art. 44 added something to the existing notice
system under the ULIS. Interpreted broadly, the wording of Arts 38 and 39 ULIS
provided some leeway to reach results which are at least comparable to the objective
pursued in Art. 44.5 As a consequence, decisions which adopted such a broad inter-
pretation can provide at least some guidance of which factors should be taken into
account in determining whether a “reasonable excuse” exists.
1. General remarks
Art. 44 constitutes an exception to the general rules in Arts 39(1) and 43(1) and as 6
such, in principle, should be interpreted narrowly.6 As a consequence of this narrow
interpretation, buyers were in the past rarely successful in their efforts to rely on
Art. 44 in practice.7 However, this may be due to the fact that most of the published
decisions are from courts in the western world where the judges may have never
actually experienced the problems faced by buyers from developing countries. More-
over, in countries where the national sales law is based on strict notice requirements,
such as Germany, there is always the risk that courts will adopt a restrictive
~ellas, The Scope of Article 44 CISG, 25 Journal of Law and Commerce (2005/2006)
2 Cf. Martı́nez Can
261 (262 seq.) (Pace).

3 For further references see Eiselen, in: Kritzer/Vanto/Vanto/Eiselen, International Contract Manual
(2008), Vol. 4 § 89:86, footnote 1.

4 Equally positive Honnold/Flechtner, Uniform Law (2009), Arts 39, 40, 44 para. 261; for a summary of
the case law see Martı́nez Can ~ellas, The Scope of Article 44 CISG, 25 Journal of Law and Commerce
(2005/2006) 261 (267 et seq.) (Pace); DiMatteo et al., International Sales Law (2005), p. 92.
5 See CISG-AC Opinion no 2, paras 4.3 et seq.; Handelsgericht Zürich (Switzerland) 30 November 1998
(lambskin coats), CISG-Online 415 (Pace) at 4 d.

6 Bundesgerichtshof (Germany) 26 January 2006 (automobile), CISG-Online 1200 (Pace) para. 14;
Handelsgericht Zürich (Switzerland) 30 November 1998 (lambskin coats), CISG-Online 415 (Pace) at
4 d; Arbitral Award, ICC 9083/1999, 1 August 1999 (books), CISG-Online 706.
7 See Flechtner, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), Art. 44 para. 5, p. 146
with considerable case law in footnote 14; Eiselen, in: Kritzer/Vanto/Vanto/Eiselen, International
Contract Manual (2008), Vol. 4 § 89:97 footnote 6; Birch, Article 44 of the U. N. Sales Convention
(CISG): A possible divergence in interpretation by courts from the original intent of the framers of the
compromise, 4 Regent Journal of International Law (2006) 1 (3).
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interpretation of Art. 44. This does not reflect the compromise intended by the
inclusion of the provision.8
7 Broadly speaking, Art. 44 constitutes a good faith exception for extraordinary cases in
which a complete loss of remedies due to non-compliance with the notice requirement
would be inequitable. The practical relevance of Art. 44 depends to a considerable
extent on the interpretation of the notice requirements in Arts 39 and 43. A strict
interpretation of these notice requirements will increase the need to rely on Art. 44
while the opposite is true for a generous interpretation.9
8 According to its wording, Art. 44 is intended to relieve the buyer of some of the
consequences resulting from Arts 39(1) and 43(1) for “a failure to give the required
notice”. “Required notice” in the sense of Art. 44 is a notice which complies with the
exigencies of Arts 39(1) and 43(1) in relation to timing and content. Consequently,
Art. 44 may not only provide an excuse in cases of a complete failure to notify the seller,
but also where such notice has been made too late or did not meet the specificity
requirements of either provision.10
9 Furthermore, notwithstanding the fact that Art. 44 only explicitly refers to the duty to
notify the seller in Art. 39(1) and not the duty to examine the goods in Art. 38,11 the
provision may also apply to cases where a failure to give notice in time was due to a
non-compliance with the examination duty.12 The reasons for the breach of the notice
requirement are irrelevant for the general applicability of Art. 44.
10 In cases of non-conforming goods in the sense of Art. 35, Art. 44 only constitutes an
exception to Art. 39(1). The two-year cut-off period in Art. 39(2) is left untouched.13
Consequently, with the expiry of the two years, buyers can no longer rely on Art. 44 to
prevent a complete loss of their Art. 39 remedies. The same applies for contractual cut-
off periods agreed upon by the parties.14
8 Critical in this respect also Birch, Article 44 of the U. N. Sales Convention (CISG): A possible
divergence in interpretation by courts from the original intent of the framers of the compromise, 4 Regent
Journal of International Law (2006) 1 (5 et seq.)
9 Magnus, in: Honsell, Kommentar (2010), Art. 44 para. 1; cf Martı́nez Can ~ellas, The Scope of
Article 44 CISG, 25 Journal of Law and Commerce (2005/2006) 261 (264) (Pace) referring to doubts
whether Art. 44 would at all be necessary if a generous application of Arts 38, 39, 43 is adopted.
11 This lack of explicit reference has been relied upon in a German decision to exclude any reliance on
Art. 44 in cases of a failure to comply with the duty to examine the goods; see Oberlandesgericht
Karlsruhe (Germany) 25 June 1997 (surface protective film), CISG-Online 263 (Pace); reversed on appeal
on other grounds by Bundesgerichtshof (Germany) 25 November 1998 (surface protective film), CISG-
Online 353 (Pace) holding that the seller had waived his right to rely on the buyer’s failure to give proper
notice so that the buyer did not have to rely on Art. 44.
12 Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 44 para. 6; Magnus, in: Staudinger
Kommentar (2013), Art. 44 para. 5; Arbitral Award, ICC 9187, June 1999 (coke), CISG-Online 705(Pace);
Commerce and Industry, 54/1999, 24 January 2000 (goods not specified), CISG-Online 1042 (Pace); for
further cases see Flechtner, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), Art. 44 para. 4.
13 Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 44 para. 1; Oberlandesgericht Linz
(Austria) 24 September 2007 (laminated glass), CISG-Online 1583 (Pace), confirmed by Oberster
Gerichtshof (Austria) 19 December 2007 (laminated glass), CISG-Online 1628 (Pace); but see Oberlan-
desgericht Zweibrücken (Germany) 2 February 2004 (milling equipment), CISG-Online 877 (Pace) which
examined the requirements of Art. 44 despite the expiration of the two-year cut-off period in Art. 39(2).
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In practice, Art. 44 has also been applied to contractual notice requirements.15 In 11
principle, it may seem sensible to extend the tempering influence of Art. 44 to
contractual notice requirements,16 particularly where they merely specify or modify the
duty in Art. 39. However, it always has to be kept in mind that in such cases the notice
requirements are based on party autonomy. Thus, an excuse under Art. 44 is normally
less warranted and cannot be based on the buyer’s unawareness of the notice require-
ment. In general, in the case of contractual notice requirements, a reasonable excuse
should only be found to exist if the failure or delay was due to circumstances which
were at the time of contracting beyond contemplation of the party trying to rely on
Art. 44. In all other cases, the relevant party should be considered to have assumed the
risk that it may lose its remedies due to a failure to comply with the notice requirement.
In the end, the applicability of Art. 44 to such contractual notice requirements depends
on their interpretation.17
Practices and usages in the sense of Art. 9, whether they are stricter or more lenient, 12
precede Art. 44. In most cases, however, they will become relevant at the preceding
stage of determining whether the notice requirement has been breached and whether
they modify or specify the relevant standards for the notice.
3. Reasonable excuse
a) The notion of “reasonable excuse”. The application of Art. 44 presupposes that 13
the buyer has a “reasonable excuse” for not complying with the notice requirements
under Arts 39(1) and 43(1). What constitutes a “reasonable excuse” has to be
determined and understood in light of the legislative history.18 Art. 44 was included
primarily upon the initiative of the developing countries. They considered the con-
sequences of Art. 39 to be too drastic and leading to inequitable results as buyers may be
required to pay the full price for defective or even unusable goods due to a slightly
belated or insufficiently specific notice. In particular, these countries were concerned
that their importers would lose their remedies either because they were not able to
discover defects in complex machinery within the required time or because they were
not aware of the notice requirement, a concept that may be unknown to their national
system.
Consequently, Art. 44 takes into account a much stronger subjective component than 14
permitted under Art. 39.19 Individual importers or importers from a certain region can
state difficulties, such as the unavailability of necessary testing facilities or problems in
organization, communication or transportation, as a “reasonable excuse”. At the same
time, it will be important to consider whether or not the actual buyer is familiar with
notice requirements in general, for example if he comes from a legal system which
provides for comparable sanctions. If the buyer is not familiar with notice requirements,
a court may be more ready to find that he has a reasonable excuse for not complying
with them, as opposed in cases where he has to comply with them in most of his
Chamber of Commerce and Industry, 54/1999, 24 January 2000 (goods not specified), CISG-Online
1042 (Pace) with critical comment by Saidov, Cases on CISG decided in the Russian Federation,
7 Vindobona Journal of International Commercial Law and Arbitration (2003) 1 (29 seq.) (Pace).
16 So Honnold/Flechtner, Uniform Law (2009), Arts 39, 40, 44 para. 261.
~ellas, The Scope of Article 44 CISG, 25 Journal of Law and Commerce (2005/2006) 261
19 Martı́nez Can
(266) (Pace); Reitz, A History of Cutoff Rules as a Form of Caveat Emptor: Part I – The 1980
U. N. Convention on the International Sale of Goods, 36 American Journal of Comparative Law (1988)
437 (461 seq.) (Pace).
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transactions.20 While, technically speaking, Art. 44 does not contain an “absence of

fault” requirement, the parties’ potential awareness of the notice requirement should be
taken into account in determining whether a “reasonable excuse” exists.
15 There have been several efforts to find a workable definition of what constitutes a
“reasonable excuse” in the sense of Art. 44. One of the problems is that to justify the
proper scope of application for Art. 44 the relevant factors must be distinguishable from
those which define what constitutes a “reasonable time” for notice in the sense of
Art. 39. Magnus, for example, recognises a reasonable excuse if the failure to give the
required notice is due to circumstances where, under principles of good faith, the
average buyer could be forgiven.21 In the words of a German court, reasonable excuses
can be recognised “if the conduct of the buyer deserves some fair understanding and
forbearance due to the circumstances of the individual case”.22 This does not require the
absence of fault in the technical sense as otherwise there would hardly be any room for
the application of Art. 44. In principle, it is largely inconceivable that a buyer who did
not comply with the notice requirements did display the necessary standard of care and
did not act negligently.23 In the end, whether one likes it or not, the decision about the
existence of a reasonable excuse has to be based on the equities of the case.24 It involves
balancing the legitimate interests of both parties to a certain degree.25
16 In determining the equities of a particular case, significant weight must be attributed
to the type and size of the breach of the notice requirement by the buyer. The equitable
character of the Art. 44 defence leaves room to look beyond the mere situation of a
buyer who is the principal addressee of the excuse. The “reasonableness” requirement
allows one to take into account other factors. These include, in particular, the legitimate
interests of the seller, the nature of the breach and the type of goods involved.26 The
facts underlying an unduly restrictive decision of the Frankfurt Regional Court serves as
a good example. Under a contract for the sale of used shoes between a German party
and a Ugandan party the goods had to be delivered to Mombasa, Kenya. Shortly after
their delivery in Kenya, they were transhipped to their final destination in Uganda
where an examination revealed that the goods were defective.27 The Ugandan party
immediately notified the German seller, but the court considered the notice – given
after the goods’ arrival in Uganda – to be too late to comply with Art. 39. The court also
rejected reliance on Art. 44. In its reasoning in relation to Art. 38 (3) the court inter alia
addressed the considerable expenses for the Ugandan party that would arise in travel-
ling to Kenya and the need to break the customs seals which would have led to customs
duties becoming due. While these factors, by themselves, in light of the contractual
20 At first sight in favour of the irrelevance of the knowledge but then taking into account the legal
nature of the party Oberlandesgericht München (Germany) 26 October 2016 (shoes), CISG-Online 2799,
at I.18.
21 Magnus, in: Staudinger Kommentar (2013), Art. 44 para. 12; see also Oberster Gerichtshof (Austria)
15 October 1998 (timber), CISG-Online 380 (Pace) which additionally requires that the buyer “acted with
the kind of diligence which it could subjectively be expected to apply in the circumstances”.
Online 1642 (Pace).

24 See also Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 44 para. 5 (“A buyer’s
conduct, although not in itself correct and in accordance with the rules, is excusable if … equity would
command a certain degree of understanding and leniency”).
Online 1642 (Pace) “Article 44 CISG requires a balancing of interests according to the criteria of
fairness”.
26 For further factors see Oberlandesgericht München (Germany) 8 February 1995 (polypropylene
plastic granulate), CISG-Online 142 (Pace).

27 Landgericht Frankfurt (Germany) 11 April 2005 (used shoes), CISG-Online 1014 (Pace).
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provisions were probably not sufficient for an Art. 44 excuse, the court could have taken
a number of other issues into account in favour of an excuse. These include the size of
the loss for the buyer, who received goods which were not usable at all and had to be
destroyed at his expense, and the nature of the goods and defects, which created no
evidentiary problems for the seller to prove their conformity at the time of delivery as
their condition did not deteriorate over the time.28
b) Seriousness of buyer’s failure to meet the notice requirements. The seriousness 17
or severity of the buyer’s breach of the notice requirement is of crucial relevance in
determining the existence of a reasonable excuse. It will be much more difficult, if not
impossible, to find a reasonable excuse in the case of a serious breach of the notice
requirement than it will be if the notice is merely a few days late. The cause for the
failure to give notice in time may also be relevant in this context. In general, it will be
easier to excuse delays that arise from difficult examinations than from those which are
due to failures to give timely notice after the defect has been discovered. Factors to be
taken into account in cases of delayed examination include the amount of delay and the
cost and problems associated with an examination.
Notices which – while not completely vague – do not meet the sometimes strictly 18
interpreted specificity requirements may benefit from a reasonable excuse.29 Notwith-
standing the fact that they do not give the seller enough information to take necessary
action, they do, at least, pass on the most crucial information, i. e. that the goods are not
conforming and that some action is required. In particular, an application of Art. 44 in
cases where the notice lacks specificity may be justified when the seller himself has been
negligent in not discovering the non-conformity or the defect in title.
However, this does not mean that the buyer will be able to rely on Art. 44 in all cases 19
of a minor breach of the notice requirements.30 The breach always has to be weighed
against the seller’s interest in strict compliance with the notice requirements and the
consequences associated with an exclusion of all remedies. In the absence of a special
reason, i. e. a reasonable excuse, the balance will always be in favour of the seller.
c) Origin of the buyer and type of business. The origin of the buyer plays an 20
important role in the application of Art. 44, as in some areas of the world buyers
encounter much greater problems in complying with the notice requirement. This may
be due to restrictions on the availability of testing facilities, insufficient means of
communication or transportation or delays caused by inefficient or corrupt public
authorities in ports or at the customs offices.31 Thus, where the examination requires
the goods delivered to be processed, an unexpected delay in the delivery of the necessary
machines for processing should constitute a reasonable excuse for the buyer.32 Equally,
the general or individual financial situation of the buyer, i. e. the availability of credit
financing, may delay the notice, for example where expensive testing has to be pre-
financed. While Art. 44 was included primarily upon the initiative of developing
(2008) 1 (27) (Pace); cf. the same in Honnold/Flechtner, Uniform Law (2009), Arts 39, 40, 44 para. 261.
29 Not if the seller has asked for additional information which was not provided by the buyer
Oberlandesgericht Oldenburg (Germany) 28 April 2000 (furniture), CISG-Online 683 (Pace).

31 May have been an overlooked issue in Oberlandesgericht Koblenz (Germany) 11 September 1998
(chemical substances), CISG-Online 505 (Pace); critical also Birch, Article 44 of the U. N. Sales Conven-
tion (CISG): A possible divergence in interpretation by courts from the original intent of the framers of
the compromise, 4 Regent Journal of International Law (2006) 1 (9 seq.).
32 For a different view see Oberlandesgericht Koblenz (Germany) 11 September 1998 (chemical
substance), CISG-Online 505 (Pace).
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countries, the exception in Art. 44 is by no means limited to buyers coming from such
states.33 It also extends to countries where the legal system either does not provide for a
notice requirement at all or does not impose such drastic results for its non-compliance,
as is the case with a number of common law countries.34
21 Furthermore, the type of business of the buyer may be relevant. It will be easier to
excuse oversights by small business entities with little experience in international trade
than those by big multinational companies which have their own legal department.35
22 d) Other subjective factors. Purely subjective factors, which cannot be taken into
account in defining the time for examination or giving notice, may also be relevant for
establishing the existence of a reasonable excuse. This includes illnesses of the buyer or
his personnel, strikes and short but crucial disruptions of the ordinary course of
business.36 Equally, communication of the notice to the wrong person(s) may be
excused where such person(s) may previously have been the seller’s representative.
23 A reasonable excuse may also result from linguistic difficulties or problems connected
with the legal evaluation of a case, e. g. the fact that a buyer misinterpreted the legal
situation if such misinterpretation is not grossly negligent.37 For example, a buyer who
has declared avoidance of the contract for a non-conformity he wrongly considered to be
fundamental may be excused for not engaging into further examinations which would
have otherwise been necessary and would have revealed additional defects. However, this
excuse will not apply to defects which could have been discovered by a superficial
examination.38 Moreover, the excuse is limited to cases of avoidance where, if the legal
evaluation had been correct, any further examination would have been a waste of
resources. By contrast, in connection with other remedies, a proper notification of one
defect does not constitute a reasonable excuse that other defects have not been notified in
time.39
24 A reasonable excuse may also exist when the buyer has wrongly deduced from the
seller’s declarations or behaviour in connection with an earlier delivery that the seller
would not insist on a timely examination and notice and has therefore not examined the
goods in time.40 This requires, however, that the buyer’s interpretation of the seller’s
previous behaviour has not been grossly negligent. For example, this may arise where
the buyer has informed the seller about the fact that the goods would be stored for some
time before being used as the necessary facilities had yet to be constructed and the seller
does not insist on an earlier examination. Even though the seller’s behaviour may not
amount to an agreement for the postponement of the examination obligation, it may be
sufficient to be relied on for the application of Art. 44.41
25 A buyer has also been held to be excused in cases where the belated notice of
conformity is the result of a reliance on an examination by an independent third party,

34 For the opposite case see Schroeter, UN-Kaufrecht und Europäisches Gemeinschaftsrecht (2005), p. 682.
35 Oberlandesgericht München (Germany) 8 February 1995 (polypropylene plastic granulate), CISG-
Online 142 (Pace) at II 3 b (cc).

38 More restrictive Danish Maritime and Commercial Court (Denmark) 31 January 2002 (fish (mack-
erel)), CISG-Online 679 (Pace).

39 See Oberlandesgericht Celle (Germany) 10 March 2004 (commercial vehicle), CISG-Online 824
(Pace).
40 Oberlandesgericht Graz (Austria) 11 March 1998 (timber), CISG-Online 670 (Pace).
41 See Oberlandesgericht Zweibrücken (Germany) 2 February 2004 (milling equipment), CISG-Online
877 (Pace) where an excuse was, however, rejected as the buyer had not informed the seller about the
postponement of the examination.
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who the parties engaged jointly to determine conclusively the conformity of the goods.
In one case, the Arbitral Tribunal held that the notice given upon the later discovery of
the incorrectness of the certificate of conformity issued by the expert was belated. It
considered the buyer to be excused under Art. 44, as the duty to examine under Art. 38
had been contractually undertaken by both parties.42
Often, the failure of complying with the notice requirements is attributed to external 26
events. In determining whether these events can constitute a valid defence, the
possibility for the buyer to overcome such events and the costs and inconveniences
associated with such efforts are a crucial element. For example, reliance on a hold up in
customs has been rejected because the buyer had not shown that he could not have
gotten access to the goods in order to examine them when they first arrived in the
buyer’s country.43 By contrast, events which would be relevant in the context of Art. 79
such as strike or events of force majeure will normally constitute a “reasonable”
excuse.44 In so far as they are temporary events, such as strikes or sickness, they will
only excuse the buyer for the time of their existence.
a) Overview of available remedies. The existence of a reasonable excuse in the sense of 27
Art. 44 only mitigates the loss of remedies and falls short of excluding such loss as is the
case with Art. 40. Art. 44 preserves the buyer’s remedies of price reduction and damages
provided that the general requirements for the existence of these remedies are fulfilled. By
contrast, the buyer may not claim damages for the loss of profit (Art. 45(1)(b)) or
performance (Art. 46), avoid the contract (Art. 49) or rely on the non-conformity as a
basis for delaying the passage of risk of loss (Art. 70), even if the requirements of Art. 44
are met. The seller’s right to cure pursuant to Art. 48 is not affected by Art. 44. It is
controversial to what extent the buyer’s failure to comply with the notice requirements
may further limit the available remedies under Arts 77 or 80 or even lead to a claim for
damages by the seller.
b) Price reduction. Notwithstanding any non-compliance with the notice require- 28
ments in Art. 39(1), a buyer able to rely on Art. 44 may reduce the price for the non-
conformity of the goods. It is controversial whether Art. 44 also preserves the remedy of
price reduction in cases of defects in title. The wording of Art. 44 is not conclusive in
this respect. On the one hand, it mentions the remedy of price reduction explicitly for
defects in title but at the same time provides that the possibility to reduce the price
exists “in accordance with Art. 50” which only refers to non-conforming goods.45 The
answer to this question depends on which view one adopts on the general applicability
of Art. 50 to defects in title. Consequently, the buyer should be entitled to a price
reduction in the context of Art. 44.46
The seller may not rely on Arts 77 and 80 to further limit or exclude the buyer’s right 29
to reduce the price.
42 Arbitral Award, ICC 9187, June 1999 (coke), CISG-Online 705; in light of the reported facts of the
case it could have been argued that the notice as such was not given belatedly and that the sanctions in
Art. 39 would not have been applicable.
43 Oberlandesgericht Koblenz (Germany) 11 September 1998 (chemical substances), CISG-Online 505
(Pace).
45 Eiselen, in: Kritzer/Vanto/Vanto/Eiselen, International Contract Manual (2008), Vol. 4 § 89:119.
46 Magnus, in: Honsell, Kommentar (2010), Art. 44 para. 12; for a detailed discussion of the issue see
Art. 50 paras 12 et seq.
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30 c) Damages. Art. 44 preserves the buyer’s right to claim damages in accordance with
Art. 74, with the exception of damages for lost profit.47 By contrast, consequential
damage can be claimed. In deviation from the normal practice under Art. 74, the time
for calculation of the loss in value is the time at which notice would have been required.
A buyer relying on Art. 44 should be able to invoke the existing remedies in the same
way as he would have been able to if proper notice had been given.48
31 d) Further limitations. Notwithstanding the existence of a reasonable excuse for the
buyer in the sense of Art. 44, the failure to give notice may deprive the seller of a
possibility to cure the lack of conformity or to avoid or mitigate losses. In particular, the
seller may be deprived of the opportunity to seek recourse from his own suppliers or the
goods may have deteriorated due to the buyer’s continued use. In such cases, where the
belated but excused notice contributes to the losses incurred, it appears unfair to the
seller if the buyer could invoke his remedies for the lack of conformity in their full
extent. Different views exist as to how this problem should be addressed.
32 Some commentators have suggested49 that in such cases50 the buyer’s claims for
damages may be reduced by an application of Art. 77, while claims for price reduction
may be limited or even excluded by Art. 80. In addition, claims for damages by the seller
himself may be envisaged for a violation of the buyer’s duties to examine the goods and
notify the seller about their non-conformity. Other commentators have suggested that
the seller will at least be able to rely on Art. 77, and classify the buyer’s non-compliance
with notice requirements as a failure to mitigate damages in the sense of Art. 77.
33 In this author’s opinion, however, the better view is to limit the application of Art. 77
to cases where the buyer, through behaviour going beyond mere non-compliance with
the notice requirement, has failed to reduce the damages. This may be the case, for
example, where the continued use of the goods after the time notice should have been
given led to an additional loss in value.
34 In all other cases, behaviour excused under Art. 44 should not lead to further limita-
tions of the buyer’s remedies explicitly provided for in Art. 44. This applies to restrictions
under Arts 77 and 80 and to claims for damages by the seller pursuant Arts 74 seq. Both
Arts 77 and 80 only require that a buyer undertake reasonable efforts to prevent further
damages to the seller, which can be assumed whenever the buyer has a “reasonable
excuse” for his behaviour.51 Moreover, their application to the cases covered by Art. 44
would de facto undermine the hard fought compromise embodied in Art. 44.52 It is
suggested that this view does not create an undue hardship for the seller. After all, it is the
seller who ultimately causes the damage by not complying with his contractual duties.53
35 For the remedy of price reduction, the loss in value of the deficient goods is calculated at
the time of delivery. Thus, it is not influenced by the buyer’s failure to give notice in time.54
47 Oberlandesgericht München (Germany) 10 January 2017 (shoes), CISG Online 2800.

49 Schlechtriem, Uniform Sales Law – The UN-Convention for Contracts on the International Sale of
Goods (1986), p. 70 (Pace).

50 Schlechtriem made his comments in relation to cases where the belated notice was due to a failure to
examine the goods in time, suggesting at the same time that in light of the purpose of Art. 44 the mere
fact the notice was belated could not justify reliance on Art. 77.
the International Sale of Goods, 36 American Journal of Comparative Law (1988) 437 (461 footnote 103)
(Pace).
54 See also Magnus, in: Staudinger Kommentar (2013), Art. 44 para. 19 – who in para. 18 considers the
time of an orderly notification to be relevant.
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The exclusion of a separate claim for damages by the seller based on the buyer’s 36
failure to comply with notice requirements is due to the fact that Arts 38 and 39 do not
contain enforceable contractual obligations. These provisions merely stipulate unen-
forceable buyer’s duties, the violation of which only lead to a loss of rights and not
claims from the other party. Furthermore, the delegates at the Diplomatic Conference
explicitly rejected the proposal to include a provision granting a separate claim for
damages to the seller, which had been foreseen still in the original proposal.55
5. Burden of proof
The burden of proof for the existence of a reasonable excuse lies with the buyer.56 37
However, as long as the buyer presents and proves the facts justifying the application of
Art. 44, no explicit reliance on Art. 44 is necessary, at least in legal systems where the
law does not also have to be pleaded.57

Due to their focus on general contract law, neither the PICC nor the PECL contain 38
comparable provisions dealing specifically with the effects of a reasonable excuse for
delays in giving notice. The same applies to the PEL-Sales and the DCFR.
55 Official Records, p. 108, 347; Reitz, A History of Cutoff Rules as a Form of Caveat Emptor: Part I –
The 1980 U. N. Convention on the International Sale of Goods, 36 American Journal of Comparative Law
(1988) 437 (460 seq.) (Pace).
56 Arbitral Award, ICC 9187, June 1999 (coke), CISG-Online 705 (Pace); Handelsgericht Zürich
(Switzerland) 30 November 1998 (lambskin coats), CISG-Online 415 (Pace) at 4 d; Oberlandesgericht

Koblenz (Germany) 11 September 1998 (chemical substances), CISG-Online 505 (Pace); Oberlandesger-
icht München (Germany) 26 October 2016 (shoes), CISG Online 2799, at I.17.
57 Magnus, in: Honsell, Kommentar (2010), Art. 44 para. 1; different Bundesgerichtshof (Germany)
26 January 2006 (automobile), CISG-Online 1200 (Pace) rejecting the defence as it had not been relied on
in the lower instances.
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Section III
Remedies for breach of contract by the seller
Article 45
(1) If the seller fails to perform any of his obligations under the contract or this
Convention, the buyer may:
(a) exercise the rights provided in Articles 46 to 52;
(b) claim damages as provided in Articles 74 to 77.
(2) The buyer is not deprived of any right he may have to claim damages by
exercising his right to other remedies.
(3) No period of grace may be granted to the seller by a court or arbitral tribunal
when the buyer resorts to a remedy for breach of contract.
Bibliography: Bridge, Uniformity and Diversity in the Law of International Sale, 15 Pace International
Law Review (2003) 55 (Pace); Ferrari, Wesentliche Vertragsverletzung nach UN-Kaufrecht, IHR (2005) 1
(Pace); Friehe, Die Setzung der unangemessen kurzen Nachfrist im CISG mit einem Ausblick auf das
BGB, IHR (2010) 230, (2011) 16, 57; Graffi, Divergences in the interpretation of the CISG: The concept of
“Fundamental Breach”, in: Ferrari, The 1980 Uniform Sales Law (2003), p. 313; Herman, Specific
Performance: a Comparative Analysis, 7 Edinburgh Law Review (2003) 5 (Pace); Holthausen, Die
wesentliche Vertragsverletzung nach Art. 25 UN-Kaufrecht, RIW (1990) 101; Huber, CISG – The
structure of remedies, RabelsZ (2007) 13 (Pace); Mullis, Avoidance for Breach under the Vienna
Convention; A Critical Analysis of Some of the Early Cases, in: Andreas and Jarborg (eds), Anglo-
Swedish Studies in Law (1998), p. 326 (Pace); Mullis, Termination for breach of contract in C. I. F.
contracts under the Vienna Convention and English law: Is there a substantial difference?, in: Lomnicka/
Morse (eds), Contemporary Issues in Commercial Law (Essays in honour of Prof. A. G. Guest) (1997),
p. 137; Schlechtriem, Subsequent Performance and Delivery Deadlines, 18 Pace International Law Review
(2006) 83 (Pace); Schmidt-Kessel, CISG-Verträge in der Insolvenz – Eine Skizze, FS Schlechtriem (2003),
p. 255.
Outline
1. System of remedies (para. 1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
a) Outline. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
b) The remedies provided for in Art. 45(1) CISG . . . . . . . . . . . . . . . . . . . . . . . . . . 4
aa) Performance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
bb) Avoidance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
cc) Reduction of the purchase price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
dd) Damages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
ee) Right to suspend performance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
c) Policy considerations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
2. Damages and other remedies (para. 2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
3. No period of grace (para. 3). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

1 The main purpose of the provision is to outline the buyer’s remedies for breach of
contract (para. 1). In addition, the provision contains two specific rules concerning the
buyer’s remedies: one clarifies that the buyer will not (necessarily) be deprived from
claiming damages by exercising his right to claim any of the remedies (para. 2); the
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Section III. Remedies for breach of contract by the seller 2–8 Article 45
other states that no period of grace may be granted to the seller (para. 3). The remedies
contained in Arts 45 et seq. may be derogated from or modified by the parties under
Art. 6. As a general rule, the system of remedies as embodied in Arts 45 et seq. should be
regarded as exhaustive and thus excludes recourse to remedies under national law;1
difficult issues may arise, however, when it comes to applying this general rule in
concrete situations, see the comment to Arts 4, 5 and 7.

1. System of remedies (para. 1)
a) Outline. Art. 45(1) states that the buyer can resort to the following remedies: 2
– performance, including substitute delivery and repair in cases of non-conformity
(Arts 45(1)(a) and 46);
– avoidance of the contract (Arts 45(1)(a) and 49);
– reduction of the purchase price (Arts 45(1)(a) and 50);
– damages (Arts 45(1)(b) and 74 et seq.)
Further, there are, in the CISG, specific provisions for partial breaches (Art. 51), for 3
early delivery (Art. 52(1)), for delivery of an excess quantity (Art. 52(2)), for instalment
contracts (Art. 73) and for cases of anticipatory breach of contract (Arts 71 and 72).
There is no specific rule on the buyer’s right to suspend performance; this remedy will
be dealt with infra para. 8.
b) The remedies provided for in Art. 45(1) CISG
aa) Performance. Art. 45(1)(a) refers to Art. 46 which governs the buyer’s right to 4
claim performance from the seller. Art. 46(1) deals with the general claim for perfor-
mance. Art. 46(2) and (3) provide specific rules for substitute delivery or repair in cases
where the seller has delivered goods that do not conform with the contract. According
to Art. 46(3) the buyer has the right to require the seller to remedy the lack of
conformity by repair, unless this is unreasonable having regard to the circumstances.
The provision on substitute delivery (Art. 46(2)) is more restrictive: the buyer can only
claim delivery of substitute goods if the lack of conformity constitutes a fundamental
breach of contract in the sense of Art. 25.
bb) Avoidance. Art. 45(1)(a) refers to Art. 49 which governs the buyer’s right to 5
avoid the contract. As a rule avoidance is limited to cases of fundamental breach
(Art. 49(1)(a)). In cases of non-delivery, however, Art. 49(1)(b) allows the buyer to
“upgrade” a non-fundamental breach to one which justifies avoidance by using the so-
called “Nachfrist”-procedure provided for in Art. 47.
cc) Reduction of the purchase price. Art. 45(1)(a) refers to Art. 50 which gives the 6
buyer the right to reduce the contract price if the goods do not conform to the contract,
subject to the seller’s right to cure.
dd) Damages. Any breach of contract by the seller will give the buyer a right to claim 7
damages. The basis for the claim is Art. 45(1)(b); the measure and the calculation of the
damages are governed by the general rules in Arts 74–77. In principle, liability is strict
(i. e. not fault-based), but there are certain grounds of exemption in Arts 79 and 80.
ee) Right to suspend performance. Art. 45 does not mention or refer to a right of the 8
buyer to suspend his own performance (in particular payment of the price) as a reaction
1 Müller-Chen, in Schlechtriem/Schwenzer, Commentary (2016) Art. 45 para. 32.
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to the seller’s breach. It is submitted, however, that there is a general principle of the
Convention under Art. 7(2) which allows the buyer (or more generally: one party) to
suspend or withhold his own performance until the seller (or more generally: the other
party) has performed his duties.2 This general principle can be derived from the rules in
Arts 58(1), 71, 85 and 86(1). The right to suspend is subject to the parties’ agreement.
Thus, it should not be granted where it would be inconsistent with such agreement, e. g.
where the contract requires the buyer to pay the price before the seller makes
performance.3 What is more, the right to suspend payment is subject to the principle
of good faith; thus, where the seller has only committed a minimal breach of an
ancillary obligation, the buyer may not be entitled to suspend payment of the (entire)
price.4 Again, however, the parties’ agreement and the commercial background of the
transaction should be taken into account so that the situation may be different in
documentary sales.
9 c) Policy considerations. The most defining feature of the system of remedies in the
CISG is that it aims at keeping the contract alive as long as possible in order to avoid the
necessity of unwinding the contract.5 Thus, in particular, termination of the contract
will only be available as a remedy of last resort.6
10 In taking that approach, the CISG is in line with an international trend which has
arisen during the 20th century.7 In fact the CISG has been one of the main causes for the
evolution of this international trend. Several modern sales laws (such as the new
German law8 and the Scandinavian laws9) and international instruments (such as the
UNIDROIT Principles10, Principles of European Contract Law11 and the Draft Com-
mon Frame of Reference12) regard the termination of the contract as a remedy of last
resort which should only be granted if other remedies (such as performance, price
reduction or damages) will not lead to an adequate result.13
11 This policy not only serves the principle of pacta sunt servanda14, but is also in line
with economic considerations. If the goods have already been delivered, the termination
2 See Oberster Gerichtshof (Austria) 8 November 2005 (recycling machine), CISG-Online 1156; Ober-
landesgericht Frankfurt (Germany) 6 October 2004 (cosmetic and perfume items), CISG-Online 996;
Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 45 para. 22; Magnus, in: Staudinger,
4 See Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 45 para. 22 (“of any
weight”); Huber, in: MünchKommBGB (2015), Art. 45 para. 12.

5 See in more detail Huber, CISG – The structure of remedies, RabelsZ (2007) 13 with further
references (Pace).
6 See for example Bundesgerichtshof (Germany) 3 April 1996 (cobalt sulphate), CISG-Online 135 (“last
possibility for the creditor”); Oberster Gerichtshof (Austria) 7 September 2000 (tombstones), CISG-Online
642; Oberster Gerichtshof (Austria) 16 December 2015 (silkscreen), CISG-Online 2663; Oberlandesgericht
Hamburg (Germany) 25 January 2008 (case inventory), CISG-Online 1681; Müller-Chen, in: Schlech-
triem/Schwenzer, Commentary (2016), Art. 49 para. 2; Schroeter, in: Schlechtriem/Schwenzer, Commen-
tary (2016), Art. 25 para. 1; Leisinger, in: Brunner, Kommentar (2014), Art. 49 para. 2.
7 For a comparative overview see: Sivesand, The Buyer’s Remedies for non-conforming Goods (2005),
pp. 68 et seq.; Torsello, Common Features (2004), pp. 187 et seq.; Huber, in: Reimann/Zimmermann (eds),
Oxford Handbook (2006), pp. 938, 960 et seq.
8 § 323 BGB (German Civil Code). For more detail on these rules see Zimmermann, The New German
Law of Obligations (2005), pp. 66 et seq.

9 Cf. Lookofsky, in: Ferrari, The 1980 Uniform Sales Law (2003), pp. 95, 113.
10 Art. 7.3.1. PICC.
11 Art. 9:301(1) PECL.
12 Art. III. – 3:502 DCFR.
13 Huber, in: Huber/Mullis, The CISG (2007), pp. 181 et seq.
14 Cf. Bonell, Restatement (1997), pp. 76 et seq.; Beale, Remedies: Termination, in: Hartkamp/Hesselink/
Hondius/du Perron/Vranken (eds), Towards a European Civil Code (1998), pp. 348, 350.
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of the contract (e. g. for non-conformity) leads to a restitution of the goods originally
delivered and possibly to a restitution of money paid by the buyer. Restitution of the
goods in particular may lead to considerable costs and risks which could be avoided if
the contract were not terminated and if the buyer’s interest in getting conforming goods
were remedied by either repair or a claim for damages.15
Finally, a restrictive approach towards winding up the contract is also in line with the 12
legitimate interests of the parties. On the one hand, the seller’s efforts in preparation of
performance should not easily be frustrated by a minor defect or by a defect which
could readily be cured at the seller’s expense. In such cases, the buyer’s wish to
terminate the contract will often be motivated by a fall in market prices for the goods
and thus carries little merit. On the other hand, there may be situations where the buyer
is justified in not accepting cure or minor defects, for instance if time and exact
conformity of delivery were of the essence in the contract.
The CISG aims at striking the balance between these two scenarios by using three 13
instruments all of which have parallels in international legal texts or modern domestic
laws.16 The CISG primarily relies on the fundamental breach doctrine. Pursuant to
Art. 49(1)(a), the avoidance of the contract will only be available if the seller committed
a fundamental breach of contract. In cases of non-delivery, however, the Convention
alternatively allows the second instrument, i. e. the so-called Nachfrist-procedure: the
buyer may also avoid the contract under Art. 49(1)(b) by fixing an additional period of
time for performance under Art. 47, thus giving the seller a second chance to perform
before the contract will be terminated. Finally, Art. 48 gives the seller a right to cure; the
right to cure is, however, “subject to” the buyer’s right to avoid the contract under
Art. 49 (cf. infra Art. 49 CISG paras 15 et seq.).
The fundamental breach doctrine is also applied to substitute delivery under 14
Art. 46(2). Viewed from an economic perspective, this is understandable. Substitute
delivery leads to the restitution of the originally tendered goods and to the delivery of
the substitute goods, causing additional cost and risk to the parties.17 Price reduction
under Art. 50 is not subject to the fundamental breach requirement, but subject to the
seller’s right to cure under Art. 48. Claims for damages depend on an avoidance of the
contract (and on the strict requirements set in Art. 49) at any rate if they are to be
calculated under the specific provisions of Arts 75 et seq.18
2. Damages and other remedies (para. 2)

Art. 45(2) states that the buyer is not deprived of any right he may have to claim 15
damages by exercising his right to other remedies. The buyer may therefore combine a
claim for performance, a reduction of the purchase price or an avoidance of the contract
with a claim for damages, if the requirements of such a claim (Arts 45(1)(b), 74 et seq.)
are met. It goes without saying that the buyer must not be overcompensated.19 In so far
15 Huber, in: Huber/Mullis, The CISG (2007), p. 182; Will, in: Bianca/Bonell, Commentary (1987),
Art. 49 para. 2.1.2; Magnus, in: Staudinger, Kommentar (2013), Art. 49 para. 4; cf. Schroeter, in: Schlech-
16 See in more detail Huber, CISG – The structure of remedies, RabelsZ (2007) 13 (20 et seq.) (Pace).
17 See Honnold, Documentary History (1989), p. 558; Müller-Chen, in: Schlechtriem/Schwenzer, Com-
mentary (2016), Art. 46 para. 4; Huber, in: MünchKommBGB (2015), Art. 46 para. 24; Magnus, in:
Staudinger, Kommentar (2013), Art. 46 paras 8, 38; Benicke, in: MünchKommHGB (2013), Art. 46
para. 12.
18 Whether similar principles should also apply to “other” claims of damages (i. e. those which are
simply governed by Art. 74) is a disputed matter, see Huber, in: Huber/Mullis, The CISG (2007), p. 282.
19 Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 45 para. 25; Akikol/Bürki, in:
Brunner, Kommentar (2014), Art. 45 para. 19.
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as his interests are already safeguarded by the other remedy, there will no longer be a
loss and thus no claim for compensation. Thus, for example, in a case of delivery of
non-conforming goods, the buyer who claims and gets repair from the seller
(Art. 46(3)) will not be able to claim as damages any diminution of value of the goods
that would have occurred if repair had not been made; he will, however, be able to claim
damages for losses which have arisen independently of the repair, e. g. loss of profit
resulting from the disruption of his production during the repair or losses which the
non-conforming goods have already caused to other goods of the buyer.20
3. No period of grace (para. 3)

16 Art. 45(3) provides that no period of grace may be granted to the seller by a court or
arbitral tribunal when the buyer resorts to a remedy for breach of contract. This
provision clarifies that any such period of grace which the (applicable) domestic law
may provide21, may not be applied if the contract is governed by the CISG. It is
submitted, however, that applicable (domestic) rules of the law of insolvency or of the
law of enforcement of judgments which provide similar periods of grace (e. g. under
Chapter 11, § 362 US Bankruptcy Code) are not barred by Art. 45(3), as these areas of
the law (enforcement of judgments, insolvency) are not governed by the CISG at all.22

17 Art. 106(1) CESL provides a rule which is similar to Art. 45.
20 Huber, in: MünchKommBGB (2015), Art. 45 para. 16; Müller-Chen, in: Schlechtriem/Schwenzer,
Commentary (2016), Art. 45 para. 27; Magnus, in: Staudinger, Kommentar (2013), Art. 45 para. 21.
21 See for example (French) Art. 1228 Code Civil.
22 Huber, in: MünchKommBGB (2015), Art. 45 para. 17; Magnus, in: Staudinger, Kommentar (2013),
Art. 45 para. 42. But see for a differing view Schmidt-Kessel, CISG-Verträge in der Insolvenz – Eine
Skizze, FS Schlechtriem (2003), pp. 273 et seq.
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Article 46
(1) The buyer may require performance by the seller of his obligations unless the
buyer has resorted to a remedy which is inconsistent with this requirement.
(2) If the goods do not conform with the contract, the buyer may require delivery
of substitute goods only if the lack of conformity constitutes a fundamental breach of
contract and a request for substitute goods is made either in conjunction with notice
given under article 39 or within a reasonable time thereafter.
(3) If the goods do not conform with the contract, the buyer may require the seller
to remedy the lack of conformity by repair, unless this is unreasonable having regard
to all the circumstances. A request for repair must be made either in conjunction with
notice given under article 39 or within a reasonable time thereafter.
Bibliography: See selected bibliography of Art. 45; CISG-AC Opinion no 2, Examination of the Goods and
Notice of Non-Conformity: Articles 38 and 39, 7 June 2004. Rapporteur: Professor Eric E. Bergsten,
Emeritus, Pace University School of Law, New York (http://www.cisg-ac.org); CISG-AC Opinion no 10,
Agreed Sums Payable upon Breach of an Obligation in CISG Contracts, 3 August 2012. Rapporteur: Dr.
Pascal Hachem, Bär & Karrer AG, Zurich, Switzerland (http://www.cisg-ac.org).
Outline
1. Purpose . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
2. Outline . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
3. Distinction between Art. 46(1) and Art. 46(2), (3): The concept of non-
conformity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
a) Clear cases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
b) Aliud. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
c) Third party rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
d) Partial delivery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
1. General claim for performance (Art. 46(1)) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
a) Purpose . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
b) Requirements for the claim for performance (Art. 46(1)). . . . . . . . . . . . . . . 10
aa) Breach of contract . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
bb) Domestic law defence (Art. 28). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
cc) Inconsistent remedy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
dd) Impossibility and hardship. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
(i) Outline of the problem . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
(ii) Suggested solution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
ee) Art. 80 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
ff) Declaration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
c) Consequences of the claim for performance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
d) Performance and other remedies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
2. Substitute delivery (Art. 46(2)). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
a) Outline of the requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
b) Fundamental breach. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
c) Request and time limit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
d) Substitute delivery and sale of specific goods . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
e) Consequences . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
aa) Substitute delivery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
bb) Costs and place of performance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
cc) Choice between substitute delivery and repair . . . . . . . . . . . . . . . . . . . . . . 42
dd) Defective substitute delivery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
ee) Return of non-conforming goods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
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3. Repair (Art. 46(3)) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
a) Outline of the requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
b) Reasonableness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
c) Time limit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
d) Consequences . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
aa) Repair . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
bb) Costs and place of performance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
cc) Repair, substitute delivery, damages and right to cure. . . . . . . . . . . . . 53
4. Burden of proof . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54

1. Purpose
1 The purpose of the provision is to make it clear that the buyer is entitled to claim
specific performance by the seller of his obligations.1 In providing for a general claim for
performance, the Convention is more in line with the Civil Law approach than the
Common Law approach.2 Civil Law systems regard a claim for performance as the
natural and primary consequence of a contractual obligation.3 Common Law jurisdic-
tions, on the other hand, tend to view claims for performance more restrictively; the
primary remedy for a breach of contract being a claim for damages. Only in exceptional
circumstances will a Common Law court grant specific performance.4 While the
practical importance of this difference in approach may only be slight,5 the Convention
nevertheless seeks to strike a balance between Common Law and Civil Law countries by
allowing a court applying the Convention to refuse to enter a judgment for specific
performance if they would do so under their own law. This compromise provision is
found in Art. 28.6
2. Outline
2 Art. 46 deals with the buyer’s right to require performance by the seller. Art. 46(1)
sets out the general rule which entitles the buyer to require performance unless he has
resorted to a remedy which is inconsistent with this requirement. Art. 46(2) and (3)
contain specific provisions for those cases in which the seller has delivered non-
conforming goods.7 Where this is the case, the buyer may be entitled to require delivery
of substitute goods (Art. 46(2)) or for the lack of conformity to be repaired (Art. 46(3));
these two remedies are subject to additional requirements.
1 Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 46 para. 1; Huber, in: Münch-

2 Huber, in: MünchKommBGB (2015), Art. 46 para. 2; Magnus, in: Ferrari/Flechtner/Brand, Draft
Digest and Beyond (2003), pp. 325 et seq.

3 Cf. § 241 BGB (German Civil Code); Art. 1184 para. 2, Art. 1610 Code Civil (French Civil Code). Cf.
also Zimmermann, The New German Law of Obligations (2005), pp. 770 et seq.
4 Cf. Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 28 para. 2. As to these
different approaches see for instance Herman, Specific Performance: a Comparative Analysis, Edinburgh
Law Review 7 (2003) 5 et seq., 194 et seq. (Pace).
5 Akikol/Bürki, in: Brunner, Kommentar (2014), Art. 46 para. 2. It could be argued that those cases in
which the buyer will actually sue for performance under Civil Law will correspond to those in which a
Common Law court would also grant specific performance, cf. Müller-Chen, in: Schlechtriem/Schwenzer,
Commentary (2016), Art. 28 para. 4; Lando, in: Bianca/Bonell, Commentary (1987), Art. 28 para. 1.3.1.;
Magnus, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 326.
6 Cf. Honnold/Flechtner, Uniform Law (2009), Art. 46 para. 281.
7 Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 46 paras 3 et seq., paras 17 et seq.,
paras 39 et seq.
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3. Distinction between Art. 46(1) and Art. 46(2), (3): The concept of
non-conformity
Art. 46 draws a distinction between two classes of cases. Whereas Art. 46(2) and (3) 3
apply “if the goods do not conform to the contract”, Art. 46(1) covers the other
breaches committed by the seller.
a) Clear cases. Where the seller has delivered goods which do not comply with the 4
requirements mentioned in Arts 35–37, this will be a case of non-conformity so that
claims for performance will be covered by Art. 46(2),(3). By contrast, Art. 46(1) will
apply in the following cases: where there has been no delivery of the goods at all; where
the seller has tendered the goods at another place than required by Art. 31 (with the
buyer having rejected that particular tender and now claiming delivery in the correct
place); where the seller has failed to transfer the property in the goods to the buyer (as
required by Art. 30); where the seller has made an incorrect tender of documents
(Art. 34); where the seller is in breach of an agreed duty to instruct the buyer or to
undertake sales promotion.
However, doubts have been raised as to whether the following situations can be 5
brought within the notion of “non-conformity”: delivery of a so-called aliud (cf. infra
para. 6); breach of Arts 41 and 42 (cf. infra para. 7); or partial deliveries (cf. infra para. 8).
b) Aliud. If the buyer purchases one particular object, for example a specified used 6
machine or the whole load of one particular ship, and the seller does not deliver the
chosen object but another one, i. e. another machine or the load of another vessel, the
question arises whether such a case involves the delivery of non-conforming goods, or
whether it should be treated as a delivery of something completely different (aliud) and
should, as a consequence, be treated as a non-delivery which falls under Art. 46(1).8 The
predominant opinion regards these situations as cases of “non-conformity” and deals
with them under Art. 46(2),(3).9 This is correct because the wording of Art. 35 (“descrip-
tion”) also covers the delivery of an aliud.10
c) Third party rights. If the seller does not fulfil his obligation under Arts 41 or 42 to 7
deliver goods which are free from third party claims, this should not be regarded as a
case of non-conformity in the sense of Art. 46(2).11 The heading to Section II of
Chapter III clearly distinguishes between conformity of the goods (Arts 35 to 40) on
the one hand and third party claims on the other (Arts 41 to 43). What is more,
8 See in the latter direction Bianca, in: Bianca/Bonell, Commentary (1987), Art. 35 para. 2.4. It should
be noted that in the author’s opinion the decision of Oberlandesgericht Düsseldorf (Germany) 10 February
1994 (fabrics), CISG-Online 115 which is sometimes mentioned as supporting that view is not clear on
that point.
9 Bundesgerichtshof (Germany) 3 April 1996 (cobalt sulphate), CISG-Online 135; Schwenzer, in:
Schlechtriem/Schwenzer, Commentary (2016), Art. 35 para. 11; Müller-Chen, in: Schlechtriem/Schwen-

zer, Commentary (2016), Art. 46 para. 20; Will, in: Bianca/Bonell, Commentary (1987), Art. 46
para. 2.1.1.1; Huber, in: MünchKommBGB (2015), Art. 46 para. 7; Schlechtriem/Butler, CISG (2009),
para. 189; Honnold/Flechtner, Uniform Law (2009), Art. 47 para. 288 note 3.
11 This seems to be the predominant view, cf. Müller-Chen, in: Schlechtriem/Schwenzer, Commentary
(2016), Art. 46 para. 22; Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 41 para. 23,
Art. 42 para. 27 (hesitating however with regard to intellectual property rights); Secretariat Commentary
on 1978 Draft, Art. 39 paras 7 et seq.; Huber, in: Huber/Mullis, The CISG (2007), p. 198; Huber, in:
MünchKommBGB (2015), Art. 46 para. 9; Benicke, in: MünchKommHGB (2013), Art. 46 para. 27;
Saenger, in: Bamberger/Roth (eds), KommentarBGB (2015), Art. 46 para. 5. For the opposite view see
Enderlein/Maskow/Strohbach, Commentary (1991), Art. 46 para. 3; Herber/Czerwenka, Kommentar
(1991), Art. 46 para. 6.
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Art. 46(2) and (3) refer to the notice requirement of Art. 39 (which only applies to non-
conformity under Arts 35–37), but not to the notice provision in Art. 43 (which is
concerned with third party rights).12
8 d) Partial delivery. If the seller delivers less than required under the contract, Art. 51
will have to be taken into account. The provision states that in cases of partial delivery
Arts 46–50 apply in respect of the part which is missing. Thus, Art. 51(1) “narrows
down” the focus on the part which is missing. If, for instance, the seller has only
delivered 80 items (instead of 100 as required by the contract), one should only look at
the missing 20 items when applying Arts 46 et seq. As a consequence, the seller will be
liable for a non-delivery, but not for a non-conformity as none of the missing 20 items
has been delivered.13 The buyer’s claim for performance will therefore not be subject to
the particular requirements of Art. 46(2), but simply be based on Art. 46(1).14
1. General claim for performance (Art. 46(1))

9 a) Purpose. Art. 46(1) governs the buyer’s claim for performance where the seller’s
breach of duty does not consist in the delivery of non-conforming goods, the latter case
being covered by Art. 46(2) (substitute delivery) or Art. 46(3) (repair). Further,
Art. 46(1) sets out general requirements which will apply to any type of performance
claim, be it the general claim in Art. 46(1), the claim for substitute delivery (Art. 46(2))
or the claim for repair (Art. 46(3)).
10 b) Requirements for the claim for performance (Art. 46(1)). The buyer’s claim for
performance is subject to six requirements.
11 aa) Breach of contract. The first requirement is that the seller has breached an
obligation under the CISG or under the contract. Not all breaches will, however, lead to
the application of Art. 46(1). In fact, if the seller has breached the obligation to deliver
conforming goods, the buyer will have to resort to the remedies of substitute delivery
(Art. 46(2)) or repair (Art. 46(3)).15 By contrast, Art. 46(1) will apply to all other types
of breach; for more detail on this distinction cf. supra paras 3 et seq.).
12 bb) Domestic law defence (Art. 28). Under Art. 28, the court may refuse to enter a
judgment for specific performance unless it would do so under its own law in respect of
similar contracts of sale not governed by the CISG. For more detail cf. supra comments
to Art. 28.
13 cc) Inconsistent remedy. Art. 46(1) excludes the buyer’s claim for performance if he
has effectively16 resorted to a remedy which is inconsistent with this claim. In deciding
whether a remedy is inconsistent with a claim for performance, the following guidelines
should be followed.
12Cf. Magnus, in: Staudinger, Kommentar (2013), Art. 46 paras 15 et seq.

13See also Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 46 para. 21; Huber, in:
MünchKommBGB (2015), Art. 46 para. 8; Magnus, in: Staudinger, Kommentar (2013), Art. 46 para. 10;
14 Huber, in: Huber/Mullis, The CISG (2007), pp. 198 et seq; Akikol/Bürki, in: Brunner, Kommentar
(2014), Art. 46 para. 3.

15 Magnus, in: Staudinger, Kommentar (2013), Art. 46 para. 10.
16 Akikol/Bürki, in: Brunner, Kommentar (2014), Art. 46 para. 11.
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An avoidance of the contract by the buyer is inconsistent with the claim for 14
performance if it was effective in the sense that the contract was actually terminated,
be it because the requirements of Art. 49 were met (rightful avoidance)17 or because the
seller accepted the buyer’s avoidance (even though the avoidance was not justified, e. g.
because the requirements of Art. 49 were not met).18
With regard to claims for damages it is submitted that a distinction should be drawn 15
depending on whether the buyer claims compensation for an impairment of his
“performance interest” (e. g. for the reduced value of the goods or for the costs of
repair) or whether he claims compensation for damage to his “integrity interest” (e. g.
damages caused to his property by the defective goods which the seller delivered)19.
Only in the former case should the claim for damages be regarded as inconsistent with a
claim for performance, because both remedies aim to compensate the same interest of
the buyer (i. e. his interest in getting what was contractually promised).20 Again, this
should only be so if the claim for damages was effective in the sense that it was either
justified or has been accepted by the seller.21 Similar principles should apply where the
contract contains a clause providing for the payment of agreed sums for failure to
perform the contract: if the agreed sum is meant to replace performance of the contract,
a claim for performance should not be granted; a performance claim therefore only
exists if the agreed sum was meant to complement performance.22 Strictly speaking, this
rule results rather from an interpretation of the clause as a modifying agreement under
Art. 6 than from a straightforward application of the inconsistent remedy rule in
Art. 46. The policy considerations, however, are the same.
A claim for price reduction is inconsistent with a demand for performance23, 16
provided that the claimed price reduction is effective in the sense that it was either
justified or has been accepted by the seller.24
With regard to the timing it is submitted that the claim for performance is barred 17
when the inconsistent remedy becomes “effective” in the sense described above, i. e. in
the case of a rightful remedy when it is declared or in the case of an originally
unjustified remedy when the seller accepts it.25
17 Cf. Secretariat Commentary on 1978 Draft, Art. 42 para. 7. In fact, in such cases the claim for
performance will not only be excluded by the inconsistency defence of Art. 46(1) but also by virtue of
Art. 81(1) first sentence.
18 Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 49 para. 45; Magnus, in: Stau-
dinger, Kommentar (2013), Art. 46 para. 21. Cf. ibid. as to the possibility for the seller to treat the buyer’s
insistence on avoidance as a fundamental breach giving the seller a right to avoid the contract (Arts 61, 64
or 71 et seq.).
19 It is submitted, however, that cases of damage to the buyer’s “integrity interest” typically arise when
the seller has delivered defective goods. Those cases will lead to claims under Art. 46(2) or (3), which are,
however, also subject to the inconsistent remedy defence.
20 Cf. Magnus, in: Staudinger, Kommentar (2013), Art. 46 paras 19 et seq.; Müller-Chen, in: Schlech-
Art. 46 para. 24. For a different view see: Will, in: Bianca/Bonell, Commentary (1987), Art. 46 para. 2.1.2;
Enderlein/Maskow/Strohbach, Commentary (1991), Art. 46 para. 2.
22 CISG-AC Opinion no 10, paras 8.2.1 et seq.
KommBGB (2015), Art. 46 para. 13; Benicke, in: MünchKommHGB (2013), Art. 46 para. 4.
24 Huber, in: Huber/Mullis, The CISG (2007), p. 192; Schlechtriem/Butler, CISG (2009), para. 183.
25 Magnus, in: Staudinger, Kommentar (2013), Art. 46 paras 20 et seq.; Müller-Chen, in: Schlechtriem/
Schwenzer, Commentary (2016), Art. 46 para. 7; Schnyder/Straub, in: Honsell, Kommentar (2010),
Art. 46 paras 25 et seq.; Saenger, in: Ferrari et al., Internationales Vertragsrecht (2011), Art. 46 para. 3;
Huber, in: MünchKommBGB (2015), Art. 46 para. 14.
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dd) Impossibility and hardship

18 (i) Outline of the problem. Under certain conditions, a claim for performance may be
excluded because performance is impossible to make or because the seller faces obstacles
to make performance which are so serious that it would be entirely inadequate to require
him to do so. The correct legal argument which leads to this result has, however, led to
some debate among scholars. Notwithstanding the fact that domestic legal systems may
draw the lines differently, it is suggested that with regard to terminology, one may
distinguish between “objective impossibility” on the one hand, and “hardship” on the
other. Cases of objective impossibility are likely to be relatively rare in practice; if they do
occur, it will usually involve a contract for the sale of specific goods, such as a used
machine or the entire load of a named ship, which are destroyed before delivery. Hardship
means that performance may still be objectively possible but that the obligor (seller) faces
serious obstacles that he would have to overcome in order to make performance (e. g. the
sold generic goods prove to be more difficult and expensive than expected to obtain). This
scenario may arise more often than cases of objective impossibility.
19 With regard to cases of objective impossibility, there is widespread agreement that a claim
for performance should not be granted.26 This is the only reasonable solution as it would be
highly inappropriate for the court to order the seller to do something that is impossible.
20 With regard to cases of hardship the solutions suggested by legal scholars and courts
differ considerably. Some authors would apply Art. 79 and decide according to the
criteria given there,27 irrespective of the fact that Art. 79(5) clearly states that this
provision does not affect remedies other than damages.28 Those authors who do not
want to apply Art. 79 can – by and large – be divided into two groups. Some would find
a solution by reference to domestic law with the help of Art. 28.29 It is, however,
submitted that this is not the correct understanding of Art. 28 as this provision should
only cover those restrictions on specific performance which result from a general
scepticism towards the appropriateness of the remedy of compulsory performance.30
Others stipulate that hardship relieves the seller in exceptional cases from his duty to
perform and refer for instance to the principle of good faith.31
21 (ii) Suggested solution. The solution should be found by having recourse to the
general principles underlying the Convention, as indicated in Art. 7(2). It is submitted
that, although it is not directly applicable, Art. 79 can serve as a basis for discerning
those general principles so that the basic policy considerations which underlie this
provision will not be disregarded (in so far as they are appropriate for claims for
performance).32 This would lead to the following results.
26 Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 46 para. 12; Schwenzer, in:
Schlechtriem/Schwenzer, Commentary (2016), Art. 79 para. 54; Magnus, in: Staudinger, Kommentar
(2013), Art. 46 para. 26; Schnyder/Straub, in: Honsell, Kommentar (2010), Art. 46 para. 30.
27 Honnold/Flechtner, Uniform Law (2009), Art. 79 para. 435.5; Magnus, in: Staudinger, Kommentar
(2013), Art. 46 para. 25; Akikol/Bürki, in: Brunner, Kommentar (2014), Art. 46 para. 13.
28 What is more, a (German) proposal to apply the provision in certain situations to performance
claims was rejected at the Diplomatic Conference; cf. in more detail Schwenzer, in: Schlechtriem/
29 Honnold/Flechtner, Uniform Law (2009), Art. 79 para. 435.5 (as a second resort after having argued
that one should apply Art. 79).

30 Cf. Huber, in: Huber/Mullis, The CISG (2007), p. 189; Müller-Chen, in: Schlechtriem/Schwenzer,

31 Schnyder/Straub, in: Honsell, Kommentar (2010), Art. 46 para. 31; for a similar approach see Müller-
Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 46 para. 13.

32 Huber, in: Huber/Mullis, The CISG (2007), pp. 194 et seq.; Huber, in: MünchKommBGB (2015),
Art. 46 para. 18.
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In case of objective impossibility the seller will be freed from his duty to perform. 22
This result should not depend on whether he could not reasonably be expected to have
taken the impediment into account at the time of the conclusion of the contract
although Art. 79(1) sets up that requirement for damages claims. Deviation from the
wording of Art. 79(1) is justified because the rules expressed in Art. 79(1) should only
be regarded as general principles relating to limits to performance claims in so far as
they fit this particular scenario. With regard to objective impossibility, the foreseeability
rule simply does not make sense: it is just as useless to order the seller to perform an
impossible act if the impossibility was foreseeable as it is if the impossibility was not
foreseeable.33
In hardship cases, on the other hand, the criteria set out in Art. 79 can be applied 23
more strictly (in particular the notion of “beyond his control”, the foreseeability
criterion and the possibility to avoid or overcome the consequences of the impediment).
Where, for example, generic goods prove to be more difficult and expensive than
expected to obtain, the basic principle should be that this is a risk that has to be borne
by the seller so that he will only be exempt from his duty to perform in highly
exceptional circumstances.34
It should be noted, however, that the approach suggested in the preceding paragraphs 24
is only concerned with the performance claim, and not with claims for damages which
are of course fully governed by Art. 79. This may lead to the result that the seller was
exempt from his duty to perform under a “general principle” in the sense of Art. 7(2),
but is still liable for damages.35 Likewise, the non-performance may – and usually will –
entitle the buyer to avoid the contract under Art. 49. In cases where the seller has
received a substitute for the performance that has become impossible (e. g. an insurance
claim or a damages claim), the CISG does not explicitely grant the buyer to claim that
substitute in lieu of performance. It is submitted, however, that in light of Art. 84(2)(b)
such a claim can be based on a general principle under Art. 7(2) CISG.36
ee) Art. 80. Art. 80 also applies to claims for performance. The buyer will therefore 25
not be able to rely on the seller’s breach to the extent that this breach was caused by his
own (the buyer’s) act or omission.37
ff) Declaration. The buyer has to declare his claim for performance. The Convention 26
does not prescribe a particular form to be kept.38 In the case of Art. 46(1) the
Convention does not impose a time limit for declaring the claim for performance.
Irrespective of that, the applicable (national) rules on the limitation of claims will have
to be kept in mind.39 What is more, the principle of good faith (Art. 7(1)) may also
impose certain time limits in exceptional cases.40
c) Consequences of the claim for performance. Under Art. 46(1) the buyer can claim 27
from the seller the performance of the respective obligation as specified in the contract
or in the Convention. If the seller’s breach consists in having delivered goods which are
33
Huber, in: Huber/Mullis, The CISG (2007), p. 195.
34
Cf. Huber, in: Huber/Mullis, The CISG (2007), p. 195; Müller-Chen, in: Schlechtriem/Schwenzer,
36 Magnus, in: Staudinger, Kommentar (2013), Art. 79 para. 54; Huber, in: MünchKommBGB (2015),
Art. 46 para. 19 b.
37 For a more detailed analysis of Art. 80 see the comments to that provision.
38 Cf. Huber, in: Huber/Mullis, The CISG (2007), pp. 37 et seq.; Schnyder/Straub, in: Honsell,
Kommentar (2010), Art. 46 para. 34 a.

40 Akikol/Bürki, in: Brunner, Kommentar (2014), Art. 46 para. 17.
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not free from third party rights under Arts 41 et seq. (cf. supra para. 7), the seller has to
either free the goods from these third party rights or, if that is possible, to deliver other
goods of the contractually agreed type which are not subject to third party rights.41
28 The seller has to bear the costs for performance unless there is a contractual
stipulation to the contrary.42 If performance can be made in different ways under the
contract or the Convention (e. g. third party rights), it should be for the seller to choose
the appropriate form of performance. However, pursuant to the general principle
(Art. 7(2)) underlying Art. 48(1), if the form of performance chosen by the seller would
cause the buyer unreasonable delay or unreasonable inconvenience, the buyer should be
given the right to insist on another form of performance.43
29 d) Performance and other remedies. When the buyer has effectively resorted to an
inconsistent remedy, the claim for performance is excluded (cf. supra paras 13 et seq.).
By contrast, the buyer is entitled to proceed in reverse order, i. e. to first claim
performance and to resort to an “inconsistent” remedy later.44 This right is however
subject to the limitations specified in Art. 47(2) and in Art. 48(2), as well as to the
principle of good faith (Art. 7(1)). The latter principle may, for example, prevent the
buyer from switching from his original performance claim to another remedy if the
seller had already incurred expenses in preparing to perform the performance claim
made by the buyer.45
30 The buyer is free to combine the claim for performance with other remedies which
are consistent with such performance claim, for example to claim both performance and
damages for the delay.46
2. Substitute delivery (Art. 46(2))

31 a) Outline of the requirements. Art. 46(2) states that if the goods do not conform
with the contract, the buyer may require delivery of substitute goods only if the lack of
conformity constitutes a fundamental breach of contract and a request for substitute
goods is made either in conjunction with notice given under Art. 39 or within a
reasonable time thereafter. In addition, there are a number of requirements which result
from other provisions. As a general rule, therefore, a claim for substitute delivery is
subject to the following requirements:
(1) Non-conformity: The goods must be non-conforming in the sense of Art. 46(2).
The concept of non-conformity has been explained supra paras 3 et seq.
(2) Fundamental breach: The non-conformity must amount to a fundamental breach of
contract (cf. infra paras 32 et seq.).
(3) Time limit: A timely request for substitute delivery must be made under Art. 46(2)
(cf. infra paras 35 et seq.), irrespective of the applicable periods of limitation.
(4) No exceptions or defences: A claim for substitute delivery will be subject to a
number of exceptions or defences under the CISG, in particular to:
41 Akikol/Bürki, in: Brunner, Kommentar (2014), Art. 46 para. 17; Schnyder/Straub, in: Honsell,
Kommentar (2010), Art. 46 para. 38; Magnus, in: Staudinger, Kommentar (2013), Art. 46 para. 37.
42 Schnyder/Straub, in: Honsell, Kommentar (2010), Art. 46 para. 42; Huber, in: MünchKommBGB
(2007), Art. 46 para. 21.

43 Huber, in: MünchKommBGB (2015), Art. 46 para. 22.
(2015), Art. 46 para. 23.

45 Huber, in: MünchKommBGB (2015), Art. 46 para. 23; Benicke, in: MünchKommHGB (2013),
Art. 46 para. 5; Magnus, in: Staudinger, Kommentar (2013), Art. 46 para. 30.
(2015), Art. 46 para. 23.
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(a) the exception in Art. 82(1) which provides that the buyer may lose his right to
require substitute delivery if he is not able to return the goods substantially in
the condition in which he received them (cf. infra comments to Art. 82);
(b) the inconsistent remedy defence (Art. 46(1), cf. supra paras 13 et seq.). Although
this defence is explicitly mentioned only in Art. 46(1), it should also apply to
the performance claims provided for in Art. 46(2) and (3);47
(c) the Art. 28 defence (cf. supra para. 12 and comment to Art. 28);
(d) the exception in Art. 80;
(e) the exceptions which are based on impossibility or hardship (cf. supra paras 18
et seq.).
b) Fundamental breach. Art. 46(2) requires that the lack of conformity constitutes a 32
fundamental breach of the contract. The notion of fundamental breach is defined in
Art. 25 and it has to be defined in the same way as under Art. 49(1)(a).48 For more
detail cf. supra Art. 25 paras 9 et seq., infra Art. 49 paras 11 et seq.
The fact that Art. 46(2) requires a fundamental breach for the remedy of substitute 33
delivery is in line with one of the major policy considerations that underlies the Conven-
tion, i. e. the objective to keep the contract alive and to avoid unnecessary transfers of
goods (ultima ratio).49 Unnecessary transfers of the goods can be caused as much by a
claim for delivery of substitute goods as by an avoidance of the contract. In both cases, the
goods originally delivered have to be transported back to the seller or to be disposed of in
another manner. In addition, a new transport is necessary with respect to the substitute
goods. These transactions can be avoided by restricting the buyer to a claim for repair, for
damages or for price reduction. It does therefore seem reasonable to treat claims for
delivery of substitute goods and the remedy of avoidance along similar lines.50
On that basis, it might be argued that a fundamental breach may be unnecessary 34
where the goods are still at their original starting point at the time the buyer discovers
their lack of conformity and therefore rejects them. Thus, the buyer could claim
performance even if the defects do not amount to a fundamental breach.51 The wording
of the provision, however, does not contain a specific exception for the cases just
mentioned.52 It is submitted that one should not create an unwritten modification of
Art. 46(2), but strictly adhere to the system that the wording of the provision sets up. As
soon as the seller has made a non-conforming “delivery” (whatever that may encompass
under Art. 31 in the case at hand, a claim for delivery of other goods (which conform to
the contract) will have to be treated as a substitute delivery which requires a funda-
mental breach.
c) Request and time limit. Art. 46(2) requires the buyer to make the request for 35
substitute goods either in conjunction with notice given under Art. 39 or within a
reasonable time thereafter. If no notice has been given (but the buyer is nevertheless
entitled to rely on the lack of conformity, for example on the basis of Art. 40), the
47 Huber, in: Huber/Mullis, The CISG (2007), p. 191; Huber, in: MünchKommBGB (2015), Art. 46
paras 5, 12; Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 46 paras 7, 17.
48 Cf. UNCITRAL, Digest of Case Law on the CISG (2008), Art. 46 para. 13.
49 UNCITRAL, Digest of Case Law on the CISG (2008), Art. 46 para. 3. See also supra Art. 45, paras 9
et seq.
51 Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 46 para. 19 (who reaches this
result by arguing that this is not a case of “substitute delivery” but a general performance claim under
Art. 46(1) which is not subject to the fundamental breach requirement).
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period should begin to run when the buyer actually discovered the defect.53 According
to Art. 27, it is sufficient if the buyer dispatches the declaration by appropriate means
within that time; the risk of delay or loss has to be borne by the seller.54
36 There has been some discussion as to whether “reasonable time” in Art. 46(2) should
have the meaning it has in Art. 49(2)(b)55 or whether instead it should rather be
construed as in Art. 39(1).56 Proponents of the latter view tend to keep the reasonable
time period rather short, suggesting that it should, as a general rule, be no more than
about 2 weeks.57 It is submitted, however, that a more generous approach is appropriate
as the buyer may need time to make his choice of remedy (for instance between
substitute delivery and repair). The standards should be similar to the standards used
under Art. 49(2)(b), as the buyer will often have to choose between substitute delivery
and avoidance; cf. infra Art. 49 paras 70 et seq.
37 d) Substitute delivery and sale of specific goods. Art. 46(2) entitles the buyer to
claim delivery of substitute goods. This means that the seller has to make a new tender
of goods which conform to the contract. This will usually not create major problems
where generic goods are the subject matter of the contract (e. g. oil, sugar, grain). It may,
however, lead to problems where there is a sale of specific goods, for instance one
particular second-hand machine or a specific shipment of clothes. In the author’s
opinion, substitute delivery will usually not be possible in these cases. A machine
different from that selected by the buyer will not be the object that he bought and thus
cannot be claimed (or offered) as (substitute) delivery under the original contract.58
Some authors have argued that even in those cases the buyer should have a claim for
substitute performance if the seller has replacement goods that are economically
equivalent to the one bought originally.59 It is submitted, however, that this view should
not be followed. In many cases, the seller will have designed the sale as one for an
identified object only with the specific intention of avoiding having to perform a
delivery of substitute goods which would force him to keep similar goods on stock or
to obtain them on the market. Of course, if the seller in such a case does have similar
goods in stock and he is willing to deliver them, the parties can easily agree on a new
sales contract and terminate the original contract. The seller should, however, not be
obliged to do so. The legal concept which leads to this result is the impossibility
exception (cf. supra paras 18 et seq.). If only and specifically one specific object has
been sold, it is impossible to deliver another object in performance of the contract.60
para. 34; Magnus, in: Staudinger, Kommentar (2013), Art. 46 para. 45. But see also Herber/Czerwenka,
Kommentar (1991), Art. 46 para. 8 (time when notice should have been given).
56 Magnus, in: Staudinger, Kommentar (2013), Art. 46 para. 43; Müller-Chen, in: Schlechtriem/Schwen-
zer, Commentary (2016), Art. 46 para. 33; Akikol/Bürki, in: Brunner, Kommentar (2014), Art. 46 para. 22.
57 Magnus, in: Staudinger, Kommentar (2013), Art. 46 para. 43. Note, however, that recently there
seems to be a trend under Art. 39(1) which points towards a period of one month as a rough average for
the notice period; cf. for instance Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 39
para. 17; CISG-AC Opinion no 2 (with detailed references to case law, being sceptical, however, towards
formulating any general rule).
59 See for instance Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 46 para. 18. The
(German) Bundesgerichtshof has taken a similar position with regard to national German sales law
Bundesgerichtshof (Germany) 7 June 2006, NJW (2006) 2839 et seq.
60 Cf. Huber, in: MünchKommBGB (2015), Art. 46 para. 38; Akikol/Bürki, in: Brunner, Kommentar
(2014), Art. 46 para. 20.
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The situation will be different where the seller has delivered the wrong object, i. e. an 38
aliud (e. g. another machine than the one chosen by the buyer). In this case the original
delivery of the wrong machine will be a (fundamental) breach of contract and the
buyer’s claim for delivery of the chosen machine will have to be regarded as a claim for
substitute delivery.61
e) Consequences
aa) Substitute delivery. Substitute delivery means that the seller delivers another 39
object which is in conformity with the requirements of the contract and of the
Convention.
bb) Costs and place of performance. It is submitted that it is the seller who has to 40
bear the costs of the substitute delivery62, even if under the original contract it had been
for the buyer to cover the costs of transportation etc.63 This can be derived as a general
principle of the Convention (Art. 7(2)) from the cost allocation for cure in Art. 48(1).64
The main policy argument for this submission is that the issue of substitute delivery
only arises because the seller did not properly fulfil his obligations under the contract
originally. This justifies imposing on him the costs for making proper performance in a
second attempt.
There is a dispute concerning the place of performance for substitute delivery. Some 41
authors argue that substitute delivery should be made at the place where the non-
conforming goods are at the time when substitute delivery is required (provided that
this is the place of destination where they were originally meant to be and that the buyer
did not redirect the goods thereby raising the costs for substitute delivery).65 In the
author’s opinion, however, it is more convincing to locate the place of performance for
substitute delivery at the place of performance of the original obligation to deliver, i. e.
according to the standards set out in Art. 31.66 In a case which involves carriage of the
goods (Art. 31(1)(a)) this would lead to the result that substitute delivery would have to
be performed by handing over the goods to the first carrier for transmission to the
buyer. Usually, however, the buyer will be entitled to claim the transport costs to the
place of destination as damages under Arts 45(1)(a) and 74.
cc) Choice between substitute delivery and repair. In a case where both substitute 42
delivery and repair are available to the buyer, it would appear that it is up to him to
choose between these two remedies. The predominant opinion, however, seems to be
that the seller can defeat the buyer’s choice by offering repair instead of substitute
delivery as long as both methods are equally suitable and sufficient to remedy the initial
dinger, Kommentar (2013), Art. 46 para. 34; Akikol/Bürki, in: Brunner, Kommentar (2014), Art. 46
para. 20.
62 See Oberlandesgericht Hamm (Germany) 9 June 1995 (window elements), CISG-Online 146; Müller-
Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 46 para. 36; Magnus, in: Staudinger Kom-
mentar (2005), Art. 46 para. 50; Schnyder/Straub, in: Honsell, Kommentar (2010), Art. 46 para. 77.
Art. 46 para. 40.

65 See in that direction Magnus, in: Staudinger, Kommentar (2013), Art. 46 para. 50; Schnyder/Straub,
in: Honsell, Kommentar (2010), Art. 46 para. 71; Akikol/Bürki, in: Brunner, Kommentar (2014), Art. 46
para. 38.
Art. 46 para. 41; Saenger, in: Ferrari et al., Internationales Vertragsrecht (2011), Art. 46 para. 10; cf. also
Cour d’Appel Paris (France) 4 March 1998 (industrial machines), CISG-Online 535.
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breach of contract.67 In fact, Art. 48 gives the seller a right to cure the defect. What is
more, the seller’s breach as a rule will not be fundamental if it can still be cured without
undue burden for the buyer.68 As, in principle, cure can often be made by repair (unless
of course repair would be unreasonable because, for example, it would lead to
inacceptable disturbance to the buyer’s business or because the buyer simply has no
use for mended goods), the seller often will be able to defeat the buyer’s claim for
substitute delivery by reasonably offering and effecting repair.69 This result is also
justified on economic grounds, as if it is the seller who has to bear the costs of substitute
delivery, it should be up to him to choose between several equally suited measures.70
43 dd) Defective substitute delivery. If the goods that are tendered by way of substitute
delivery are defective, the non-conforming tender will amount to a new breach of
contract which may once more trigger the remedies of Art. 45, for instance claims under
Art. 46. The buyer should be subject to the notification requirements of Arts 38 et seq.
with regard to the substitute delivery.71 The fact that substitute delivery was not
successful may be the one element that makes the first breach (i. e. the original delivery
of non-conforming goods) “fundamental” in the sense of Arts 49(1)(a), 25 and there-
fore gives the buyer a right to avoid the contract.72
44 ee) Return of non-conforming goods. Art. 82 does not explicitly state, but clearly
presupposes, that the buyer who claims substitute delivery will be under a duty to make
restitution of the (non-conforming) goods that had originally been delivered. This raises
the question how the buyer’s claim for delivery of substitute goods and the seller’s claim
for restitution relate to each other, and in particular whether they have to be performed
concurrently. It is submitted, however, that these two obligations are not concurrent.73
Whereas the Convention in Art. 81(2) second sentence explicitly says that the restitu-
tionary duties which arise out of an avoidance of the contract have to be performed
concurrently, there is no such rule for the relationship between substitute delivery and
restitution. Indeed, a Norwegian proposal to include a provision to that effect has been
rejected by the Diplomatic Conference.74 This submission also seems reasonable from a
practical perspective as the concurrent exchange of goods for goods would create
considerable practical problems. In that respect the situation is different from the
avoidance cases addressed in Art. 81(2) second sentence, which provides for a con-
current exchange of goods for money which does not present particular problems for
commercial sales.75 As a result, therefore, the buyer can claim substitute delivery
without having to offer restitution of the originally delivered goods at the same time.
67 Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 46 para. 35 with further refer-
ences; Huber, in: Huber/Mullis, The CISG (2007), pp. 203 et seq.; Huber, in: MünchKommBGB (2015),
Art. 46 paras 44 et seq.
68 See in more detail infra Art. 49, paras 15 et seq.
70 Cf. Huber, in: Huber/Mullis, The CISG (2007), pp. 203 et seq.
71 Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 46 para. 37; Huber, in: Huber/
Mullis, The CISG (2007), p. 203.

para. 47.
KommBGB (2015), Art. 46 para. 43; Magnus, in: Staudinger, Kommentar (2013), Art. 46 para. 49;
Schnyder/Straub, in: Honsell, Kommentar (2010), Art. 46 para. 62; Saenger, in: Ferrari et al., Internatio-
nales Vertragsrecht (2007), Art. 46 para. 8. For the opposite view see Herber/Czerwenka, Kommentar
(1991), Art. 46 para. 7.
74 Cf. Honnold, Documentary History (1989), pp. 608 et seq., 708.
Mullis, The CISG (2007), p. 201; Huber, in: MünchKommBGB (2015), Art. 46 para. 43.
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3. Repair (Art. 46(3))

a) Outline of the requirements. Under Art. 46(3) the buyer has the right to require 45
the seller to remedy the lack of conformity by repair, unless this is unreasonable having
regard to all the circumstances. The request for repair must be made either in
conjunction with notice given under Art. 39 or within a reasonable time thereafter. In
addition, there are a number of requirements which result from other provisions. As a
general rule, therefore, a claim for repair is subject to the following requirements:
(1) Non-conformity: The goods must be non-conforming in the sense of Art. 46(3).
The concept of non-conformity has been explained supra paras 3 et seq.
(2) Reasonableness: Repair must not be unreasonable (cf. infra paras 46 et seq.)
(3) Time limit: A timely request for repair must be made under Art. 46(3) (cf. infra
para. 50) irrespective of the applicable periods of limitation.
(4) No general exceptions or defences: A claim for repair will be subject to a number of
exceptions or defences under the CISG, in particular to:
(a) the inconsistent remedy defence (Art. 46(1), cf. supra paras 13 et seq.). Although
this defence is explicitly mentioned only in Art. 46(1), it should also apply to
the performance claims provided for in Art. 46(2) and (3);76
(b) the Art. 28 defence (cf. supra para. 12 and comment to Art. 28)
(c) the exception in Art. 80;
(d) the exceptions which are based on impossibility or hardship (cf. supra paras 18
et seq.).
b) Reasonableness. The buyer can claim repair, “unless this is unreasonable having 46
regard to all the circumstances”. As the word “unless” indicates, it is for the seller to
prove the unreasonableness “defence”.77 Whether this defence is available, will have to
be decided on a case-by-case basis by taking into account all the circumstances of the
case and by weighing the buyer’s interest in getting repair against the seller’s expense78
and inconvenience. The following indications may, inter alia, be of relevance.
If the costs of repair are considerably higher than the costs of substitute delivery or 47
than the advantage which the buyer will derive from the repair, this is a strong
indication of unreasonableness;79 it is submitted that the purchase price should not be
integrated into that equation.80 Whether one may assume a case of unreasonableness
simply because the costs of repair are higher, but not considerably so, is a matter of
dispute.81
Regard should also be had to which side is in a better position to perform or to 48
organize the repair of the goods. If the defect can be easily removed by the buyer (or by
contractors easily available to him) and if the distant seller would have considerable
difficulties in organising repair at the place where the goods are, it may prove
paras 5, 12; Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 46 para. 39.
Commentary (2016), Art. 46 para. 40; Akikol/Bürki, in: Brunner, Kommentar (2014), Art. 46 para. 33.
Mullis, The CISG (2007), pp. 205 et seq.; Will, in: Bianca/Bonell, Commentary (1987), Art. 46
para. 2.2.2.2; Magnus, in: Staudinger, Kommentar (2013), Art. 46 para. 61.
80 The matter is disputed. Cf. for a view similar to the one suggested here: Müller-Chen, in:
Schlechtriem/Schwenzer, Commentary (2016), Art. 46 para. 40 (with further references, also to a differing
opinion); Huber, in: MünchKommBGB (2015), Art. 46 para. 55.
81 Cf. Magnus, in: Staudinger, Kommentar (2013), Art. 46 para. 61 on the one hand and Benicke, in:
MünchKommHGB (2013), Art. 46 para. 22 on the other hand.
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unreasonable to require the seller to do so. The seller would then have to bear the costs
of repair as damages under Art. 45(1)(b) and Arts 74 et seq. It is submitted that, as a
general rule and depending on the individual circumstances of the case, the seller then
should also be obligated to pay the buyer an advance on the costs of repair, if the buyer
so wishes.
49 If the buyer has a legitimate interest specifically in a repair made by the seller (e. g.
because the seller is a well-known expert in this field or because repair by other sources
would take longer), this will be an indication in favour of regarding repair as reason-
able.82
50 c) Time limit. Art. 46(3) submits the claim for repair to the same time limit as the
claim for delivery of substitute goods.83
d) Consequences
51 aa) Repair. Repair may, in particular, be made by mending the goods or by ex-
changing defective parts. Repair may even consist of the delivery of a part which had
not been delivered originally, as long as this partial failure to deliver amounts to a non-
conformity under Art. 35. This will not be the case, however, if Art. 51 applies to the
partial delivery because then the missing part will be regarded as a non-delivery and
dealt with under Art. 46(1).84
52 bb) Costs and place of performance. It is submitted that the costs of repair have to
be borne by the seller.85 It is disputed where the place of performance for repair should
be located. While some authors86 look to the place where the goods are located at the
time of (the request for) repair, others87 look to the place of performance under Art. 31
for the original delivery. It is submitted that, with regard to repair (but not with regard
to substitute delivery, cf. supra paras 40 et seq.), the first approach is more convincing as
it would be economically unreasonable to transport the defective goods back to the
original place of delivery for repair (e. g. goods sold on an “ex works” basis).88
53 cc) Repair, substitute delivery, damages and right to cure. It is submitted that it
follows from Art. 48 that the seller can defeat the buyer’s claim for repair by making
substitute delivery under the conditions of Art. 48 (reasonableness requirements).89 As a
general rule, the buyer has the option to organize the repair of the goods himself and to
claim the costs as damages under Arts 45(1)(b), 74 et seq., taking into account of course
Commentary (2016), Art. 46 para. 40; Magnus, in: Staudinger, Kommentar (2013), Art. 46 para. 61;
Schnyder/Straub, in: Honsell, Kommentar (2010), Art. 46 para. 98 a; Will, in: Bianca/Bonell, Commentary
(1987), Art. 46 para. 2.2.2.2.
83 Cf. supra paras 35 et seq.
85 Oberlandesgericht Hamm (Germany) 9 June 1995 (window elements), CISG-Online 146; Müller-
Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 46 para. 45; Huber, in: Huber/Mullis, The
CISG (2007), p. 206; Huber, in: MünchKommBGB (2015), Art. 46 para. 59; Schnyder/Straub, in: Honsell,
Kommentar (2010), Art. 46 para. 77; Magnus, in: Staudinger, Kommentar (2013), Art. 46 paras 50, 65;
Schlechtriem/Butler, CISG (2009), para. 187.
86 See in that direction: Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 46
para. 45; Saenger, in: Ferrari et al., Internationales Vertragsrecht (2011), Art. 46 para. 15; Schnyder/Straub,
in: Honsell, Kommentar (2010), Art. 46 para. 104 et seq.
87 Cour d’Appel Paris (France) 4 March 1998 (industrial machines), CISG-Online 535.
Art. 46 para. 59.

Art. 46 para. 61. But see for a different view Magnus, in: Staudinger, Kommentar (2013), Art. 46 para. 53.
686 Huber
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the duty to mitigate damages under Art. 77.90 Again, the seller can deprive the buyer of
this option by exercising his right to cure under Art. 48. It should be noted in that
regard, however, that the principle of good faith (Art. 7(1)) requires the seller to inform
the buyer about his intention to cure (cf. infra Art. 48 paras 13 et seq).91
4. Burden of proof
It is submitted that the following considerations should apply with regard to the 54
burden of proof.92 The buyer has to prove that the seller’s obligation exists. Once he has
succeeded in doing so and claimed that there was a breach, it should in principle be for
the seller to prove that he actually performed; with regard to the non-conformity of the
goods (Art. 46(2),(3)), however, the burden should shift on the buyer as soon as he
accepts the goods.93 The seller, for his part, bears the burden of proof with regard to his
defences arising out of Arts 79, 80 and out of the inconsistent remedy argument of
Art. 46(1). The burden for the fundamental breach requirement and for the time limits
should be on the buyer, whereas the burden for the unreasonableness defence should be
on the seller.

Most international instruments on contract law have a rule which would give the 55
buyer a right to claim performance by the seller under certain (more or less strict)
conditions, cf. for example Arts 7.2.1 et seq. PICC, Arts 9:101 et seq. PECL, Arts 3:301 et
seq. DCFR. There are, however, differences in detail which cannot be explored here
further. Suffice it to mention two points by way of example. First, neither the PICC, nor
the PECL nor the DCFR provide specific rules on substitute delivery or repair which are
as detailed as in Art. 46(2),(3) CISG. Secondly, the general claim for performance of
non-monetary obligations under the PICC and under the PECL is subject to a defence
that is not generally available under Art. 46 CISG, i. e. the rule that there is no claim for
performance if the creditor (buyer) may reasonably obtain performance from another
source (cf. Art. 7.2.2(c) PICC, Art. 9:102(2)(d) PECL).
90 Bundesgerichtshof (Germany) 24 September 2014 (tools), CISG-Online 2545; Oberster Gerichtshof
(Austria) 14 January 2002 (cooling system), CISG-Online 643; Oberlandesgericht Graz (Austria) 22 No-
vember 2012 (machine), CISG-Online 2459; Müller-Chen, in: Schlechtriem/Schwenzer, Commentary
(2016), Art. 46 para. 46.
91 Bundesgerichtshof (Germany) 24 September 2014 (tools), CISG-Online 2545.
92 Cf. Huber, in: Huber/Mullis, The CISG (2007), pp. 207 et seq; Huber, in: MünchKommBGB (2015),
Art. 46 paras 67 et seq.; see also Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 46
paras 16, 31.
93 See, e. g., Bundesgericht (Switzerland) 13 November 2003 (used laundry machine), CISG-Online 840;
Bundesgerichtshof (Germany) 8 March 1995 (New Zealand mussels), CISG-Online 144. See in more detail
Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 35 paras 52 et seq.
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Article 47
(1) The buyer may fix an additional period of time of reasonable length for
performance by the seller of his obligations.
(2) Unless the buyer has received notice from the seller that he will not perform
within the period so fixed, the buyer may not, during that period, resort to any
remedy for breach of contract. However, the buyer is not deprived thereby of any
right he may have to claim damages for delay in performance.
Bibliography: See selected bibliography of Art. 45; CISG-AC Opinion no 10, Agreed Sums Payable upon
Breach of an Obligation in CISG Contracts, 3 August 2012. Rapporteur: Dr. Pascal Hachem, Bär & Karrer
AG, Zurich, Switzerland (http://www.cisg-ac.org).
Outline
1. Requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
a) Non-performance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
b) Declaration fixing a Nachfrist. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
c) Defined period of reasonable length . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
2. Consequences. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
a) Right to avoid the contract. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
b) Restriction of buyer’s choice of remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
aa) Purpose of the rule. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
bb) Suspension of remedies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
cc) End of suspension period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
c) Nachfrist not effective under Art. 47 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
aa) Period too short . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
bb) Period too long. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
cc) Period not clearly defined . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
3. Burden of proof . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29

1 Under Art. 47(1) the buyer may fix an additional period of time of reasonable length
for performance by the seller of his obligations. In reference to parallels in German law,
this is often called the Nachfrist mechanism. At first sight, the provision seems to state
something which is self-evident. Of course, it is possible and admissible for the buyer to
fix an additional period of time for performance by the seller, a Nachfrist. This would be
so even if there were not express entitlement to this effect in the Convention. The
importance of the provision thus results from its interaction with other provisions, in
particular with Art. 49(1)(b) which, in cases of non-delivery, gives the buyer a right to
avoid the contract after he has fixed a reasonable period of time under Art. 47 without
success. This specific ground of avoidance – which unlike the general ground of
avoidance in Art. 49(1)(a) does not require the breach to be fundamental – is thus
based on the Nachfrist-procedure as it is outlined in Art. 47. Put differently, Art. 47(1)
sets out the requirements for an effective Nachfrist in the sense of Art. 49(1)(b).1 What
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is more, the Nachfrist mechanism under Art. 47 can also be relevant with regard to the
time limit for avoidance as set up by Art. 49(2)(b).
If the buyer fixes a reasonable Nachfrist under Art. 47(1), he will not be entitled to 2
resort to any remedy except damages for the delay for a certain period of time pursuant
to Art. 47(2). This rule intends to protect the seller’s reliance on having the entire
period of time that was accorded to him by the buyer available for making perfor-
mance.2 Obviously a modification of contract according to Art. 29 remains possible
because it does not constitute a “remedy” – even though the modification contains a
reduction of the purchase price.3
1. Requirements
As the major consequences of Art. 47 are, on the one hand, the right of avoidance 3
under Art. 49(1)(b) and, on the other hand, the temporary restriction of the buyer’s
choice of remedies under Art. 47(2), the following analysis describes the requirements
that Art. 47(1) sets out for these consequences.
a) Non-performance. Art. 47(1), in conjunction with Art. 45(1), requires that the 4
seller has not performed one of his obligations under the contract or under the
Convention. Any type of breach will suffice.4 It should be noted, however, that the
Nachfrist-procedure will only lead to a right to avoid the contract under Art. 49(1)(b) in
cases of non-delivery; irrespective of that, fixing an additional period of time for
performance may also be useful with regard to other types of breach (e. g. non-
conforming delivery), cf. infra Art. 49 para. 36.
b) Declaration fixing a Nachfrist. The Nachfrist is fixed by a declaration by the 5
buyer. The declaration must clearly demand performance by the seller of his obligations.
Being overly polite in this respect (e. g. “We hope that your delivery will arrive by July
31st”) may turn out to be dangerous as a court may regard such a demand as not being
clear enough.5 It is not necessary, however, for the buyer to state that he will refuse to
accept the goods after the Nachfrist has expired.6
KommBGB (2015), Art. 47 para. 3. But see for a differing view (Nachfrist may be fixed before time for
performance, provided that there remains a reasonable period of time for performance after the agreed
time of performance) Benicke, in: MünchKommHGB (2013), Art. 47 para. 5.
3 U.S. Court of Appeals (3rd Circuit) (U.S.) 19 July 2007, Valero Marketing Supply Co vs. Greeni Oy,
CISG-Online 1510; Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 47 para. 3.

4 Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 47 para. 1; Schnyder/Straub, in:
Honsell, Kommentar (2010), Art. 47 para. 8; Magnus, in: Staudinger, Kommentar (2013), Art. 47 para. 8.
But see for a differing view (notice-avoidance procedure only applicable to non-delivery) Honnold/
Flechtner, Uniform Law (2009), Art. 47 para. 288; Will, in: Bianca/Bonell, Commentary (1987), Art. 47
para. 1.2. For the specific (but rarely relevant) question whether the requirements for a claim for
performance must have been given cf. Huber, in: MünchKommBGB (2015), Art. 47 para. 7.
5 See Honnold/Flechtner, Uniform Law (2009), Art. 47 para. 289; Müller-Chen, in: Schlechtriem/
Schwenzer, Commentary (2016), Art. 47 para. 5 with further references. For an example where the court
regarded the demand as clear enough see Oberlandesgericht Hamburg (Germany) 28 February 1997 (iron
molybdenum), CISG-Online 261.
Schnyder/Straub, in: Honsell, Kommentar (2010), Art. 47 para. 19; Herber/Czerwenka, Kommentar
(1991), Art. 47 para. 3. But see for a differing view Will, in: Bianca/Bonell, Commentary (1987), Art. 47
para. 2.1.3.1.
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6 The declaration is widely regarded as falling under Art. 27 so that under the
requirements set out there, the seller will have to bear certain communication risks.7
This may lead to the result that the buyer can avoid the contract under Art. 49(1)(b)
although the seller did not know about the Nachfrist.8 It is a different issue, however,
whether the buyer will be bound under Art. 47(2) if his declaration has not actually
reached the seller, but is deemed to have reached him under Art. 27. In this case the
seller is not in need of protection, as he did not actually rely on the Nachfrist. As a
consequence, the buyer should be given the right to withdraw his declaration under
Art. 15(2) (in an analogous application) and to regain his choice of remedies.9
7 As a general rule, an effective Nachfrist under Art. 47(1) can only be set when the
time for performance (under the contract or under Art. 33) has passed;10 cf. infra
Art. 49 paras 53 et seq. (with regard to the right to avoid under Art. 49(1)(b)).
Irrespective of this, the buyer may be restricted in his choice of remedies under
Art. 47(2) even where he has set the Nachfrist prematurely, i. e. before the date for
delivery.
8 c) Defined period of reasonable length. The declaration must make it clear that the
buyer expects the seller to perform within a defined period of time.11 The period is
sufficiently defined if its end can be determined by reference to the calendar (e. g. “until
January 31st” or “within three weeks of receipt of this letter”).12 The period is not
sufficiently defined if the buyer merely demands performance “immediately” or “within
reasonable time”; for the consequences of such a demand see infra para. 28.13
9 Whether the period chosen by the buyer is reasonable for the purposes of Arts 47(1)
and 49(1)(b) will depend on the circumstances of the case. As a general rule, the buyer
need not give the seller enough time to start from scratch, i. e. to begin preparing for his
performance only now. It is sufficient if the Nachfrist set for the seller is long enough to
make performance, if the seller has already made reasonable preparations for perfor-
mance.14
10 Regard may, inter alia, be had to the following criteria.15 Where it was apparent to
the seller that the buyer has a particular interest in quick delivery, the Nachfrist may
be kept rather short. The fact that the original delivery periods were rather long or
were on an “as space is available” basis may indicate that a longer Nachfrist is
appropriate, and vice versa. If the seller owes goods which have to be tailor-made for
the buyer, the period should be longer than if the seller owes standard goods from
mass production. The agreed shipment terms also have to be taken into account; thus
KommBGB (2015), Art. 47 para. 8; Benicke, in: MünchKommHGB (2013), Art. 47 para. 4.
9 Huber, in: MünchKommBGB (2015), Art. 47 para. 8. Cf. also Magnus, in: Staudinger, Kommentar

11 Oberlandesgericht Düsseldorf (Germany) 24 April 1997 (shoes), CISG-Online 385.

KommBGB (2015), Art. 47 para. 9; Honnold/Flechtner, Uniform Law (1999), Art. 47 para. 289; Will, in:
Bianca/Bonell, Commentary (1987), Art. 47 para. 2.1.3.1; Schnyder/Straub, in: Honsell, Kommentar
(2010), Art. 47 para. 20; Magnus, in: Staudinger, Kommentar (2013), Art. 47 para. 17.
Commentary (2016), Art. 47 para. 6; Benicke, in: MünchKommHGB (2013), Art. 47 para. 6.
15 Cf. Huber, in: MünchKommBGB (2015), Art. 47 para. 11.
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where the seller has to organize a sea transport of the goods, he has to be given
reasonable time for doing so.16
2. Consequences
a) Right to avoid the contract. If, in a case of non-delivery, the buyer has fixed an 11
additional period of time which satisfies the requirements set out in supra paras 5 et
seq., he may be entitled to avoid the contract under Art. 49(1)(b) even if the seller’s
breach was not fundamental under Arts 49(1)(a) and 25; in this case the buyer may
have to act within the time limit set out in Art. 49(2)(b)(ii). Art. 49(1)(b) does, however,
not apply to other types of breach (e. g. delivery of non-conforming goods); irrespective
of that, fixing an additional period of time for performance may also be useful with
regard to other types of breach (e. g. non-conforming delivery), cf. infra Art. 49 para. 36.
b) Restriction of buyer’s choice of remedies. Under Art. 47(2) the buyer is limited in 12
his choice of remedies for as long as the additional period set by him has not expired.
aa) Purpose of the rule. Art. 47 (2) states as a general rule that the buyer may not, 13
during the additional period of time fixed by him, resort to any remedy for breach of
contract, except for claims for damages for delay in performance. The provision aims at
protecting the seller who is entitled to rely on having the period specified by the buyer
for making his performance. It is also based on the principle of good faith in the sense
that a party (the buyer) should not be allowed to act in contradiction to his own
behaviour (venire contra factum proprium, estoppel).17
bb) Suspension of remedies. Art. 47(2) operates by suspending the buyer’s right to 14
certain remedies for a certain period of time, i. e. until the Nachfrist fixed by the buyer has
expired or until the seller has notified the buyer that he will not perform within the
Nachfrist. From a doctrinal perspective, it is submitted that while the provision suspends
the use of these remedies, it does not terminate or suspend the seller’s obligation as such.
With some exceptions, the provision suspends all the buyer’s remedies. This concerns 15
in particular the right to avoid the contract (Art. 49) and the right to reduce the price
(Art. 50). It also concerns types of performance claims other than the one for which the
buyer has fixed the Nachfrist. Thus, if the buyer fixes an additional period of time for
repair (Art. 46(3)), he will be barred by Art. 47(2) from making a claim for substitute
delivery (Art. 46(2)) while the Nachfrist set for repair is still open.18 It is submitted,
however, that the buyer’s right to withhold payment of the price (cf. Art. 45 para. 8)
should not be affected by the suspension of remedies.19
With regard to claims for damages, several distinctions need to be drawn. First, 16
Art. 47(2) states in its last part that the buyer is not deprived of any right he may have
to claim damages for delay in performance. The provision does not create these claims
but simply states that they would not be barred or suspended by the Nachfrist. Thus, the
legal basis for such claims would normally lie in Arts 45(1)(b) and 74.20
16
See Oberlandesgericht Celle (Germany) 24 May 1995 (used printing press), CISG-Online 152.
17
See Huber, in: MünchKommBGB (2015), Art. 47 para. 16; Müller-Chen, in: Schlechtriem/Schwenzer,
19 This is the solution of the UNIDROIT Principles of International Commercial Contracts
(Art. 7.1.5(2) PICC).

dinger, Kommentar (2013), Art. 47 para. 28; Huber, in: MünchKommBGB (2015), Art. 47 para. 23;
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17 It is submitted that the buyer should also be entitled to claim damages for those types
of losses which have resulted already from the original breach and which could not be
prevented or remedied if the seller made performance within the Nachfrist set by the
buyer, e. g. damage that the delivered defective production machine has already caused
to the buyer’s property when the buyer started to operate the machine.21 This submis-
sion can be based on a general principle of the Convention (Art. 7(2)) which is not only
evidenced by the last part of Art. 47(2) with regard to damages for delay, but is also the
rationale underlying Art. 48(1),(2). This general principle would state that the fact that
the Convention (and/or the buyer) give the seller a second chance to perform does not
deprive the buyer of any right to claim damages for those losses which he has already
incurred as a result of the original breach and irrespective of whether the seller will later
be able to perform.22
18 By contrast, the buyer is barred from claiming so-called “damages for non-perfor-
mance” or “damages in lieu of performance”, i. e. those types of damages which are
calculated on the basis that performance will not be made by the seller, such as a claim
for the loss of value that the goods suffer due to the defects they had when they were
originally delivered or a claim for loss of profit from a resale by the buyer which could
not be made due to the seller’s breach.23
19 If the contract contains clauses for liquidated damages or contractual penalties,
distinctions should be drawn along similar lines: the buyer should be entitled to invoke
claims under these clauses in so far as they relate to the delay caused by the Nachfrist
(e. g. penalty of 10,000 E/day for delay in delivery), but should not be entitled to invoke
them in so far as they are based on the seller’s final non-performance (e. g. penalty of
200,000 E if no goods are delivered at all).24
20 Art. 47(2) does not prevent the parties from reaching a new agreement concerning the
obligation in question.25 This results from Art. 6. What is more, it should be noted that the
suspension provided for in Art. 47(2) only operates with regard to the obligation to which
the Nachfrist refers. Thus, if the seller has committed several breaches and the buyer has
proceeded under Art. 47 with regard to one of these breaches only, the buyer will not be
barred from invoking his remedies concerning the other breach.
21 cc) End of suspension period. Art. 47(2) sets out two alternative scenarios in which
the suspension of remedies comes to an end. First, the suspension of remedies ends
when the Nachfrist (which was effective in the sense that it satisfied the requirements set
out in supra paras 5 et seq.) expires without the seller having made proper performance;
in this case the buyer may invoke his remedies under Arts 45 et seq. Secondly, the
suspension of remedies ends if the seller declares that he will not perform within the
(effective) Nachfrist fixed by the buyer26 and if this declaration has been received by the
zer, Commentary (2016), Art. 47 para. 19; Huber, in: MünchKommBGB (2015), Art. 47 para. 24;
24 Favouring the buyer’s right to claim under such clauses Magnus, in: Staudinger, Kommentar (2013),
Art. 47 para. 23; Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 47 para. 20; Huber,
in: MünchKommBGB (2015), Art. 47 para. 25; Schnyder/Straub, in: Honsell, Kommentar (2010), Art. 47
para. 29. Generally on these clauses CISG-AC Opinion no 10.
25 See U.S. Court of Appeals (3rd Circuit) (U.S.) 19 July 2007 (Naphta), Valeo Marketing & Supply Co. v
Grenni Oy, CISG-Online 1510.

26 Or if the seller offers performance, but makes this offer subject to a counter performance to which he
is not entitled, see Bundesgericht (Switzerland) 20 December 2006 (machines), CISG-Online 1426.
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buyer.27 If, however, in the latter case, the seller combines his refusal to perform with an
offer to perform at a later date, this may trigger the mechanism provided for in
Art. 48(2)-(4) which may again lead to a situation where the buyer is bound in his
choice of remedies28; for more detail see infra Art. 48 paras 37 et seq.
If the seller does perform within the Nachfrist, but if this performance is not in 22
conformity with the contract, two different situations should be distinguished. On the
one hand, if the non-conformity amounts to a fundamental breach, the buyer will be
entitled to avoid the contract under Arts 49(1)(a), 25 immediately, i. e. even before the
expiry of the original Nachfrist.29 The reason for this is that the non-conforming
delivery should be regarded as a new and separate breach which again triggers the
application of the remedial provisions in Arts 45 et seq. On the other hand, if the non-
conformity as such does not amount to a fundamental breach, this will not immediately
entitle the buyer to avoid the contract. It is submitted as a general rule that the buyer
should then be required to wait and see whether the seller still makes a conforming
performance within the original Nachfrist; if the seller does not do so, the buyer will be
entitled to avoid the contract under Art. 49(1)(b). However, if the buyer has good
grounds for having lost his trust in the seller’s ability to perform properly, he should be
given the right to avoid the contract immediately; doctrinally this could be justified by
saying that the second breach (non-conformity), although not per se fundamental, was
the one element that tipped the balance in that it made the original breach fundamental
so that the buyer would now have a right to avoid the contract under Art. 49(1)(a) for
fundamental breach.
c) Nachfrist not effective under Art. 47
aa) Period too short. According to the predominant opinion, if the buyer sets a time 23
limit which is too short, this will not be entirely ineffective, but will initiate a period of
reasonable length.30
It is submitted that this is correct with regard to the buyer’s right to avoid under 24
Art. 49(1)(b). In practice, this can lead to two different scenarios. One the one hand, if
the buyer declares avoidance immediately after the expiry of the insufficient period of
time, this will have no effect under Art. 49(1)(b);31 in fact, the untimely declaration of
avoidance may itself constitute a fundamental breach of contract which entitles the
seller to avoid the contract. If, on the other hand, the buyer delays giving a notice of
avoidance until after a reasonable period of time has expired32, such notice will be valid
27 As the refusal is not effective until received by the buyer, the seller may withdraw the declaration
prior to the receipt. Cf. Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 47 para. 17;
Huber, in: MünchKommBGB (2015), Art. 47 para. 22; Schnyder/Straub, in: Honsell, Kommentar (2010),
28 Cf. Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 47 para. 17 and Art. 48 paras 22
et seq.
Commentary (2016), Art. 47 para. 15 with further references.

30 Oberlandesgericht Celle (Germany) 24 May 1995 (used printing press), CISG-Online 152; Müller-
Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 47 para. 8; Magnus, in: Staudinger, Kom-
mentar (2013), Art. 47 para. 20; Saenger, in: Ferrari et al., Internationales Vertragsrecht (2011), Art. 47
para. 6; Benicke, in: MünchKommHGB (2013), Art. 47 para. 7.
31 If the delay in delivery as such constitutes a fundamental breach, it will justify avoidance under
Art. 49(1)(a) but not under Art. 49(1)(b), cf. Müller-Chen, in: Schlechtriem/Schwenzer, Commentary
(2016), Art. 47 para. 9.
32 It should be noted that the time bars in Art. 49(2) do not apply here because the seller has not (yet)
delivered, Huber, in: Huber/Mullis, The CISG (2007), p. 238.
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under Art. 49(1)(b) because the insufficiently short period has initiated the reasonable
period under the above-mentioned rule.33
25 It should be noted, however, that the seller may prevent the buyer’s right to avoid
from coming into existence. Thus, if the seller simply delivers within that reasonable
period as it is set in motion (and before the buyer has declared avoidance), the buyer
will lose his right to avoid under Art. 49(1)(b).34 What is more, the seller may counter
the buyer’s time limit by offering cure under Art. 48(2),(3) within a period of time
which is longer than the one set by the buyer. If the buyer does not reject that proposal
within reasonable time, Art. 48(2) will have the effect that the period suggested by the
seller takes precedence over the one fixed by the buyer. As a result, the buyer cannot
declare avoidance because that would be inconsistent with the seller’s right to effect
performance (Art. 48(2) second sentence).
26 With regard to the question whether the buyer is bound by the Nachfrist (in the sense
that he may not resort to other remedies), a different approach should be taken. It is
submitted that the buyer should only be bound under Art. 47 for as long as the period
fixed by him lasts, even if it is too short to be “reasonable” under Art. 47(1). The reason
for this submission is that after the expiry of the (albeit too short) period, the seller has
no longer reasonable ground to believe in the buyer’s acceptance of his performance.35
27 bb) Period too long. If the period of time fixed by the buyer is longer than a
reasonable period would have been, the (too long) period fixed by the buyer should be
regarded as a valid Nachfrist for the purposes of Arts 47 and 49. The buyer will thus be
bound under Art. 47(2) until it has expired and if it has expired without the seller
having made performance the buyer will be entitled to avoid the contract under
Art. 49(1)(b).36
28 cc) Period not clearly defined. If the buyer has not fixed an additional period of time
which is sufficiently defined, he will not be entitled to avoid the contract under
Art. 49(1)(b).37 He will not be bound under Art. 47(2) in his choice of remedies, but
may under certain circumstances be bound on a case by case basis by virtue of the good
faith principle in Art. 7(1). This may be the case where the buyer has required delivery
“as soon as possible” – which is not sufficiently defined in the sense of Art. 47(2) – and
declared the avoidance shortly afterwards although the seller has already started to
make preparations for performance.38
3. Burden of proof
29 If the buyer has declared the avoidance of the contract under Art. 49(1)(b) it will be
for him to prove that he has fixed a reasonable period of time under Art. 47(1); he will
33 Cf. Oberlandesgericht Naumburg (Germany) 27 April 1999 (automobile), CISG-Online 512; Ober-
landesgericht Celle (Germany) 24 May 1995 (used printing press), CISG-Online 152; Müller-Chen, in:
Schlechtriem/Schwenzer, Commentary (2016), Art. 47 para. 9. But see for a differing view Schnyder/
Straub, in: Honsell, Kommentar (2010), Art. 47 paras 24, 37. For a detailed problem analysis cf. Friehe,
Die Setzung der unangemessen kurzen Nachfrist im CISG mit einem Ausblick auf das BGB, IHR (2010)
230, (2011) 16, 57.
36 Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 47 para. 10; Saenger, in: Ferrari
et al., Internationales Vertragsrecht (2011), Art. 47 para. 7; Benicke, in: MünchKommHGB (2013), Art. 47
para. 8. But see for a differing view Schnyder/Straub, in: Honsell, Kommentar (2010), Art. 47 para. 25.
37 Huber, in: MünchKommBGB (2015), Art. 47 para. 28; Honnold/Flechtner, Uniform Law (2009),
Art. 47 para. 289.

Commentary (2016), Art. 47 para. 21 and Art. 45 para. 15.
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Section III. Remedies for breach of contract by the seller 30 Article 47

be able to rely on Art. 27 in that regard.39 If the seller relies on Art. 47(2) to show that a
remedy invoked by the buyer was inadmissible, it should be for the seller to prove that
the Nachfrist had been fixed.40 By contrast, it will be for the buyer to prove that the
seller declared his refusal to perform.41

The PICC (Arts 7.1.5 and 7.3.1(3)) and the PECL (Arts 8:106, 9:301(2)) contain 30
similar (albeit not identical) rules.
39 Oberlandesgericht Düsseldorf (Germany) 24 April 1997 (shoes), CISG-Online 385; Huber, in:


Art. 47 para. 30.
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Article 48
(1) Subject to Article 49, the seller may, even after the date for delivery, remedy at
his own expense any failure to perform his obligations, if he can do so without
unreasonable delay and without causing the buyer unreasonable inconvenience or
uncertainty of reimbursement by the seller of expenses advanced by the buyer.
However, the buyer retains any right to claim damages as provided for in this
Convention.
(2) If the seller requests the buyer to make known whether he will accept
performance and the buyer does not comply with the request within a reasonable
time, the seller may perform within the time indicated in his request. The buyer may
not, during that period of time, resort to any remedy which is inconsistent with
performance by the seller.
(3) A notice by the seller that he will perform within a specified period of time is
assumed to include a request, under the preceding paragraph, that the buyer make
known his decision.
(4) A request or notice by the seller under paragraph (2) or (3) of this article is not
effective unless received by the buyer.
Bibliography: See selected bibliography of Art. 45.
Outline
1. Right to cure under Art. 48(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
a) Seller’s failure to perform . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
b) Cure after delivery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
c) Reasonable cure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
d) Seller required to give notice without undue delay? . . . . . . . . . . . . . . . . . . . . 13
e) “Subject to” the buyer’s right to avoid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
f) Effective cure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
g) Place of performance and costs. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
h) Consequences . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
aa) General outline . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
bb) Avoidance of the contract . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
cc) Reduction of the price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
dd) Damages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
ee) Substitute delivery and repair . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
i) Buyer’s refusal to accept cure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
2. Right to cure under Art. 48(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
a) Outline. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
b) Indication of performance by seller . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
c) No objection by buyer. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
d) Requirements of Art. 48(1) irrelevant . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
e) Interaction with avoidance by the buyer. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
f) Consequences . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
aa) Before cure (Art. 48(1), (2)) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
bb) After cure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
3. Burden of proof . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
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The Convention contains three provisions on the seller’s right to cure a breach, i. e. 1
Arts 34 and 37 on the one hand, and Art. 48 on the other hand. While the former two
provisions are concerned with the situation where the seller has performed before the
date for performance and wants to cure certain breaches before that date, Art. 48 deals
with the seller’s right to cure a breach after the time of performance. Giving the seller a
right to cure is in line with the overall objective of the Convention to save the contract
and to avoid restitution of the goods (cf. supra Art. 45 paras 9 et seq.).
Art. 48 recognizes that the right to cure may arise in two situations, the first of which 2
depends upon an application of the requirements of Art. 48(1), while the second is
founded on an (implied) “agreement” between the parties (Art. 48(2)).
1. Right to cure under Art. 48(1)

Under certain circumstances (see infra paras 4 et seq.) Art. 48(1) gives the seller a 3
right to remedy (at his own expense) a failure to perform his obligations. If the seller has
successfully cured the breach the buyer will be deprived of several of the remedies under
Arts 45 et seq.
a) Seller’s failure to perform. Art. 48 applies to any failure by the seller to perform 4
his obligations under the contract; this results from the clear wording of the provision.1
In practice, however, its main field of application will be the delivery of non-conforming
goods.2
b) Cure after delivery. As a rule, Art. 48 only applies if the cure which the seller 5
intends to make is supposed to take place after the date when the obligation which has
not been performed became due. If the cure is intended to be made before that date,
Art. 34 or Art. 37 may apply, but not Art. 48 CISG.3
This is expressly mentioned in Art. 48 for the case where the seller’s breach consists 6
in not making (conforming) delivery (“even after the date for delivery”). It should,
however, be regarded as a general principle of the Convention under Art. 7(2).
c) Reasonable cure. Art. 48(1) firstly requires that cure must actually be possible (“if 7
he can do so”).4 Cases of impossibility will, however, be rare in practice, as – at least
where generic goods are sold – substitute delivery will usually be possible.
Secondly, the seller’s right to cure is subject to a reasonableness requirement. The 8
seller must be able to effect cure “without unreasonable delay and without causing the
buyer unreasonable inconvenience or uncertainty of reimbursement by the seller of
expenses advanced by the buyer”. As a rule, these reasonableness requirements should
Art. 48 para. 8; Schnyder/Straub, in: Honsell, Kommentar (2010), Art. 48 para. 6; Honnold/Flechtner,
Uniform Law (2009), Art. 48 para. 295.
2 Huber, in: Huber/Mullis, The CISG (2007), p. 218; Müller-Chen, in: Schlechtriem/Schwenzer, Com-
mentary (2016), Art. 48 paras 3, 1; Huber, in: MünchKommBGB (2015), Art. 48 para. 4.
3 See Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 48 para. 4; Huber, in:

4 Cf. Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 48 para. 5.
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be assessed on an objective basis from the buyer’s perspective rather than from the
seller’s perspective.5
9 The delay caused will usually be “unreasonable” at any rate if it is so serious as to
amount to a fundamental breach in itself.6 It can, however, also be unreasonable below
that threshold.7 The reasonable period for cure under Art. 48(1) should be determined
along similar lines as the determination of the reasonable period of time for perfor-
mance (Nachfrist) in Art. 47.8 As a rule, it may be advisable for the buyer to fix a
Nachfrist under Art. 47 because this may facilitate the task to prove that the period of
time for cure suggested by the seller was unreasonable and should therefore be
disregarded.9 It has been held that the delay may be unreasonable if it makes the buyer
liable towards his own sub-buyers.10
10 The term “unreasonable inconvenience” refers inter alia to the disturbances that cure
would bring to the buyer’s business, e. g. noise, dirt, disruption of business.11 If the
buyer, with good grounds, has lost his trust in the seller’s ability to cure, for example as
a result of the first unsuccessful attempts at cure, the seller’s right to cure under Art. 48
will not bar any remedies of the buyer. The loss of trust may be regarded as a factor
which causes “unreasonable inconvenience”.12
11 The reference to uncertainty of reimbursement may become relevant if the seller needs
the buyer’s cooperation for effecting cure. The seller will only have a right to cure under
Art. 48(1) if there is no uncertainty concerning the reimbursement of the buyer’s
expenses that result from this cooperation (cf. also infra paras 19 et seq.).13 Whether there
actually is uncertainty in that regard, will depend on the circumstances of the case. As,
however, it is the seller who wishes to cure his breach and as he needs the buyer’s
cooperation in that regard, one should not understand the concept of “uncertainty”
restrictively. If the buyer reasonably argues that subsequent reimbursement is not entirely
certain, the burden should shift on the seller to guarantee such certainty, for example, by
making an advance payment or by providing effective security14 for those expenses; it is
submitted that effective security will often mean that it must be on a first-demand-basis.
12 It should be noted, however, that the reference to uncertainty of reimbursement in
Art. 48(1) does not qualify or modify the rule that it is the seller who has to bear the
costs of cure (cf. “at his own expense”).
13 d) Seller required to give notice without undue delay? Unlike Art. 7.1.4(1)(a) PICC,
Art. 48 CISG does not explicitly require the seller to give notice of his intention to cure
6 Secretariat Commentary on 1978 Draft, Art. 44 para. 3; Will, in: Bianca/Bonell, Commentary (1987),
Art. 48 para. 2.1.1.1.2; Huber, in: MünchKommBGB (2015), Art. 48 para. 6.

7 Huber, in: MünchKommBGB (2015), Art. 48 para. 6; Bundesgerichtshof (Germany) 24 September
2014 (tools), CISG-Online 2545.

KommBGB (2015), Art. 48 para. 6; Benicke, in: MünchKommHGB (2013), Art. 48 para. 7. But see also
Schnyder/Straub, in: Honsell, Kommentar (2010), Art. 48 paras 24, 57 et seq.
9 See Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 48 para. 10.
10 Cf. Bundesgerichtshof (Germany) 24 September 2014 (tools), CISG-Online 2545; Amtsgericht
München (Germany) 23 June 1995 (pharmaceutical goods – tetracycline), CISG-Online 368.

11 Huber, in: MünchKommBGB (2015), Art. 48 para. 7; Benicke, in: MünchKommHGB (2013), Art. 48
para. 6; Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 48 para. 11; Magnus, in:
Staudinger, Kommentar (2013), Art. 48 para. 15.
13 Huber, in: Huber/Mullis, The CISG (2007), p. 219; Müller-Chen, in: Schlechtriem/Schwenzer,

14 Huber, in: MünchKommBGB (2015), Art. 48 para. 8. Moreover cf. Will, in: Bianca/Bonell, Commen-
tary (1987), Art. 48 para. 2.1.1.1.2.
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to the buyer without undue delay after being informed of the non-performance. It is
submitted, however, that such a requirement of notice should also exist under the
CISG.15
In fact, without such notice the buyer will have to wait until the reasonable period for 14
cure, as envisaged by Art. 48(1), has elapsed, before he can decide on how to proceed
further (e. g. claiming damages, reducing the price, avoiding the contract etc.). As,
depending on the circumstances of the case and on the nature of the non-performance,
this may be a rather long period of time, the buyer is left with a considerable degree of
uncertainty. As a rule, he will not be able to shorten this period of uncertainty by fixing
a Nachfrist under Art. 47, as this additional period of time will also have to be so long as
to reasonably enable the seller to cure, i. e. about as long as the “reasonable period”
under Art. 48(1). This situation is in conflict with the requirements of certainty and
fastness in international trade.16
This uncertainty for the buyer can be reduced without imposing too heavy a burden 15
on the seller by adopting the rule that is expressed in Art. 7.1.4(1)(a) PICC. If one takes
the view that the PICC may not be used to fill internal gabs in the CISG under Art. 7(2)
(cf. supra Art. 7 para. 61), one should base the rule on the principle of good faith
(Art. 7(1)). This has recently been confirmed by the German Bundesgerichtshof.17
Consequently, if the seller does not conform to this notice requirement, he should
rightfully lose his right to cure under Art. 48(1).18
e) “Subject to” the buyer’s right to avoid. Art. 48(1) states that the seller’s right to 16
cure is “subject to Article 49”, i. e. to the buyer’s right to avoid the contract. It is this
part of the provision which has created considerable controversy with regard to the
relationship between the seller’s right to cure and the fundamental breach doctrine. This
will be dealt with infra Art. 49 paras 15 et seq. Suffice it here to state that most courts
and authors nowadays take the view that, as a rule, the seller’s right to cure the breach
under Art. 48 should be taken into account when deciding on whether the breach was
fundamental under Arts 49(1)(a) and 25, unless the buyer has a particular and
legitimate interest in being allowed to avoid the contract immediately. As a rule,
therefore, even a serious breach will not be fundamental if an effective (cf. infra paras 17
et seq.) and reasonable cure under Art. 48 is offered and made. This approach leaves the
“subject to” provison in Art. 48(1) intact in that the buyer’s right to avoid actually takes
precedence over the seller’s right to cure, but also permits to take into account the fact
that a breach which is reasonably curable will often not be fundamental and will then
not justify a right to avoid.
f) Effective cure. Art. 48 will only have full effect, i. e. “wipe out” the breach and thus 17
bar (most of) the buyer’s remedies, if the seller’s cure is complete, successful and
effective, i. e. if it leads to a completely proper performance of the seller’s obligation. If
the cure is only partly effective in the sense that it alleviates the consequences of the
breach to the extent that the breach is still existing but no longer fundamental (Art. 25),
this may bar certain of the buyer’s remedies (e. g. avoidance under Art. 49(1)(a)), but
not all (e. g. damages under Arts 45(1)(b) and 74).
The seller is not restricted to any particular measures of cure, as long as they are 18
suited to remedy the defect. If different methods of cure exist, the choice of which
15 Cf. Huber in: MünchKommBGB (2015), Art. 48 para. 8 a.

16 Cf. Schlechtriem, Fristsetzungen, FS Trinkner (1995), p. 321 (328 et seq.).
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method to adopt is for the seller subject only to the reasonableness requirement.19 He
should, however, try to choose the one that causes the least inconvenience for the buyer,
without being strictly obligated to do so.20 As outlined supra (Art. 46 para 42), it will
usually also be for the seller to choose between substitute delivery and repair, provided
both are equally suited and acceptable to the buyer.21
19 g) Place of performance and costs. As a rule, the place of performance for the cure
should be the place of performance of the original obligation. If, however, cure is made
by substitute delivery or by repair, the place of performance may be situated at a
different place, as outlined supra (Art. 46 paras 40 et seq., 52).22
20 Art. 48 expressly provides that the seller has to cure the breach at his own expense.
This means that it is for the seller to bear the costs that he incurs for curing the defect
himself and that he is not entitled to claim reimbursement for these costs from the
buyer. In addition, it also results from the provision that the seller will have to
reimburse the buyer for any costs that the buyer incurs as a result of the seller’s efforts
to cure. This would cover cases where the buyer has to cooperate in order to make cure
work (e. g. by providing personnel in order to enable the seller’s employees to get access
to the sold machine) or cases where the buyer suffers a loss due to the disruption of
business caused by the seller’s efforts to cure (cf. also supra para. 10). This right of the
buyer to claim compensation should be derived directly from the cost allocation rule in
Art. 48(1), irrespective of the question whether it might also be brought under a claim
for damages under Arts 45(1)(b), 74 et seq. and 48(1)(2).23
h) Consequences
21 aa) General outline. An effective cure under Art. 48(1) will lead to the result that
there no longer is a non-performance. The buyer will thus lose his rights under Art. 45,
except for certain types of damages claims as provided for in the second sentence of
Art. 48(1). If the cure is only partly effective in the sense that it alleviates the
consequences of the breach to the extent that the breach is still existing but no longer
fundamental (Art. 25), this may bar certain of the buyer’s remedies (e. g. avoidance
under Art. 49(1)(a)), but not all (e. g. damages under Arts 45(1)(b) and 74).
22 Even before the cure is effective, the buyer’s remedies under Art. 45 will normally be
suspended, if the seller offers a cure which satisfies the requirements set out in
Art. 48(1); the suspension of the buyer’s remedies ends when a reasonable time for
cure, as it is envisaged in Art. 48(1), has elapsed.
23 bb) Avoidance of the contract. As indicated supra para 16 and discussed in more
detail infra Art. 49 paras 15 et seq., the prevailing view is that if the buyer does not have
a legitimate interest in immediate avoidance, the seller’s breach will not be fundamental
until the time for such reasonable cure has elapsed without effective (cf. supra paras 17
et seq.) cure being made or until the seller has refused to offer such cure. As is submitted
Art. 48 para. 4; Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 48 para. 6; Schny-
der/Straub, in: Honsell, Kommentar (2010), Art. 48 para. 10.
20 Huber, in: MünchKommBGB (2015), Art. 48 para. 13; Huber, in: Huber/Mullis, The CISG (2007),
p. 219.
para. 13. But see for a different view Magnus, in: Staudinger, Kommentar (2013), Art. 48 para. 32 and
Will, in: Bianca/Bonell, Commentary (1987), Art. 48 para. 3.1 (as a rule buyer’s choice unless Art. 48(2)
applies and binds the buyer).
22 See Huber, in: Huber/Mullis, The CISG (2007), pp. 202 et seq., 206.
KommBGB (2015), Art. 48 para. 16; Schnyder/Straub, in: Honsell, Kommentar (2010), Art. 48 para. 18.
700 Huber
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infra Art. 49 paras 24 et seq. nothing turns on whether or not the seller actually offers to
cure before the buyer declares avoidance so that the seller can still defeat a “premature”
declaration of avoidance by offering reasonable cure under Art. 48(1).24
cc) Reduction of the price. As a rule, the seller’s right to cure takes precedence over 24
the buyer’s right to reduce the purchase price. The details in that regard are dealt with
infra Art. 50 paras 23 et seq.
dd) Damages. Art. 48(1) second sentence provides that cure by the seller will not 25
have any effect on the buyer’s right to claim damages under the Convention. Whether
the buyer will actually be able to claim damages, depends on whether the general
requirements for such a claim (Arts 45(1)(b) and 74 et seq.) are met.25
Although this is not explicitly said, the provision obviously only refers to those types of 26
damage which result from the original breach and which cannot be removed by the
cure.26 By contrast, those types of losses which can be remedied by the seller’s cure, will
not be recoverable. Thus, where the seller delivers a machine which was not in conformity
with the contract under Art. 35 and where its repair takes three weeks, damages will be
recoverable for any lost profit incurred while the machine was being repaired, but not for
the difference in value between the (unrepaired) machine and the value that a conforming
machine would have had at the time of delivery. If the buyer has the defective machine
repaired by a third party, thus preventing the seller from making cure under Art. 48, the
costs incurred towards the third party will not be recoverable either, because they could
have been avoided if the buyer had allowed the seller to cure.27
ee) Substitute delivery and repair. The influence of the seller’s right to cure on the 27
choice between substitute delivery (Art. 46(2)) and repair (Art. 46(3)) has been dis-
cussed supra Art. 46 paras 42 and 53.
i) Buyer’s refusal to accept cure. If the buyer refuses to accept the seller’s offer to cure 28
which meets the requirements of Art. 48(1), he will have to face serious consequences. It
is submitted as a rule that in such a case the buyer will not be able to rely on the non-
performance to the extent that this would have been remedied by the seller’s cure.
2. Right to cure under Art. 48(2)

a) Outline. A seller who is willing to cure will usually not know whether the buyer is 29
ready to accept his offer or whether he is likely to reject it. Art. 48(2) – (4) give the seller
the chance to clarify the situation by contacting the buyer. In order to do so the seller
must indicate to the buyer that he is willing to perform within a certain period and
request him to make known whether he will accept performance.28 If the buyer does not
respond within a reasonable time, or if he accepts the seller’s offer, the seller will have a
right to cure irrespective of whether the requirements of Art. 48(1) are actually met.29 If,
24
Huber, in: Huber/Mullis, The CISG (2007), pp. 224 et seq.
25
Huber, in: Huber/Mullis, The CISG (2007), p. 220; Müller-Chen, in: Schlechtriem/Schwenzer,
Commentary (2016), Art. 48 para. 21; Huber, in: MünchKommBGB (2015), Art. 48 paras 20 et seq.
26 See Huber, in: MünchKommBGB (2015), Art. 48 para. 20; Müller-Chen, in: Schlechtriem/Schwenzer,

Commentary (2016), Art. 48 para. 21. See also Oberster Gerichtshof (Austria) 14 January 2002 (cooling
system), CISG-Online 643.
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on the other hand, the buyer rejects the seller’s offer within a reasonable time, Art. 48(2)
will have no effect on the existence of a right to cure. Whether such a right to cure exists
will then have to be decided according to the general criteria of Art. 48(1) (cf. infra
paras 32 et seq.).30
30 b) Indication of performance by seller. Art. 48(2) requires that the seller requests the
buyer to make known whether he will accept performance within a certain time. Thus
the seller must declare three points: first his willingness to perform, secondly a certain
period of time within which he intends to do so (“within the time indicated in his
request”) and a request that the buyer make known his decision.31 It does not matter,
however, whether or not the period of time which the seller indicates as the perfor-
mance period is long enough to be “reasonable” in the sense of Art. 48(1) or
Art. 47(2).32 If the buyer regards the indicated period as being too long he can simply
refuse the seller’s offer (cf. infra paras 32 et seq.) and thus defeat the seller’s attempt to
get a right to cure under Art. 48(2). Again, such a rejection does not affect any right to
cure that the seller may have under Art. 48(1).
31 The requirement that the seller indicate his willingness to perform and request a reply
from the buyer, is specified in more detail in the third and fourth paragraph of Art. 48.
Art. 48(3) provides that a notice by the seller that he will perform within a specified
period of time is assumed to include such a request. It is submitted that this assumption
is not rebuttable.33 Pursuant to Art. 48(4) – and in exception to Art. 27 – the seller’s
request or indication is not effective unless received by the buyer. The burden of proof
concerning the receipt of the declaration is on the seller.34
32 c) No objection by buyer. A right to cure under Art. 48(2) will arise if the buyer does
not make known within a reasonable time whether he will accept performance. In
practice, this means that the buyer will have to object to the seller’s offer to cure if he
does not wish to be bound by it. He will have a “reasonable time” to do so. This
reasonable period for objection should be kept rather short.35
33 The fact that the buyer had already fixed an additional period of time for perfor-
mance under Art. 47 before the seller sent a request under Art. 48(2) does not relieve
the buyer from making the objection under Art. 48(2);36 this should apply even if the
buyer had combined his Nachfrist with a conditional declaration of avoidance for the

dinger, Kommentar (2013), Art. 48 para. 39; Huber, in: MünchKommBGB (2015), Art. 48 para. 24;
Benicke, in: MünchKommHGB (2013), Art. 48 para. 16; Will, in: Bianca/Bonell, Commentary (1987),
Art. 48 para. 2.2.1.
Saenger, in: Ferrari et al., Internationales Vertragsrecht (2011), Art. 48 para. 8. For a differing view see
Schnyder/Straub, in: Honsell, Kommentar (2010), Art. 48 para. 42 b.
33 Huber, in: MünchKommBGB (2015), Art. 48 para. 25; Schnyder/Straub, in: Honsell, Kommentar

35 As a general rule, this seems to be widely accepted, although there are differences in the wording
used; see for example Huber, in: MünchKommBGB (2015), Art. 48 para. 26; Müller-Chen, in: Schlech-
triem/Schwenzer, Commentary (2016), Art. 48 para. 26; Magnus, in: Staudinger, Kommentar (2013),
Art. 48 para. 42; Will, in: Bianca/Bonell, Commentary (1987), Art. 48 para. 2.2.2; Akikol/Bürki, in:
Brunner, Kommentar (2014), Art. 48 para. 16.
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case that the seller does not perform within the Nachfrist.37 By contrast, if the buyer
reacts to the seller’s request by fixing a shorter period for performance under Art. 47,
this should be regarded as an objection in the sense of Art. 48(2).38
Art. 48(4) does not apply to the buyer’s declaration of objection, so that it will fall 34
under Art. 27; the burden of proof for having it dispatched in accordance with Art. 27 is
on the buyer.39 The buyer does not have to give any reasons for his objection.40 He may
also object if the seller’s offer was perfectly reasonable under the standards set out in
Art. 48(1); in that case, however, the seller will usually have a right to cure under
Art. 48(1) and the buyer may face adverse consequences as a result of his refusal to
accept cure (cf. supra para. 28).
d) Requirements of Art. 48(1) irrelevant. According to the prevailing opinion, the 35
requirements of Art. 48(1) need not be met for the right to cure under Art. 48(2) to
arise, so that it is irrelevant whether the cure offered by the seller would be reasonable
or whether the buyer has a right to avoid the contract under Art. 49 (e. g. because he has
a legitimate interest in immediate avoidance of the contract, cf. infra para. 36 and
Art. 49 paras 20 et seq.).41 This is correct because the buyer can prevent the right to cure
under Art. 48(2) from coming into existence by simply objecting to the seller’s indica-
tion which he has received (Art. 48(4)).42
e) Interaction with avoidance by the buyer. The mere fact that the buyer has a right 36
to avoid the contract does not exempt the buyer from making an objection under
Art. 48(2). The situation is different, however, if the buyer has already declared the
avoidance of the contract rightfully and effectively before the seller made his request
under Art. 48(2). In that case the contract had already been terminated and cannot be
reanimated by a seller’s request under Art. 48(2)43 (cf. infra para. 38).
f) Consequences. If the buyer has not objected within a reasonable time to a request 37
by the seller under Art. 48(2) the seller will have a right to cure the non-performance.
With regard to the specific details, a distinction should be drawn between the time
before cure has effectively been made and the time after cure has effectively been made.
aa) Before cure (Art. 48(1), (2)). During the period indicated by the seller for 38
performance, the buyer may not resort to any remedy which is inconsistent with
performance by the seller (Art. 48(1), (2)). Such inconsistent remedies are, firstly, the
right to reduce the purchase price; this is also indicated by the rule in the second sentence
of Art. 50. Secondly, the right to avoid the contract is inconsistent with performance by
the seller. Thus, even where the buyer has a legitimate interest in immediate avoidance of
the contract and where the breach is fundamental under Art. 49(1)(a), he will not be
entitled to declare the avoidance of the contract if he has not objected to the seller’s
KommHGB (2013), Art. 48 para. 20.

39 Benicke, in: MünchKommHGB (2013), Art. 48 para. 24; Huber, in: MünchKommBGB (2015),
Art. 48 para. 26.

Art. 48 para. 18.

KommBGB (2015), Art. 48 para. 27; Magnus, in: Staudinger, Kommentar (2013), Art. 48 para. 41; Will,
in: Bianca/Bonell, Commentary (1987), Art. 48 para. 2.2. But see for a differing view Saenger, in: Ferrari
et al., Internationales Vertragsrecht (2011), Art. 48 para. 12.
Art. 48 para. 19; Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 48 para. 30.
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request under Art. 48(2) in time.44 By contrast, if the buyer has rightfully and effectively
declared the avoidance of the contract before receiving the seller’s request under
Art. 48(2), the avoidance will have terminated the contract, cf. supra para. 36. With
regard to claims for damages, the situation is the same as under Art. 48(1), cf. supra
paras 25 et seq. Claiming damages for those losses which cannot be avoided by the seller’s
performance would be consistent with the seller’s request, whereas claiming damages for
other losses would be inconsistent with it.45 As under Art. 48(1), the buyer is not entitled
to have the defect repaired by a third party at the seller’s cost, cf. supra para. 26.
39 These consequences end when the time for performance indicated by the seller lapses
without cure being made or when the seller declares before that time that he will not (be
able to) make cure. The buyer will then no longer be restricted in his choice of remedies
under Arts 45 et seq.46
40 bb) After cure. If the seller has effectively made cure, the consequences will be the
same as if cure had been made effectively under Art. 48(1), cf. supra paras 17, 21 et seq.
The buyer will lose his remedies except for those claims for damages that would be
covered by the exception in Art. 48(1), (2), cf. supra paras 25 et seq.
3. Burden of proof
41 As a rule, the seller should have to prove that the requirements of Art. 48(1) are met,
except for the unreasonableness defence for which the buyer has the burden of proof, cf.
supra para. 9.47 With regard to Art. 48(2), the seller should have to prove receipt by the
buyer of his request, whereas it should be for the buyer to prove that he dispatched his
objection in accordance with Art. 27.48

42 Art 7.1.4 PICC contains detailed rules on the non-performing party’s right to cure.
Art 7.1.4 explicitly states that the right to cure is not precluded by notice of termination,
and that upon effective notice of cure those rights of the aggrieved party that are
inconsistent with performance, such as termination, are suspended until the time for
cure has expired. A similar provision is provided for in Art 8:104 PECL. Art. 109 CESL
contains detailed rules on the right to cure. The right to cure is also known to a certain
extent in US law.49
44 See Handelsgericht des Kantons Aargau (Switzerland) 5 November 2002 (inflatable triumphal arch),
CISG-Online 715.

46 Huber, in: MünchKommBGB (2015), Art. 48 para. 32. See also Müller-Chen, in: Schlechtriem/

KommBGB (2015), Art. 48 para. 34; Saenger, in: Ferrari et al., Internationales Vertragsrecht (2011),
Art. 48 para. 17. For a more detailed analysis see Hepting/Müller, in: Baumgärtel/Laumen/Prütting,
Handbuch der Beweislast im Privatrecht (2009), Art. 48 paras 2 et seq.; Müller, Ausgewählte Fragen der
Beweislastverteilung (2005), pp. 131 et seq. See also Handelsgericht des Kantons Aargau (Switzerland)
5 November 2002 (inflatable triumphal arch), CISG-Online 715; Oberlandesgericht Koblenz (Germany)
31 January 1997 (acrylic blankets), CISG-Online 256.
KommBGB (2015), Art. 48 para. 34; Hepting, in: Baumgärtel/Laumen, Handbuch der Beweislast im
Privatrecht (2009), Art. 48 paras 21 et seq.; Schnyder/Straub, in: Honsell, Kommentar (2010), Art. 48
para. 64 et seq; Benicke, in: MünchKommHGB (2013), Art. 48 para. 24.
49 See § 2–508 UCC (US Commercial Code); White/Summers, Uniform Commercial Code (2000),
pp. 332 et seq.
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Article 491
(1) The buyer may declare the contract avoided:
(a) if the failure by the seller to perform any of his obligations under the contract
or this Convention amounts to a fundamental breach of contract; or
(b) in case of non-delivery, if the seller does not deliver the goods within the
additional period of time fixed by the buyer in accordance with paragraph (1)
of article 47 or declares that he will not deliver within the period so fixed.
(2) However, in cases where the seller has delivered the goods, the buyer loses the
right to declare the contract avoided unless he does so:
(a) in respect of late delivery, within a reasonable time after he has become aware
that delivery has been made;
(b) in respect of any breach other than late delivery, within a reasonable time:
(i) after he knew or ought to have known of the breach;
(ii) after the expiration of any additional period of time fixed by the buyer in
accordance with paragraph (1) of article 47, or after the seller has declared
that he will not perform his obligations within such an additional period; or
(iii) after the expiration of any additional period of time indicated by the seller in
accordance with paragraph (2) of article 48, or after the buyer has declared
that he will not accept performance.
Bibliography: See selected bibliography of Art. 45. CISG-AC Opinion no 5, The buyer’s right to avoid the
contract in case of non-conforming goods or documents, 7 May 2005. Rapporteur: Professor Dr. Ingeborg
Schwenzer, LL.M., Professor of Private Law, University of Basel (http://www.cisg-ac.org).
Outline
1. Outline of the requirements. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
a) Seller’s breach of contract. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
b) Ground of avoidance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
c) Declaration of avoidance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
d) Time limit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
e) Possibility to make restitution of the goods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
f) No defence under Art. 80 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
2. Avoidance for fundamental breach (Art. 49(1)(a)). . . . . . . . . . . . . . . . . . . . . . . . . . 11
a) Fundamental breach under Art. 25 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
b) Criteria for assessing the fundamental character of the breach. . . . . . . . . 12
aa) Contractual agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
bb) Seriousness of the breach . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
cc) Seller’s right to cure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
(i) Setting of the problem. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
(ii) History of the Convention . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
(iii) Prevailing opinion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
(iv) Operation of the right to cure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
dd) Reasonable use test . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
c) Specific case scenarios. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
aa) Delay in delivery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
bb) Definite non-delivery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
1 The first edition’s text was written by Peter Huber; as of this second edition, Ivo Bach is in charge of it.
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cc) Delivery of non-conforming goods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
dd) Third party rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
ee) Documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
ff) Breach of ancillary obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
3. Avoidance using the Nachfrist-procedure (Art. 49(1)(b)). . . . . . . . . . . . . . . . . . 51
a) Outline. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
b) Non-delivery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
aa) Definition of non-delivery. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
bb) Relevant point in time . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
cc) Specific issues. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
c) Fruitless expiry of the additional period of time fixed under Art. 47. . 60
aa) Additional period of time under Art. 47 (Nachfrist) . . . . . . . . . . . . . . . 60
bb) Absence of delivery or refusal to deliver . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
4. Declaration of avoidance and time limits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
a) Need for a declaration of avoidance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
b) Time limits under Art. 49(2). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
aa) Delivery of the goods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
bb) Time limit in cases of late delivery (Art. 49(2)(a)) . . . . . . . . . . . . . . . . . 70
cc) Time limit for other types of breach (Art. 49(2)(b)) . . . . . . . . . . . . . . . 72
(i) “knew or ought to have known”. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
(ii) Nachfrist . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
(iii) Cure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79
(iv) Reasonable period of time. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
dd) Interrelation with statutes of limitation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83
5. Burden of proof . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84
6. Effects of avoidance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85
a) Lawful avoidance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85
b) Unlawful avoidance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86

1 Art. 49 governs the buyer’s right to avoid (i. e. to terminate) the contract as a
response to a non-performance by the seller. Art. 49(1) sets out the grounds for
avoidance while Art. 49(2) submits the remedy to a rather complicated regime of time
limits. The effects of avoidance are dealt with in Arts 81 et seq.
2 Art. 49 – together with Art. 64 which governs the seller’s right to avoid the contract –
is the central element of the Convention’s strategy to keep the contract in existence as
far as possible and to avoid the costs and risks of restitution which would arise out of its
termination. In the eyes of the Convention, avoidance of the contract should only be
granted to the buyer as a last resort, i. e. if his legitimate interests cannot be satisfied by
any other means.2
3 Art. 49(1) gives effect to this policy by strictly limiting the situations in which the
buyer has a right to avoid the contract. As a general rule, avoidance is limited to cases of
fundamental breach as defined in Art. 25 (Art. 49(1)(a)). The only exception to that rule
is Art. 49(1)(b) which allows the buyer to “upgrade” a non-fundamental breach to one
which justifies avoidance by using the Nachfrist-procedure (Art. 47). However, this
possibility is limited to cases of non-delivery. Thus, if the seller has actually delivered
goods and the buyer complains that these are not of the standard required by the
2 Cf. Bundesgerichtshof (Germany) 3 April 1996 (cobalt sulphate), CISG-Online 135 = NJW (1996) 2364;
Oberlandesgericht Köln (Germany) 14 October 2002 (designer clothes), CISG-Online 709 = BeckRS 2003,
00152; Huber, in: MünchKommBGB (2015), Art. 49 para. 3; Müller-Chen, in: Schlechtriem/Schwenzer,
Commentary (2016), Art. 49 para. 2; Magnus, in: Staudinger, Kommentar (2013), Art. 49 para. 4.
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contract, he cannot rely on Art. 49(1)(b), but must instead rely on Art. 49(1)(a) which
requires proof of fundamental breach.3

1. Outline of the requirements
The buyer’s right to avoid the contract under Art. 49 is subject to the following 4
requirements: seller’s breach of contract; ground of avoidance; declaration of avoidance;
time limit; possibility to make restitution; and absence of the defence under Art. 80. By
contrast, the right to avoid is neither subject to any requirement of fault4 nor to the
grounds of exemption provided by Art. 79 (cf. Art. 79(5)).
a) Seller’s breach of contract. There must be a non-performance (i. e. a breach) by 5
the seller. Any type of non-performance is sufficient. Where the breach consists of the
delivery of non-conforming goods or of goods infringing third party rights, the buyer
must have complied with the notice provisions (Arts 39 et seq., 43 et seq.) to be able to
declare the contract avoided.5
b) Ground of avoidance. There must be a ground of avoidance under Art. 49(1)(a) 6
(fundamental breach) or under Art. 49(1)(b) (Nachfrist-procedure, if the non-perfor-
mance consists of a non-delivery).
c) Declaration of avoidance. The avoidance of the contract has to be declared by the 7
buyer, as is apparent from the wording of Art. 49 and from Art. 26. As a rule, avoidance
will therefore not occur ipso facto or by operation of the law.6
d) Time limit. In cases falling within Art. 49(2), i. e. in cases where the seller has 8
delivered the goods, the declaration must be made within the time limits set there.
e) Possibility to make restitution of the goods. Pursuant to Art. 82(1), the buyer will 9
lose his right to avoid the contract if it is impossible for him to make restitution of the
originally delivered goods substantially in the condition in which he received them.
Art. 82(2), however, restricts substantially the principle set out in Art. 82(1) by provid-
ing that the buyer will not lose his right to declare the contract avoided in any of the
three situations specified there.7
f) No defence under Art. 80. Pursuant to Art. 80 the buyer will not be able to rely on 10
the seller’s breach to the extent that this breach was caused by his own (the buyer’s) act
or omission.8
2. Avoidance for fundamental breach (Art. 49(1)(a))

a) Fundamental breach under Art. 25. The concept of fundamental breach (or of 11
fundamental non-performance) as it is used in Art. 49(1)(a) is defined in Art. 25.
Pursuant to this provision a breach is fundamental “if it results in such detriment to
3 Cf. Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 49 para. 15. See for example
Bundesgerichtshof (Germany) 3 April 1996 (cobalt sulphate), CISG-Online 135 = NJW (1996) 2364.
KommBGB (2015), Art. 49 para. 9; Magnus, in: Staudinger, Kommentar (2013), Art. 49 para. 8.
5 Cf. Will, in: Bianca/Bonell, Commentary (1987), Art. 49 para. 2.2.2.
6 For more detail and for exceptions to the rule cf. infra paras 62 et seq.
7 For more detail cf. infra Art. 82 paras 1 et seq.
8 For more detail see infra Art. 80 paras 1 et seq.
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the other party as to substantially deprive him of what he is entitled to expect under the
contract, unless the party in breach did not foresee and a reasonable person of the same
kind in the same circumstances would not have foreseen such a result”. The provision is
discussed generally supra (Art. 25 paras 1 et seq.). The comment to Art. 49 rather more
specifically addresses those issues which will have particular relevance for the buyer’s
right to avoid the contract.
12 b) Criteria for assessing the fundamental character of the breach. There is abundant
case law and legal writing on the fundamental breach doctrine.9 It is submitted that one
can discern from those sources a consistent approach to the criteria that may be used
when deciding on whether the seller’s breach was fundamental in the sense of Arts 25
and 49(1)(a). On that basis there would essentially be four criteria which can be taken
into account when deciding on the fundamental character of the non-performance, i. e.
the contractual agreement, the seriousness of the breach, the seller’s right to cure and
(arguably) the reasonable use test.10 These criteria will be discussed shortly here and
with regard to specific case scenarios infra paras 28 et seq.
13 aa) Contractual agreement. The parties may in their contract define which of the
requirements shall be fundamental in the sense that their breach will lead to a right of
avoidance.11 They may do so explicitly or in an implied manner. What is more, it is
submitted that the fundamental character of a term or of an obligation may result from
the commercial background of the case (for example the general rule that time will
usually be of the essence, i. e. fundamental, in a documentary commodity contract, cf.
infra para. 29).12
14 bb) Seriousness of the breach. Regard is to be had to the seriousness of the breach.13
As the definition in Art. 25 looks rather to the creditor (buyer) than to the debtor
(seller) by referring to the creditor’s deprivation and expectations, the seriousness
criterion should primarily be assessed from the perspective of the buyer. How important
was that particular obligation for him, on the basis of an objective interpretation of the
contract (“was entitled to expect under the contract”)? Within that perspective, it may
of course also be relevant to see how strongly the seller disregarded his obligations
under the Convention or the contract.
15 cc) Seller’s right to cure. Most courts and authors nowadays take the view that, as a
rule, the seller’s right to cure the breach under Art. 48 should be taken into account
when deciding on whether the breach was fundamental under Arts 49(1)(a) and 25,
unless the buyer has a particular and legitimate interest in being allowed to avoid the
contract immediately.14 As a rule, therefore, even a serious breach will not be funda-
mental if reasonable cure under Art. 48 is offered and made. Both the discussion and
the legal theories that lead to this result have however never been undisputed and touch
9 See for a short outline of the case law: UNCITRAL, Digest of Case Law on the CISG (2008), Art. 49
paras 5 et seq.
11 See, e. g., Bundesgerichtshof (Germany) 3 April 1996 (cobalt sulphate), CISG-Online 135 = NJW
(1996) 2364; Bundesgericht (Switzerland) 2 April 2014 (wire rod), CISG-Online 2592 = IHR 2015, 250;
Magnus, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 322; Lookofsky, Understanding
the CISG (2008), p. 117; Gruber, in: MünchKommBGB (2015), Art. 25 para. 34; Schroeter, in: Schlech-
triem/Schwenzer, Commentary (2016), Art. 25 paras 21 et seq.
12 Huber, in: Huber/Mullis, The CISG (2007), pp. 217, 231 seq.
13 See, e. g., Oberlandesgericht München (Germany) 2 March 1994 (coke), CISG-Online 108; U.S. Court
of Appeals (2nd Circuit) (U.S.A.) 6 December 1995 (Compressors for air conditioners), Rotorex Corp. v
Delchi Carrier S. p. A., CISG-Online 140.
14 For references cf. infra paras 20 et seq.
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on difficult issues of interpretation of the Convention. The issue therefore needs to be
analyzed in more detail.
(i) Setting of the problem. The interaction between the seller’s right to cure and the 16
buyer’s right to avoid the contract may lead to problems if the right to cure is based on
Art. 48(1), but not if it is based on Art. 48(2).
If the buyer has, expressly or by remaining silent, “accepted” the seller’s offer under 17
Art. 48(2), the seller’s right to cure takes precedence over the buyer’s right to avoid the
contract. This follows from both the agreement the parties have reached and the second
sentence of Art. 48(2) which provides that during the time indicated by seller for his
attempts to cure, the buyer may not resort to any remedy which is inconsistent with
performance by the seller.
If, however, there is no “agreement” in the sense of Art. 48(2), the seller’s right to 18
cure can only result from the general rule in Art. 48(1). The crucial point here is the
reservation which is made in favour of Art. 49. The right to cure is “subject to article
49”, so that the buyer’s right to avoid the contract takes precedence over the right to
cure. This has been used by some15 as an argument for the submission that the seller’s
right to cure should in no way impair the buyer’s right to avoid the contract and that, as
a consequence, the right to cure should not be taken into account when deciding
whether the breach was fundamental. It is submitted, however, that the issue is more
complex. In fact, the reservation simply says that if the requirements of Art. 49 are met,
avoidance will be available for the buyer. This, however, only shifts the problem to the
interpretation of Art. 49 where it has to be decided whether the possibility of cure has to
be taken into account under the fundamental breach doctrine.16
(ii) History of the Convention. The history of Arts 48 and 49 does not permit definite 19
conclusions in that respect. A proposal not to insert any reservation in favour of Art. 49
(thus strengthening the seller’s right to cure) was rejected at the Vienna Conference.17
This, however, only allows the conclusion that, in principle, the right of avoidance, if it
exists, shall not be impaired by the cure provision. It does not necessarily mean that the
curability of the defect must not be regarded when it comes to the examination of the
preconditions of the right to avoid, i. e. the concept of fundamental breach. As a result of
this lack of definite guidance in both the wording and the history of the relevant
provisions, the issue was intensively debated in the “early years” of the Convention.18
(iii) Prevailing opinion. The (now) predominant opinion both in case law19 and in legal 20
writing20 takes the position which has already been outlined supra para. 15. According to
15 See for example Holthausen, Die wesentliche Vertragsverletzung nach Art. 25 UN-Kaufrecht, RIW
(1990) 101 (103 et seq.). Cf. further Arbitral Award, ICC 7531/1994 (scaffold fittings), CISG-Online 565,
which rejected the right to cure in the specific case without however broadly discussing the issue; it is
submitted therefore that this award is not a strong authority against giving relevance to the right to cure
within the fundamental breach analysis.
17 Honnold, Documentary History (1989), pp. 562 et seq., 686, 688.
18 Huber, in: Huber/Mullis, The CISG (2007), p. 222. For more detail and further references see Huber,
in: MünchKommBGB (2015), Art. 49 paras 21 et seq.; Will, in: Bianca/Bonell, Commentary (1987),
Art. 48 paras 3.2 and 2.1.1.1.1.
19 See, e. g., Oberster Gerichtshof (Austria), 22 November 2011 (Video surveillance system), CISG-
Online 2239 = IHR 2012, 114; Oberlandesgericht Köln (Germany) 14 October 2002 (designer clothes),
CISG-Online 709 (BeckRS 2003, 00152); Oberlandesgericht Koblenz (Germany) 31 January 1997 (acrylic
blankets), CISG-Online 256 (BeckRS 1997, 15993); Handelsgericht des Kantons Aargau (Switzerland)
5 November 2002 (inflatable triumphal arch), CISG-Online 715.
KommBGB (2015), Art. 49 paras 28 et seq.; Huber, in: Huber/Mullis, The CISG (2007), pp. 221 et seq.;
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this view, the curability of the breach should, as a general rule, be taken into account
when deciding whether the breach was fundamental. Thus a breach that can be cured in
accordance with the requirements of Art. 48(1) will usually not be regarded as funda-
mental under Arts 49(1)(a) and 25, unless the seller refuses or fails to cure (note that and
even if the seller fails to cure, its breach may be considered non-fundamental because the
buyer himself is able to cure the defect (cf. infra para. 40).
21 By way of an exception, however, the curability of the breach should not be taken
into account where the buyer has a particular and legitimate interest in being allowed to
avoid the contract immediately. In such a case the breach should be regarded as
fundamental without regard to its curability.
22 A legitimate interest in immediate avoidance can, inter alia, derive from the serious-
ness of the breach. Thus, there will be a legitimate interest in immediate avoidance
where the basis of trust between the parties has been destroyed as a result of the seller’s
breach.21 This may in particular result from deceitful conduct by the seller (e. g. de-
liberate delivery of cheap imitations under a sale of technical equipment of a particular
brand) or from his obvious incapability to perform his obligations, as evidenced, for
example, by the degree, the gravity and the number of the breaches the seller has already
committed in trying to perform the contract. Thus, in a famous case decided by the
(German) Oberlandesgericht Köln22 many items of the sold clothes which were delivered
in the first consignment were seriously defective because they were far too small, prone
to tear easily and badly cut. As a result the clothes were more or less unusable and the
court therefore concluded that due to the seriousness of the seller’s breaches the buyer
was entitled to avoid the contract for fundamental breach immediately, without being
obligated to accept the seller’s offer to cure.23
23 The buyer’s legitimate interest in immediate avoidance may also result from the
contractual agreement or from the commercial background of the case.24 Thus, where
time is of the essence within the contract, any delay will entitle the buyer to avoid the
contract.25 This may be the case in international commodity sales or when the buyer
buys goods for production on a “just-in-time” basis (cf. infra para. 29).
24 The buyer may also have a legitimate interest in immediate avoidance where
according to the contract it was essential that the subject matter of the sale should
exactly conform to the contractual specifications.26
25 (iv) Operation of the right to cure. If the seller has a right to cure, i. e. if the buyer does
not have a legitimate interest in immediate avoidance, the seller’s breach will not be
fundamental until the time for such reasonable cure has elapsed without effective cure
being made or until the seller has refused to offer such cure. If the cure is only partly
effective in the sense that it alleviates the consequences of the breach to the extent that
Magnus, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 323; Lookofsky, Understanding
the CISG (2008), p. 121; Hartmann, in: BeckOGK (2016), Art. 49 para. 19 et seq.
22 Oberlandesgericht Köln (Germany) 14 October 2002 (designer clothes), CISG-Online 709 (BeckRS
2003, 00152).
23 The court also took into consideration that due to the “seasonal” character of the clothes there was
not much time left for cure.

25 Cf. Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 48 para. 15; Huber, in:
MünchKommBGB (2015), Art. 49 para. 28. See for more detail on the general issue Schlechtriem, Pace
International Law Review 18 (2006), 83 et seq.; Mullis, in: Andreas/Jarborg (eds), Anglo-Swedish Studies
in Law (1998), pp. 326 et seq.
26 Huber, in: Huber/Mullis, The CISG (2007), p. 224; cf. Higher Court Ljubljana (Slovenia) 14 Decem-
ber 2005 (door and door jamb), CISG-Online 1959.
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the breach is still existing but no longer fundamental (Art. 25), this may bar some of the
buyer’s remedies (e. g. avoidance under Art. 49(1)(a)), but not all (e. g. damages under
Art. 45(1)(b), 74).
It is submitted that nothing turns on whether or not the seller actually offers cure 26
before the buyer declares avoidance.27 Even if the buyer declares the avoidance “prema-
turely” (i. e. if he neither has a legitimate interest in immediate avoidance nor asked the
seller for cure), the seller can still counter with a reasonable offer to cure under Art. 48. If
he does not do so in time or if he refuses to do so the breach will become fundamental.28
If, however, the buyer has a legitimate interest in immediate avoidance, the seller’s breach 27
is fundamental from the outset and the buyer’s right to avoid under Art. 49(1)(a) takes pre-
cedence over the seller’s right to cure under the provision in the first sentence of Art. 48(1).
dd) Reasonable use test. Where the seller had delivered non-conforming goods several 28
courts have looked to whether the buyer could make some (other) reasonable use of the
goods. They have for example, refused the right to avoid the contract if it was possible
and reasonable for the buyer to resell the goods in the ordinary course of business, albeit
for a lower price, and to claim damages for the losses incurred. This test, which has not
been universally accepted yet, will be discussed in more detail infra paras 37 et seq.
c) Specific case scenarios
aa) Delay in delivery. As a general rule, the mere fact that the seller has not delivered 29
the goods on the agreed date for delivery does not amount to a fundamental breach.29
Normally the consequences of a delay for the buyer will not be so serious as to
substantially deprive the buyer of what he was entitled to expect under the contract.
What is more, the Nachfrist-procedure under Arts 49(1)(b), 47 would be meaningless if
every delay per se constituted a fundamental breach under Art. 49(1)(a).
A delay in performance may, however, amount to a fundamental breach if time was 30
of the essence, i. e. if punctual delivery was of crucial importance to the buyer, and if
that was apparent to the seller at the conclusion of the contract. The fact that time was
of the essence can result from an express stipulation in the contract or from the
circumstances of the case, in particular from the commercial background of the
transaction.30 For example: where the buyer buys goods for production on a “just-in-
time” basis, the purchase contract will usually provide for time of the delivery being of
the essence; even if the contractual terms are not entirely clear in that respect, the fact
that it was obvious to the seller that the buyer bought for “just-in-time” production may
justify the conclusion that time was of the essence. The same is true in international
commodity sales, as they have often been decided by English courts under English law.
These contracts are typically concluded on “CIF (Incoterms)” or “FOB (Incoterms)” basis
and there is a string of buyers and sellers which primarily deal with documents and
27 Cf. Honnold, Documentary History (1989), pp. 686 et seq.: The original version (“Unless the buyer
has declared the contract avoided in accordance with …”) was not included in the final text, but replaced
by the provision: “Subject to …”.
29 See, e. g., Oberlandesgericht Hamburg (Germany) 28 February 1997 (iron molybdenum), CISG-
Online 261 (BeckRS 1997, 15842); Oberlandesgericht Düsseldorf (Germany) 24 April 1997 (shoes),
CISG-Online 385; Arbitral Award, ICC 8128/1995, 1 January 1995 (chemical fertilizer), CISG-Online
526; Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 49 para. 5; Gruber, in: Münch-
KommBGB (2015), Art. 25 para. 21. See also for a somewhat complicated case on delay in delivery U.S.
Federal District Court, New Jersey (U.S.) 4 April 2006 (Naphtha), Valero Marketing and Supply Co vs.
Greeni Oy and Greeni Trading Oy, CISG-Online 1216.
30 See, e. g., Oberlandesgericht Düsseldorf (Germany) 21 April 2004 (mobile car phones), CISG-Online
915 (BeckRS 2004, 18385); cf. Lookofsky, Understanding the CISG (2008), p. 118.
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provide for payment by letter of credit. In such cases it will appear from the commercial
background of the transaction that time is of the essence so that any delay in performance
will have to be regarded as fundamental.31 Note, however, that the agreement on CIF or
FOB delivery does not by itself indicate that time is of the essence.32
31 Further, the nature of the sold goods may indicate that time was of the essence, for
instance in case of goods which are quickly perishable.33 The situation is similar in case
of seasonal articles which are delivered too late to be marketed in the relevant season.34
It is submitted that the delay will also be fundamental where it was evident to the seller
that the buyer had already re-sold the goods and that the buyer would become liable to
his sub-buyers if he delivered late.35 By contrast, the mere fact that the goods are subject
to fluctuations in the market price will not necessarily be sufficient.36
32 Even if time was not intended by the parties to be of the essence, a delay may
nevertheless entitle the buyer to treat the delay as a fundamental breach, for example by
virtue of its long duration or as a result of further delaying tactics by the seller.37 At first
sight, this may seem surprising as in the cases of delay the buyer can always avoid the
contract by using the Nachfrist-procedure in Arts 49(1)(b) and 47. On the other hand,
nothing in the text of the provision indicates that one should restrict the buyer to the
Nachfrist procedure. It is submitted as a general rule, however, that the buyer will
usually not be entitled to treat the mere delay as a fundamental breach if he took no
action whatsoever to remind the seller of his delivery obligation. In any event courts
may only assume a delay in delivery to be fundamental if the buyer is better off without
the delivery than with a delayed delivery.38
31 See further Schlechtriem, Subsequent Performance and Delivery Deadlines, Pace International Law
Review 18 (2006), 83 et seq. (Pace); Mullis, in: Andreas/Jarborg, Anglo-Swedish Studies in Law (1998),
pp. 326 et seq. (Pace).
32 Bundesgericht (Switzerland) 2 April 2014 (wire rod), CISG-Online 2592 = IHR 2015, 250; but see
Oberlandesgericht Hamburg (Germany) 28 February 1997 (iron molybdenum), CISG-Online 261 (BeckRS
1997, 15842) for the opposing view; cf. Magnus/Lüsing, CISG and Incoterms, HSR 2007, 1.
33 Ferrari, Wesentliche Vertragsverletzung nach UN-Kaufrecht, IHR (2005) 1 (8); Graffi, in: Ferrari,
The 1980 Uniform Sales Law (2003), p. 313. But see also Oberlandesgericht Hamm (Germany) 12 No-
vember 2001 (computer parts – memory modules), CISG-Online 1430 (BeckRS 2001, 30218777).
34 As for seasonal goods see for instance: Oberlandesgericht Düsseldorf (Germany) 24 April 1997
(shoes), CISG-Online 385 (holding, however, that in the case at hand the sale was not such a sale of
“seasonal” goods as the buyer still had an interest in the sold shoes); Corte di Appello di Milano (Italy)
28 March 1998 (knitwear), CISG-Online 348 (“end of year” sales; in the author’s estimation, however, the
court also based its ruling on the fact that the date of delivery had been made “of the essence” in the
contract); Landgericht Oldenburg (Germany) 27 March 1996 (clothes), CISG-Online 188 (BeckRS 2013,
21486) (where the fact that the fashion goods for the summer season were sent one day too late was not
regarded as a fundamental breach).
35 Arbitral Award ICC 8128/1995, 1 January 1995 (chemical fertilizer), CISG-Online 526; Huber, in:
Huber/Mullis, The CISG (2007), p. 226; Gruber, in: MünchKommBGB (2015), Art. 25 para. 21.
36 Oberlandesgericht Hamm (Germany) 12 November 2001(computer parts – memory modules), CISG-
Online 1430 (BeckRS 2001, 30218777).

37 See in that direction: Bundesgericht (Switzerland) 2 April 2014 (wire rod), CISG-Online 2592 = IHR
2015, 250; Arbitral Award, Tribunal of International Commercial Arbitration at the Ukraine Chamber of
Commerce and Trade, 18 November 2004 (manufactured articles), CISG-Online 1371 (delay in delivery
of 15 months regarded as fundamental); Landgericht Halle (Germany) 27 March 1998 (car), CISG-Online
521 (delay of more than two months regarded as fundamental); Pretura di Parma-Firenze (Italy)
24 November 1989 (knapsacks, bags, wallets), CISG-Online 316 (delay of about 2 months regarded as
fundamental); Arbitral Award, ICC 8128/1995, 1 January 1995 (chemical fertilizer), CISG-Online 526;
U.S. District Court, New Jersey (U.S.) 4 April 2004 (Naphtha), Valero Marketing and Supply Company vs.
Greeni Oy and Greeni Trading Oy, CISG-Online 1216; Huber, in: Huber/Mullis, The CISG (2007), p. 226;
Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 49 para. 5 (with references to a
differing opinion).
38 Bundesgericht (Switzerland) 2 April 2014 (wire rod), CISG-Online 2592 = IHR 2015, 250.
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bb) Definite non-delivery. A definite failure to deliver will usually amount to a 33
fundamental breach per se.39 Examples for a definite failure are cases where perfor-
mance has become impossible40 or where the seller is no longer bound to deliver under
the hardship-exception (cf. supra Art. 46 paras 18 et seq.). The situation is the same in
cases where the seller declares that he definitely will not perform,41 for instance if the
seller informs the buyer in a sale of a specific item (e. g. the load of one specific ship)
that he has sold and delivered the goods to a third party.42 A similar situation arises
where the seller indicates without justification that he will only perform if the buyer
makes additional payments (which he is not obliged to make under the contract);43 it is
submitted that in such a case nothing should turn on whether the seller honestly
believed that he was entitled to such additional payments.44
cc) Delivery of non-conforming goods. The decision whether the delivery of non- 34
conforming goods amounts to a fundamental breach will always have to be made on a
case-by-case basis so that any attempt to generalise relevant factors must therefore be
treated carefully. Bearing that in mind, however, it is suggested that it is possible to
develop a number of guidelines which may be used as a starting point for the analysis of
each individual case. Based on the four general criteria described supra paras 12 et seq.
these guidelines would be as follows.
(1) First, regard should be had to the parties’ explicit or implicit agreement and to the 35
commercial background of the transaction. In particular, the parties may in their
contract define which of the requirements shall be fundamental in the sense that their
breach will lead to a right of avoidance.45
(2) If there is no contractual agreement classifying the particular breach in question 36
as fundamental, one should look to the seriousness of the breach. The main focus
should be on the perspective of the buyer, i. e. on the consequences of the breach for
him.46 Within that perspective, however, one may also take into account how far the
goods departed from the standard required by Art. 35. On that basis, as a rule, minor
non-conformities which have little or no impact on the usability of the goods will not
amount to a fundamental breach.47
39Huber, in: Huber/Mullis, The CISG (2007), p. 227.
40Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 49 para. 6; Gruber, in: Münch-
Schlechtriem/Butler, CISG (2009), para. 190.
41 See for instance Oberlandesgericht Celle (Germany) 24 May 1995 (used printing press), CISG-Online
152; Oberlandesgericht Hamburg (Germany) 28 February 1997 (iron molybdenum), CISG-Online 261
(BeckRS 1997, 15842); Oberlandesgericht Düsseldorf (Germany) 24 April 1997 (shoes), CISG-Online 385;
Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 49 para. 6; Schlechtriem/Butler, CISG
(2009), para. 190.
42 See for instance Oberlandesgericht Celle (Germany) 24 May 1995 (used printing press), CISG-Online
152.
43 See Oberlandesgericht Brandenburg (Germany) 5 February 2013 (Beer), CISG-Online 2400 = IHR
2013, 245.
44 For a similar scenario see Arbitral Award, Hamburg Friendly Arbitrage, 29 December 1998 (cheese),
CISG-Online 638. See also Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 49 para. 6.
45 Bundesgerichtshof (Germany) 3 April 1996 (cobalt sulphate), CISG-Online 135 = NJW (1996) 2364;
Bundesgerichtshof (Germany) 24 September 2014 (tools), CISG-Online 2545 = NJW (2015) 867; Gruber,
in: MünchKommBGB (2015), Art. 25 para. 34; Schroeter, in: Schlechtriem/Schwenzer, Commentary
(2016), Art. 25 para. 44.
46 Bundesgerichtshof (Germany) 24 September 2014 (tools), CISG-Online 2545 = NJW (2015) 867.
47 See Oberlandesgericht München (Germany) 2 March 1994 (coke), CISG-Online 108 = NJW-RR
(1994) 1075; U.S. Court of Appeals (2nd Circuit) (U.S.) 6 December 1995 (Compressors for air condi-
tioners), Rotorex Corp. vs. Delchi Carrier S. p.A, CISG-Online 140; Rechtbank van Koophandel Hasselt
(Belgium) 14 September 2005 (printed media) CISG-Online 2001; Huber, in: Huber/Mullis, The CISG
(2007), pp. 228, 217; Graffi, in: Ferrari, The 1980 Uniform Sales Law (2003), pp. 305, 316 et seq.
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37 (3) Even if the breach is serious it will not necessarily be fundamental because the
seller has a right to cure the defect unless the buyer has a legitimate interest in
immediate avoidance of the contract; see supra paras 20 et seq. If the buyer fixes an
additional period of time for cure under Art. 47 and if the period elapses without cure
being made, this may help to show that the seller was given his chance to cure under
Art. 48. Thus, the Nachfrist-procedure may indirectly help the buyer to show that the
breach is fundamental. From a “tactical” perspective, however, it should be noted that
the buyer who fixes the Nachfrist will also have to accept being bound by his choice of
remedies under Art. 47(2) while the Nachfrist is running.
38 (4) The fourth and most disputed factor is the reasonable-use test. Both the highest
German48 and Swiss49 courts have attached considerable weight to the question whether
the buyer can make some other reasonable use of the non-conforming goods. Under
that approach, there would be no right to terminate the contract if it is possible and
reasonable for the buyer to resell the goods in the ordinary course of business, albeit for
a lower price (the resulting loss being then recoverable as damages under Art. 74).
39 The leading case is the cobalt sulphate case, decided by the German Bundesgerichtshof
in April 1996 where the seller had sold different quantities of cobalt sulphate to the
buyer, a German company. It was agreed that the goods should be of British origin
(facts simplified).50 The buyer tried to avoid the contract inter alia on the ground that
the cobalt sulphate originated from South Africa and that this caused him serious
difficulties, as he “primarily” exported to India and South East Asia where there was an
embargo on South African products. The buyer did not succeed with this line of
argument. According to the Bundesgerichtshof, the buyer had neither been able to
name potential buyers in those countries or to adduce evidence of earlier sales in these
countries, nor had he even alleged that it would have been impossible or unreasonable
to make another use of the goods in Germany or to export them into another country.
The actual decision of the case is based on procedural reasons, namely on the lack of
proof by the buyer.51 It is, however, an interesting question what the court would have
decided if the buyer actually had proven that he could not resell the goods in a
considerable part of the world. In light of the reasoning adopted, it seems likely that
the court would have told the buyer to look for a country where there was no embargo,
sell the goods there (albeit for a lower price) and claim damages for the losses incurred
by doing so (for instance for the price difference). In the case decided by the Swiss
Bundesgericht in 199852 the delivered frozen meat did not live up to the agreed
standards and its value was about 25 percent less than agreed. The Swiss Bundesgericht
explicitly referred to the cobalt sulphate judgment of the German Bundesgerichtshof and
48 Bundesgerichtshof (Germany) 3 April 1996 (cobalt sulphate), CISG-Online 135 = NJW (1996) 2364;
Bundesgerichtshof (Germany) 24 September 2014 (tools), CISG-Online 2545 = NJW (2015) 867; cf. also
Oberlandesgericht Köln (Germany) 14 October 2002 (designer clothes), CISG-Online 709 (BeckRS 2003,
00152); Oberlandesgericht Frankfurt (Germany) 18 January 1994 (shoes), CISG-Online 123 = NJW (1994)
1013.
49 Bundesgericht (Switzerland) 28 October 1998 (meat), CISG-Online 413.
50 The seller was also obligated to supply certificates of origin and of quality. The consequences of the
breach of his documentary obligations will not be discussed here, however.

51 The situation was the same in the case of Oberlandesgericht Frankfurt (Germany) 18 January 1994
(shoes), CISG-Online 123 = NJW (1994) 1013: A stock of shoes had been sold from Italy to Germany.
The buyer refused to pay on the ground that he had avoided the contract because the goods did not
conform to the contract. The court found against the buyer on the ground that he had not alleged and
proven to a sufficiently detailed extent that the goods were defective and that it would have been
unreasonable to make some other use of them.
52 Bundesgericht (Switzerland) 28 October 1998 (meat), CISG-Online 413.
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held that there was no fundamental breach as the delivered meat could have been
reasonably sold on by the buyer of a lower price.53
In 2014 the German Bundesgerichtshof further expanded its reasonable use doctrine: 40
A seller had delivered non-conforming machinery and refused to cure the non-
conformity within reasonable time. Nevertheless, the Bundesgerichtshof declared the
seller’s breach non-fundamental, because the buyer himself repaired – and then used –
the machinery.54
However, the reasonable use test has not been universally accepted yet. Thus, in the 41
U.S. case Delchi vs. Rotorex55 the air conditioner compressors delivered by the seller
were less efficient than the sample model and had lower cooling capacity and consumed
more energy than the specifications indicated. The Court held that there was a
fundamental breach by the seller because “the cooling power and energy consumption
of an air conditioner compressor are important determinants of the product’s value”.56
The court did so without having regard to whether the buyer could have reasonably
been expected to resell the defective goods or make any other use of them and claim
damages or price reduction. It is submitted, however, that Delchi and decisions like it do
not necessarily mean that the reasonable use criterion should not be applied at all. It is
possible to explain them on the basis that there was no other reasonable use to which
the goods could have been put and that thus the court did not have to address directly
the reasonable use issue. To date, therefore, no definite answer exists in case law as to
whether the reasonable-use criterion will find general acceptance.57
It is submitted that the reasonable use criterion is in accordance with the general 42
policy of the CISG to restrict the availability of avoidance as a remedy (cf. supra Art. 45
paras 9 et seq.). It should, however, be given a restrictive interpretation.58 Particular
importance should be attached to the commercial background of the transaction which
may lead to the result that there was no reasonable use for the buyer or even to the
conclusion that there should be no “reasonable use” analysis at all. Thus, where it
appears from the commercial background of the contract that time and/or quality were
of the essence within the contract, the delivery of non-conforming goods will amount to
a fundamental breach from the outset and there will therefore be neither room nor
justification for embarking on a “reasonable use” analysis.59
Where the buyer needs the goods for use in his production process it will often 43
appear from the commercial background that he cannot reasonably use materials of a
53Huber, in: Huber/Mullis, The CISG (2007), pp. 228 et seq.

54Bundesgerichtshof (Germany) 24 September 2014 (tools), CISG-Online 2545 = NJW (2015) 867; cf.
CISG-AC Opinion no 5, para 4.5 (“if the buyer is in a better position than the seller to have the goods
repaired”).
55 U.S. Court of Appeals (2nd Circuit) (U.S.) 6 December 1995 (Compressors for air conditioners),
Rotorex Corp. v Delchi Carrier S. p. A., CISG-Online 140. Another case is: Oberlandesgericht Hamburg
(Germany) 26 November 1999 (jeans), CISG-Online 515. The position of the French courts is not clear
yet: cf. Cour de Cassation (France) 23 January 1996 (wine), CISG-Online 159, where artificially sugared
wine was regarded as a fundamental breach without examining the question of whether it could have
been resold (for instance for industrial purposes), but on the other hand stating that the wine was not
suited for consumption thus virtually excluding the very use wine is made for; Cour de Cassation (France)
26 May 1999 (laminated sheet metal), CISG-Online 487, where the court may have been indirectly
influenced by the fact that the goods were not usable; Huber, in: Huber/Mullis, The CISG (2007), p. 230.
56 U.S. Court of Appeals (2nd Circuit) (U.S.) 6 December 1995 (Compressors for air conditioners),
Rotorex Corp. v Delchi Carrier S. p. A., CISG-Online 140.

58 See for further considerations for instance CISG-AC Opinion no 5, paras 4.1 et seq.; Schroeter, in:
Schlechtriem/Schwenzer, Commentary (2016), Art. 25 para. 52; Huber, in: Huber/Mullis, The CISG
(2007), pp. 230 et seq.
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lower quality. The position may, however, be different if the buyer also produces goods
of a lower quality so that he can simply use the delivered goods for that part of his
business (provided of course that he has a need for the delivered materials there and
that he will not create an overload of material on stock there).60
44 A buyer who purchases a profit making machine is entitled to expect it to perform
according to the specifications agreed upon. If it does not do so, the commercial
background may indicate that the machine is not of any reasonable use to him.61
However, the mere fact that the machine does not operate as quickly or efficiently as
agreed in the contract should not mean that the buyer is entitled to avoid the contract.
A buyer who can still make reasonable use of the machine should be obligated to do so,
albeit that any loss he suffers would be compensated by damages.62
45 Where the buyer purchases goods for resale, much will turn on the question whether
the buyer only sells high-quality goods or whether he also deals in goods of a lower
quality and could use the goods delivered by the seller for that line of his business. In this
respect, considerable importance should be given to the issues of reputation, brand image
and related matters. The reasonable use test should not lead to the result that the buyer is
left with goods that he cannot sell on without risking damage to his reputation.63
46 dd) Third party rights. Where the goods sold are subject to third party claims (Arts
41 et seq.) the position is similar to the cases of non-conformity. Particular emphasis
should be placed on whether the breach can be cured by the seller under reasonable
conditions, for instance by discharging the third party’s right64 or – in a sale of generic
goods – by delivering other goods of the same type which are not subject to third party
rights.65 Possibly, and depending on the circumstances of the case, cure might also be
made by paying licence fees to the third party thus enabling the buyer to use the goods;
it should be noted, however, that the buyer’s interest in making full and proper use of
the goods must not be impaired by that.
47 ee) Documents. As a general rule, the delivery of non-conforming documents should
be treated in a similar way to the delivery of non-conforming goods.66 Thus, where it
does not result from the contract or from the commercial background that strict
conformity is of the essence of the contract, the major criteria should therefore be the
seriousness of the breach and the question whether the seller can cure the defect. The
reasonable use test, however, may have to be slightly modified in that, rather than
asking whether the buyer can make reasonable use of the documents tendered, at least
one court has instead asked whether it is reasonable to expect the buyer to acquire
conforming documents for himself.67
48 It is submitted that the interpretation of the contract in light of the commercial
context should in many cases lead to the conclusion that strict conformity is of the
essence so that any lack of conformity in the documents will be treated as fundamental,
irrespective of whether there could still be made a reasonable use of the documents and
61 Cf. Bundesgericht (Switzerland) 18 May 2009 (packaging machine), CISG-Online 1900.
62 Huber, in: Huber/Mullis, The CISG (2007), p. 231; Cf. Oberlandesgericht Hamburg (Germany)
25 January 2008 (inventory for a café), CISG-Online 1681: in this case the seller had delivered but not
installed inventory for an ice cream parlour. The court held that this did not amount to a fundamental
breach because the seller was able to install at least parts of the inventory himself.
63 Huber, in: Huber/Mullis, The CISG (2007), p. 232; Schroeter, in: Schlechtriem/Schwenzer, Commen-
tary (2016), Art. 25 para. 55; Gruber, in: MünchKommBGB (2015), Art. 25 para. 22.
66 Cf. Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 49 para. 11.
67 Bundesgerichtshof (Germany) 3 April 1996 (cobalt sulphate), CISG-Online 135 = NJW (1996) 2364.
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irrespective of whether the non-conformity of the documents was severe or only slight.
This should be so in particular where documentary sales of commodities are concerned,
where proper documents are needed for the agreed payment mechanism or where the
buyer is in the business of reselling the goods under payment terms which require strict
conformity of the documents (e. g. letter of credit).68 It is doubtful, however, in how far
the courts or tribunals will follow that approach strictly. Case law so far seems to point
in a different direction.69 This has been criticised as not being suitable for typical
international commodity sales such as they have long been known to and governed by
English sales law. These types of sales, so it is argued, require a high level of legal
certainty and strict and fast rules on the termination of the contract.70 It is suggested
that the CISG may produce reasonable results for these types of contracts (only) if
sufficient weight is given to the commercial background of the case, as submitted here.
There may, of course, be cases where the commercial background is such that it is 49
perfectly reasonable to expect the buyer to get missing documents himself (reasonable
use analysis). This may, for instance, be the case where the seller does not tender correct
certificates of analysis or certificates of origin and where the buyer did not urgently need
these correct certificates (for instance because he could sell the goods on without those
documents or because he bought the goods for use in his own production process).71
ff) Breach of ancillary obligations. The breach of ancillary obligations (e. g. duties to 50
give instructions to the buyer, to provide additional services etc.) may amount to a
fundamental breach, depending in particular on the seriousness of the breach and the
question of cure.72 The breach of exclusive distribution agreements may also amount to
a fundamental breach. A fundamental breach has been assumed in a case where a
producer who delivered goods to his buyer for exclusive distribution offered part of the
production himself for sale to sub-buyers and continued to do so even after the buyer
had requested him to stop; the court laid great stress on the fact that the buyer’s trust in
the seller’s willingness to honour their agreement was shaken.73
3. Avoidance using the Nachfrist-procedure (Art. 49(1)(b))

a) Outline. In cases of non-delivery, the buyer may declare the contract avoided 51
under Art. 49(1)(b), if the seller does not deliver the goods within the additional period
dinger, Kommentar (2013), Art. 49 para. 17; Huber, in: Huber/Mullis, The CISG (2007), pp. 232 seq.
69 See for instance Arbitral Award CIETAC CISG/1999/28 (industrial raw material), CISG-Online
1806, where the bill of lading mistakenly stated “1999” instead of “1998” and where payment to the seller
under the letter of credit was refused by the issuing bank: held that the breach was not fundamental on
the specific facts of the case. See also Bundesgerichtshof (Germany) 3 April 1996 (cobalt sulphate), CISG-
Online 135 = NJW (1996) 2364 where the court did not regard the breach as fundamental on the basis of
the reasonable use test.
70 See Bridge, Uniformity and Diversity in the Law of International Sale, 15 Pace International Law
Review (2003) 55 et seq. (Pace); see also, somewhat less critical, Mullis, Termination for breach of contract
in C. I. F. contracts under the Vienna Convention and English law: Is there a substantial difference?, in:
Lomnicka/Morse (eds), Contemporary Issues in Commercial Law (Essays in honour of Prof. A. G. Guest),
(1997) pp. 137 et seq.

Mullis, The CISG (2007), p. 233; Gruber, in: MünchKommBGB (2015), Art. 25 para. 29.
73 Oberlandesgericht Frankfurt (Germany) 17 September 1991 (shoes), CISG-Online 28 = NJW (1992)
633; also Oberlandesgericht Koblenz (Germany) 31 January 1997 (acrylic blankets), CISG-Online 256
(BeckRS 1997, 15993); Handelsgericht des Kantons Aargau (Switzerland) 26 September 1997 (cutlery),
CISG-Online 329.
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of time (Nachfrist74) fixed by the buyer in accordance with Art. 47(1) or if the seller
declares that he will not deliver within that period. Art. 49(1)(b) does not require the
breach to be fundamental. The provision, in other words, enables the buyer to
“upgrade” a non-fundamental breach to one which justifies avoidance, by using the
Nachfrist-procedure.
52 It is submitted that the Nachfrist-mechanism of Art. 49(1)(b) provides an option for
the buyer which he is not bound to take. Even in cases of non-delivery the buyer may,
therefore, choose to proceed under Art. 49(1)(a) by proving that the non-delivery was a
fundamental breach of contract (for instance because time was of the essence).75 In such
a case the buyer will have the right to avoid the contract without having to fix an
additional period of time for performance. This appears from the wording and from the
structure of Art. 49 which does not restrict the buyer’s options to the Nachfrist-
procedure in cases of non-delivery. Of course, if the buyer is not sure whether the delay
will qualify as a fundamental breach, he may be well advised to use the Nachfrist-
procedure, rather than relying on the fundamental breach doctrine.76
b) Non-delivery
53 aa) Definition of non-delivery. As is indicated by the wording of Art. 49(1)(b), the
right to avoid the contract under this provision is limited to cases of non-delivery by the
seller. As a rule, non-delivery presupposes that the seller failed to fulfil his delivery
obligations under the contract or under the Convention (Art. 31).77 By contrast, if the
seller has in fact delivered any goods in purported performance of the contract, there is
a “delivery”, irrespective of whether the goods conform to the contract (Arts 35 et seq.)
and irrespective of whether they are free from third party rights (Arts 41 et seq.). Even
the delivery of an aliud, i. e. in the case of a sale of a specific good, the delivery of
another object than the one sold, is a delivery in that sense (albeit a non-conforming
one).78 In all the cases mentioned above, the buyer can only avoid the contract under
the fundamental breach rule in Art. 49(1)(a). According to Art. 6, however, parties may
agree to apply the Nachfrist-mechanism in cases of non-conformity as well.79
54 A partial delivery will have to be analyzed under Art. 51, if the latter provision applies
(see infra Art. 51 paras 9 et seq.). Thus, with regard to the missing part, there is a non-
delivery under Art. 49(1)(b) and the buyer may proceed under that provision in order
to obtain the right to avoid the contract with regard to the missing part.80 He will,
74 Cf. Will, in: Bianca/Bonell, Commentary (1987), Art. 49 para. 2.1.3.

75 Huber, in: Huber/Mullis, The CISG (2007), pp. 234 seq.; Huber, in: MünchKommBGB (2015),
Art. 49 para. 47; Magnus, in: Staudinger, Kommentar (2013), Art. 49 para. 11; Honnold/Flechtner, Uni-
form Law (2009), Art. 49 para. 305. For case law in that direction see the references supra paras 28 et seq.
which assume that a delay in performance may amount to a fundamental breach and entitle the buyer to
avoid the contract; this assumption can only be made on the ground that Art. 49(1)(b) is not the only
option for the buyer in cases of non-delivery. But see also statements which possibly seem to point in a
different direction: Amtsgericht Oldenburg (Germany) 24 April 1990 (fashion textiles), CISG-Online 20;
Oberlandesgericht Düsseldorf (Germany) 10 February 1994 (fabrics), CISG-Online 115 = NJW-RR (1994)
506; Oberlandesgericht Köln (Germany) 22 February 1994 (rare hard wood), CISG-Online 127 (BeckRS
1994, 05495). It is submitted that many of these statements are not entirely clear and that in so far as they
really restrict the buyer’s options to Art. 49(1)(b) in cases of non-delivery, they should not be followed.
76 Cf. also Lookofsky, Understanding the CISG (2008), p. 122.

78 As for the qualification of an aliud-delivery as a non-conformity cf. supra Art. 46 para. 6.
79 Cf. Appelationsgericht Basel-Stadt (Switzerland), 26 September 2008 (Packaging machine), CISG-
Online 1732.
zer, Commentary (2016), Art. 51 para. 6; Honnold/Flechtner, Uniform Law (2009), Art. 51 para. 316;
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however, only be entitled to avoid the entire contract (i. e. also with regard to the parts
which had been delivered already) under the requirements of Art. 51, i. e. if the partial
non-delivery amounts to a fundamental breach even if set in proportion to the entire
contract.81 Where Art. 51 does not apply, because there is no delivery “in part”, but
simply a lack of quantity (for example where the sold animal weighs only 250 kilos
instead of 350 kilos as was promised), Art. 51 will not apply82; there is, however, in such
a case a “delivery” so that the buyer’s right to avoid cannot be based on Art. 49(1)(b).
bb) Relevant point in time. The relevant point in time for assessing the requirements 55
of Art. 49(1)(b) is the time when the buyer fixes the additional period of time for
performance under Art. 47. At this moment in time there must be a non-delivery in the
sense described at supra paras 51 et seq.83 If therefore the seller has delivered after the
agreed time for delivery, but before the buyer had fixed the Nachfrist, the buyer will only
be able to rely on Art. 49(1)(a).
It should be noted, however, that Art. 49(1)(b) will only apply if the time of delivery 56
(as specified by Art. 33) has passed already. A failure to deliver before that time would
not amount to a breach of contract and would thus not trigger the application of Arts
45 et seq. The buyer in these cases may be entitled to remedies for anticipatory breach
(Arts 71 et seq.), but not under Arts 45 et seq. Where the seller’s obligation becomes due
upon a notice given by the buyer, the Nachfrist may be set together with this notice,
provided it is still of reasonable length.84
cc) Specific issues. It is sometimes argued that the concept of non-delivery should 57
also cover those exceptional cases where the seller has already made delivery but where
the goods have not yet been physically moved from the seller’s place of business85 – a
situation which can arise in particular under Art. 31(b) or (c), for example if the seller
has already placed the goods at the buyer’s disposal at the seller’s place of business and
where the buyer has not collected them. The argument advanced in support of this is
that the fundamental breach requirement primarily aims at avoiding the costs and risks
of restitution of the goods and that this concern does not arise in cases where the goods
have not been moved. However, this view does not find any basis in the wording of the
provision which clearly refers to the concept of delivery and not to the question of
whether the goods have been moved.86
With regard to documentary sales, the predominant opinion assumes that a failure to 58
tender documents amounts to a “non-delivery” if the missing documents are of the type
that the buyer needs in order to be able to dispose of the goods, for instance bills of
lading or warehouse warrants.87 Thus, if the buyer does not tender the documents at the
Huber, in: MünchKommBGB (2015), Art. 49 para. 49; cf. Kantonsgericht Zug (Switzerland) 14 December
2009 (spinning company), CISG-Online 2026; Arbitral Award, Tribunal of International Commercial
Arbitration at the Russian Federation Chamber of Commerce and Industry, 1 March 2006, CISG-Online
1941.
para. 48.
84 Huber, in: MünchKommBGB (2015), Art. 47 para. 6; Oberlandesgericht München (Germany) 19 Oc-
tober 2006 (cars), CISG-Online 1394 (with regard to the similar provisions in Arts 64 and 63, i. e. for the
buyer’s obligation to pay the price).
86 Cf. Huber, in: Huber/Mullis, The CISG (2007), p. 236; Honnold/Flechtner, Uniform Law (2009),
Art. 49 para. 305.

Mullis, The CISG (2007), pp. 236 et seq.; Huber, in: MünchKommBGB (2015), Art. 49 para. 52; Magnus,
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required time and place, there will be a non-delivery in respect of those and the buyer
can proceed under Art. 49(1)(b) by fixing an additional period for the tender of the
documents. If the failure to tender the documents in itself constitutes a fundamental
breach (as will often be the case in documentary sales where time will often be of the
essence), he can also avoid the contract immediately for fundamental breach under
Art. 49(1)(a). If the seller does tender the documents at the required place and time, but
they are not in conformity with the contractual requirements, this will not constitute a
“non-delivery” and will have to be treated exclusively under Art. 49(1)(a).
59 The failure to deliver other documents (i. e. those documents that may be required by
the contract, but are not needed for the disposition of the goods, as for instance an
insurance policy or a certificate of origin) will not amount to a non-delivery in the sense
of Art. 49(1)(b). The buyer will have to rely on the fundamental breach doctrine under
Art. 49(1)(a) if he wants to avoid the contract. In fact, under strict documentary sales
where payment is based on a letter of credit or on the basis of “cash against documents”
and where those documents are required under the payment terms, there will usually be
a fundamental breach.88
c) Fruitless expiry of the additional period of time fixed under Art. 47
60 aa) Additional period of time under Art. 47 (Nachfrist). Art. 49(1)(b) refers to the
Nachfrist provision of Art. 47(1). The buyer therefore has to demand performance
within a specified period of time.89 For more details cf. supra Art. 47 paras 3 et seq.
61 The seller may counter the buyer’s time limit by offering cure under Art. 48(2),(3)
within a period of time which is longer than the one set by the buyer’s Nachfrist. If the
buyer does not reject that proposal within reasonable time, Art. 48(2) will have the
effect that the period suggested by the seller takes precedence over the one fixed by the
buyer. According to the second sentence of Art. 48(1) the buyer cannot declare
avoidance because that would be inconsistent with the seller’s right to effect perfor-
mance.90
62 bb) Absence of delivery or refusal to deliver. Art. 49(1)(b) presupposes that the
seller has not delivered or has declared that he will not deliver within the period of time
specified by the buyer. As a rule, therefore, once the buyer has fixed the additional
period of time, he will have to wait until the period expires. Art. 47(2) prevents him
from resorting to any remedy for breach of contract, except for damages for the delay.91
63 If, however, the seller has declared his refusal to perform within the additional period,
the buyer may declare avoidance of the contract right away, irrespective of whether or not
the Nachfrist has already elapsed. This results both from the purpose of Art. 49(1)(b) and
from the “unless” provision in Art. 47(2).92 A refusal to perform in the sense of
Art. 49(1)(b) can lie in the fact that the seller offers to perform in time, but makes this
in: Staudinger, Kommentar (2013), Art. 49 para. 22; Schnyder/Straub, in: Honsell, Kommentar (2010),
Art. 49 para. 100; Saenger, in: Ferrari et al., Internationales Vertragsrecht (2011), Art. 49 para. 10; Benicke,
in: MünchKommHGB (2013), Art. 49 para. 8.

89 Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 47 para. 4; Art. 49 paras 15 et
seq.
91 If the breach was fundamental from the beginning, the buyer could, of course, have proceeded under
Art. 49(1)(a) right away. If he did not do so, but chose to set an additional period, he will be bound by
Art. 47(2). See further U.S. Court of Appeals (3rd Circuit) (U.S.) 19 July 2007 (Naptha), Valero Marketing
and Supply Company vs. Greeni Oy, CISG-Online 1510.
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dependent on counter-performances by the buyer to which the seller is not entitled.93 If,
by contrast, the buyer has fixed too short a period under Art. 47 and if the seller (makes
clear that he) only refuses to perform within that (too short) period, one should not
assume a refusal to perform in the sense of Art. 49(1)(b).94 Whether, in the latter case, one
should oblige the seller to offer performance within a “reasonable” period, is, in the
author’s opinion, doubtful. For more detail see supra Art. 47 paras 23 et seq.
4. Declaration of avoidance and time limits

a) Need for a declaration of avoidance. The avoidance of the contract has to be 64
declared by the buyer, as becomes apparent from the wording of Art. 49 and from
Art. 26. Avoidance will therefore not occur ipso facto or by operation of the law.95 An
exception to this rule should be made, however, where the seller has definitely and
clearly declared that he will not perform.96
The declaration need not be made in any particular form.97 Neither is it necessary 65
that it contains the word “avoidance”. It must however make clear that the buyer is no
longer prepared to perform the contract as a result of the seller’s breach.98 It is
submitted that the buyer can also declare the avoidance implicitly or by conduct,
provided that such conduct clearly shows his intention to terminate the contract.99 If,
after the breach, the parties take up negotiations on how to “fix” the problems by
discussing different delivery and payment options, and if these negotiations are not
successful, it will be a matter of interpretation whether the parties only spoke about (but
did not reach agreement on) a modification of the original contract or whether one
party’s conduct even amounted to an implicit avoidance of the contract, coupled with
an offer for a new contract on modified terms which was not accepted by the other
party.
93 Cf. Bundesgericht (Switzerland) 20 December 2006 (machines), CISG-Online 1426 (seller made
delivery within Nachfrist dependent on payment of full purchase price (Art. 58), although buyer was
entitled to reduce purchase price as a result of a set-off, see decision of the court for more detail); Huber,
in: MünchKommBGB (2015), Art. 49 para. 55; Müller-Chen, in: Schlechtriem/Schwenzer, Commentary
(2016), Art. 49 para. 20.
Art. 49 para. 55.

95 Oberster Gerichtshof (Austria) 6 February 1996 (propane), CISG-Online 224; Kantonsgericht Zug
(Switzerland) 14 December 2009 (spinning company), CISG-Online 2026; Huber, in: MünchKommBGB
Leisinger, in: Brunner, Kommentar (2014), Art. 49 para. 7.
96 Oberlandesgericht Hamburg (Germany) 28 February 1997 (iron molybdenum), CISG-Online 261
(BeckRS 1997, 15842); Huber, in: MünchKommBGB (2015), Art. 49 para. 10.
97 Cf. Oberster Gerichtshof (Austria) 5 July 2001 (intel pentium computer parts), CISG-Online 652;
Kantonsgericht Zug (Switzerland) 14 December 2009 (spinning company), CISG-Online 2026.

Schnyder/Straub, in: Honsell, Kommentar (2010), Art. 49 para. 34. See also Oberster Gerichtshof (Austria)
5 July 2001 (intel pentium computer parts), CISG-Online 652; Oberster Gerichtshof (Austria) 6 February
1996 (propane), CISG-Online 224; Oberlandesgericht Köln (Germany) 14 October 2002 (designer
clothes), CISG-Online 709 (BeckRS 2003, 00152); Oberlandesgericht Karlsruhe (Germany) 19 December
2002 (machine), CISG-Online 817 (BeckRS 2003, 09235); Kantonsgericht Zug (Switzerland) 30 August
2007 (GMS modules), CISG-Online 1722.
99 See Oberster Gerichtshof (Austria) 5 July 2001 (intel pentium computer parts), CISG-Online 652;
Huber, in: MünchKommBGB (2015), Art. 49 para. 11; Müller-Chen, in: Schlechtriem/Schwenzer, Com-
mentary (2016), Art. 49 para. 24; Saenger, in: Ferrari et al., Internationales Vertragsrecht (2011), Art. 49
para. 2; Magnus, in: Staudinger, Kommentar (2013), Art. 26 para. 6; Hartmann, in: BeckOGK (2016)
Art. 49 para. 33; Leisinger, in Brunner, Kommentar (2014), Art. 49 para. 7.
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66 Declaration of avoidance falls under the provision of Art. 27.100 Thus if it is made by
means appropriate in the circumstances, a delay or error in the transmission of the
communication or its failure to arrive does not deprive the buyer of the right to rely on
the declaration.101
67 b) Time limits under Art. 49(2). Art. 49(2) submits the buyer’s right to avoid the
contract to a complicated regime of time limits which will apply only if the seller has
delivered the goods (cf. infra paras 66 et seq.). If this requirement is met, one has to
distinguish between the type of breach that has led to the right of avoidance. If it was a
late delivery, lit. (a) will apply (cf. infra paras 68 et seq.). If it was another type of breach,
lit. (b) will apply (cf. infra para. 70).
68 aa) Delivery of the goods. Art. 49(2) presupposes that the seller has delivered the
goods at some point in time. The provision applies to both alternatives of Art. 49(1), i. e.
both to the right to avoid for fundamental breach (lit. a) and to the right to avoid after
having used the Nachfrist procedure. The latter scenario becomes relevant where the
seller has not delivered by the contractual delivery date and the buyer has fixed an
additional period of time under Arts 49(1)(b) and 47 which has expired and where the
seller has delivered after that date. In such a case, the buyer has a right of avoidance
under Art. 49(1)(b) but the time limits of Art. 49(2) will apply because there was, in the
end, a delivery of the goods.102
69 It is submitted that one should not construe the reference to the seller too narrowly.
Art. 49(2) should also apply where a third party makes delivery obviously on behalf of
the seller.103 The German Bundesgerichtshof104 has given the provision a rather wide
interpretation in a complicated case where the contract of sale had been concluded with
a distributor of the manufacturer and where – as a result of controversies between the
manufacturer and the distributor – the manufacturer had delivered the machine
himself. The court excluded the buyer’s right to avoid referring to Art. 49(2). However,
it did not specifically discuss the question in how far third parties can be regarded as the
“seller” for the purposes of Art. 49(2). In the author’s opinion, the facts of the case
rather indicated that the manufacturer did not want to deliver on behalf of the
distributor so that the application of Art. 49(2) was probably not correct.
70 bb) Time limit in cases of late delivery (Art. 49(2)(a)). Pursuant to Art. 49(2)(a), the
buyer loses the right to declare the contract avoided in respect of late delivery unless he
does so within a reasonable time after he has become aware that delivery has been
made. The buyer will have become aware of the delivery for example when he received
the transport documents or the goods. It is submitted that the provision only applies to
cases where the late delivery is the only breach by the seller. By contrast, if the goods
(which were delivered late) do not conform with the contract, lit. (a) will not be
applicable and the time limit will result from lit. (b).
100 Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 49 para. 25; Hartmann, in:
BeckOGK (2016) Art. 49 para. 35.

101 For further details see the comments of Art. 27 paras 1 et seq.
para. 57; Magnus, in: Staudinger, Kommentar (2013), Art. 49 para. 37; Honnold/Flechtner, Uniform Law
(2009), Art. 49 para. 307.
103 Huber, in: Huber/Mullis, The CISG (2007), p. 239 (note 861); Hartmann, in: BeckOGK (2016)
Art. 49 para. 36.1.

104 Bundesgerichtshof (Germany) 15 February 1995 (key press – stamping machine), CISG-Online 149
= NJW (1995) 2101.
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A reasonable period of time in this context is generally regarded as being very short105 71
and should rather be measured in days than in weeks. Keeping the time period rather
short is warranted by the legitimate interests of the parties. In a case where the seller has
finally delivered the goods (late but at least in conformity with the contract under
Art. 35, cf. supra paras 1 et seq.), the buyer, for his part, does not need much time to
decide whether he can and wants to use the late delivered goods; he should not be given
the chance to speculate on market fluctuations. The seller, however, needs to know as
quickly as possible whether he will have to dispose of the goods.106
cc) Time limit for other types of breach (Art. 49(2)(b)). Art. 49(2)(b) governs cases 72
involving any breach other than late delivery, i. e. in particular the delivery of non-
conforming goods or the breach of ancillary obligations (e. g. installation of the goods,
service elements, documentary duties).107 It is submitted that if the seller commits two
breaches by delivering both late and not in conformity with the contractual require-
ments, the time limit should be deduced from lit. (b) rather than from lit. (a), cf. supra
para. 68. Under Art. 49(2)(b), the buyer has a reasonable time to declare the contract
avoided. The following issues have to be determined. How long is this period of time (cf.
infra paras 77 et seq.)? When does it commence (cf. infra paras 71 et seq.)?
(i) “knew or ought to have known”. The basic rule is that this period begins to run 73
after the buyer knew or ought to have known of the breach, lit. (b)(i). It is submitted
that the term “knew” refers to positive knowledge and the term “ought to have known”
refers to negligent ignorance.108 In the case of a non-conforming delivery, as a rule the
buyer ought to have known of the breach at the time when an examination under
Art. 38 would have shown the non-conformity.109 With regard to other breaches, one
should start from the assumption that the buyer is not bound to check whether the
seller actually performed his obligations so that one should assume a case of negligent
ignorance only if the buyer had concrete indications that the seller was in breach.110
It has been discussed whether one should stay close to the wording of the provision in 74
looking only to the breach as such111 or whether one should rather look to the time when
a breach becomes fundamental as a result of the seller’s failure to cure.112 The practical
results of these two approaches will, however, rarely differ because even under the latter
approach one would have to take the period of cure into account when determining the
Mullis, The CISG (2007), pp. 240 et seq.; Huber, in: MünchKommBGB (2015), Art. 49 para. 62; Benicke,
in: MünchKommHGB (2013), Art. 49 para. 21; Magnus, in: Staudinger, Kommentar (2013), Art. 49
para. 36; Hartmann, in: BeckOGK (2016) Art. 49 para. 43.1.
KommBGB (2015), Art. 49 para. 62; Huber, in: Huber/Mullis, The CISG (2007), p. 241.

KommBGB (2015), Art. 49 para. 68; Magnus, in: Staudinger, Kommentar (2013), Art. 49 para. 37.
KommBGB (2015), Art. 49 para. 68. Cf. Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016),
Art. 43 para. 4 referring to third party rights.
111 Will, in: Bianca/Bonell, Commentary (1987), Art. 49 para. 2.2.2.1.; Huber, in: MünchKommBGB
(2015), Art. 49 para. 70.

112 This seems to be the opinion of Bundesgericht (Switzerland) 18 May 2009 (packaging machine),
CISG-Online 1900 and of Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 49

para. 35; possibly also Oberlandesgericht Oldenburg (Germany) 22 September 1998 (raw salmon), CISG-
Online 508 = NJW-RR (2000) 1364.
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length of the “reasonable period” of time (cf. infra para. 78).113 The question, however,
became relevant in a case decided by the (German) Oberlandesgericht Koblenz:114 the
seller had delivered 319 pairs of shoes to the buyer, who resold approx. 180 to his
customers in the regular course of his business. Between July and December different
customers returned their shoes because of non-conformities. In December, the buyer
declared avoidance, i. e. 5 months after the first customer had returned his pair of shoes
and the buyer therefore had discovered the breach of contract. The Oberlandesgericht held
that Art. 49(2)(b) did not bar the buyer from avoiding the contract in that particular case.
The court reasoned, that the breach only became fundamental after the amount of shoes
returned had increased over the months – and that the reasonable time period did not
start before the buyer’s actually had the right to avoid the contract.
75 It is submitted that these rules on the commencement of the time limit apply
irrespective of whether or not the seller knew of his breach, as Art. 49(2) does not look
to the seller’s but only to the buyer’s knowledge.115
76 (ii) Nachfrist. If the buyer had proceeded under the Nachfrist-procedure of Art. 47 by
fixing a period of time of reasonable length for performance, the period will begin to run
after the expiration of the Nachfrist or after the seller’s declaration that he will not perform
within that period, Art. 49 (2)(b)(ii). It is submitted that the provision presupposes that the
buyer had a right to claim performance under Art. 46 when he fixed the Nachfrist.116 Thus,
for example, in the case of a non-conforming delivery, the buyer will have to claim
substitute performance or repair within the time limits set by Art. 46(2),(3). If he did not
do so, he will have lost his right to claim performance so that he could not effectively fix a
Nachfrist under Art. 47 in order to gain a right of avoidance under Art. 49(1)(b),(2)(b)(ii).
77 When the Nachfrist fixed by the buyer has expired, the buyer – rather than avoiding
the contract – may fix a second Nachfrist. The avoidance period under Art. 49(2)(b)(ii)
then does not start before the second Nachfrist has expired.117 However, in order to
uphold the function of Art. 49(2) – namely preventing the buyer from speculating –
courts should refuse to consider the second Nachfrist if the buyer has set it for the sole
reason to postpone the avoidance deadline.118
78 Once the avoidance period has elapsed under Art. 49(2)(b)(i) or (iii), a Nachfrist does
not alter this result.119 Accordingly, a second Nachfrist should not be relevant under
Art. 49(2)(b)(ii) if the avoidance period after the first Nachfrist has elapsed. If a
Nachfrist had the effect to start the avoidance period anew after it had already lapsed,
the buyer could easily undermine the regime of Art. 49(2)(b).
113 Huber, in: MünchKommBGB (2015), Art. 49 paras 69 et seq.

114 Oberlandesgericht Koblenz (Germany) 21 November 2007 (Shoes), CISG-Online 1733 (BeckRS
2008, 19974).
115 See Magnus, in: Staudinger, Kommentar (2013), Art. 49 para. 39; Huber, in: MünchKommBGB
(2015), Art. 49 para. 71; Honnold/Flechtner, Uniform Law (2009), Art. 49 para. 308.1. But see for a differing
opinion Will, in: Bianca/Bonell, Commentary (1987), Art. 49 para. 2.2.2.2 (analoguous application of
Art. 43(2)); Benicke, in: MünchKommHGB (2013), Art. 49 para. 24 a (extension of the reasonable period).
116 See Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 49 para. 37; Huber, in:
MünchKommBGB (2015), Art. 49 para. 74; Schnyder/Straub, in: Honsell, Kommentar (2010), Art. 49
para. 59.
Commentary (2016), Art. 49 para. 40; Benicke, in: MünchKommHGB (2013), Art. 49 para. 28; Leisinger,
in Brunner, Kommentar (2014), Art. 49 para. 14.
118 Cf. Hartmann, in: BeckOGK (2016), Art. 49 para. 61.2.
119 Honnold/Flechtner, Uniform Law (2009), Art. 49 para. 308; Saenger, in: Ferrari et al., Internationales
Vertragsrecht (2011), Art. 49 para. 22; similarly Müller-Chen, in: Schlechtriem/Schwenzer, Commentary
(2016), Art. 49 para. 40; Leisinger, in Brunner, Kommentar (2014), Art. 49 para. 14; dissenting Huber, in:
MünchKommBGB (2015), Art. 49 para. 78;
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(iii) Cure. Where the seller has proceeded under Art. 48(2) by offering performance 79
or cure, the period will begin to run after the expiration of the period of time indicated
by the seller or after the buyer has declared that he will not accept performance,
Art. 49(2)(b)(iii). If the seller offers cure under Art. 48(2) after the buyer’s right to avoid
the contract has been time barred under Art. 49(2)(b)(i) (the buyer not having declared
the avoidance within a reasonable time after he knew of the breach), the seller’s offer
should not alter this result. Otherwise the seller would be punished for offering cure.120
(iv) Reasonable period of time. It seems to be widely accepted that the length of the 80
reasonable period of time under Art. 49(2)(b) has to be measured in a much more
generous way than under Art. 49(2)(a).121 In particular, the buyer normally should be
given more time than for giving notice under Art. 39122 because the decision on whether
or not to avoid the contract is a more difficult one than the decision to simply give
notice of a non-conformity. It is submitted that one should apply similar standards as
are applied to the time limit for performance claims under Art. 46(2),(3) because the
buyer will often have to choose between substitute delivery and avoidance. There is case
law which has – always on the facts of the specific cases – regarded periods of about a
month (and sometimes even more) as “reasonable”.123 Periods of several months have,
however, not been regarded as reasonable in other situations.124 Of course, the matter
will always have to be decided in light of the facts of the individual case so that one
should be careful in trying to generalize the findings of the courts. If for instance the
goods are perishable, seasonal or if they are subject to strong fluctuations in the market
price, the buyer will have to make a fast decision.125
Where the seller has a right to cure, the period necessary for effecting it must be 81
taken into account. If the buyer has proceeded under Art. 47 (fixing a Nachfrist for the
cure) or if the seller has used the procedure of Art. 48(2) in order to offer cure, this
120 Will, in: Bianca/Bonell, Commentary (1987), Art. 50 para. 2.2.1.2; dissenting Huber, in: Münch-
KommBGB (2015), Art. 49 para. 80; Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016),
Art. 49 para. 41.
121 Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 49 para. 31; Magnus, in:
Staudinger, Kommentar (2013), Art. 49 para. 38; Huber, in: Huber/Mullis, The CISG (2007), pp. 241
seq.; Leisinger, in Brunner, Kommentar (2014), Art. 49 para. 12.
Mullis, The CISG (2007), p. 241; Leisinger, in Brunner, Kommentar (2014), Art. 49 para. 12. Note,
however, that there are statements in case law which seem to assume that the time periods under
Arts 39(1) and 49(2)(b) are identical. In the authors’ opinion, however, these statements were made obiter
or refer to sources which were not entirely to the point; see further Huber, in: MünchKommBGB (2015),
Art. 49 para. 64 (fn. 101).
123 See for instance Bundesgericht (Switzerland) 18 May 2009 (packaging machine), CISG-Online 1900;
Oberlandesgericht Oldenburg (Germany) 22 September 1998 (raw salmon), CISG-Online 508 = NJW-RR
(2000) 1364; Oberlandesgericht Celle (Germany) 24 May 1995 (used printing press), CISG-Online 152;
Landgericht Freiburg (Germany) 22 August 2002 (automobile), CISG-Online 711 (three months); Kan-
tonsgericht des Kantons Wallis (Switzerland) 21 February 2005 (CNC-machine), CISG-Online 1193.
124 See for instance Bundesgerichtshof (Germany) 15 February 1995 (key press – stamping machine),
CISG-Online 149 = NJW (1995) 2101 (five months); Oberlandesgericht München (Germany) 2 March
1994 (coke), CISG-Online 108 = NJW-RR (1994) 1075 (more than four months); Cour de Cassation
(France), 8 November 2011 (press breaks), CISG-online 2310 (18 months). For a stricter view see
Oberlandesgericht Stuttgart (Germany) 31 March 2008 (automobile), CISG-Online 1658 (BeckRS 2008,
06273) (two months); Oberlandesgericht Koblenz (Germany) 31 January 1997 (acrylic blankets), CISG-
Online 256 (BeckRS 1997, 15993) (seven weeks). But see also Landgericht Freiburg (Germany) 22 August
2002 (automobile), CISG-Online 711 (three months reasonable under Art. 49(2)(b)(i)).
125 Huber, in: Huber/Mullis, The CISG (2007), pp. 241 et seq.; Müller-Chen, in: Schlechtriem/Schwenzer,
Commentary (2016), Art. 49 para. 32; Hartmann, in: BeckOGK (2016) Art. 49 para. 55. For an example see
Vestre Landsret (Denmark) 10 November 1999 (christmas trees), CISG-Online 704 (avoidance of contract
for delivery of Christmas trees in December: period of seven days held to be too long as the seller did not
have much time left for disposing otherwise of the Christmas trees before December 24th).
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results naturally from the application of Art. 49(2)(b)(ii) or (iii): the reasonable period
of time will only begin to run after the expiry of the cure period. If the case does not fall
under lit. (ii) or (iii), so that lit. (i) is applicable, the same result can be reached either by
following the above-mentioned approach which lets the reasonable period of time only
begin to run after the cure period or – if one only looks to the time of the breach – by
simply adding the period which is necessary for curing the defect to the period which
would normally be regarded as reasonable in the sense of Art. 49(2)(b).126
82 The period of time may also extend if the parties negotiate in order to find an amicable
settlement because it may be unreasonable for a party to avoid a contract during such
negotiations. This may, of course, lead to uncertainty with regard to the exact point in time
when such negotiations have come to an end so that the period for avoidance will continue
to run. It may therefore be advisable to address this issue during the negotiations.127
83 dd) Interrelation with statutes of limitation. These time limits will apply indepen-
dently of the issue of limitation (prescription). Limitation of actions or claims is not
governed by the Convention. The applicable limitation periods will be determined by
the UN Limitation Convention or by the applicable limitation law; see supra Art. 4
para. 30. Irrespective of whether or when the right to avoid the contract may be
excluded by the applicable limitation rules, the buyer will have to comply with the
time limits set in Art. 49(2).
5. Burden of proof
84 In the author’s opinion, the following considerations should apply with regard to the
burden of proof.128 The buyer has to prove that the seller’s obligation exists. Once he has
succeeded in doing so and claimed that there was a breach, it should in principle be for
the seller to prove that he actually performed; with regard to the non-conformity of the
goods, however, the burden should shift onto the buyer as soon as he has accepted the
goods.129 It is further submitted that the buyer bears the burden of proof concerning the
fundamental breach requirement (including – where relevant – his legitimate interest in
immediate avoidance and the absence of any reasonable use)130 and for the fact that he
fixed an additional period of time for performance under Art. 49(1)(b); it should then be
for the seller to prove that he made performance within that additional period of time.131
With regard to the time limits it should be for the seller to prove the commencement of
the reasonable time period whereas it should be for the buyer to prove that he made the
declaration of avoidance in time.132
126 See in that direction Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 49
para. 32; Huber, in: Huber/Mullis, The CISG (2007), p. 242.

127 Oberlandesgericht Stuttgart (Germany) 31 March 2008 (automobile), CISG-Online 1658 (BeckRS
2008, 06273).
128 Cf. Huber, in: Huber/Mullis, The CISG (2007), p. 242; Huber, in: MünchKommBGB (2015), Art. 49
para. 86; see also Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 46 paras 16, 31.
129 See, e. g., Bundesgericht (Switzerland) 13 November 2003 (used laundry machine), CISG-Online 840;
Bundesgerichtshof (Germany) 8 March 1995 (New Zealand mussels), CISG-Online 144. See in more detail
Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 35 paras 50 et seq.
KommBGB (2015), Art. 49 para. 86. See also Bundesgerichtshof (Germany) 3 April 1996 (cobalt sulphate),
CISG-Online 135 = NJW (1996) 2364.
Commentary (2016), Art. 49 para. 20; Huber, in: MünchKommBGB (2015), Art. 49 para. 86.
132 See Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 49 paras 25, 28, 34, 39;
Huber, in: Huber/Mullis, The CISG (2007), pp. 242 seq.; Huber, in: MünchKommBGB (2015), Art. 49
para. 87. See also Kantonsgericht des Kantons Wallis (Switzerland) 21 February 2005 (CNC-machine),
CISG-Online 1193.
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6. Effects of avoidance
a) Lawful avoidance. If the buyer has rightfully and effectively (cf. supra para. 4 et 85
seq.) exercised his right to avoid the contract, the consequences will result from the
application of Arts 81 et seq. Thus, both parties will be released from their obligations
under the contract. The contractual relationship does not disappear entirely, however. It
will continue to exist as a framework for winding up the contract,133 as is exemplified by
Art. 82(1) or by the duty to make restitution under Arts 81(2) and 84.
b) Unlawful avoidance. If the buyer declares the avoidance unlawfully, i. e. in a case 86
where not all of the requirements set out supra para. 4 et seq. are met, this will usually
amount to a fundamental breach of the contract on the part of the buyer as it is
equivalent to a definite refusal to perform. This may entitle the seller to avoid the
contract under Art. 64(1)(a) if he so chooses. The seller may also choose to uphold the
contract despite the buyer’s breach. In the latter case the question arises whether the
seller who, under the contract, originally had to perform concurrently with the buyer or
who even had to perform first, still has to offer delivery in order to obtain payment
from the buyer. It is submitted that Art. 80 entitles the seller to claim payment without
having to do so; the buyer may not refuse payment because of the seller’s non-
performance.134

The fundamental breach doctrine (Art. 49(1)(a)) is widely used as the central element 87
of the right of termination in modern codifications. Thus, it is the guiding principle of
the PICC135, of the PECL136 and of the DCFR137. Today, the doctrine of fundamental
breach is also part of the Scandinavian sales laws138 and of those legal systems which
have taken inspiration from the CISG, such as the new Estonian law of obligations.139 In
certain respects, English and U.S. contract laws also know doctrines of fundamental
breach or similar doctrines, some aspects of which overlap with the doctrine as
enshrined in the CISG and in the PECL. Thus, the substantial deprivation test as
provided for in Art. 25 CISG is very similar to the famous formula used by Diplock LJ
in the Hong Kong Fir case where he said that the right to terminate should not (only)
depend on the prior classification of the term along the traditional lines (i. e. along the
distinction between conditions and warranties), but also on the consequences of the
breach.140
133 See Fountoulakis, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 81 paras 12 et seq; Magnus,
in: Staudinger, Kommentar (2013), Art. 81 paras 6 et seq.

134 Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 49 para. 48; Hartmann, in:
BeckOGK (2016) Art. 49 para. 55; Leisinger, in Brunner, Kommentar (2014), Art. 49 para. 16; similarly
Huber, in: MünchKommBGB (2015), Art. 49 para. 85 (relying on the good faith principle).
135 Art 7.3.1(1) PICC. See Huber, in: Vogenauer, UNIDROIT Commentary (2015), Intro Art. 7.3.
para. 3.
136 Art 9:301(1) PECL.
137 Art. III. – 3:502 DCFR.
138 Lookofsky, in: Ferrari, The 1980 Uniform Sales Law (2003), pp. 95, 113.
139 Cf. Varul, CISG: a Source of Inspiration for the Estonian Law of Obligations, ULR VIII (2003), 209.
140 Hong Kong Fir Shipping Co Ltd v Kawasaki Kisen Kasha Ltd (1962) 2 QB 26, CA: ‘does the
occurrence of the event deprive the party who has further undertakings still to perform of substantially
the whole benefit which it was the intention of the parties as expressed in the contract that he should
obtain as the consideration for performing those undertakings?’ (per Diplock LJ).
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88 The Nachfrist-mechanism, too, has found widespread acceptance. The PICC141 and
the PECL142 contain similar provisions. The Nachfrist-mechanism is known to several
legal systems. In particular, it is the centre-piece of the new German sales law (cf. §§ 437
Nr. 2, 323 BGB (Civil Code)) and is not restricted there to cases of delay.143
141Arts 7.3.1.(3), 7.1.5. PICC.
142Arts 9:301(2), 8:106(3) PECL.
143 For more detail on these rules see Zimmermann, The New German Law of Obligations (2005),
pp. 66 et seq.
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Article 50
If the goods do not conform with the contract and whether or not the price has
already been paid, the buyer may reduce the price in the same proportion as the value
that the goods actually delivered had at the time of the delivery bears to the value that
conforming goods would have had at that time. However, if the seller remedies any
failure to perform his obligations in accordance with Art. 37 or Art. 48 or if the buyer
refuses to accept performance by the seller in accordance with those articles, the
buyer may not reduce the price.
Bibliography: Bergsten/Miller, The remedy of reduction of price, 27 American Journal of Comparative

Law (1979) 255; Enderlein, Die Verpflichtung des Verkäufers zur Einhaltung des Lieferzeitraums und die
Rechte des Käufers bei dessen Nichteinhaltung nach dem UN-Übereinkommen über Verträge über den
internationalen Warenkauf, IPRax (1991) 313; Flechtner, More U. S. Decisions on the U. N. Sales
Convention: Scope, Parol Evidence, “Validity” and Reduction of Price under Article 50, 14 Journal of
Law and Commmerce (1995) 153; Hirner, Der Rechtsbehelf der Minderung nach dem UN-Kaufrecht
(2000); Piliounis, The Remedies of Specific Performance, Price Reduction and Additional Time (Nachfr-
ist) under the CISG: Are these worthwhile changes or additions to English Sales Law? 12 Pace
International Law Review (2000) 1; Sondahl, Understanding the Remedy of Price Reduction – A Means
to Fostering a More Uniform Application of the United Nations Convention for the International Sale of
Goods, 7 Vindobona Journal (2003) 255; Terlitza, Der OGH und die Preisminderung auf Null – ABGB
versus UN-Kaufrecht, FS Posch (2011).
Outline
1. History of the provision . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
2. Importance of the provision . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
3. Nature of the remedy. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
4. Position in the system of remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
1. Requirements. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
a) General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
b) Non-conforming goods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
aa) Defects in quality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
bb) Defects in title. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
cc) Defects in quantity. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
c) No cure of the defect by the seller . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
aa) Right to cure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
bb) Performance by the seller or refusal by the buyer . . . . . . . . . . . . . . . . . . 25
cc) Legal consequences . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
d) Declaration of price reduction. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
aa) Form and content . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
bb) Effectiveness/Validity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
cc) Irrevocability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
dd) No time limit. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
2. Legal consequences . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
a) General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
b) Calculation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
aa) Formula. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
bb) Relevant time. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
cc) Relevant place . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
dd) Price reduction to zero; goods without value. . . . . . . . . . . . . . . . . . . . . . . . 48
c) Claim for restitution/repayment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
aa) Legal basis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
bb) Currency. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
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cc) Place of performance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
dd) Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
3. Burden of proof . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
4. Interaction with other remedies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
a) Effects of price reduction to other remedies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
b) Effects of other remedies to price reduction. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65

1. History of the provision
1 Based on the actio quanti minoris of Roman law,1 the remedy of price reduction is
rightfully referred to as “a venerable legal tool.”2 While most civil law jurisdictions have
codified the remedy,3 price reduction remains widely unknown in common law
systems.4 The reason for the discrepancy lies in the fact that the remedy of damages is
more readily available in common law systems than under many civil codes. Most civil
law systems allow buyers to claim damages only when the seller is at fault for his
breach.5 Where the seller is not at fault, the buyer must choose between avoiding the
contract (and returning the goods) or keeping the non-conforming goods and paying
the full purchase price. The remedy of price reduction allows the buyer to keep the
goods and claim a measure of relief for their non-conformity. Since common law
systems allow claims for damages without regard to fault, damages actions effectively
address the purposes served by price reduction without the need for a separate remedy.6
2 With this background in mind, it is surprising that the damages provisions of Arts
45(1)(b) and 74 do not include an element of fault, instead establishing a damages
regime that mirrors the common law. However, the CISG also provides for the remedy
of price reduction in Art. 50. The CISG therefore adopts a “hybrid solution”7 to
damages which can only be explained – as so often in international conventions – as a
compromise between different positions during the drafting process. The civil-law
countries agreed on adopting the common-law system of fault-independent damages;
they insisted, however, on keeping “their” habitual remedy of price reduction. The
inclusion of price reduction among CISG remedies thus constituted a concession by the
common-lawyers to the civil-lawyers.8 This compromise ultimately inures to the benefit
1 The history of the actio quanti minoris is illustrated in detail by Bergsten/Miller, The remedy of
reduction of price, 27 American Journal of Comparative Law (1979) 255 (256 et seq.); Zimmermann, The
Law of Obligations: Roman Foundations of the Civilian Traditions (1990), p. 318.
3 For example § 932 Austrian ABGB (Civil Code); Art. 1644 French c. c. (Civil Code); § 441 German
BGB (Civil Code), Art. 1492 Italian c. c. (Civil Code); Art. 205 Swiss OR (Code of Obligations).
4 Bergsten/Miller, The remedy of reduction of price, 27 American Journal of Comparative Law (1979)
255 (255); Flechtner, More U. S. Decisions on the U. N. Sales Convention: Scope, Parol Evidence,
“Validity” and Reduction of Price under Article 50, 14 Journal of Law and Commerce (1995) 153 (170);
Sondahl, Understanding the Remedy of Price Reduction – A Means to Fostering a More Uniform
Application of the United Nations Convention for the International Sale of Goods, 7 Vindobona Journal
(2003) 255.
255 (257); Huber, in: Reimann/Zimmermann, Oxford Handbook (2006), pp. 956 et seq.
6 The buyer then is given the opportunity to set up the this claim for damages against the seller’s
demand for payment of the purchase price; cf. § 2–717 UCC; s. 53(2),(3) Sale of Goods Act 1979.
7 Will, in: Bianca/Bonell, Commentary (1987), Art. 50 para. 1.2.
8 See for a detailed overview on the drafting history Bergsten/Miller, The remedy of reduction of price,
27 American Journal of Comparative Law (1979) 255 (266 et seq.); Honnold/Flechtner, Uniform Law
(2009), Art. 50 para. 313.
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of the CISG buyer, who, regardless of fault, may claim either price reduction or damages
depending on which remedy appears more advantageous at the moment of breach.
Under civil law systems a buyer enjoys such a choice only when the seller is at fault.9
2. Importance of the provision

For buyers, Art. 50 price reduction can hold four distinct advantages over a claim for 3
damages. First, buyers may claim price reduction regardless of whether a loss has in fact
occurred: even if the buyer resold non-conforming goods at the price he would have
received had they conformed to the contract, he may still reduce the purchase price he
pays the seller.10 Accordingly, a failure of the buyer to mitigate damages is of no
relevance to a claim for price reduction.11 Second, price reduction may be claimed even
when the diminution in value to the goods was unforeseeable, while Art. 74 restricts
damages awards to foreseeable losses.12 Third, although Art. 79 excludes damages claims
when force majeure or hardship interfere with a seller’s performance, it does not
exclude claims against sellers for price reduction.13 Fourth, the proportional calculation
Art. 50 prescribes to determine the amount of a price reduction14 may offer buyers
higher recoveries than the linear formula with which the CISG calculates damages.15
3. Nature of the remedy

Art. 50 provides a unilateral right for the buyer to declare a reduction of the purchase 4
price.16 Thus, price reduction does not occur ipso iure upon the buyer’s receipt of non-
conforming goods; however, neither does it depend on approval by the seller. Instead,
Art. 50 provides the buyer the right to unilaterally alter the terms of the contract.17
255 (274).
10 Piliounis, The Remedies of Specific Performance, Price Reduction and Additional Time (Nachfrist)
under the CISG: Are these worthwhile changes or additions to English Sales Law? 12 Pace International
Law Review (2000) 1; Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 50 para. 14.
11 Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 50 para. 14; Sondahl, Under-
standing the Remedy of Price Reduction – A Means to Fostering a More Uniform Application of the
United Nations Convention for the International Sale of Goods, 7 Vindobona Journal (2003) 255.
12 Sondahl, Understanding the Remedy of Price Reduction – A Means to Fostering a More Uniform
Application of the United Nations Convention for the International Sale of Goods, 7 Vindobona Journal
(2003) 255; cf. infra Art. 74 paras 42 et seq.
13 Flechtner, More U. S. Decisions on the U. N. Sales Convention: Scope, Parol Evidence, “Validity” and
Reduction of Price under Article 50, 14 Journal of Law and Commerce (1995) 153 (170); Honnold/
Flechtner, Uniform Law (2009), Art. 50 para. 311; Piliounis, The Remedies of Specific Performance, Price
Reduction and Additional Time (Nachfrist) under the CISG: Are these worthwhile changes or additions
to English Sales Law? 12 Pace International Law Review (2000) 1. Cf. infra Art. 79 para. 41. Art. 79 CISG
may be seen as a rudiment of the fault-requirement; in this context the remedy of price reduction thus
keeps its original raison d’être.
14 Flechtner, More U. S. Decisions on the U. N. Sales Convention: Scope, Parol Evidence, “Validity” and
Reduction of Price under Article 50, 14 Journal of Law and Commerce (1995) 153 (171 et seq.); Piliounis,
The Remedies of Specific Performance, Price Reduction and Additional Time (Nachfrist) under the CISG:
Are these worthwhile changes or additions to English Sales Law? 12 Pace International Law Review
(2000) 1; Sondahl, Understanding the Remedy of Price Reduction – A Means to Fostering a More
Uniform Application of the United Nations Convention for the International Sale of Goods, 7 Vindobona
Journal (2003) 255; cf. infra para. 36.
15 See in detail infra paras 37 et seq.
16 For the requirements that a declaration must meet see infra paras. 29 et seq.
17 Cour de Justice de Genève (Switzerland) 15 November 2002 (Window frames), CISG-Online 853;
Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 50 para. 1; Schlechtriem/Butler, CISG

(2009), para. 203, Will, in: Bianca/Bonell, Commentary (1987), Art. 50 para. 2.1.3; Bergsten/Miller, The
remedy of reduction of price, 27 American Journal of Comparative Law (1979) 255 (263).
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4. Position in the system of remedies

5 Within the hierarchy of CISG remedies, price reduction is among the readily
available remedies. A mere non-conformity within delivered goods, without more,
entitles the buyer to declare a price reduction. Thus, the remedy is available regardless
of actual loss on the buyer’s side and regardless of fault or foreseeability on the seller’s
side.18 As a result, price reduction may be available even in cases where no damages
would be granted. Moreover, price reduction does not require that the non-conformity
constitute a substantial detriment to the buyer, as is required under Art. 25 for finding a
fundamental breach. Since avoiding the contract is only possible in cases of funda-
mental breach, price reduction remains far more readily available than avoidance.
1. Requirements
6 a) General. As a general rule, price reduction is available to the buyer whenever the
seller commits any breach of contract outlined in Arts 35 to 44. However, the second
sentence of Art. 50 makes the buyer’s right to reduce the price subject to the seller’s
right to cure pursuant to Arts 37 or 48. The priority of the seller’s right to cure derives
from Arts 37 and 48; the language of Art. 50 incorporating them by reference is merely
declaratory.
7 The remedy of price reduction may be exercised irrespective of whether the buyer has
already paid the purchase price. As a result of ongoing debates surrounding ULIS price
reduction provisions,19 the wording of Art. 50 expressly decouples the right to price
reduction from payment of the purchase price. As a consequence, payment of the full
purchase price does not constitute a waiver of the right to declare a price reduction.20
8 Usually, price reduction may not be claimed before the defective goods have been
delivered. However, scholars have argued that the buyer need not await actual delivery if
it has become clear before delivery that the seller will deliver non-conforming goods
that cannot be repaired.21 This view seems to be convincing. The argument is a corollary
of the principle of anticipatory breach laid down in Art. 72(1), which constitutes a
“general principle” underlying the CISG under Art. 7(2).
b) Non-conforming goods
9 aa) Defects in quality. Under Art. 50, a buyer may declare price reduction “[i]f the
goods do not conform with the contract.” This requirement of non-conformity limits
the availability of price reduction to cases in which goods are actually delivered but do
not conform to contractual specifications. Cases of non-delivery or late delivery there-
fore are not within the scope of Art. 50.22
10 Non-conformity exists if, at the time of the passing of risk (see Art. 36), the goods do
not meet the elements of conformity set out in Art. 35. Thus, non-conformity exists if
the delivered goods do not embody contractual specifications or, in the absence of such
18Under Art. 79(5) not even force majeure or hardship bars the application of Art. 50.
19Art. 46 ULIS; cf. Will, in: Bianca/Bonell, Commentary (1987), Art. 50 paras 1.2. et seq.
21 Magnus, in: Staudinger, Kommentar (2013), Art. 50 para. 12; Müller-Chen, in: Schlechtriem/Schwenzer,

22 Landgericht Düsseldorf (Germany) 5 March 1996 (Shoes), CISG-Online 181; Huber, in: Münch-
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agreement, do not satisfy the warranties contained in Art. 35(2). Since the CISG does
not distinguish between aliud and peius,23 CISG non-conformity also encompasses the
delivery of an aliud.
Certain actions of the buyer can preclude his right to declare price reduction. 11
Articles 35(3) and 39, which outline when the buyer loses his right to rely on non-
conformity for any CISG remedy, also apply to price reduction. A buyer may not
declare the price reduced when (a) at the time of the conclusion of the contract, the
buyer knew or could not have been aware of the nonconformity, or (b) the buyer did
not give reasonable notice of the non-conformity to the seller within a reasonable time
and in a substantial manner.24
bb) Defects in title. The fact that Art. 50 makes reference only to “non-conformity” 12
raises the question of whether a defect in title in the delivered goods may, absent any
defect in the underlying goods themselves, entitle the buyer to price reduction. The
question first arose during the Vienna Conference when the Norwegian delegation
suggested an amendment that expressly included defects in title as a type of Art. 35
non-conformity. The amendment was neither adopted nor rejected, and eventually the
Norwegian delegation withdrew its proposal due to a lack of time before voting. In
response, the Vienna Conference then explicitly stated that question of whether a defect
in title constitutes a “non-conformity” in the underlying goods remained an issue to be
solved by courts.25
At present, however, no reported cases have addressed the issue. Within scholarly 13
literature, opinion remains divided. The majority26 of authors understand “non-con-
formity” as a technical term which has to be interpreted consistently throughout the
convention as not including defects in title. Their argument for excluding defects in title
from non-conformity is primarily textual: since the heading of Chapter II Section II
refers to “Conformity of the Goods and Third Party Claims,” the language of the CISG
distinguishes between non-conformity – governed by Art. 35 – and defects in title,
which is governed by Art. 41.27
In contrast, the minority28 proffer a structural argument that CISG “non-conformity” 14
includes title defects. They point to Art. 44, which preserves the buyer’s right to declare
23 Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 35 para. 10; cf. supra Art. 35
para. 13.
24 Oberlandesgericht Graz (Austria) 11 March 1998 (Wood), CISG-Online 670; Handelsgericht Zürich
(Switzerland) 10 February 1999 (Art books), CISG-Online 488; Handelsgericht Zürich (Switzerland)
21 September 1998 (Catalogue), CISG-Online 416; Landgericht Gießen (Germany) 18 March 2003
(Frozen pork meat), CISG-Online 951; Landgericht Darmstadt (Germany) 29 May 2001 (Furniture),
CISG-Online 686; Landgericht Stendal (Germany) 12 October 2000 (Granite rock), CISG-Online 592.
Note that the buyer’s duty to give reasonable notice is subject to the counter-exception of Arts 40 and 44.
25 Honnold, Documentary History (1989), p. 582; cf. Sondahl, Understanding the Remedy of Price
Reduction – A Means to Fostering a More Uniform Application of the United Nations Convention for
the International Sale of Goods, 7 Vindobona Journal (2003) 255.
26 Secretariat Commentary on 1978 Draft, Art. 39 (now Art. 41) para. 8; Bergsten/Miller, The remedy of
reduction of price, 27 American Journal of Comparative Law (1979) 255 (258); Schlechtriem/Butler, CISG
(2009), para. 202; Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 50 para. 2; Huber,
in: Huber/Mullis, The CISG (2007), § 12 II, p. 248; Schwenzer, in: Schlechtriem/Schwenzer, Commentary
(2016), Art. 41 para. 20; Honnold/Flechtner, Uniform Law (2009), Art. 50 para. 313.1; Piliounis, The
Remedies of Specific Performance, Price Reduction and Additional Time (Nachfrist) under the CISG:
Are these worthwhile changes or additions to English Sales Law? 12 Pace International Law Review
(2000) 1; Benicke, in: MünchKommHGB (2013), Art. 50 para. 2; Piltz, Internationales Kaufrecht (2008),
para. 5–345.
28 Magnus, in: Staudinger, Kommentar (2013), Art. 50 para. 10; Altenkirch, in: Brunner, Kommentar
(2014), Art. 50 para. 3; Enderlein/Maskow, International Sales Law (1992), Art. 50 note 1; Hartmann, in:
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a price reduction despite the buyer’s failure to notify the seller of a non-conformity.
When the buyer can provide a reasonable excuse, Art. 44 not only excuses buyers who
fail to supply notice of “standard” CISG non-conformity under Art. 39; it also excuses
those who fail to notify a seller of a defect in title under Art. 43. As a result, the minority
concludes that the Convention allows an application of Art. 50 to defects in title.
15 The minority position, however, remains unconvincing. Art. 44’s excuse provisions
merely allow a buyer, upon being excused from his failure to notify the seller, to reduce
the purchase price “in accordance with Article 50.” By making price reduction depen-
dent on the requirements of Art. 50, Art. 44 remains silent on what those requirements
are.29 Minority scholars counter that, if an Art. 44 excuse does nothing more than
remove a barrier to applying Art. 50 requirements for price reduction – requirements
that exclude title defect claims – Art. 44 contains meaningless language when it also
excuses buyers who fail to notify a seller of title defects under Art. 43. Again, however,
the minority argument fails for a simple reason: Art. 44 excuses buyers who wish to
“claim damages,” not merely those who desire price reduction. Since damages claims
are readily available for defects in title, Art. 44’s excusal of buyers who neglect to notify
sellers of title defects under Art. 43 is by no means surplusage. More importantly, if the
CISG drafters refused to resolve in Art. 50 whether title defects are non-conformities,30
it borders on the unthinkable that they would insert a hidden, implicit resolution of the
problem into Art. 44.
16 De lege lata therefore the majority opinion should be followed. Legal certainty
requires a consistent interpretation of the term non-conformity throughout the CISG.
It is submitted, however, that de lege ferenda an extension of Art. 50 to defects in title
would be desirable.31 There are no conclusive reasons that would require a different
treatment of non-conformity and defects in title.32 Furthermore, the border between
non-conformity and defects in title is often difficult to ascertain – which causes the very
legal uncertainty that to prevent is the purpose of a consistent interpretation of the term
non-conformity.
17 cc) Defects in quantity. Much like with defects in title, whether Art. 50 allows buyers
to claim price reduction for defects in quantity remains unsettled. Again, no reported
cases have addressed the issue. The literature is divided into opposing groups of authors.
The first argues that Art. 50 should be available for defects in quantity since Art. 35(1)
clearly lists a defect in quantity as a “non-conformity” of delivered goods.33 The second34
contends that price reduction is not available for quantity defects because Art. 51 provides
BeckOGK, Art. 49 para. 13 seq.; differentiating: Mohs, The Restitution of goods on Avoidance of the
Contract for Lack of Conformity within the Scope of Art. 82(2)(c) CISG, Review of the Convention in
Contracts for the International Sale of Goods (CISG) (2003–2004) 53 (67 et seq.)
29 Mohs, The Restitution of goods on Avoidance of the Contract for Lack of Conformity within the
Scope of Art. 82(2)(c) CISG, Review of the Convention in Contracts for the International Sale of Goods
(CISG) (2003–2004) 53 (61).
31 Cf. Schlechtriem/Butler, CISG (2009), para. 202.
32 The mere fact that the buyer of goods that are encumbered with third party rights, may claim
damages, does not constitute an adequate alternative because – as mentioned see para. 3 – the remedy of
price reduction may be more advantageous to the buyer than the remedy of damages.
33 Magnus, in: Staudinger, Kommentar (2013), Art. 50 para. 8; Saenger, in: Ferrari et al., Internationales
Vertragsrecht (2011), Art. 50 para. 2; Schnyder/Straub, in: Honsell, Kommentar (2010), Art. 50 para. 10;
Piliounis, The Remedies of Specific Performance, Price Reduction and Additional Time (Nachfrist) under
the CISG: Are these worthwile changes or additions to English Sales Law? 12 Pace International Law
Review (2000) 1.
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that, in cases of partial delivery – i. e. a defect in quantity – the buyer’s Art. 50 remedies
are limited to the non-delivered portion of the goods.35
In the opinion of this Author, the latter view is preferable (only) if Art. 51 applies. In 18
limiting the buyer’s Art. 50 remedies to the non-delivered portion of the goods, Art. 51
effectively splits a partial delivery into two independent parts – one part delivered
conforming goods, the other part a simple non-delivery. However, since price reduction
is not available in cases of non-delivery,36 it should not be available for a partial non-
delivery that is treated as if it were a complete and independent non-delivery. Instead,
the buyer may avoid the contract to the extent of the non-delivered goods.
Practical consequences also support excluding price reduction from cases of partial 19
delivery. While buyers will achieve identical results through price reduction or avoid-
ance when a seller only partially delivers homogenous goods, the two remedies produce
divergent recoveries when a seller partially delivers heterogeneous goods. A classic
example37 is as follows: a seller has a ton of apples and a ton of oranges, each of which
is worth E 1000 at the time he contracts to sell them to the buyer. Accordingly, the seller
and buyer agree on a purchase price of E 2000. The seller then delivers the oranges, but
fails to deliver the apples.
Assume now that, at the time of delivery, the price of apples has risen to E 2000 per 20
ton. If the buyer partially avoids the contract under Art. 51(1) to the extent of the
undelivered apples, the buyer is still obligated to pay the seller the portion of the purchase
price allocable to the delivered oranges, i. e. E 1000. In contrast, the calculation for price
reduction does not allocate the purchase price to the delivered goods; it reduces the
overall price by the ratio of the missing value to the value of the entire goods at the time
of delivery.38 Here, the increase in apple prices meant that the value of the goods, at the
time of delivery, was a total of E 3000. Thus, delivering only the oranges (worth E 1000)
provided the buyer with exactly 1/3 of the value of the goods he contracted for. Under
Art. 50, the buyer may therefore reduce the overall purchase price to 1/3, i. e. to E 667.
In an opposite scenario, the price of apples has fallen to E 500 per ton by the time of 21
delivery. If the seller again fails to deliver the apples, he has provided the buyer with
E 1000 worth of goods in a deal worth E 1500, i. e. 2/3 the total value of the goods. The
buyer may thus reduce the overall purchase price to 2/3, i. e. to E 1333.
As is now readily apparent, allowing price reduction for partial deliveries would allow 22
fluctuating apple prices to affect orange prices. Such a rule has the potential to operate
capriciously, since it likely matters little to the buyer or seller whether they formalize
such a heterogeneous exchange in a single contract or two separate contracts.
c) No cure of the defect by the seller
aa) Right to cure. The buyer loses his right to declare price reduction under Art. 50 23
when either (a) the seller cures the defect in the delivered goods or (b) the buyer refuses
to accept a seller’s cure or offer to cure. Art. 50 therefore grants the seller’s right to cure
priority over the buyer’s right to price reduction.39 This approach is consistent with the
general CISG policy of encouraging performance of contracts to the furthest extent
35See Art. 51 para. 45.

37 Cf. Hirner, Der Rechtsbehelf der Minderung nach dem UN-Kaufrecht (2000), pp. 148 seq.
38 For the method of calculating Art. 50 price reductions, see para. 36 infra.
39 Cf. Oberlandesgericht Koblenz (Germany) 31 January 1997 (Acrylic blankets), CISG-Online 256
(BeckRS 1997, 15993); Handelsgericht Zürich (Switzerland) 10 February 1999 (Art bookds), CISG-Online
488; Arbitral Award, Tribunal of International Commercial Arbitration at the Russian Federation
Chamber of Commerce and Industry, 23 March 2005 (–), CISG-Online 1481; District Court Komárno
(Slovac Republic) 24 February 2009 (Potatoes), CISG-Online 1992.
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possible: if it is in the seller’s interest to cure, Art. 50 bars the buyer from cutting short
the seller’s performance by “accepting” non-conforming goods and reducing the price.40
24 However, Art. 50 grants the seller’s right to cure priority over the buyer’s right to
price reduction only when the seller cures “in accordance with Article 37 or Article 48.”
Thus, a seller’s cure cannot bar a buyer’s declaration of price reduction unless the seller
was entitled to cure under Art. 37 or 48. Art. 37 allows sellers to cure defects in goods he
has delivered before the contractual date for delivery during the period leading up to the
contractual date. Art. 48 permits sellers to cure goods delivered after the contractual
delivery date. Both articles require that the seller’s cure not lead to unreasonable delay,
inconvenience, or expense to the buyer.
25 bb) Performance by the seller or refusal by the buyer. The mere existence of a right to
cure is not sufficient to exclude the buyer’s right to price reduction. Price reduction is
barred only when the seller actually cures the defect or the buyer refuses to accept such cure.
26 A buyer may either expressly or impliedly refuse to accept a seller’s cure. Commen-
taries and cases have provided several examples of buyer behaviour that constitute an
implied refusal to accept a seller’s cure. If a buyer refuses to cooperate with the seller –
e. g. by refusing to open his warehouse to accept a seller’s delivery – the buyer impliedly
refuses the seller’s cure.41 The same is true for buyers who themselves cure the defective
goods, rendering cure by the seller impossible. More controversially, if the buyer’s
obligation to pay the purchase price has become due under the contract before the seller
has cured, the buyer’s refusal to pay may constitute an implied refusal to accept cure.42
27 Still, the buyer’s refusal to accept cure bars his right to price reduction only if the
seller has made a serious offer to cure that contained sufficient information to enable
the buyer to plan his business.43 As a result, an offer to cure must at least indicate the
expected time of the cure.
28 cc) Legal consequences. After the seller has cured or the buyer has refused to accept
cure, the buyer loses his right to declare price reduction. However, until the seller has
effected a cure, or until the buyer has refused a seller’s offer to cure, the seller’s mere
right to cure does not bar the buyer’s right to declare price reduction. Thus, the buyer
may declare price reduction at any time, although the seller’s performance will render
the declaration ineffective.44 As a result, all pre-cure declarations of price reductions are
subject to the condition subsequent of the seller’s cure.45
d) Declaration of price reduction
29 aa) Form and content. The remedy of price reduction is a unilateral right of the
buyer which he exercises by way of declaration.46 The declaration has no requirements
40 See Art. 45; further Honnold, Documentary History (1989), pp. 337 seq.; Hirner, Der Rechtsbehelf
der Minderung nach dem UN-Kaufrecht (2000), pp. 245 seq.

41 Hirner, Der Rechtsbehelf der Minderung nach dem UN-Kaufrecht (2000), p. 249.
42 Hirner, Der Rechtsbehelf der Minderung nach dem UN-Kaufrecht (2000), p. 252; this alternative was
overlooked by the Arbitral Award, Arbitral Tribunal of the Hungarian Chamber of Commerce and
Industry, 5 December 1995 (Containers), CISG-Online 163. In this case the seller did not perform cure
for the reason that the buyer refused to pay the agreed purchase price. As a consequence, the buyer
contracted a third party to repair the defects. The Tribunal held that because the seller had refused to cure
the goods the buyer was entitled to reduce the purchase price.
43 Handelsgericht Zürich (Switzerland) 10 February 1999 (Art books), CISG-Online 488.
44 Honnold, Documentary History (1989), p. 433; Huber, in: Huber/Mullis, The CISG (2007), p. 249;
Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 50 para. 2.

46 Oberlandesgericht München (Germany) 2 March 1994 (Coke), CISG-Online 108 = NJW-RR (1994)
1075; Cour de Justice de Genève (Switzerland) 15 November 2002 (Window Frames), CISG-Online 853;
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as to form. As to its content, it must clearly and unambiguously state that the buyer
wishes to reduce the purchase price but need not include the technical term “price
reduction.” The mere payment of a reduced sum does not unambiguously state a desire
for price reduction since it could also be understood an exercise of the buyer’s
temporary right of retention under Art. 58 or 71.47 Neither is it an unambiguous
declaration, when the buyer demands that the seller “either take the goods back or
reduce the price”.48
Art. 50 does not indicate whether the buyer must declare the specific amount by 30
which he intends to reduce the purchase price. Since a method set by law determines the
extent of a price reduction, a buyer likely need not inform the seller of the amount by
which he intends to reduce.49 However, if the buyer has already paid the full purchase
price and claims restitution of the reduced portion thereof, the procedural law of most
systems requires his claim to be sufficiently definite.50
bb) Effectiveness/Validity. A declaration of price reduction becomes valid at the time 31
of dispatch. The provisions of Art. 27 govern the time of effectiveness of price reduction
declarations.51 So long as a buyer dispatches his declaration in a timely fashion and by a
means appropriate in the circumstances, neither a delay, error or failure in the
transmission of the declaration render the declaration invalid.52
cc) Irrevocability. At the moment of dispatch, a declaration of price reduction has 32
the constitutive effect of altering the legal obligations between buyer and seller in that it
reduces the purchase price the buyer owes the seller.53 Most authors conclude on the
basis of this instantaneous change in legal relations that the buyer’s declaration is
irrevocable.54 Their conclusion, however, remains doubtful. If a buyer can alter the legal
relations between himself and the seller, why should he not be allowed to re-alter those
relations by revocation? Some authors answer that the seller must be protected from the
buyer’s whims, but again this argument has no foundation: since price reduction solely
benefits the buyer, its revocation can only benefit the seller.55
Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 50 para. 2; UNCITRAL, Digest of

Case Law on the CISG, Art. 50 para. 5; Huber, in: Huber/Mullis, The CISG (2007), p. 250; Audit, Vente
internationale (1990), p. 138; Enderlein/Maskow, International Sales Law (1992), Art. 50; Sondahl, Under-
standing the Remedy of Price Reduction – A Means to Fostering a More Uniform Application of the
United Nations Convention for the International Sale of Goods, 7 Vindobona Journal (2003) 255.
47 Hirner, Der Rechtsbehelf der Minderung nach dem UN-Kaufrecht (2000), pp. 295 seq.; Altenkirch,
in: Brunner, Kommentar (2014), Art. 50 para. 6.

48 Magnus, in: Staudinger, Kommentar (2013), Art. 50 para. 16; Piltz, Internationales Kaufrecht, (2008),
para. 5-350.
49 Hartmann, in: BeckOGK (2016) Art. 50 para. 24; Magnus, in: Staudinger, Kommentar (2013),
Art. 50 para. 16.

50 Cf. Cour de Justice de Genève (Switzerland) 15 November 2002 (Windows Frames), CISG-Online
853; Handelsgericht Zürich (Switzerland) 21 September 1998 (Catalogue), CISG-Online 416; Müller-Chen,
51 Huber, in: Huber/Mullis, The CISG (2007), p. 250; Will, in: Bianca/Bonell, Commentary (1987),
Art. 50 para. 2.1.3.

54 Oberlandesgericht München (Germany) 2 March 1994 (Coke), CISG-Online 108 = NJW-RR (1994)
1075; Magnus, in: Staudinger, Kommentar (2013), Art. 50 para. 15; Schnyder/Straub, in: Honsell, Kom-
mentar (2010), Art. 50 para. 31; – contra Schlechtriem, Bindung an Erklärungen nach dem Einheitskau-
frecht, FS Neumayer (1997), pp. 259 et seq.; Benicke, in: MünchKommHGB (2013), Art. 50 para. 14;
Honnold/Flechtner, Uniform Law (2009), para. 312; differentiating Hartmann, in: BeckOGK (2016)
Art. 50 para. 40.
55 An indirect violation may derive from the coincidence that the revocation of price reduction often
will be followed by an avoidance of the contract or a claim for damages that might be higher than the
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33 Nevertheless, if majority opinion is followed, a buyer should not be permitted to

withdraw his declaration of price reduction before it reaches the seller. The reason is
clear: if the declaration is effective upon dispatch,56 then an irrevocable change in legal
relations binds the buyer the moment the dispatch leaves his possession.57
34 dd) No time limit. Art. 50 provides no specific time limit in which the buyer must
exercise his right to reduce the purchase price.58 Any limitation periods will therefore be
found either in the 1974 UN Convention on the limitation period in the international
sale of goods or in domestic law.59 Note, however, that under Art. 39 the buyer must
provide notice of the defect within a reasonable time in order to preserve his right to
declare a price reduction.60
35 a) General. A valid declaration of price reduction directly reduces the payment
obligation the buyer owes the seller. If the buyer has not yet paid the purchase price,
the seller may claim payment of only the reduced sum – the reduction of price thus may
be used as a (partial) defence against an action for payment by the seller.61 If the buyer
has already paid the purchase price, he will be entitled to a claim for restitution equal to
the amount by which the purchase price was reduced.
b) Calculation
36 aa) Formula. The method for calculating an Art. 50 price reduction differs from the
method of calculating damages under Art. 74. Damages are calculated by what is known
as the “linear method:” take the value of conforming goods, subtract the value of the
actually delivered non-conforming goods62, and the difference is the damages award. In
contrast, the amount of a price reduction is determined with what is known as the
“proportional method.”63 First, the value of the actually delivered non-conforming
goods is divided by the value of conforming goods, generating the percentage of value
the goods have lost. The purchase price is then reduced by this percentage, leading to
the following formula:
amount by which the price is reduced under Art. 50 CISG. Neither indirect consequence, however, may
lead to an irrevocability of the declaration of price reduction. If at all the declaration of price reduction
may lead to a forfeiture of the right of avoidance or damages.
57 Contra Magnus, in: Staudinger, Kommentar (2013), Art. 50 para. 15.
58 Oberster Gerichtshof (Austria) 23 May 2005 (Coffee Machines), CISG-Online 1041; Cour de Justice de
Genève (Switzerland) 15 November 2002 (Window Frames), CISG-Online 853.

59 Oberlandesgericht Koblenz (Germany) 14 December 2006 (Bottles), CISG-Online 1408 (BeckRS 2007,
10389); Cour de Justice de Genève (Switzerland) 15 November 2002 (Window Frames), CISG-Online 853;
Will, in: Bianca/Bonell, Commentary (1987), Art. 50 para. 2.1.3; Huber, in: MünchKommBGB (2015),
61 Oberlandesgericht Koblenz (Germany) 14 December 2006 (Bottles), CISG-Online 1408 (BeckRS 2007,
10389); Landgericht Gießen (Germany) 18 March 2003 (Frozen pork meat), CISG-Online 951; Handels-
gericht Zürich (Switzerland) 10 February 1999 (Art books), CISG-Online 488; Müller-Chen, in: Schlech-
triem/Schwenzer, Commentary (2016), Art. 50 para. 16; Huber, in: MünchKommBGB (2015), Art. 50
para. 26.
62 Whether and in which way a court may estimate this value, is a question of procedure rather than
substance and is therefore governed by the procedural law of the forum; see Landgericht Stuttgart
(Germany) 29 October 2009 (Artificial lawn), CISG-Online 2017.
63 Handelsgericht Zürich (Switzerland) 10 February 1999 (Art books), CISG-Online 488; Müller-Chen,
in: Schlechtriem/Schwenzer, Commentary (2016), Art. 50 para. 8; Huber, in: Huber/Mullis, The CISG
(2007), pp. 251 seq.; Bergsten/Miller, The remedy of reduction of price, 27 American Journal of
Comparative Law (1979) 255 (259).
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Value of delivered
(non-conforming goods)
Reduced Price = × Contract Price
Value of owed
(conforming) goods
In cases where the goods were (a) sold at the market price and (b) market price has 37
not changed before the time of delivery, the linear and proportional methods lead to
identical results. For example, if the buyer bought goods worth E 1000 at a price of
E 1000 and if the non-conformity of these goods reduced their value by 20 percent, both
damages and price reduction would result in an award of E 200 to the buyer and a
payment of E 800 to the seller.
Differences between the linear and proportional methods arise when either (a) the 38
goods were sold above or below market value or (b) the market price of the goods has
risen or fallen. For example, assume the goods above were sold at an above-market
value of E 1200, had a market value of E 1000 without any non-conformity, but their
non-conformity further reduced their value to E 800. Under the linear method, damages
are still equivalent to the difference between the market value of conforming goods and
that of the non-conforming goods, i. e. E 1000 less E 800 results in damages of E 200. In
contrast, the proportional method produces a more favourable result for the buyer.
Since only 80 percent of the value of conforming goods has been delivered (E 800/
E 1000), the purchase price is reduced to 80 percent of E 1200, or E 960, resulting in a
recovery of E 240. However, if the buyer had purchased goods below market value,
damages would provide the more advantageous remedy.64
Falling market prices can produce another situation advantageous to the buyer. 39
Assume that, in the above example, the market price of the goods fell from E 1000 to
E 500 between the contract formation and delivery, and that the non-conforming goods
again are worth 80 percent of the value of conforming goods, i. e. E 400. The linear
method would gain non-conforming market value from conforming market value, i. e.
E 500 – E 400, to result in a E 100 award and a total reduction of the purchase price to
E 900. The proportional method attempts to insert the non-market detriment into the
original bargain: 80 percent (E 400/E 500) of E 1000 produces a reduced price of E 800.
Again the proportional method is advantageous to the buyer, and again the opposite
obtains when market prices rise between contract formation and delivery.65
bb) Relevant time. Given the constant flux of market prices, it is critical to both the 40
linear and proportional methods to ascertain the precise moment in time at which the
market value of conforming and non-conforming goods are determined. Art. 50
provides that the time of delivery is the moment at which the values of goods are
measured. Thus, market fluctuations that occur after delivery do not affect price
reductions. Market fluctuations that occur between contract formation and delivery
most certainly do.66
64 Cf. Bergsten/Miller, The remedy of reduction of price, 27 American Journal of Comparative Law
(1979) 255 (262), Examples E and F.

65 Cf. Flechtner, More U. S. Decisions on the U. N. Sales Convention: Scope, Parol Evidence, “Validity”
and Reduction of Price under Article 50, 14 Journal of Law and Commerce (1995) 153 (171 et seq.);
Bergsten/Miller, The remedy of reduction of price, 27 American Journal of Comparative Law (1979) 255
(260), Examples A and B and for further interesting differences Examples C, D.
66 This constitutes a difference from many national legal systems according to which the calculation of
price reduction is based on the values at the time of the conclusion of the contract.
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41 In practice, the proportional method of calculating price reductions67 considerably

reduces the effect of changes in market price. Market fluctuations result in substantial
purchase price reductions only when the market price of the delivered non-conforming
goods varies to a greater or lesser degree than the market price of conforming goods.
Such divergent fluctuation is an exception, likely only in cases involving delivery of an
aliud, e. g. delivery of crude oil under a contract for gasoline. Moreover, a buyer may
claim damages under Arts 45 and 74 for losses resulting from market fluctuations.
42 When does “delivery” occur for purposes of price reduction? Predominant opinion
defines Art. 50 “delivery” in light of the delivery obligations contained in Art. 31.68 In
cases where the buyer must collect the goods at the seller’s premises under Art. 31(b) or
31(c), “delivery” under Art. 50 occurs at the point in time at which the seller places the
goods at the buyer’s disposal. If the seller is obligated to deliver the goods to the buyer,
“delivery” occurs upon the buyer taking possession of the goods. If the sale involves
carriage of the goods under Art. 31(a), Art. 50 “delivery” occurs when the seller hands
over to the goods to the first carrier.
43 Cases involving carriage contracts have drawn the special attention of a number of legal
scholars. They argue that, for purposes of price reductions, it makes more sense to
determine the market value of conforming and non-conforming goods at the time and
place of destination instead of the time the seller hands goods off to the carrier.69 Their
reasoning: since the buyer is neither able to inspect nor use the goods until they reach
their destination, their true economic value does not materialize until well after the seller
hands them off to the carrier.70 Unfortunately, this reasoning fails simply because the
same factual scenario exists every time a buyer must collect goods at the seller’s premises.
In such cases, predominant opinion places Art. 50 “delivery” at the time at which the
seller places the goods at the buyer’s disposal. Thus, another period arises in which the
buyer can neither inspect nor make use of the goods until they are actually handed over.
For this reason another group of authors advocate defining “delivery” as the time of
actual handover in every CISG transaction. This view has the advantage of providing a
simple and uniform solution not subject to multiple exceptions and counter-exceptions.
44 This solution, however, fails for two reasons. First, the wording of the CISG itself
differentiates between “actual handover” (e. g. in Art. 76(1) second sentence) and
“delivery” (e. g. in Art. 76(2)). Second, arguing that the true economic value of goods
materializes only upon their handing over assumes that only the buyer’s interest in the
goods determines their value. However, when parties contract at a fixed price for a
future delivery, both parties assume the risk that the goods will rise or fall in value.71
45 cc) Relevant place. Art. 50 provides no guidance as to the relevant place for deter-
mining the market value of delivered goods. However, ascertaining the relevant place

Art. 50 para. 21; Altenkirch, in: Brunner, Kommentar (2014), Art. 50 para. 8; contra Will, in: Bianca/
Bonell, Commentary (1987), Art. 50 para. 3.3; Müller-Chen, in: Schlechtriem/Schwenzer, Commentary
(2016), Art. 50 para. 9; Hartmann, in: BeckOGK (2016) Art. 50 para. 27 et seq.
69 Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 50 para. 9; Hirner, Der Re-
chtsbehelf der Minderung nach dem UN-Kaufrecht (2000), p. 382; von Hoffmann, Gewährleistungsan-
sprüche im UN-Kaufrecht, in: Schlechtriem (ed.), Einheitliches Kaufrecht und nationales Obligationen-
recht (1987), p. 293 (301) – contra Schnyder/Straub, in: Honsell, Kommentar (2010), Art. 50 para. 31.
70 Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 50 para. 9; Hirner, Der Re-
chtsbehelf der Minderung nach dem UN-Kaufrecht (2000), p. 382.

71 For this reason some delegates heavily criticized the decision to rely on the time of delivery in the
first place; see the critical remarks of the delegates Sami (Iraq), Kuchibhotla (India), Bonell (Italy) and
Maskow (German Democratic Republic) – Honnold, Documentary History (1989), p. 579.
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for determining market values is most likely less important than pinpointing the
relevant time: while the difference in value between conforming goods and a delivered
aliud can vary widely within even short spans of time, it is less likely that an alternate
geographic location will cause comparable variance. Still, “less likely” is not equivalent
to an impossibility, and legal certainty suffers due to Art. 50’s lack of specificity.
Since no reported cases have addressed Art. 50’s “place for delivery” gap, legal 46
scholarship has assumed that the place for delivery is where goods are actually located
at the time of delivery. Depending on which view is taken in regard to the relevant time
of delivery72, the “place for delivery” under Art. 50 is either the location of the goods at
the time of Art. 31 delivery – as argued by predominant opinion – or the location of the
goods at the time they are actually handed off to the buyer.
If the goods are sold while in transport, the relevant place of delivery will generally be 47
the seller’s place of business rather than the actual location of the goods. The reason: at
the time of contracting, neither party usually knows were goods in transit are actually
located. Thus, Art. 31(b)’s provisions for goods the parties know to be at “a particular
place” are inapplicable, leaving Art. 31(c) to govern the place of delivery.
dd) Price reduction to zero; goods without value. In cases where defects render 48
delivered goods completely worthless, price reduction to zero may be claimed.73 Some
scholars challenge this rule on the grounds that it circumvents Art. 49’s restrictive
avoidance regime.74 Their criticism is not without merit: by reducing the purchase price
to zero, the buyer’s remedy is identical in result to avoidance. The authors point out
four discrepancies between the two remedies that potentially incentivize buyers to
neglect avoidance in favour of price reduction:
(1) Price reduction may be claimed irrespective of whether the seller’s breach was
fundamental, while avoidance requires a fundamental breach;
(2) Buyers are not barred from claiming price reduction when they fail to give a seller
timely notice of defects as long as they can provide a reasonable excuse for their
failure (Art. 44);
(3) Despite reducing the purchase price to zero, the buyer may keep the delivered
goods, whereas under avoidance he must return them to the seller; and
(4) Price reduction must not be claimed within the time limitations governing avoid-
ance under Art. 49(2)(b).75
Although correct, the first three discrepancies will rarely be relevant in practice. If a 49
seller delivers completely worthless goods, he has almost certainly fundamentally
breached the contract. Moreover, instead of reducing the purchase price, the buyer
could simply claim damages for the decrease in value, which would lead to identical (or
72
See supra paras 40 et seq.
73
Bundesgerichtshof (Germany) 2 March 2005, CISG-Online 999 = NJW-RR (2005) 1218; Oberster
Gerichtshof (Austria) 23 May 2005 (Coffee machines), CISG-Online 1041; Supreme Court of Western
Australia (Australia) 17 January 2003 (Contact lens solution), CISG-Online 807; Oberlandesgericht
Koblenz (Germany) 14 December 2006 (Bottles), CISG-Online 1408 (BeckRS 2007, 10389); Landgericht
Gießen (Germany) 18 March 2003 (Frozen pork meat), CISG-Online 951; Müller-Chen, in: Schlechtriem/
Schwenzer, Commentary (2016), Art. 50 para. 13; Huber, in: Huber/Mullis, The CISG (2007), p. 254;
Benicke, in: MünchKommHGB (2013), Art. 50 para. 15; Magnus, in: Staudinger, Kommentar (2013),
Art. 50 para. 23; Saenger, in: Ferrari et al., Internationales Vertragsrecht (2011), Art. 50 para. 4; Hart-
mann, in: BeckOGK (2016) Art. 50 para. 34; contra: Terlitza, Der OGH und die Preisminderung auf Null,
FS Posch (2011), p. 753.
74 Schnyder/Straub, in: Honsell, Kommentar (2010), Art. 50 paras 45 et seq.
75 Oberlandesgericht Koblenz (Germany) 14 December 2006 (bottles), CISG-Online 1408 (BeckRS 2007,
10389).
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at least similar76) results as a reduction of the purchase price and which would not
require the breach to be fundamental, either. The same is true for the difference that is
caused by Art. 44. Damages and price reduction are treated equally by this provision.
The fact that the buyer may keep the goods is immaterial: if the goods are worthless,
neither seller nor buyer likely have any interest in them.
50 Finally, the fact that price reduction is not time-barred when avoidance would be
does not justify precluding a price reduction to zero. The CISG does not permit courts
to set a minimum value below which price reduction becomes unavailable. To attempt
to do so for cases of complete worthlessness leaves buyers in a far better position when
goods have a nominal remaining value than when goods are worthless.
c) Claim for restitution/repayment
51 aa) Legal basis. If the buyer has already paid the full purchase price before declaring
price reduction under Art. 50, he may claim restitution for what he has paid in excess of
the reduced price.
52 The legal basis for this claim is widely held to be Art. 50 itself.77 Since the language of
Art. 50 extends price reduction to cases where the buyer has already paid the purchase
price, it implies that the buyer is entitled to claim back any excess amounts. However,
since a right to restitution is not expressly mentioned in Art. 50, some authors argue
that the buyer must resort to Art. 81(2)’s restitution provisions for buyers who have
avoided a contract post-payment.78 While the debate at first glance seems to be largely
moot since a restitution claim under Art. 50 or Art. 81(2) generates identical results in
practice, the issue becomes relevant in respect to the claim for interest. In this regard,
the most consistent solution appears to consist in basing all repayment claims on
Art. 82(1) (see in detail infra paras 57 et seq.).
53 bb) Currency. As a rule, restitution must be made in the same currency as the
buyer’s original payment, even if that currency was not the currency the parties agreed
to in the contract.79
54 cc) Place of performance. The place where the seller has to repay the sums paid in
excess is not addressed by Art. 50. However, the location of restitution has relevance
where jurisdictional rules grant personal jurisdiction over the seller at the place where
his repayment obligation should be performed. Since the issue is addressed within the
CISG, it is an internal gap that must be filled by reference to general principles of the
CISG.80 In this case, such principles may be derived from provisions governing the place
of performance of the original payment and delivery obligations.
55 When faced with the same question under the ULIS, the (German) Bundesgerichtshof
found that the place of both “original” performances was located at the seller’s premises.
Following this principle it held, that the place of restitution should be located at the
76 Because of the different calculation methods (cf. supra paras 36 et seq.) minor differences would
occur in the case that the goods were purchased above or below market price. While price reduction
would de facto lead to the buyer’s claim amounting to the purchase price, the damages claim would be
limited to the market price, i. e. the value of the (conforming) goods.
77 Cour de Justice de Genève (Switzerland) 15 November 2002 (Window Frames), CISG-Online 853;
Huber, in: MünchKommBGB (2015), Art. 50 para. 26; Müller-Chen, in: Schlechtriem/Schwenzer, Com-
mentary (2016), Art. 50 para. 16; Saenger, in: Ferrari et al., Internationales Vertragsrecht (2011), Art. 50
para. 6; Magnus, in: Staudinger, Kommentar (2013), Art. 50 para. 25; Schnyder/Straub, in: Honsell,
78 Audit, Vente Internationale (1990), p. 138; Karollus, Kommentar (1997), p. 157.
Art. 50 para. 25.

80 Art. 7(2).
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seller’s place of business as well.81 The (German) Oberlandesgericht Hamm took a
different approach, holding that seller may be sued for restitution at the place where
the goods were originally to be delivered.82 Unfortunately, the court gave no reasons for
its decision.
At present, jurisprudence and legal literature seem to have agreed on another 56
approach. They see Art. 57(1)(a) – which provides that the place of payment is generally
the seller’s place of business – as containing a general CISG principle: payment is to be
performed at the creditor’s place of business.83 Thus, the place of performance for a
seller’s obligation to repay a buyer’s excess payments is the buyer’s place of business.
dd) Interest. If the buyer has paid the purchase price before declaring price reduc- 57
tion, he is entitled to interest on the sum he claims in restitution. Although all agree that
the buyer is entitled to interest, the legal basis for his claim remains subject to some
debate. While most authors base interest claims on Art. 78,84 others rely on Art. 84(1).85
This debate has consequences for the buyer’s recovery: under Art. 84(1), interest is
owed from the date the price was paid, but under Art. 78, interest must be paid on any
sum that is “in arrears.” Since an Art. 50 (or 81(2)) repayment claim is not in arrears
until the buyer has declared price reduction,86 interest under Art. 78 claims begins to
accrue on a different date than it would under Art. 84(1).87
From a dogmatic perspective, if restitution is granted under Art. 50 instead of 58
Art. 81(2), Art. 78 should provide the applicable interest calculations. However, this
would produce a discrepancy: restitution in cases of avoidance – calculated on the basis
of Art. 84(1) – would be treated differently than the “partial restitution” of price
reduction cases. Thus, the most consistent solution appears to consist in basing all
repayment claims on Art. 82(1), resulting in interest calculated under Art. 84(1). Some
scholars have argued that Arts 50 and 78 should be applied nonetheless, with repayment
claims views as “in arrears” under Art. 78 at the original time of payment.88 However,
such a solution requires some conceptual twisting: since there can be no claim to price
reduction before a declaration, there can also be no pre-declaration sum “in arrears.”
Interest on excess payments may also be claimed as damages under Arts 45(1)(b), 74, 59
since by not restituting the overpaid sum the seller violates an obligation under the
CISG. Such a claim would allow a buyer to recoup losses that arise when he has
81Bundesgerichtshof (Germany) 22 October 1980, BGHZ 78, 257, 260 seq. (NJW (1981) 1158).
82Oberlandesgericht Hamm (Germany) 5 November 1997 (Inline skates), CISG-Online 381 with
reference to Huber, in: Caemmerer/Schlechtriem (2nd German edition, 1995), Art. 50 para. 16.
83 Huber, in: MünchKommBGB (2015), Art. 50 para. 27 and Art. 57 para. 32; Magnus, in: Staudinger,
Kommentar (2013), Art. 50 para. 25 and Art. 57 para. 23; Altenkirch, in: Brunner, Kommentar (2014),
Art. 50 para. 11; see further Oberlandesgericht Düsseldorf (Germany) 2 July 1993 (Veneer cutting
machine), CISG-Online 74 (BeckRS 1993, 31009121); Cour d’Appel de Grenoble (France) 23 October
1996 (Stock equipment), CISG-Online 305; Landgericht Gießen (Germany) 17 December 2002 (Warning
triangles), CISG-Online 766; Maskow, in: Bianca/Bonell, Commentary (1987), Art. 57 para. 3.2; Huber, in:
Huber/Mullis, The CISG (2007), p. 314; Hager, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 57
para. 25; – contra Witz, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), pp. 428 et seq.
KommBGB (2015), Art. 50 para. 28; Schnyder/Straub, in: Honsell, Kommentar (2010), Art. 50 para. 52;
Piltz, Internationales Kaufrecht (2008), para. 5–359.
85 Magnus, in: Staudinger, Kommentar (2013), Art. 50 para. 26; Enderlein/Maskow, International Sales
Law (1992), Art. 50 para. 4.3; Hartmann, in: BeckOGK (2016) Art. 50 para. 38.
86 See for the constitutive character of the declaration supra para. 4.
87 Even if one was to grant interest under Art. 78 CISG already for the time the “right” to reduce the
purchase price existed (cf. Hirner, Der Rechtsbehelf der Minderung nach dem UN-Kaufrecht (2000),
p. 416), the difference would persist because the right to price reduction arises at the time of delivery of
the non-conforming goods but not at the time of payment of the purchase price.
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borrowed to pay the purchase price and is faced with a base rate on his debt that is
higher than the Art. 84(1) or Art. 78 interest rate. Of course, a damages claim is always
subject to the restrictions of Arts 77 and 79, although it is near impossible to imagine a
force majeur that could impede a repayment. Still, claiming interest through Arts 84(1)
or 78 offers the buyer the procedural amenity of not needing to prove any concrete loss.
3. Burden of proof
60 The burden of proof for the non-conformity of the goods shifts between buyer and seller
as outlined in Art. 46.89 First, the buyer must prove the existence of the obligation that has
allegedly been breached, i. e. the contractual agreement on a certain quantity and quality of
the goods. If successful, the burden shifts to the seller to prove that he has fulfilled the
obligation.90 However, in regard to the (non-)conformity of the goods, the burden of proof
shifts back to the buyer when he has accepted delivery without complaints or reservations.91
61 Since the priority of the seller’s right to cure constitutes an exception in the seller’s
favour, the burden again falls to the seller to prove that either (a) he has cured the
defect, or (b) the buyer unjustifiably refused to accept cure.92
62 Conversely, the buyer must prove all elements necessary for calculating a price
reduction: the purchase price; the value of the delivered non-conforming goods; and
the value the goods would have had if they had conformed to the contract.93 If no
market for the goods exists – often the case with non-conforming goods – proving a
specific value for the goods may be nearly impossible. In such a case, the value of the
non-market goods will be estimated – if the procedural law of the lex fori so permits.94 If
it does, two presumptions govern the estimation: first, that the value of the conforming
goods equals the purchase price;95 and second, that the decrease in value is equal to the
costs a buyer would incur in repairing the goods.96 However, if these presumptions are
applied simultaneously, the result is equal to what the buyer would receive by simply
claiming damages. The peculiarities of the proportional method no longer have any
effect.
89See Art. 46 para. 54.

90Hepting/Müller, in: Baumgärtel/Laumen/Prütting (eds), Handbuch der Beweislast im Privatrecht
(2009), Art. 50, para. 2; Huber, in: MünchKommBGB (2015), Art. 50 para. 35.
91 Bundesgerichtshof (Germany), 8 March 1995 (Mussels from New Zealand), CISG-Online 144 = NJW
1995, 2099; Bundesgerichtshof (Germany) 9 January 2002 (Milk powder), CISG-Online 651; Bundesgericht
(Switzerland) 13 November 2003 (Used Textile Cleaning Machine), CISG-online 840; Bundesgericht
(Switzerland) 7 July 2004 (Conduction pipes and cables), CISG-Online 848; Bundesgericht (Switzerland),
16 July 2012 (Spinning Plant), CISG-Online 2371; Huber, in MünchKommBGB, Art. 45 para. 19; see in
more detail Art. 35 para. 169 et seq.
92 Hepting/Müller, in: Baumgärtel/Laumen/Prütting (eds), Handbuch der Beweislast im Privatrecht
(2009), Art. 50, paras 9 et seq.; Huber, in: MünchKommBGB (2015), Art. 50 para. 35.
(2009), Art. 50, paras 4 et seq.

Huber, in: MünchKommBGB (2015), Art. 50 para. 35; Magnus, in: Staudinger, Kommentar (2013),
Art. 50 para. 34.
Huber, in: MünchKommBGB (2015), Art. 50 para. 35; Benicke, in: MünchKommHGB (2013), Art. 50
para. 10 a.
96 Amtsgericht Nordhorn (Germany) 14 June 1994 (Shoes), CISG-Online 259; Benicke, in: Münch-
KommHGB (2013, Art. 50 para. 9; Huber, in: Schlechtriem, Commentary (1998), Art. 50 para. 9;
however, the Handelsgericht Zürich (Switzerland) 10 February 1999 (Art books), CISG-Online 488,
denied the possibility to deduce the decreased value from the costs for repair.
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4. Interaction with other remedies

a) Effects of price reduction to other remedies. If the buyer declares price reduction, 63
he may no longer demand delivery of substitute goods or repair,97 nor may he declare
avoidance.98 Thus, a subsequent declaration of avoidance will be valid only if the buyer
simultaneously revokes his declaration of price reduction – as long as the buyer is allowed
to do so. However, the majority of legal scholars doubt that the CISG allows such a
revocation.99
As discussed above, the remedy of price reduction exists for the same purposes as 64
damages claims, and both often lead to similar results.100 Thus, a buyer who claims price
reduction is barred from a damages action to recoup the decreased value of defective
goods.101 Whether the buyer may switch from price reduction declaration to a damages
action depends – as discussed in the previous paragraph – on whether the buyer is
permitted to revoke his price reduction declaration.102 However, if the buyer suffers losses
beyond a decrease in value to the goods, he may recoup these losses through damages while
simultaneously remedying the decreased value of the goods through price reduction.103
b) Effects of other remedies to price reduction. A declaration of avoidance precludes 65
a subsequent declaration of price reduction. Predominant opinion regards declarations
of avoidance as irrevocable, thus rendering a post-avoidance conversion to price
reduction impermissible.104
If the buyer has requested substitute delivery or repair, he may declare price 66
reduction at any time thereafter – with several exceptions. First, Art. 50 precludes the
buyer from declaring price reduction when a seller’s performance qualifies as a cure
under Arts 37, 48(1), or 48(2). Second, if the buyer sets a Nachfrist for the seller’s
performance, Art. 47(2) bars the buyer from invoking any other remedy until the
Nachfrist has expired. Last, the buyer’s duty of good faith may preclude a buyer from
declaring a price reduction after the buyer has demanded full performance from the
seller and the seller has already incurred (substantial) expenses in complying.105
As discussed above, predominant opinion holds that a buyer may no longer claim the 67
decreased value of defective goods as damages after he has declared price reduction.106
However, the opposite is not true: a claim for damages does not bind the buyer in the
same manner as a price reduction declaration. Thus – until the damages claim has been
paid – claiming the decreased value of defective goods as damages does not preclude the
buyer from abandoning the damages claim to switch to a price reduction declaration.
97 Art. 46(2),(3); Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 50 para. 17;
Huber, in: MünchKommBGB (2015), Art. 50 para. 33; Altenkirch, in: Brunner, Kommentar (2014),
Art. 50 para. 12.
KommBGB (2015), Art. 50 para. 33; Altenkirch, in: Brunner, Kommentar (2014), Art. 50 para. 12.
100 See for the differences supra paras 3 and 37 et seq.
101 Bundesgericht (Switzerland) 28 October 1998 (meat), CISG-Online 413; Huber, in: Münch-
KommBGB (2015), Art. 50 para. 30; Altenkirch, in: Brunner, Kommentar (2014), Art. 50 para. 3.
103 Amtsgericht Luzern-Land (Switzerland) 21 September 2004 (Watches), CISG-Online 963; Cour de
Justice de Genève (Switzerland) 15 November 2002 (Window Frames), CISG-Online 853; Huber, in:
104 See Huber, in: MünchKommBGB (2015), Art. 50 para. 34.
105 Piltz, Internationales Kaufrecht (2008), para. 5–343; Magnus, in: Staudinger, Kommentar (2013),
Art. 50 para. 32.

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68 The remedy of price reduction is effectively unknown in common law legal systems.
The buyer, however, often reaches a similar (but not identical107) result by offsetting his
damages for the loss in value (which are granted independently of fault on the seller’s
side) against the seller’s claim for the purchase price. The PICC also provides no
remedy of price reduction.
69 The PECL has adopted the remedy of price reduction. Art. 9:401 PECL contains a
rule very similar to Art. 50 CISG: “A party who accepts a tender of performance not
conforming to the contract may reduce the price. This reduction shall be proportionate
to the decrease in the value of the performance at the time this was tendered compared
to the value which a conforming tender would have had at that time.”
70 Thus, the PECL provides the same solution as the CISG does: price reduction is
calculated with the proportional method discussed above, and the relevant time for
valuing the defective goods is the time at which the seller tenders performance.
Art. 9:401(2) PECL provides that the buyer may declare price reduction even after he
has paid the seller, in which case he would recover what he had paid in excess of the
value of the defective goods.108 Art. 9:401(3) PECL also precludes buyers who have
declared price reduction from revoking their declaration to sue for damages.109
71 The PECL differs from the CISG only concerning the effect of the seller’s right to
cure to a price reduction declaration. Whereas the CISG grants explicit priority to the
right to cure, PECL provisions operate to provide the opposite. Under Art. 8:104 PECL,
only when the buyer rejects the goods as not conforming with the contract may the
seller first offer to cure. If, however, the buyer accepts the seller’s goods despite their
non-conformity, the seller has no right to cure. Since on the other hand the buyer may
claim price reduction only when he has accepted the goods, the seller’s right to cure
cannot interfere with the buyer’s right to price reduction.
72 The price reduction provisions of the DCFR (Art. III.-3:601) are identical to those of
the PECL with the exception of its cure provisions. Under Art. III.-3:202 DCFR the
seller’s right to cure exists independently of whether the buyer has rejected the goods.
Thus, in the end, the price reduction provisions of the DCFR are identical to those
within the CISG.
107 See supra paras 3 and 37 et seq.
108 The same rule exists under the CISG; see supra para. 35.
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Article 51
(1) If the seller delivers only a part of the goods or if only a part of the goods
delivered is in conformity with the contract, Articles 46 to 50 apply in respect of the
part which is missing or which does not conform.
(2) The buyer may declare the contract avoided in its entirety only if the failure to
make delivery completely or in conformity with the contract amounts to a funda-
mental breach of the contract.
Outline
1. The general rule: narrowing the view under Art. 51(1). . . . . . . . . . . . . . . . . . . . . 1
2. The exception: re-expanding the view under Art. 51(2) . . . . . . . . . . . . . . . . . . . . 3
3. Application to instalment contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
1. Prerequisites . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
a) Divisibility. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
b) Defects in title . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
c) Violation of duties other than the delivery of goods . . . . . . . . . . . . . . . . . . . . 17
2. Legal consequences . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
a) General and scope . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
b) Buyer’s remedies under Art. 51(1): specific performance, repair,
substitute delivery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
aa) Cases of partial non-conformity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
bb) Cases of partial non-delivery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
cc) Analogous application of Art. 51(2)?. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
c) Avoidance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
aa) Partial avoidance due to partial non-conformity. . . . . . . . . . . . . . . . . . . . 29
bb) Partial avoidance for partial non-delivery . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
cc) Avoidance of the entire contract, Art. 51(2). . . . . . . . . . . . . . . . . . . . . . . . . 34
d) Price reduction. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
aa) Partial non-conformity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
bb) Partial non-delivery. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
e) Damages. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
f) Rejection of delivery. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
3. Burden of proof . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
1. The general rule: narrowing the view under Art. 51(1)

In cases of partial non-delivery or partial non-conformity, Art. 51(1) narrows the view 1
to the missing or non-conforming portion of the seller’s performance. The remedies
provided in Arts 46 to 50 are applied in respect to this portion only (note: this does not
include the remedy of damages which is provided for in Arts 45(1)(b), 741). At first glance,
Art. 51(1)’s partial-application rule may appear purely declaratory in light of Art. 46(3),
1 Magnus, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), Art. 51 note 2; Huber, in:
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which allows buyers to claim repair only for the defective portions of deliveries.2 However,
the provision is of great importance in the context of avoidance for several reasons. First,
many legal systems lack mechanisms for “partially avoiding” a contract, as Art. 51(1)
allows.3 Second, without Art. 51(1) expressly governing partial non-delivery, buyers would
not have free reign to argue that a partial non-delivery constitutes a “case of non-delivery”
under Art. 49(1)(b) that allows them to avoid the entire contract.4
2 Narrowing the view to the missing or non-conforming portion of the seller’s
performance therefore provides benefits to both buyer and seller. On the one hand,
the seller need not worry that the buyer will attempt to question the entirety of his
performance when only a portion of it is defective. At the same time, the buyer retains
mechanisms that provide him with the full benefit it bargained for.
2. The exception: re-expanding the view under Art. 51(2)

3 While subsection (1) of Art. 51 permits the application of most CISG remedies only
to the nonconforming or missing portion of a seller’s performance, subsection (2)
contains a narrow exception that applies solely to the remedy of avoidance. It allows to
re-expand the view to the entire contract if the partial non-delivery or non-conformity
constitutes a “fundamental breach” of the contract. As a remedy, Art. 51(2) is duplica-
tive: Art. 49(1)(a) independently provides buyers the right to avoid for any fundamental
breach, including partial non-delivery. However, the duplication has its rationale:
fearing diverging national interpretations of buyers’ rights in cases of partial perfor-
mance, the CISG drafters decided to expressly duplicate the remedy contained in
Art. 49(1)(a) in the Art. 51(2)’s provisions regulating partial non-performance.
3. Application to instalment contracts

4 If the parties have agreed to delivery in instalments, Art. 73 provides a lex specialis
that – within its scope of application – prevails over Art. 51.5 Therefore, if an entire
instalment is not delivered or if an instalment is defective in its entirety, only Art. 73
applies.6
5 The remaining disputes therefore focus on whether Art. 51 applies if part of a single
instalment is missing or defective. The minority view is simple: Art. 73 eliminates any
application of Art. 51 to instalment contracts.7 Conversely, the majority of authors
argue that Art. 51 remains available to the buyer for limited actions with regard to a
single instalment.8 If the buyer wants to declare partial avoidance regarding the missing
or defective part of the instalment, he may do so under Art. 51(1). Likewise, if he wants
to avoid the entire instalment, he may do so under the requirements set out by
Art. 51(2). However, if the buyer seeks to avoid the entire instalment contract, he may
do so only under Arts 73(2) and (3).
3 Honnold, Documentary History (1989), p. 434; cf. Schnyder/Straub, in: Honsell, Kommentar (2010),
Art. 51 para. 5.
4 See in detail infra paras 31 et seq.
Commentary (2016), Art. 51 para. 3; Magnus, in: Staudinger, Kommentar (2013), Art. 51 para. 6; Benicke,
in: MünchKommHGB (2013), Art. 51 para. 3.

7 Magnus, in: Staudinger, Kommentar (2013), Art. 73 para. 7 (but Art. 51 para. 6).
Commentary (2016), Art. 51 para. 3; Benicke, in: MünchKommHGB (2013), Art. 51 para. 3; Altenkirch,
in: Brunner, Kommentar (2014), Art. 51 para. 2.
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The difference between majority and minority opinions has no effect on a buyer 6
seeking to avoid an entire instalment: both Art. 51(2) and Art. 73(1) require a funda-
mental breach with respect to that instalment before a buyer may avoid. Instead, the two
opinions diverge solely on the availability of partial avoidance as a remedy for the missing
or9 defective part of a single instalment. This possibility is only provided for by Art. 51(1).
The rationale in favour of allowing Art. 73 to fully displace Art. 51 contains one part 7
clear text reading, one part concern for the systematic integrity of the CISG. Under the
clear text claim, Art. 73(1) expressly governs the case of a partially-performed instal-
ment. The provision’s wording states that it applies whenever the seller fails to “perform
any of his obligations,” and such wording encompasses a defect in quantity as well as a
partial defect in quality. Thus, Art. 73 should provide the exclusive rules for partially-
performed instalments. However, the only remedy that Art. 73 provides buyers is
avoiding the entire instalment. The fact that this possibility is provided for, while the
possibility of a partial avoidance is not, argues against allowing partial avoidance of
single instalments. Under the systematic integrity claim, allowing partial avoidance
under Art. 73(1) would turn the rule-exception relationship of the Art. 51 subsections
on its head. Under Art. 51, partial avoidance is the rule while an entire avoidance
remains the exception. Allowing Art. 51(1) to apply to single instalments would leave
entire avoidance as the rule and relegate partial avoidance to an exception.
Despite these strong systematic concerns, this author sees better reasons for allowing 8
partial avoidance. Simply put, there is no reason that justifies treating partial delivery
under an instalment contract differently from partial delivery under a regular contract.
If 10 out of 1000 cars do not run, these ten cars remain fundamentally defective
regardless of the timing of delivery: it does not make a difference whether these 10
cars are delivered together with the remaining 990 in one single shipment or whether
they are delivered with only 90 other cars in an instalment.

1. Prerequisites
a) Divisibility. Narrowing the view to the missing or defective part of a delivery is 9
feasible only when this defective portion may be addressed independently from the rest
of the shipment. In technical terms, the missing or defective part must be divisible from
the remainder of the shipment.10 Although easy to conceptualize, the borderline
between divisible and indivisible may be hard to draw. If 100 cars are delivered of
which 10 do not start, Art. 51 easily applies to the 10 defective cars. But is the trailer
divisible from the tractor? Are the tyres divisible from the rest of the tractor? Is the
tailpipe?
Courts as well as academic writers conceive the standard of divisibility to consist in 10
physical and economic independence: when single parts are physically and economically
independent such that they could be sold to different customers as well as in their
present configuration, the parts are divisible for purposes of Art. 51.11 Courts have held
9 In case of a partial non-delivery the difference is again eliminated by the buyer’s right to reduce the
purchase price, cf. Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 51 para. 6.
10 Honnold/Flechtner, Uniform Law (2009), Art. 51 para. 316; Huber, in: MünchKommBGB (2015),
Art. 51 para. 2; Magnus, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), Art. 51 para. 2;
Will, in: Bianca/Bonell, Commentary (1987), Art. 51 para. 2.1.1.
11 Oberster Gerichtshof (Austria) 21 June 2005 (Software), CISG-Online 1047; Müller-Chen, in: Schlech-
triem/Schwenzer, Commentary (2016), Art. 51 para. 2; Benicke, in: MünchKommHGB (2013), Art. 51
para. 2.
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the following goods to be divisible from one another: single modules and standard
software;12 inventory of a café;13 textiles in different colours and sizes;14 different pairs of
shoes15, scaffolding fittings;16 fabrics that are sold in running (or square) meters;17 larger
quantities of steel wire/wire rod;18 and spare parts of an assembly line for batteries19. By
contrast, divisibility has been denied for a set of samples,20 and a spinning plant.21
11 However, the “physical and economical independence test” can only be the first of
two necessary steps in order to assess divisibility under Art. 51. The main purpose of the
divisibility requirement is to determine the legal consequences of a seller’s partial
performance. If a car’s tailpipe is corrosive upon delivery, the reason for which partial
avoidance may be undesirable is not the fact that the buyer cannot return the tailpipe to
the seller, nor is it the fact that the completed car itself forms an economic unit. Instead,
partial avoidance is undesirable because the extent of the seller’s duty to compensate the
buyer is not ascertainable. If a portion of the purchase price cannot be allocated to the
tailpipe, it will be difficult to determine the extent to which the restitution of this
purchase price is to be made. As a result, the standard of divisibility must be whether or
not the “price” of the missing or defective portion of the seller’s performance is fixed by
or at least ascertainable from the contract.22
12 The result is a two-part test to determine whether one object is divisible from
another. The first step is concerned with the physical and economic independence of
the parts: whether the parts can be sold independently from each other; the second step
concerns itself with identifiability of price: whether the price of the defective or non-
delivered portion the seller’s performance is fixed, or can be ascertained from, the terms
of the sales contract.
13 Applying the above analysis to a sale of tractors and trailers, they pass the first step of
the test: tractors and trailers can be sold independently from each other. Regarding the
second step of the test, the contractual terms become decisive. If the contract calls for
“10 tractors at 30,000 E each and 10 semitrailers at 20,000 E each,” the plain wording of
the contract itself treats tractors as divisible from trailers. If the contract calls for “10
lorries at a price of 50,000 E each,” a different result may obtain. The plain wording of
the contractual terms makes no effort to differentiate tractors from trailers. Still, if the
seller sells tractors and trailers separately in the usual course of business, and if both
goods have list prices which sum equals the contractual purchase price, tractor and
trailer may be found divisible. Concerning the tyres: since the price of tyres is not
usually identified in the contract, the tyres are not divisible. Also, the option to refer to a
list price of the seller is not present, since the price of a car does not equal the sum of its
12Oberster Gerichtshof (Austria) 21 June 2005 (Software), CISG-Online 1047.

13Oberlandesgericht Hamburg (Germany) 25 January 2008 (Inventory for a cafe), CISG-Online 1681.
14 Oberlandesgericht Frankfurt (Germany) 21 December 1982 (Textiles), summarized in: Schlechtriem/
Magnus, Internationale Rechtsprechung zu EKG und EAG (1987), Art. 45 para. 2.

15 Oberlandesgericht Koblenz (Germany) 21 November 2007 (shoes), CISG-Online 1733 (BeckRS 2008,
19974); Oberlandesgericht Koblenz (Germany) 18 May 1984 (Shoes), summarized in: Schlechtriem/
16 Arbitral Award, ICC 7531/1994 (Scaffold fittings), CISG-Online 565.
17 Oberlandesgericht Düsseldorf (Germany) 10 February 1994 (Fabrics), CISG-Online 115 = NJW-RR
(1994) 506.
18 Bundesgerichtshof (Germany) 25 June 1997 (Stainless wire), CISG-Online 277 = NJW (1997) 3311.
19 Arbitral Award, ICC 7660/JK, 23 August 1994 (Assembly line), CISG-Online 129.
20 Oberlandesgericht Frankfurt (Germany) 21 December 1982 (Textiles), summarized in: Schlechtriem/

21 Bundesgericht (Switzerland), 16 July 2012 (Spinning plant), CISG-Online 2371.
22 Concurring Altenkirch, in: Brunner, Kommentar (2014), Art. 51 para. 3; Hartmann, in: BeckOGK
(2016) Art. 51 para. 7.
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components. Still, the opposite may be true for snow tyres purchased separately from a
car’s standard equipment.
The second step of the test also becomes relevant when a certain amount of goods are 14
sold (100 cars, 100 tons of rice) and only a portion is actually delivered (80 cars or tons
of rice): here divisibility depends on whether the seller offers the goods at a constant
price per item/weight or whether the price per item/weight decreases the more items are
sold. In the latter case the goods are not divisible.
b) Defects in title. Art. 51(1) applies only when a portion of the goods are missing or 15
do not conform to the contract. This gives rise to the question of whether third party
claims encumbering a portion of the delivered goods constitute a partial “non-con-
formity” that allows Art. 51(1) to apply. Most authors understand the term “non-
conformity” as a technical term that should be interpreted consistently throughout
the CISG as not including defects in title.23 These authors rely on the heading of
Chapter II Section II which mentions “conformity of the goods” in addition to “third
party claims.” From this wording, the authors conclude that the CISG distinguishes
between non-conformity (dealt with in Arts 35 to 40) and defects in title (dealt with in
Arts 41 to 43).24
In this author’s opinion, what has been developed under Art. 5025 must apply to 16
Art. 51(1) as well: de lege lata the majority opinion should be followed. Legal certainty
calls for a consistent interpretation of the term non-conformity throughout the CISG.
De lege ferenda, however, an extension of Art. 51(1) to defects in title is desirable
because no compelling reasons require treating nonconformity differently from defects
in title. Moreover, since the distinction between non-conformity and defects in title is
sometimes hard to draw, this distinction causes as much legal uncertainty as it was
introduced to prevent. Some legal literature proposes to apply Art. 51 to defects in title
indirectly by way of analogy.26 This appears to be an appropriate solution.
c) Violation of duties other than the delivery of goods. The wording of Art. 51 limits 17
its application to two cases: partial non-delivery and partial defective delivery. In either
case, the partial violation involves only the seller’s duty to deliver the goods. However,
every sales contract will provide for other obligations to which Art. 51 may apply by
way of analogy.27 For example, if the parties have agreed to delivery CIF the seller is
obligated to insure the goods against damages in transport. If he insures only a portion
of the goods, the buyer should be allowed to “narrow his view” to the uninsured portion
of the goods for remedies purposes. As a result, the buyer may either claim performance
from the seller (i. e. demand that the seller insure the goods) or even partially avoid the
contract if the failure to insure part of the goods amounts to a fundamental breach in
regard to this part of the goods.
23 Honnold, Documentary History (1989), p. 426; Schlechtriem/Butler, CISG (2009), para. 202; Müller-
Chen, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 50 para. 2; Huber, in: Huber/Mullis, The
CISG (2007), p. 248; Schwenzer, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 41 para. 20;
Benicke, in: MünchKommHGB (2013), Art. 50 para. 2; Schnyder/Straub, in: Honsell, Kommentar (2010),
Art. 50 para. 11.
27 Oberlandesgericht Hamburg (Germany), 25 January 2008 (Inventory for a cafe), CISG-Online 1681 =
IHR 2008, 98; Magnus, in: Staudinger, Kommentar (2013), Art. 51 para. 20; Huber, in: MünchKommBGB
(2015), Art. 51 para. 21; Benicke, in: MünchKommHGB (2013), Art. 51 para. 16; Hartmann, in: BeckOGK
(2016) Art. 51 para. 11; contra Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 51
para. 1 note 1.
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18 a) General and scope. As discussed above, Art. 51(1) narrows the applicability of
CISG remedy provisions to the missing or defective portion of a seller’s performance.
However, it does so only for remedies contained in Arts 46 to 50. As a result, disputes
remain in legal literature as to whether Art. 51(1) influences the applicability of the
non-conformity provisions of Arts 35 et seq. as well.28
19 The debate becomes relevant in the case of a defect in quantity. If the seller delivers
less than the agreed quantity, his delivery constitutes a non-conformity under Art. 35 –
with the consequence under Art. 39 that the buyer must notify the seller of the non-
conformity if he wishes to retain his right to rely on it. If, in this regard, one would
narrow the view to the missing part, the defect in quantity would turn into a non-
delivery (in regard to the respective part). A non-delivery, however, is not comprised by
Art. 35 and is therefore not subject to the notification requirement of Art. 39.29 It is
submitted that the wording of Art. 51(1) requires an Art. 35 analysis to govern all
quantity deficiencies. Art. 51(1) only refers to the provisions of Arts 46 to 50, which deal
exclusively with the legal consequences of a breach of contract. Thus, Art. 51(1) does
not displace provisions containing the requirements for finding a breach of contract, i. e.
Arts 35 to 44.30 As a result, every partial non-delivery must constitute a defect in
quantity under Art. 35(1) so that the buyer may claim breach in the first place.
According to Art. 39, the buyer must notify the seller of the defect.31
20 It is to be noted however that where this limitation of the provision’s scope of
influence would lead to inappropriate results, certain exceptions must be allowed.
Therefore, e. g., the view must be narrowed in regard to Art. 82(1) as well.32 The buyer’s
right to partially avoid the contract may obviously only be excluded if he cannot make
restitution of the defective goods. Whether or not he could make restitution of the
remaining (i. e. conforming) goods cannot be of any relevance.
b) Buyer’s remedies under Art. 51(1): specific performance, repair, substitute delivery
21 aa) Cases of partial non-conformity. Art. 51(1) specifically limits the remedies of
repair and substitute delivery to the non-conforming portion of a seller’s performance.
For cases involving repair, such a limitation will always make sense: neither seller nor
buyer have any interest in repairing goods that conform to contractual terms
(Art. 46(2)). However, the same will not always be true in cases where the buyer desires
substitute delivery. In certain circumstances, the buyer may need to replace all delivered
goods including those in conformity with the contract.
22 For example, a buyer orders floor tiles, but the only tiles the seller has to offer in
replacement are of a slightly different colour. Here, the seller’s partial non-performance
28 Cf. for a detailed overview on the opposing opinions Huber, in: MünchKommBGB (2015), Art. 51
para. 8.
30 Huber, in: Huber/Mullis, The CISG (2007), p. 294; Schwenzer, in: Schlechtriem/Schwenzer, Com-
mentary (2016), Art. 35 para. 8; Gruber, in: MünchKommBGB (2015), Art. 35 para. 7; Müller-Chen, in:
Schlechtriem/Schwenzer, Commentary (2016), Art. 51 para. 8; Altenkirch, in: Brunner, Kommentar
(2014), Art. 51 para. 5; contra Enderlein/Maskow, International Sales Law (1992), Art. 35 para. 3; Salger,
in: Witz/Salger/Lorenz, Kommentar (2016), Art. 35 para. 6.
31 Oberlandesgericht Düsseldorf (Germany) 8 January 1993 (Cucumbers), CISG-Online 76 = NJW-RR
(1993) 999; Magnus, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), Art. 51 para. 2; Huber,
in: MünchKommBGB (2015), Art. 51 para. 8; Schwenzer, in: Schlechtriem/Schwenzer, Commentary
(2016), Art. 35 para. 8; Gruber, in: MünchKommBGB (2015), Art. 35 para. 7; Altenkirch, in: Brunner,
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endangers the very purpose for which the buyer entered into the contract. The buyer’s
situation is therefore at least analogous to the fundamental breach of Art. 51(2), and the
buyer therefore may argue that he is entitled to substitute delivery of the entire order
(see in detail infra paras 25 et seq.).
bb) Cases of partial non-delivery. For cases of partial non-delivery, Art. 51 limits 23
buyers’ remedies to specific performance under Art. 46(1) for the non-delivered portion
of the seller’s performance.33 It is worth noting that, as CISG remedies are concerned,
Art. 46(1) specific performance is not the buyer’s usual remedy: defective performance
under Art. 35 entitles the buyer to demand only repair or substitute goods under
Art. 46(2) and (3).34 However, as a result of Art. 51(1) the buyer seeks to remedy a
“non-delivery,” not a mere defect in quantity, and may therefore demand delivery of
non-delivered goods under Art. 46(1).
As in cases of partial non-conformity, a buyer who receives an incomplete shipment 24
may in some situations have an argument that he is entitled to replacement of all
delivered goods. For whether Art. 51(2) applies to such a situation, see infra paras 25
et seq.
cc) Analogous application of Art. 51(2)? Under certain circumstances, narrowing 25
the view to the missing or defective portion of a seller’s performance may impair the
buyer’s interests. The danger is best illustrated by an example: assume a buyer ordered
200m2 of tiles for his office floor. Of these 200m2, only 150m2 were delivered, or only
150m2 were in conformity with the contract. The buyer therefore required the seller
under Art. 46 to replace the 50m2 of missing or non-conforming tiles. However, the
replacement tiles originated from a different production run, and were a slightly
different colour from the tiles the buyer received.
As is obvious, the buyer’s contractual interests are served only by replacing all 200 m2 26
of tile. Nevertheless, Art. 51(1) restricts the reach of the buyer’s remedies to the non-
conforming 50m2. The exception of Art. 51(2) offers the buyer no further help. Even if
Art. 51(2) allows the buyer to claim that 50m2 of non-matching tiles constitutes a
fundamental breach of the contract, the clear wording of Art. 51(2) leaves the buyer
with no remedy but avoidance.35 Thus, the buyer is left with the choice of either
avoiding the entire contract – and possibly losing a good bargain – or finding a spot in
his office where no one will notice a different shade of tile.
The issue therefore becomes whether the buyer may argue that a seller’s Art. 51(2) 27
fundamental breach entitles it to substitute performance of the entire contract by the
seller. Unfortunately for the buyer, the structure of CISG remedies provisions argues
against allowing such a claim. In normal cases of avoidance, the buyer must give the
seller notice of a fundamental breach, after which Art. 48 gives the seller the option of
remedying the breach with a substitute delivery. As a result, after a fundamental breach
the seller retains the option, but not the obligation, to deliver substitute goods from his
inventory. His only obligation in avoidance cases is to re-accept the defective goods into
inventory. To allow buyers to argue that Art. 51(2) grants them a right to substitute
performance of the entire contract turns this structure on its head: sellers would be
obligated to reach into their inventories, whether or not doing so lies in their interests,
33 Huber, in: MünchKommBGB (2015), Art. 46 para. 8 and Art. 51 para. 10; Müller-Chen, in: Schlech-
triem/Schwenzer, Commentary (2016), Art. 51 para. 6; Magnus, in: Staudinger, Kommentar (2013),
Art. 51 para. 12; Benicke, in: MünchKommHGB (2013), Art. 51 para. 5; contra Schnyder/Straub, in:
34 See in detail Art. 46 para. 2.
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in order to protect the interests of the buyer. Thus, in order to protect the integrity of
CISG avoidance, Art. 51(2) should not allow buyers to demand complete substitute
performance from sellers.
28 c) Avoidance. The bulk of litigation surrounding Art. 51 has been generated by
buyers seeking the remedy of avoidance. The ability to “partially avoid” a contract –
made possible by Art. 51(1)’s limitation of avoidance to the defective portion of
performance – leads to significant and often unforeseen legal consequences.
29 aa) Partial avoidance due to partial non-conformity. In cases of partial non-confor-
mity, determining that Art. 51(1) warrants “partial avoidance” of the contract remains
straightforward in most factual scenarios. Art. 51(1)’s ease of application to partial non-
conformity cases is best illustrated by imagining a situation where Art. 51(1)’s partial-
avoidance provisions do not exist. If 1 out of 1000 cars delivered to the buyer had no
engine, Art. 46(2) would allow the buyer to request a substitute for the defective car only
if 1 engineless car in 1000 constituted a fundamental breach of the contract. In possession
of 999 well-performing cars, it is impossible for the buyer to claim that the seller
“substantially deprived” him of what he reasonably expected under the contract.
30 In contrast, Art. 51(1) allows the buyer to focus the fundamental breach analysis on
the defective portion of the seller’s performance.36 Instead of asking whether 1 bad car
in 1000 constitutes a fundamental breach, the buyer may disregard the 999 functioning
cars and determine whether, with regard to one car, the lack of an engine constitutes a
substantial detriment. Under this narrower analysis, the seller’s fundamental breach
with regard to a single car is clear, allowing the buyer to avoid the contract to the extent
of a single car.
31 bb) Partial avoidance for partial non-delivery. In regard to a partial non-delivery,
Art. 51(1) opens up the possibility to gain the right of avoidance by setting a Nachfrist.
In general avoidance in case of a defective performance is only possible if the
defect constitutes a fundamental breach, Art. 49(1)(a); the Nachfrist mechanism of
Art. 49(1)(b) is reserved to cases of non-delivery. However, narrowing the view leads
to the defect in quantity constituting a (partial) non-delivery to which Art. 49(1)(b)
may be applied.37
32 The availability of the Nachfrist under Art. 49(1)(b) does not affect a buyer’s right to
avoid a contract under 49(1)(a) when a partial non-delivery constitutes a fundamental
breach of the contract.38 Art. 51(1) further allows buyers to narrow the focus of the
fundamental breach inquiry to the non-delivered portion of the seller’s obligations. As a
result, a buyer may claim that the failure to deliver a percentage of the contracted-for
goods on time constituted a fundamental breach with regard to non-delivered portion.
Using this analysis, the seller’s failure to deliver a portion of “autumn fashion” on time
may constitute a fundamental breach with regard to the non-delivered clothes when the
seller does not deliver the remaining fall fashion wear until after the fall season and the
buyer cannot resell the late-delivered clothes after the season.39
36 Magnus, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), Art. 51 para. 4.
37 Honnold, Documentary History (1989), p. 434; Honnold/Flechtner, Uniform Law (2009), Art. 51
para. 316; Magnus, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), Art. 51 para. 2; Huber,
in: MünchKommBGB (2015), Art. 51 para. 11; Benicke, in: MünchKommHGB (2013), Art. 51 para. 5;
Hartmann, in: BeckOGK (2016) Art. 51 para. 15.
38 Honnold/Flechtner, Uniform Law (2009), Art. 51 para. 316; Magnus, in: Ferrari/Flechtner/Brand,
Draft Digest and Beyond (2003), Art. 51 para. 4.

39 Enderlein, Die Verpflichtung des Verkäufers zur Einhaltung des Lieferzeitraums und die Rechte des
Käufers bei dessen Nichteinhaltung nach dem UN-Übereinkommen über Verträge über den internatio-
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Note that irrespective of whether the buyer bases his avoidance on Art. 49(1)(a) or 33
Art. 49(1)(b) he must declare avoidance within the period of time granted by Art. 49(2)(a);
Art. 49(2)(b) is not applicable.40
cc) Avoidance of the entire contract, Art. 51(2). In addition to the partial avoidance 34
of Art. 51(1), Art. 51(2) allows buyers to avoid the entire contract when a partial non-
delivery or non-conformity amounts to a fundamental breach of the contract in its
entirety. Thus, although Art. 51(1) narrows the focus to the missing or non-conforming
portion of the seller’s performance, paragraph (2) allows courts to re-expand their focus
to encompass the entire contract when buyers claim avoidance.41
Art. 25 defines the term “fundamental breach” as a breach of contract that “results in 35
such detriment” to the injured party “as substantially to deprive him of what he was
entitled to expect under the contract.”42 Since avoidance is considered the ultima ratio
of CISG remedies43 – and since Art. 51(2) itself provides an exception to Art. 51(1)’s
limitation of avoidance to the defective portion of a seller’s performance – courts have
established a highly restrictive standard for finding a fundamental breach under
Art. 51(2).44 Only when the buyer has been deprived of all value in the remaining
goods, i. e. can neither use nor resell the goods in a reasonable manner,45 may the buyer
claim an Art. 51(2) fundamental breach.
Examples from jurisprudence remain rare. 36
The (German) Oberlandesgericht Koblenz found an Art. 51(2) fundamental breach 37
when 80 % of the shoes that a seller delivered to a retailer were defective. The court held
that, under considerations of “proper presentation and orderly retail,” the shoes were of
no value to the retailer.46 However, the decision dates from 1984, and intervening
decisions appear to have further restricted the fundamental breach standard. In the
Cobalt Sulfate case of 1996, the German Bundesgerichtshof held that a fundamental
breach under Art. 49(1)(a) exists only when the buyer cannot reasonably resell the
goods.47 Thus, the mere disturbances to a proper presentation and orderly resale that
motivated the Koblenz decision may no longer suffice to constitute a fundamental
breach under Art. 49(1)(a) – let alone under Art. 51(2).
The French Cour d’Appel Paris found an Art. 51(2) fundamental breach in a case 38
involving the delivery of 15,000 pressure cookers. When the buyer investigated the
pressure cookers by testing samples at random, a high percentage of the samples
showed safety deficiencies. The buyer therefore argued that, in order to resell the
pressure cookers, he would have to inspect each individual unit in order to avoid
liability to customers for accidents. The court held that inspecting each pressure cooker
nalen Warenkauf, IPRax (1991) 313 (315); Magnus, in: Staudinger, Kommentar (2013), Art. 51 para. 13 –
missed by Amtsgericht Oldenburg (Germany) 24 April 1990 (Fashion textiles), CISG-Online 20.
41 For the question of an analogous application on the remedy of substitute delivery see supra, paras 32
et seq.
42 See in detail Art. 25 paras 10 et seq.
43 Bundesgerichtshof (Germany) 24 September 2014 (Tools), CISG-Online 2545 (BeckRS 2014, 20679)
(para. 24); Bundesgerichtshof (Germany) 3 April 1996 (Cobalt sulphate), CISG-Online 135 = NJW (1996)
2364; Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 49 para. 2.
44 Will, in: Bianca/Bonell, Commentary (1987), Art. 51 para. 2; Magnus, in: Ferrari/Flechtner/Brand,
Draft Digest and Beyond (2003), Art. 51 para. 2.

Art. 51 para. 18; for the general reasonable use requirement see in detail Art. 49 paras 37 et seq.
46 Oberlandesgericht Koblenz (Germany) 18 May 1984 (Shoes), summarized in: Schlechtriem/Magnus,
Internationale Rechtsprechung zu EKG und EAG (1987), Art. 45 para. 3.

47 Bundesgerichtshof (Germany) 3 April 1996 (Cobalt sulphate), CISG-Online 135 = NJW (1996) 2364;
cf. in detail Art. 49 paras 38 et seq.
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could not reasonably be expected from the buyer and therefore found that he had lost
all interest in the goods.48
39 Examples given in legal literature are as follows.
40 The buyer has ordered cans of vegetables. When investigating the goods through
random sampling, one can contains toxic plant parts. To avoid liability to his customers,
the buyer would have to open all cans in order to ascertain which are defective. As he
will not be able to sell a can once it has been opened, the buyer should be able to avoid
the entire contract under Art. 51(2).49
41 The buyer has bought a package of hardware and software. If the software is defective
and the hardware was ordered for the sole purpose of running the software, the buyer
may avoid the contract with regard to the hardware as well.50
42 The hardware-software example demonstrates the relationship of Art. 51(2) to the
question of divisibility. One might well argue that hardware and software comprise an
indivisible economic unit, thus precluding the buyer from partially avoiding the
contract under Art. 51(1). However, if the buyer wants to avoid the entire contract,
divisibility becomes irrelevant. If faulty software constitutes a fundamental breach, it
does not matter whether software is divisible from hardware – the contract, along with
all of its divisible or indivisible components, is avoided in its entirety. By contrast,
differences occur if the buyer wants to only partially avoid the contract. He is only
allowed to do so if the goods are divisible, i. e. if they do not form an economic unit.
d) Price reduction
43 aa) Partial non-conformity. When a buyer seeks to remedy partial non-conformity
through price reduction, the buyer will achieve identical results regardless of whether he
pursues price reduction directly through Art. 50 or through the focus-narrowing
provisions of Art. 51(1). For example, a seller delivers 100 cars at E 5000 each, and 10
cars suffer from a defect that halves their value. Accordingly, the buyer may reduce the
purchase price by E 25,000 irrespective of whether he reduces under Art. 50 or 51(1).
44 bb) Partial non-delivery. In regard to a partial non-delivery narrowing the view has
disadvantageous consequences for the buyer – while qualifying a defect in quantity as a
partial non-delivery opens a door in respect to the remedy of avoidance, it closes a door
in regard to the remedy of price reduction. As Art. 50 is not applicable in the case of
non-delivery in general,51 it may not be applied in the particular case of a partial non-
delivery either.52 Nevertheless, the majority of scholarly opinion takes a contrary view.53
It notes that, if price reduction in cases of partial non-delivery was truly barred, the
reference to Art. 50 within Art. 51(1) would be superfluous. However, this logical
argument fails on logical grounds. As shown above, the remedy of price reduction is
readily available in cases of partial non-conformity54 and thus the reference to Art. 50 in
Art. 51(1) is not superfluous.
48 Cour d’Appel de Paris (France) 4 June 2004 (Pressure cookers), CISG-Online 872; Bundesgericht
(Switzerland) 2 April 2014 (wire rod), CISG-Online 2592 = IHR 2015, 250; Oberlandesgericht Koblenz
(Germany), 21 November 2007 (Shoes), CISG-Online 1733 (BeckRS 2008, 19974).
Commentary (2016), Art. 51 para. 11; Benicke, in: MünchKommHGB (2013), Art. 51 para. 12.
51 See Art. 50 para. 9.
53 Magnus, in: Staudinger, Kommentar (2013), Art. 51 para. 14; Benicke, in: MünchKommHGB (2013),
Art. 51 para. 6; differentiating Hartmann, in: BeckOGK (2016) Art. 51 para. 16 (hypothetical intent of the
parties).
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e) Damages. A buyer’s right to damages is not affected by the application of 45
Art. 51(1).55 Art. 51(1)’s clear wording limits the provision’s application to the remedies
contained in Arts 46 to 50, whereas damages are provided for in Arts 45 and 74 to 77.
Thus, whenever a buyer suffers loss due to a seller’s breach, he may claim compensation
for the entire loss. It should be noted however, that applying Art. 51(1) to CISG
damages provisions would not alter the measure of damages to which buyers are
otherwise entitled.
f) Rejection of delivery. Predominant opinion holds that when a buyer may properly 46
avoid a contract or claim substitute delivery, he may also reject acceptance of goods
delivered pursuant to that contract.56 Since the right to reject delivery flows from the
right to avoid the contract (respectively to claim substitute delivery), however, the extent
of the right to reject delivery is coextensive with these rights. Thus, if a buyer is
restricted to partial avoidance or partial substitute delivery under Art. 51(1), he must
be restricted to a partial right to reject as well. In cases of partial non-conformity, this
means that the buyer may reject any defective goods but must accept the remaining
conforming goods. In cases of a partial non-delivery, the buyer cannot reject any goods,
since the punctually-delivered goods conform to the contract.57 If the buyer can avoid
the entire contract under Art. 51(2), he may reject the entire delivery.58
3. Burden of proof
For questions arising under Art. 51(1)’s provisions, the burden of proof is allocated 47
according to the general principles.
When determining the divisibility of goods, the burden of proof lies with the party 48
who invokes Art. 51(1).59 Depending on the facts underlying the dispute, Art. 51(1) may
be advantageous for the buyer or the seller. If the buyer wants to partially avoid the
contract on the basis of Art. 49(1)(b),60 he must invoke Art. 51(1) and thereafter prove
the portion to be avoided is divisible. If the seller wants to prevent the buyer from
avoiding the entire contract, he may invoke Art. 51(1), after which he also must prove
divisibility. If, however, the buyer wishes to avoid the entire contract, the buyer must
prove that the requirements of Art. 51(2) are met.61
For factual claims that a part is missing or defective, the burden of proof shifts 49
between buyer and seller as outlined in Art. 46.62 First, the buyer must prove the
existence of the obligation that has allegedly been breached by the missing or defective
part. If successful, the burden shifts to the seller to prove that he has fulfilled the
obligation.
55 Honnold/Flechtner, Uniform Law (2009), Art. 51 para. 316; Huber, in: MünchKommBGB (2015),
Art. 51 para. 7; Magnus, in: Staudinger, Kommentar (2013), Art. 51 para. 9; Altenkirch, in: Brunner,
56 See Art. 52 para. 4; cf. Schlechtriem/Butler, CISG (2009), para. 221; Magnus, in: Staudinger, Kom-
mentar (2013), Art. 52 para. 27; Altenkirch, in: Brunner, Kommentar (2014), Art. 51 para. 7.
57 Oberster Gerichtshof (Austria) 21 June 2005 (Software), CISG-Online 1047; Hartmann, in: BeckOGK
(2016) Art. 51 para. 19.

58 Oberster Gerichtshof (Austria) 21 June 2005 (Software), CISG-Online 1047; Huber, in: Münch-
KommBGB (2015), Art. 51 para. 14; Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016),
Art. 51 para. 4; Magnus, in: Staudinger, Kommentar (2013), Art. 51 para. 11; Schnyder/Straub, in:
(2009), Art. 51 para. 1.

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50 The PICC does not contain a special provision for situations in which only a portion
of a seller’s performance is missing or defective. However, legal literature has concluded
that partial avoidance is available under Art. 7.3.1. PICC, which applies “with a limited
focus” – i. e. to the missing or defective part.63 Thus, for cases of partial non-delivery,
the buyer may set a Nachfrist under Art. 7.3.1(5) in which the seller must complete his
delivery and, if the seller does not perform within the Nachfrist period, the buyer may
avoid the contract with regard to the non-delivered goods.64
51 Lacking any explicit provision in regard to partial non-performance, it is obvious
however, that the buyer is by no means limited to partial avoidance when a seller only
partially performs. If the seller’s non-performance amounts to fundamental non-
performance in regard to the entire contract, the buyer may avoid the entire contract.65
52 The PICC rules governing partial non-performance are thus equivalent, if not
identical, with those of Art. 51 CISG. With one exception, in cases of partial non-
delivery, the PICC offers the buyer a partial rejection remedy that is not available under
the CISG. Under Art. 6.1.3(1) PICC, the buyer “may reject an offer to perform in part
[…] whether or not such offer is coupled with the assurance as to balance of the
performance, unless the [buyer] has no legitimate interest in so doing”.
53 Similar to the PICC, the PECL also provides no special provision governing partial
non-performance. Unfortunately, since legal literature has yet to debate the propriety of
partial avoidance under PECL provisions, it remains unclear whether partial avoidance
is available under the PECL.
54 The DCFR provides in its Art. III.-3:506 a rule governing instalment contracts as well
as all other contracts whose obligations are divisible. Its remedies mirror those found in
Art. 51 CISG: partial avoidance remains available under Art. III.-3:506(2) and avoidance
of the entire contract is allowed “if the [buyer] cannot reasonably be expected to accept
performance of the other parts or there is a ground for [avoidance] in relation to the
contractual relationship as a whole” (Art. III.-3:506(3)).
63 Huber, in Vogenauer, UNIDROIT Commentary (2015), Art. 7.3.1 para. 95.
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Article 52
(1) If the seller delivers the goods before the date fixed, the buyer may take delivery
or refuse to take delivery.
(2) If the seller delivers a quantity of goods greater than that provided for in the
contract, the buyer may take delivery or refuse to take delivery of the excess quantity.
If the buyer takes delivery of all or of part of the excess quantity, he must pay for it at
the contract rate.
Outline
1. Early delivery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
a) Prerequisites . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
b) Legal consequences . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
aa) Buyer’s choice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
bb) Effects of an acceptance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
cc) Effects of a lawful rejection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
dd) Effects of an unlawful rejection. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
c) Burden of proof. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
2. Excessive delivery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
a) Prerequisites . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
aa) Excess quantity. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
bb) Analogous application to excess in quality? . . . . . . . . . . . . . . . . . . . . . . . . . 29
cc) Notice required under Art. 39? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
b) Legal Consequences . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
aa) Buyer’s Choice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
bb) Effects of an acceptance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
cc) Effects of a lawful rejection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
dd) Effects of an unlawful rejection. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
c) Burden of proof. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
1. Early delivery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
2. Excessive delivery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55

All major legal systems understand the term “breach of contract” to encompass non- 1
delivery, late delivery, and defects in quality or quantity. Under the CISG, a seller who
provided early delivery or better than contracted-for quality also potentially breaches his
contract.1 The reason for this rule is that early or excessive delivery may cause
inconvenience to the buyer, as made obvious by the hyperbolic example of the zoo
that ordered one elephant but received 20. It is difficult to imagine any buyer prepared
to handle such a delivery.2
1 Will, in: Bianca/Bonell, Commentary (1987), Art. 52 para. 2; Magnus, in: Staudinger, Kommentar
Huber, in: Huber/Mullis, The CISG (2007), p. 296.
2 Will, in: Bianca/Bonell, Commentary (1987), Art. 52 para. 2.1.2; Magnus, in: Staudinger, Kommentar
(2013), Art. 52 para. 2
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2 In this case the “regular” remedies – as stipulated by Art. 45 – are available to the
buyer. In addition, Art. 52 gives the buyer an additional option: the buyer may reject the
entire early delivery or the excess portion of the excess delivery. These additional
provisions do not affect the availability of “regular” remedies under Art. 45.
3 Art. 52’s special rejection rule has interpretive consequences for the availability of
rejection as a CISG remedy. Expressly providing for rejection in cases of early or excess
delivery implies e contrario that rejection is not available to buyers for any other cases of
non-conformity.3 Thus, buyers may remedy such “standard” non-conformities only
through the regular remedies of Art. 45. As a result, barring an early or excessive
delivery, CISG buyers may reject deliveries only if they are entitled to a substitute
delivery or to avoidance of contract (i. e. in cases of fundamental breach).4
1. Early delivery
4 a) Prerequisites. Under Art. 33, the seller must deliver the goods (a) on the date or
(b) within the period specified by the contract. This provision entails a twofold
obligation for the seller. First, the seller may not deliver after the delivery date or after
expiration of the delivery period. Second, the seller also must wait to deliver until the
contractual delivery date, or until the delivery period has commenced. Thus, if a
contract provides for delivery “on 1 January 2017” or “in January 2017” or “in 2017”,
the seller may not undertake to deliver in 2016. If he does, the buyer will have the right
to reject his deliveries under Art. 52(1).
5 The same is true when parties structure delivery in a certain fashion. The parties may
condition the seller’s obligation to deliver on a certain event, such as the buyer placing a
purchase order. If the seller undertakes a delivery before the buyer places a purchase
order, the buyer may reject the delivery under Art. 52(1)’s early delivery provisions.
Similarly, the parties may agree on delivery in instalments. If the seller delivers all goods
within the first instalment, the first instalment is considered an “early delivery” under
Art. 52(1) in regard to the goods that were agreed to be delivered in later instalments.5
6 Whether early delivery is possible when the contract provides no date or period for
delivery remains unsettled. For such cases, Art. 33(c) simply directs that the buyer
“must deliver the goods […] within a reasonable time after the conclusion of the
contract.” Unlike the wording of Art. 33(a) and 33(b) – which both speak in terms of a
‘start’ and ‘end’ time for delivery – Art. 33(c) appears to set only a “reasonable” end
time after which deliveries may not be made.6 Legal scholarship, however, has often
argued that – at least by way of analogy – Art. 33(c) bars delivery immediately after
contract formation; instead, the seller must afford the buyer time to prepare to accept
the goods.7 In the author’s opinion an analogy is not justified: if preparation time is
important to the buyer, he has ample opportunity to specify as much in the contract.
3 Magnus, in: Staudinger, Kommentar (2013), Art. 52 para. 27; Hartmann, in: BeckOGK (2016) Art. 52
para. 4.
4 Magnus, in: Staudinger, Kommentar (2013), Art. 52 para. 27; Schlechtriem/Butler, CISG (2009),
para. 221.
5 Magnus, in: Staudinger, Kommentar (2013), Art. 52 para. 8; Schnyder/Straub, in: Honsell, Kommen-
tar (2010), Art. 52 para. 11

6 “… on that date …” means not before and not after that date; “… within that period …” means not
before the start and not after the end of that period.
7 Gruber, in: MünchKommBGB (2015), Art. 33 para. 13; contra: Magnus, in: Ferrari/Flechtner/Brand,
Draft Digest and Beyond (2003), Art. 52 para. 1; Magnus, in: Staudinger, Kommentar (2013), Art. 33
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The same is true when parties agree only to no more than the end of a delivery 7
period, e. g. “delivery within two months.”
b) Legal consequences
aa) Buyer’s choice. When a seller delivers early, Art. 52 allows the buyer to freely 8
accept or reject the goods. Since the early delivery itself justifies a rejection, the buyer
need not state any reasons for rejecting.8 However, the buyer’s right to reject is limited
by the duty of good faith implied in every contract by Art. 7.9 Thus, the buyer may not
reject delivery if accepting causes him no inconvenience, but rejection would cause
significant harm to an otherwise innocent seller.10
However, for all Art. 52(1) rejections, it remains unlikely that the duty of good faith 9
will play any appreciable role. When a buyer rejects under Art. 52(1), Art. 86(2)
obligates him to take possession of the goods and preserve them for the seller to the
extent that doing so does not result in “unreasonable inconvenience” or “unreasonable
expense (see in detail infra para. 18). This obligation averts any harm to the seller. Thus,
Art. 86(2) implies that the buyer’s convenience provides the measuring stick for when
his obligations to the seller arise, thereby setting a very low standard for good faith in
rejection cases.11 As a result, only a buyer’s intentional fraud or harassment will likely
violate his good faith obligations.12
The buyer may exercise the choice granted by Art. 52(1) only once. If he originally 10
accepted the goods, he may not later on reject them.13 Thus, much scholarship has
focused on determining what constitutes an “acceptance” for purposes of Art. 52(1).
There appears to be widespread agreement on instances that do not constitute
acceptance. First, a buyer has not accepted goods if he merely takes possession of them
under his Art. 86(2) obligation to do so. Second, a buyer’s mere physical possession of
the goods does not constitute an “acceptance,” since a buyer may readily gain physical
possession of goods without identifying them – and thus without an opportunity to
discover that he holds goods delivered early.14 Unconsciously receiving delivery should
not qualify as an Art. 52(1) acceptance.15
Instead, in order for a buyer to “accept” early-delivered goods under Art. 52(1), the 11
buyer must actually or constructively know, upon receipt of the goods, that the goods
are being delivered early. If the buyer attains such knowledge after receiving the goods,
then an Art. 52(1) “acceptance” lies if the buyer fails to reject the goods without
para. 29 and Art. 52 para. 7; Benicke, in: MünchKommHGB (2013), Art. 52 para. 2; Müller-Chen, in:
Schlechtriem/Schwenzer, Commentary (2016), Art. 52 para. 2; Schnyder/Straub, in: Honsell, Kommentar
(2010), Art. 52 para. 9.
9 For details on this principle cf. Art. 7 para. 24 in regard to the interpretation of the convention and
Art. 7 para. 25 in regard to the parties’ behaviour.

10 Magnus, in: Staudinger, Kommentar (2013), Art. 21 para. 11; Benicke, in: MünchKommHGB (2013),
Art. 52 para. 4; critical: Will, in: Bianca/Bonell, Commentary (1987), Art. 52 para. 2.1.3; Huber, in: Huber/
Mullis, The CISG (2007), pp. 296, 301; Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 52 para. 16.
13 Schnyder/Straub, in: Honsell, Kommentar (2010), Art. 52 para. 16. In principle, the same holds true
for the opposite scenario: If the buyer has once rejected the goods he may not later on accept them. This
scenario however, is unlikely to occur – at least it is unlikely to cause differences between the parties,
because the (later) acceptance will usually be in the best interest of the buyer.
14 Cf. Benicke, in: MünchKommHGB (2013), Art. 52 para. 16, who names the example of the buyer
taken possession through employees without competence/authority for the contact to a business partner.
In this scenario, however, knowledge of the buyer must be assumed; he must not be allowed to leave the
acceptance to employees and later on rely on their lack of authority.
15 Contra Schnyder/Straub, in: Honsell, Kommentar (2010), Art. 52 para. 14.
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unreasonable delay.16 When determining whether a delay in rejecting is “unreasonable,”

the time provisions of Arts 38 and 39 may offer some guidance. However, the early-
delivery buyer need not identify a complex technical defect, but rather simply compare
agreed and actual delivery dates. As a result, the period in which a buyer may reject
after learning of early delivery is very narrow.
12 If a buyer elects to reject the goods under Art. 52(1), he must reject them in their
entirety. Since Art. 52(2) expressly allows buyers to reject only a portion of the goods,17
a simple argument e contrario leads to the conclusion that Art. 52(1) does not.18
13 bb) Effects of an acceptance. Time for payment. Accepting an early delivery
potentially affects the buyer’s payment obligation only when the parties have linked
delivery and payment terms in the contract, e. g. “payment within two weeks after
delivery.” Predominant opinion holds that acceptance does not alter the original
payment date,19 and such a rule is in the interest of both parties. A buyer prepared to
pay “within two weeks” of a delivery in August may not be able to pay within two weeks
of a June shipment. If obligated to do so, he may well reject goods he would have
otherwise accepted, a result likely contrary to the seller’s interests.20 Thus, for purposes
of determining time for payment, courts should assume that the seller delivered on the
contractually-stipulated date or on the first day of the delivery period.
14 Period for notice. The considerations behind not altering the buyer’s payment term
also argue against modifying the time within he must give notice of non-conformity to
the seller. Buyers may not be able, or willing, to interrupt normal business flows to
inspect goods that arrive ahead of schedule, and may reject more deliveries if forced to
do so. Leaving the time for notice unaffected therefore serves the purpose of encoura-
ging an acceptance. Therefore, the period for inspection and notice should not start
before the agreed delivery date.21
15 Availability of damages. The policy of encouraging acceptances also argues in favour
of permitting a buyer to claim damages long after accepting an early delivery. The buyer
may only be willing to accept delivery if he later on may claim compensation for extra
costs that incurred for the “early acceptance”. Comparing Art. 52(1) with its predeces-
sor, Art. 29 of the ULIS, reinforces this result. Under Art. 29 ULIS buyers were
precluded from receiving damages from sellers unless they expressly reserved a claim
for damages when accepting the goods. Since the CISG rejected this rule, damages
should remain available to buyers so long as they notify the seller of defects within the
normal time period outlined in the previous paragraph.22
16 Contra Benicke, in: MünchKommHGB (2013), Art. 52 para. 9 who in this case allows rejection until
the period of limitation has lapsed.

18 Concurring Hartmann, in: BeckOGK (2016) Art. 52 para. 10.
19 Huber, in: Huber/Mullis, The CISG (2007), p. 297; Magnus, in: Staudinger, Kommentar (2013),
Art. 21 para. 14; Huber, in: MünchKommBGB (2015), Art. 52 para. 11; Müller-Chen, in: Schlechtriem/
Schwenzer, Commentary (2016), Art. 52 para. 4; contra Will, in: Bianca/Bonell, Commentary (1987),
Art. 52 para. 2.1.2; Schnyder/Straub, in: Honsell, Kommentar (2010), Art. 52 para. 23; Piltz, Internatio-
nales Kaufrecht (2008), para. 4–169.
21 Magnus, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), Art. 52 para. 3; Huber, in:
Huber/Mullis, The CISG (2007), p. 297; Huber, in: MünchKommBGB (2015), Art. 52 para. 11; Müller-
Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 52 para. 4; Piltz, Internationales Kaufrecht
(2008), para. 4–170; – contra Schnyder/Straub, in: Honsell, Kommentar (2010), Art. 52 para. 23, Salger, in:
22 Magnus, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), Art. 52 para. 3; Huber, in:
Huber/Mullis, The CISG (2007), p. 297; Huber, in: MünchKommBGB (2015), Art. 52 para. 11; Müller-
Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 52 para. 4; Altenkirch, in: Brunner, Kom-
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Modification of contract. Whether accepting goods despite their early delivery 16
constitutes a simultaneous modification of the sales contract is disputed in legal
literature.23 In this author’s opinion, the question is only of academic interest. The
buyer’s payment and notification obligations, and the buyer’s right to claim damages,
should remain identical to those of an “on-time” delivery even if an acceptance of early
delivery modifies the sales contract.24 Thus, if any contractual modification is assumed,
it should be construed as not modifying the original payment or notice obligations, or
the right to damages. Otherwise, the law would presume that a buyer intends to waive
his contractual payment term and his right to damages every time he accepts goods
ahead of schedule. As, however, some authors have taken the opposite view and
jurisprudence has not yet settled the matter, the buyer is advised to explicitly state that
he will only accept the early delivery under the condition that neither the time for
payment and notice nor his claim for damages are affected.
cc) Effects of a lawful rejection. Even if a buyer rejects an early delivery, the seller 17
remains obligated to undertake delivery at the contractually specified time. In other
words, the buyer’s rejection does not alter the seller’s delivery obligation;25 the seller is
simply treated as never having attempted delivery. If the buyer suffered any losses due
to the early delivery, he may claim damages.26 Also, Art. 52 does not bar buyers from
avoiding the contract, although it is difficult to imagine that an early delivery would
ever constitute the fundamental breach required to avoid.27
After rejecting the early-delivered goods, Art. 86(2) requires the buyer to take 18
possession of the goods if he can do so “without payment of the price and without
unreasonable inconvenience or unreasonable expense.” However, Art. 86(2) only re-
quires buyers to take possession of goods that are prematurely “dispatched to the
buyer.” Thus, if the seller has possession of the goods at the time of the buyer’s
rejection, Art. 86(2) does not obligate the buyer to take possession of them. Similarly,
where a seller has dispatched the goods but may easily re-gain possession of them
himself – for example, if the seller runs the warehouse at the port of destination –
Art. 86(2) places no obligation to take possession on the buyer.
The obligations that Art. 86(2) imposes on buyers may erode the right to reject the 19
goods to a certain extent. When a buyer takes possession of goods under Art. 86(2) after
mentar (2014), Art. 52 para. 3 Piltz, Internationales Kaufrecht (2008), para. 4–170; contra Schnyder/
Straub, in: Honsell, Kommentar (2010), Art. 52 para. 23; Salger, in: Witz/Salger/Lorenz, Kommentar
(2016), Art. 52 para. 3.
23 Pro alteration: Benicke, in: MünchKommHGB (2013), Art. 52 para. 6; Enderlein/Maskow, Interna-
tional Sales Law (1992), Art. 52 para. 2; contra alteration: Magnus, in: Ferrari/Flechtner/Brand, Draft
Digest and Beyond (2003), Art. 52 para. 3; Huber, in: MünchKommBGB (2015), Art. 52 para. 10; Müller-
Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 52 para. 5; Altenkirch, in: Brunner, Kom-
mentar (2014), Art. 52 para. 3; Schnyder/Straub, in: Honsell, Kommentar (2010), Art. 52 para. 26; Piltz,
Internationales Kaufrecht (2008), para. 4–170.
24 Cf. Hartmann, in: BeckOGK (2016) Art. 52 para. 14. As however some authors have taken the
opposite view and jurisprudence has not yet settled the matter, the buyer is advised to explicitly state that
he will only accept the early delivery under the condition that neither the time for payment and notice
nor his claim for damages are affected.
25 Will, in: Bianca/Bonell, Commentary (1987), Art. 52 para. 2.1.4; Magnus, in: Ferrari/Flechtner/Brand,
Draft Digest and Beyond (2003), Art. 52 para. 2; Müller-Chen, in: Schlechtriem/Schwenzer, Commentary
(2016), Art. 52 para. 3; Huber, in: Huber/Mullis, The CISG (2007), p. 296; Hartmann, in: BeckOGK
(2016) Art. 52 para. 11.
Art. 21 para. 15.

27 Benicke, in: MünchKommHGB (2013), Art. 52 para. 5; Schnyder/Straub, in: Honsell, Kommentar
(2010), Art. 52 para. 30 who name the example of “just-in-time bargains”. It is submitted that even in this
case a fundamental breach may only be assumed under exceptional circumstances.
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a rejection, his obligations are almost identical to those that arise when a buyer accepts
an early delivery under Art. 52(1).28 In neither case must the buyer pay the purchase
price, and he need not inspect the goods immediately or notify the seller of defects.
Further, in both scenarios, the buyer may claim damages for losses caused by the early
delivery. As a result, taking possession of rejected goods under Art. 86(2) appears
almost identical to accepting early-delivered goods under Art. 52(1). This coincidence,
however must not serve as an argument regarding the debate on the effects of an
acceptance: it is still necessary to stimulate a voluntary acceptance, i. e. in the (admit-
tedly rare) cases that do not give rise to an Art. 86(2) obligation to take possession.
20 dd) Effects of an unlawful rejection. If the buyer is not entitled to reject the goods –
because the delivery must not be qualified as being too early – his rejection constitutes a
breach of contract. Articles 53 and 60 impose the duty to take delivery on the buyer.
The seller may therefore employ the remedies found in Art. 61 for the breach of this
remedy. Although avoidance is included in these remedies, a refusal to accept the goods,
without more, will rarely in itself constitute a fundamental breach as required by
Art. 64(1)(a). Thus, any attempt to avoid the contract will generally require setting a
Nachfrist under Art. 64(1)(b) during which the buyer may accept the seller’s delivery.
21 c) Burden of proof. Under general CISG principles, the buyer must first prove the
existence of any obligation, after which the burden shifts to the seller to prove that he
has fulfilled that obligation.29 Thus, in Art. 52 cases, the buyer must prove that a date
for delivery or delivery period was agreed upon, and the seller must then prove that
delivery did not take place before that date or period.30
22 If the seller claims that the buyer accepted early-delivered goods, he must show some
behaviour of the buyer that qualifies as acceptance.31
23 This allocation of burden remains valid irrespective of the procedural posture of the
case. Regardless of whether the buyer is demanding a new delivery or damages for early
delivery, or whether the seller is demanding payment for wrongful rejection – the
shifting burdens of proof remain unchanged.32
2. Excessive delivery
a) Prerequisites
24 aa) Excess quantity. Art. 52(2) provides buyers a limited right of rejection when the
seller “delivers a quantity of goods higher than that provided for in the contract.” This
“excess delivery” requirement is clearly fulfilled when the seller delivers a greater
number of units than agreed, such as delivering 2000 instead of 1000 cars. It is also
easily met when the contract agrees to a specific weight or volume of goods, and the
seller delivers a greater weight or volume than agreed – such as delivering 1500 tons of
rice instead of 1000.
25 What remains unclear is whether an excess delivery exists when a seller ships the
agreed-upon number of units, but each individual unit is heavier or larger than specified
in the contract – for example, 1000 tubes of 10 meters in length instead of 1000 tubes of

29See Huber, in: MünchKommBGB (2015), Art. 52 para. 12.
30 Huber, in: MünchKommBGB (2015), Art. 52 para. 12; Hepting/Müller, in: Baumgärtel/Laumen/
Prütting (eds), Handbuch der Beweislast im Privatrecht (2009), Art. 50 paras 2 and 4; Hartmann, in:
BeckOGK (2016) Art. 52 para. 24.
(2009), Art. 50 paras 2 and 4.
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5 meters.33 Under predominant opinion, Art. 52 does not apply in such cases. Instead,
the excessive length or volume constitutes a non-conformity in the goods under
Art. 35(1) rather than an excess delivery under Art. 52(2).34 A minority of authors,
however, argue that Art. 52 should apply for reasons of uniformity in CISG interpreta-
tion.35 Denying application of Art. 52, they argue, means that the ‘excess’ portion of the
delivered units are not addressed within the CISG, thus forcing courts to look to
domestic law to determine the buyer’s right to reject the ‘excessive’ portion of delivery.
In response, predominant opinion points out that barring the application of 26
Art. 52(2) does not entail barring application of the entire CISG. All remedies provided
in the CISG remain available to remedy excessively large or heavy goods, just as they
remain available to remedy any defect in quality. Moreover, the remedy provided by
Art. 52(2) – allowing buyers to reject the “excessive part” of a delivery36 – is a terrible fit
for situations involving units that are simply bigger or heavier than expected. If 100
baguettes are delivered weighing 500 grams instead of 250 grams, the buyer cannot
simply “reject” half of every baguette. Thus, as a general matter, predominant opinion
should govern the applicability of Art. 52(2).
However, under exceptional circumstances, Art. 52(2) provides a viable remedy for 27
buyers who receive excessively large or heavy goods. Specifically, when (a) the excessive
mass or volume of the delivered units can easily be separated from the rest of those
units, or when (b) a buyer purchases a specific number of goods at a specific weight but
the buyer is interested only in the aggregate weight of the shipment.37 For example, if a
hotel orders 1000 loaves of bread at 500 grams each, it is entirely possible that the hotel
is only interested in 500 total kilograms of bread. If it instead receives 1000 loaves at
1000 grams each, it would be appropriate to allow the hotel to reject 500 of these loaves
to reach the agreed total weight. Still, allowing an application of Art. 52 in this case
might be against the interest of the buyer: buyers who do not reject under Art. 52(2)
must pay at contract rates for the “excessive part” of deliveries they accept.
If the goods contain additives that were not agreed to, delivery is not excessive, but 28
rather defective.38
bb) Analogous application to excess in quality? It is similarly unclear whether 29
Art. 52(2) can be applied to goods that are delivered with a higher quality than that
specified in the contract. The relevant Art. 52(2) issue is whether the buyer’s acceptance of
“excessive” quality obligates him to pay for the extra quality just as if he had accepted the
excessive weight or volume of a delivery.39 The opinion of this Commentary is that,
generally, buyers should not have to pay a higher price when they accept higher-quality
33 Pro application of Art. 52: Magnus, in: Staudinger, Kommentar (2013), Art. 52 para. 17; contra
application of Art. 52: Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 52 para. 6
note 24; Huber, in: MünchKommBGB (2015), Art. 52 para. 14; Schnyder/Straub, in: Honsell, Kommentar
(2010), Art. 52 para. 30; Benicke, in: MünchKommHGB (2013), Art. 52 para. 13.
para. 14; Schnyder/Straub, in: Honsell, Kommentar (2010), Art. 52 para. 41; Benicke, in: Münch-
KommHGB (2013), Art. 52 para. 13; Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016),
Art. 52 para. 6; Hartmann, in: BeckOGK (2016) Art. 52 para. 16.1.
36 For a detailed description of what constitutes the “excessive part,” see infra paras 40 et seq.
37 Concurring Hartmann, in: BeckOGK (2016) Art. 52 para. 16.1.
39 Yes: Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 52 para. 11; Magnus, in:
Staudinger, Kommentar (2013), Art. 52 paras 28 et seq.; Schwenzer, in: Schlechtriem/Schwenzer, Com-
mentary (2016), Art. 39 para. 30; Altenkirch, in: Brunner, Kommentar (2014), Art. 52 para. 9; No: Huber,
in: Huber/Mullis, The CISG (2007), p. 298; Benicke, in: MünchKommHGB (2013), Art. 52 para. 20;
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goods. Making buyers pay a premium for “excessive” portions of deliveries is only justified
when the buyers have the complementary right to reject those excessive portions. Whereas
when extra units or extra volumes are shipped, the excess portion of the shipment can be
easily isolated, the “excessive” quality of higher-quality goods is not separable from the
goods themselves. Therefore, the buyer has no chance to reject the higher quality. In
theory, the buyer could reject the whole delivery since the entire delivery is ‘compromised’
when goods are shipped with excess quantity. However, practical considerations may often
force buyers to accept the entire excess-quality delivery: the buyer must decide to purchase
the higher-quality shipment at a raised price, or to reject the shipment in its entirety.
Buyers are thus placed in an all-or-nothing dilemma that may force them to pay higher
prices simply because they need the goods to keep their businesses running.
30 In addition, determining the price the buyer must pay for “excessive” quality is
inherently problematic. In cases of excess units or volume, the contract price provides a
reliable basis for determining the rate at which the buyer must purchase any excess
deliveries – 10 trucks for a total E 500,000 results in a price of E 50,000 for each
additional truck. In cases of excess quality, the contract price provides no such basis,
especially since enhancements in quality are often provided as concessions in negotia-
tion or as inducements to enter contracts.
31 Since Art. 52(2) does not govern cases of excessive quality, CISG formation provisions
govern whether a buyer must pay for the excess quality of a shipment he receives. A
payment obligation may only be assumed if the seller’s excess-quality shipment constitu-
tes an offer and the buyer’s receipt constitutes an acceptance to modify the contract. As
offer and acceptance both require the parties’ intention to alter the contract, courts may
not assume a modification if either party acts unconscious. If the parties’ behaviour shows
their intention to modify the contract, Art. 55 would set the price at the “price generally
charged” for such higher-quality goods at the time of contract formation.
32 If the seller’s conduct does not amount to an Art. 14 offer or the buyer’s conduct does
not amount to an Art. 18 acceptance, the seller may claim restitution of the goods
through any remedies available under applicable domestic law, such as vindication or
unjust enrichment. Authors who argue that Art. 52(2) should apply to excess-quality
cases criticize this detour into national law, and they have a point: any application of
domestic law does lead to fragmentation within jurisprudence.40 However, this small
amount of fragmentation does not outweigh the harm that buyers – and with them,
international trade – would suffer if Art. 52(2) governed excess-quality cases.
33 cc) Notice required under Art. 39? Art. 39 obligates the buyer to notify the seller of
any non-conformity in deliveries;41 if the buyer fails to do so, he loses his right to rely
on that non-conformity.42 Predominant opinion holds that the notice requirements of
Art. 39 apply to Art. 52(2) as well. Thus, if the buyer fails to notify the seller of the
excess in delivery within the deadlines provided in Arts 38 and 39, he may not reject the
excessive goods under Art. 52(2), but rather must accept and pay for them.43
Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 52 para. 42; Hartmann, in: BeckOGK (2016)
Art. 52 para. 16.
dinger, Kommentar (2013), Art. 21 paras 28 et seq.; Schwenzer, in: Schlechtriem/Schwenzer, Commentary
(2016), Art. 39 para. 30.
41 Oberlandesgericht Rostock (Germany) 25 September 2002 (Frozen foods), CISG-Online 672; Gruber,
in: MünchKommBGB (2015), Art. 39 para. 4; Piltz, Internationales Kaufrecht (2008), para. 4–171.
42 Subject, of course, to the exception of Art. 40.
43 Landgericht Köln (Germany), 5 December 2006 (Covers for mobile phone), CISG-Online 1440 =
IHR 2007, 162; Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 52 para. 7; Huber, in:
MünchKommBGB (2015), Art. 52 para. 17; Benicke, in: MünchKommHGB (2013), Art. 52 para. 14.
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In this author’s opinion, the language of the CISG does not support this rule. The 34
right to reject is indeed one of the buyer’s remedies, and if he waits too long to notify
the seller of excess in delivery he should lose the right to rely on that non-conformity
when claiming his remedies. However, when it comes to the buyer’s duty to pay for
excess goods, the buyer in no way “relies on the non-conformity” – instead, the seller
relies on the excess of his shipment to generate a higher price. Requiring the buyer to
pay, then, does not square with the wording of Art. 39, which merely prevents the buyer
from relying on a non-conformity, but nowhere permits a seller to rely on one.
Against this background it stands to reason that, while the buyer’s right to reject is 35
subject to Art. 39 notice requirements, his duty to pay is not. Unfortunately, these two
aspects of Art. 52(2) cannot be separated. Unpaid sellers would surely resort to domestic
remedies to receive some measure of restitution for their goods. The result is a seller
harnessing any legal means he can to recap his excess goods – the same goods a buyer
would have returned had he rejected. Thus, decoupling the buyer’s obligation to pay
from notice requirements creates an indirect, but equally effective right of rejection for
the buyer. Therefore in this author’s opinion, Art. 39 should not be applied in regard to
the right to reject excessive delivery at all.
Whatever the resulting rule, the question of Art. 39 notice will probably remain 36
mostly irrelevant in practice. On the one hand, rejection of excess goods will usually
qualify as a notice of non-conformity under Art. 39.44 On the other, a buyer’s taking
possession of excess goods without rejecting them – i. e., without notifying the seller –
will amount to an acceptance as soon as the buyer knows or ought to know of the excess
deliveries.45
Thus, only two scenarios remain relevant for Art. 39 notice questions. First, where a 37
buyer rejects goods by refusing to accept them from a carrier, and the carrier does not
forward the buyer’s rejection to the seller. Second, where the buyer takes possession of
the goods he intends to reject under his Art. 86(2) duties, but does not transmit his
rejection to the seller.
b) Legal Consequences
aa) Buyer’s Choice. As in cases of early delivery under Art. 52(1), Art. 52(2) allows 38
the buyer to freely choose to either accept or reject the goods. Unlike under Art. 52(1),
the buyer’s decision does not apply to the entire shipment, but is limited to the excessive
portion of the delivery. Moreover, the wording of Art. 52(2) allows the buyer to ‘split’
the excessive goods such that he accepts some of them while rejecting the rest: “if the
buyer takes delivery of all or part of the excess quantity ….”
Beyond these limiting and splitting provisions, the buyer’s rights under Art. 52(2) are 39
identical to those under Art. 51(1). The buyer’s free choice to accept or reject is again
limited by the Art. 7 implied duty of good faith, and the duty will rarely be relevant
since the seller’s interest in the goods is protected by Art. 86. Once the buyer accepts the
goods, he loses his right to reject them. Again, however, merely taking physical
possession of the goods does not amount to an acceptance. Instead, the buyer must
take possession of the goods with actual or constructive knowledge of their excess
quantity, and must do so for a reason other than fulfilling his Art. 86(2) obligations.
However, the limitation of the buyer’s right to reject to the “excessive” portion of a 40
delivery can create difficulties when that portion cannot be separated from the rest of
the goods. As discussed above, Art. 52(2) is not applicable if separation of the
44 And the other way around, cf. Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016),
Art. 52 para. 7; Huber, in: Huber/Mullis, The CISG (2007), p. 299.

45 Huber, in: Huber/Mullis, The CISG (2007), p. 299; cf. supra para. 10.
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“excessive” portion of a delivery is not physically possible.46 However, when separation

of the excessive portion is physically possible, but is practically or economically
unfeasible – e. g., if a seller makes out a bill of lading for the entire delivery, the buyer
may only accept the bill of lading (for the entire delivery) or reject it – difficulties arise.
41 Predominant opinion solves the problem by allowing the buyer to reject the entire
delivery under Art. 52(2) on the basis of practical inseparability.47 A substantial number
of authors, however, disagree. In their opinion, Art. 52(2) does not apply, meaning that
the buyer may only reject the entire delivery if the excessive delivery constituted a
fundamental breach.48 After considering the buyer’s interests, the minority position
appears preferable. As in excessive quality cases, the drawback to applying Art. 52(2) is
that every acceptance of an excess shipment is accompanied by a price hike on the
buyer. And again, the buyer may be practically forced to do so in order to keep his
business running. Conversely, not applying Art. 52(2) gives the buyer an opportunity to
accept the entire delivery, excess and all, and places the burden on the seller to claim
back the excess value of the shipment through applicable domestic legal remedies.49
Moreover, barring the application of Art. 52(2) is more in line with other CISG
remedies. If a buyer could reject an entire shipment of goods under Art. 52(2) because
an excess delivery was practically inseparable from it, the seller would de facto be
required to make a substitute delivery. Art. 46, however, makes substitute delivery
available to buyers only when the seller has committed a fundamental breach.
42 When partial rejection of the goods is practically unfeasible because the seller has
made out a bill of lading for the entire delivery, the buyer must be given the opportunity
to take over the goods and later separate the excess quantity and return it to the seller.
However, a buyer who takes possession of the goods under such circumstances should
not be regarded as having “accepted” the goods under Art. 52(2) which would result in
an obligation to pay for the excess goods the buyer intends to return.50
43 bb) Effects of an acceptance. When the buyer accepts excess goods “he must pay for
[them] at the contract rate”. Where the contract rate corresponds to the seller’s listed prices
for the goods, the buyer should also receive any volume discount the seller has listed.51
44 As was the case with Art. 52(1), the question arises as to whether an acceptance under
Art. 52(2) constitutes a modification of the underlying contract.52 As was the case with
Art. 52(1), the debate is of little practical importance. The most relevant consequences
of an acceptance obtain irrespective of whether a modification occurs. First, the clear
wording of Art. 52(1) obligates the buyer to pay for the excessive goods he accepts at the
price per unit specified in the contract. Second, if the accepted excess goods are
defective, the buyer retains all remedies outlined in Art. 45(1). Although maintaining
47Müller-Chen, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 52 para. 11; Huber, in: Münch-
Benicke, in: MünchKommHGB (2013), Art. 52 para. 17; Piltz, Internationales Kaufrecht (2008), para. 4–
170, Schnyder/Straub, in: Honsell, Kommentar (2010), Art. 52 para. 56.
48 Honnold, Documentary History (1989), p. 434; Huber, in: Huber/Mullis, The CISG (2007), p. 300;
Will, in: Bianca/Bonell, Commentary (1987), Art. 52 para. 2.2.1; Magnus, in: Ferrari/Flechtner/Brand,
Draft Digest and Beyond (2003), Art. 52 para. 5; Enderlein/Maskow, International Sales Law (1992),
Art. 52 para. 4.
52 Yes: Magnus, in: Staudinger, Kommentar (2013), Art. 21 para. 17; Huber, in: MünchKommBGB
(2015), Art. 52 para. 23; Benicke, in: MünchKommHGB (2013), Art. 52 para. 19, Müller-Chen, in:
Schlechtriem/Schwenzer, Commentary (2016), Art. 52 para. 10; Altenkirch, in: Brunner, Kommentar
(2014), Art. 52 para. 7.
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Art. 45 remedies is not addressed by Art. 52(1)’s language, the similarity between
accepting excess goods and simply accepting contractually specified goods requires
that Art. 45(1) apply analogously to a buyer who accepts an excessive shipment.
However, the question of whether acceptance constitutes modification may have 45
relevance on whether damages caused by the excess delivery are available to the buyer.
If acceptance modifies the quantity term of the contract, some would argue that
excessive delivery no longer constitutes a breach, and the buyer thus no longer has a
claim for damages caused by the excess delivery.
However, as under Art. 52(1), the question of modification must not precede, but 46
rather follow the determination of the availability of damages,53 and under Art. 52(2),
allowing damages to the buyer is most likely in the interest of both buyer and seller.54
There is no reason to treat excess deliveries differently than early deliveries – to the
contrary, especially in commodity contracts, the buyer continuously purchases certain
amounts of goods. If the buyer accepts an excess delivery of a commodity, it is
tantamount to his accepting a portion of his next purchase early. Allowing the buyer
to claim for damages caused by excess quantities eases the buyer’s willingness to accept
deliveries despite an accompanying financial detriment. As a matter of fairness, how-
ever, once the buyer has accepted the goods, he should not be entitled to demand
removal of the goods by the seller by way of damages.
cc) Effects of a lawful rejection. If the buyer rejects the excessive part of the goods, 47
he has no obligation to pay for it. As under Art. 52(1), the remedies of repair, substitute
delivery and damages, as well as the remedy of avoidance55 are available to buyers under
Art. 52(2). Since he is entitled to both damages and repair, the buyer may require the
seller to remove the excess goods – which constitute the Art. 45 “non-conformity” to be
repaired – if the buyer has taken possession of them.56
Despite his rejection, the buyer may be obligated under Art. 86 CISG to take possession 48
of this part of the goods and reasonably preserve them for the seller. The rights and duties
that attend this obligation under Art. 52(1) apply equally to Art. 52(2).57
dd) Effects of an unlawful rejection. If the buyer rejects an allegedly ‘excess’ portion 49
of the goods although the quantity delivered was in conformity with the contract, the
non-acceptance constitutes a breach of Arts 53 and 60. The seller may thus employ the
remedies provided by Art. 61. Again, a rejection of a portion of a shipment in the errant
belief that it is excessive will rarely constitute a fundamental breach. Thus, sellers
wishing to claim avoidance for an errant rejection under Art. 52(2) will generally
require the seller to first set a Nachfrist during which the buyer may retract his rejection.
c) Burden of proof. As a general rule, the burden of proof in Art. 52(2) cases lies with 50
whichever party first invokes Art. 52(2).58 Thus, if a buyer claims damages for losses
caused by a seller’s excessive delivery, the buyer must prove that the requirements of

54Contra Magnus, in: Staudinger, Kommentar (2013), Art. 21 para. 26; Benicke, in: MünchKommHGB
(2013), Art. 52 para. 19; Huber, in: Huber/Mullis, The CISG (2007), pp. 301 et seq.
55 Again, however, it is barely imaginable that an excessive delivery constitutes a fundamental breach of
contract.
56 Schnyder/Straub, in: Honsell, Kommentar (2010), Art. 52 para. 65; Hartmann, in: BeckOGK (2016)
Art. 52 para. 21.

57 Supra para. 18.
58 Huber, in: MünchKommBGB (2015), Art. 52 para. 27; Hepting/Müller, in: Baumgärtel/Laumen/
Prütting (eds), Handbuch der Beweislast im Privatrecht (2009), Art. 52 paras 2 et seq.; Magnus, in:
Staudinger, Kommentar (2013), Art. 21 paras 52, 31.
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Art. 52(2) are met. If the seller demands payment in regard to the excessive amount
according to Art. 52(2), he must prove that the buyer has accepted the excessive delivery.
51 However, the buyer’s burden of proof is further modified by general CISG proof
principles. Generally, the buyer must prove the existence of an obligation, after which
the burden shifts to the seller to prove that he has fulfilled his obligation.59 Thus, when
buyers invoke Art. 52(2), they must prove that a certain quantity of goods was agreed to
in the contract, after which the burden shifts to the seller to prove that he did not
deliver more than the agreed quantity60 – a scenario hardly imaginable in practice.
52 If one followed predominant opinion and allowed rejection of an entire shipment on
grounds of practical inseparability, the buyer must prove the lack of separability.

1. Early delivery
53 Both the PICC and the PECL provide solutions to early delivery similar to Art. 52(1)
CISG. Under Art. 6.1.5 PICC, the buyer may reject goods that are delivered early unless
“the buyer has no legitimate interest in doing so,” and Art. 7:103 PECL contains an
equivalent provision. The “legitimate interest” restriction equals the result reached by
CISG through Art. 86 and the Art. 7 duty of good faith in international trade.61
54 An interesting difference between PICC, PECL, and CISG provisions lies in the rule
governing time for payment in cases where the buyer accepts an early delivery. As
discussed above, the CISG does not address the time for payment after acceptance of an
early delivery. In contrast, both the PICC and PECL provide explicit rules. Under
Art. 6.1.5(2) PICC, time of payment remains unaffected “if that time has been fixed in
the contract irrespective of the other party’s obligations.” From this rule, scholars have
concluded e contrario that if parties couple payment time and delivery terms, e. g. by
agreeing to “payment on delivery,” acceptance of an early delivery makes the date of
acceptance, not the contractual date, the relevant date in determining time of pay-
ment.62 In contrast, Art. 7:103(2) PECL maintains that the original contractual timeline
continues to govern the time for payment, even if payment was agreed “upon delivery.”
The rule of Art. III:2–103 DCFR mirrors the PECL rule.
2. Excessive delivery
55 Neither the PICC nor the PECL contain any rule that deals expressly with excessive
delivery. However, scholarship has taken the view that Art. 6.1.3. PICC, which deals
with partial delivery, applies analogously to excessive deliveries.63 As a result, an
excessive delivery constitutes a breach of contract under the PICC that entitles the
buyer to reject either the entire delivery or the excessive portion thereof, provided the
excessive portion can be easily separated.64
59See Art. 46.
60Huber, in: MünchKommBGB (2015), Art. 51 para. 27; Hepting/Müller, in: Baumgärtel/Laumen/
Prütting (eds), Handbuch der Beweislast im Privatrecht (2009), Art. 51 para. 9; Hartmann, in: BeckOGK
(2016) Art. 52 para. 25.
62 Atamer, in Vogenauer, UNIDROIT Commentary (2015), Art. 6.1.5 para. 12.
63 Atamer, in Vogenauer, UNIDROIT Commentary (2015), Art. 6.1.3 para. 24.
64 Atamer, in Vogenauer, UNIDROIT Commentary (2015), Art. 6.1.3 paras 24 et seq.
770 Bach
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Chapter III
Obligations of the Buyer
Article 53
The buyer must pay the price for the goods and take delivery of them as required
by the contract and this Convention.
Bibliography: Gabriel, Buyer’s Performance under the CISG: Arts 53–60 Trends in the Decisions, 25
Journal of Law and Commerce (2005–2006) 273; Tercier, Droits et obligations de l’acheteur, in: Wiener
Übereinkommen von 1980 über den internationalen Warenkauf, Lausanner Kolloquium (1985) 119.
Outline
1. Overview. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
2. Purchase price. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
3. Payment arrangements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
4. Payment clauses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
5. Duty to take delivery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
6. Further duties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
7. Choice of payment debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
8. Practical considerations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25

Part III of the CISG (Arts 53 to 65) governs the buyer’s duties and the consequences 1
of their breaches. Art. 53 is the Grundnorm. It declares that it is the buyer’s funda-
mental obligation to pay for the goods and to accept the seller’s delivery. The seller’s
obligation can therefore be characterised as an obligation to give (“dare”) as opposed to
other contracts in which the obligation is an obligation to do something (“facere”) as
occurs with work, services, or construction contracts1. Both obligations are subject to
the parties’ contractual agreement and the parties may modify or limit these obligations
as they see fit.2 The obligation to pay the purchase price as it has been set is further
expanded on in Arts 54–59, whereas additional matters relating to the obligation to take
delivery of the goods are set out in Art. 60. Therefore, the objective of Art. 53 is to
establish the central obligations of the buyer. The interplay between Art. 53 and the
parallel provision of Art. 30 stipulate the contract’s essentialia negotii.3
Given the relative lucidity of the provision and its further clarification by subsequent 2
articles, the courts have had little issue with its interpretation and Art. 53 is in general
only made reference to in outlining the obligations.4 This is also reflected by the fact
1 Perales Viscasillas, “International Distribution Contracts under the CISG” in Schwenzer/Atamer/
Butler (eds) Current Issues in the CISG and Arbitration (2014) 43, 53.
2 Compare Handelsgericht des Kantons Aargau (Switzerland), 19 June 2007 (Railway rails), CISG-
Online 1741 (Pace); Arbitral Award, CIETAC 18 August 2005, (Automatic production line) CISG-Online
1710 (Pace).
3 Mohs, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 53 para. 1; Huber, in: Münch-

4 See, e. g., Oberlandesgericht Brandenburg (Germany) 18 November 2008 (Beer), CISG-Online 1734
(Pace); District Court Nitra (Slovak Republic) 29 May 2008, CISG-Online 1766 (Pace); Oberlandesgericht
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Article 53 3–7 Part III. Chapter III. Obligations of the Buyer
that the provision provoked little debate at its adoption and it is directly adopted from
the wording of Art. 56 ULIS.5
3 Given the distinction made between breaches that are fundamental and those that are
not, it is possible to argue that the primacy afforded to the obligation to pay and accept
delivery is such that any breach of it would be fundamental and hence would allow the
seller to avoid the contract.6 Alternatively, one may consider the breach fundamental
only if the parties themselves agreed of its importance.7 Practically speaking the two
approaches may not lead to different conclusions as most parties acknowledge the great
importance of these obligations. In theory, however, paying 95 % of the value or
accepting delivery two days late may be instances where courts find the breach not to
be fundamental.
4 Given that the obligation to pay and to take steps to make payment are interlinked,
cases speak of Arts 53 and 54 in the same breath as they are often seen as two faces of
the same obligation.8

1. Overview
5 Art. 53 affirms the duty to pay the purchase price, generally stipulated in the sale of
goods contract.9 Particular rules in regard to the duty to pay the purchase price are set
out in Arts 54 to 59. Those provisions, however, do not capture all issues arising out of
the duty to pay the purchase price. Some issues are not dealt with by the CISG. In the
following paragraphs the basic questions will be analysed as far as they are not dealt
with by Arts 54 to 59.
2. Purchase price
6 The purchase price generally results from the explicit or implied contractual agree-
ment between the parties. If such an agreement is missing and a valid contract none-
theless exists,10 Art. 55 will apply.11 If the price is determined according to weight,
Art. 56 is engaged.
7 The agreed purchase price generally encapsulates all performances which the seller
owes under the contract. This would include, for example, not only the goods as such,
but also the packaging, the transport costs, the insurance costs and any taxes (e. g. sales
Köln (Germany) 14 January 2008 (Shoes), CISG-Online 1730 (Pace); UNCITRAL Digest of Case law on
the CISG pp 246 et seq available at http://www.uncitral.org/pdf/english/clout/CISG_Digest_2016.pdf (last
accessed 20 April 2017); Gabriel, Buyer’s Performance under the CISG: Arts 53–60 Trends in the
Decisions, 25 (2005–2006) Journal of Law and Commerce 273.
5 Note Hager, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 53 para. 1 raises the Czechoslo-
vakian (as it then was) proposal that the seller should be under a general obligation to cooperate in the
performance of the contract.
6 Enderlein/Maskow/Strohbach, Internationales Kaufrecht (1991), Art. 53 para. 4.1; Maskow, in: Bianca/
Bonell, Commentary (1987), Art. 53 para. 2.2.

7 The view taken by Schlechtriem, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 25 para. 24
and Hager, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 53 para. 4; Mohs, in: Schlechtriem/
Schwenzer, Commentary (2016), Art. 53 para. 41 seems to agree with the views taken by Hager in the
earlier edition.
8 Tribunal Supremo (Spain) 17 January 2008 (Used automobiles), CISG-Online 1640 (Pace).
9 Compare, for example, Oberlandesgericht München (Germany) 8 March 1995 (Nickel-copper cath-
odes), CISG-Online 145 (Pace); Oberster Gerichtshof (Austria) 27 February 1996, CISG-Online 648;
Kantonsgericht Zug (Switzerland) 16 October 1997 (Hygrometers), CISG-Online 335 (Pace).
10 Compare Art. 14(1) para. 28.
11 See infra Art. 55.
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Chapter III. Obligations of the Buyer 8–10 Article 53

tax, transaction tax etc.).12 Of course, the parties can stipulate any other arrangement by
agreement, for example, through the use of trade terms like the Incoterms.13 The
agreement of a ‘franco’ clause between the parties would mean that the transport costs
to the place of delivery are included in the purchase price.14
The purchase price that the parties agree upon is generally final. The CISG does not 8
know a claim to retrospectively adapt the contract or renegotiate.15 It is for the parties to
provide for eventualities, like difficulties in the performance or price or currency
fluctuations, within the contract itself. However, Arts 71, 72 or 79 might be applicable
if the respective requirements are met.16
3. Payment arrangements
Generally speaking, the parties agree on the payment arrangements or payment 9
arrangements are determined by trade usages and practices. To some extent, Arts 54 et
seq. contain some payment arrangements. However, these are non-mandatory and
parties can deviate from those as they think fit. Provisions which contain payments
arrangements are Art. 57 (place of payment), the time of payment (Arts 58, 59) and
Art. 54 (certain duties relating to the preparation of the purchase price payment).
Arts 54 et seq., however, leave some questions open, especially in regard to the mode of 10
payment. In regard to the latter, party agreement, as well as trade usages and practices, are
paramount once more. So far as the mode of payment is not determined either by party
agreement or trade usages and practices Arts 54 et seq. stipulate some basic rules. Art. 59
embodies the principle that the entire purchase price has to be made available to the seller
at the time the payment is due without the seller having to make any further effort to
secure the actual availability of the purchase price.17 It follows that the buyer does not have
a right to pay by instalments.18 In addition to this, it can be deduced from that principle
that the purchase price has to be paid in cash or has to be transferred in a timely manner
into the seller’s account.19 The transfer is timely if the payment is unconditionally and
without reservation credited to the seller’s account.20 Payment by cheque or bank draft is
generally not sufficient unless the parties have agreed upon it, or trade usages and practices
12 OLG Köln (Germany) 3 April 2006 (strawberry plants case) CISG-Online 1218 (Pace); Magnus, in:
Staudinger Kommentar (2013), Art. 53 para. 6; Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 53
para. 10; Achilles, Art. 53 para. 1; Piltz, Internationales Kaufrecht (2008), para. 4–131.
13 Bridge, The International Sale of Goods (2013) para 10.62 adding that INCOTERMS might be
implied; Huber, in: MünchKommBGB (2016), Art. 53 para. 9.

14 Magnus in: Staudinger Kommentar (2013), Art. 53 para 6.
15 Tercier, Droits et obligations de l’acheteur, in: Wiener Übereinkommen von 1980 über den
internationalen Warenkauf, Lausanner Kolloquium (1985), pp. 119, 121; Huber, in: MünchKommBGB
16 Magnus, in: Staudinger Kommentar (2013), Art. 53 para. 5; Schnyder/Straub, in: Honsell, Kommen-
tar (1997), Art. 53 para. 11. Art. 71 allows a party to suspend performance when it is apparent that the
other party will not be able to perform, i. e. will not be able to pay the purchase price (see generally
Art. 71 paras 4, 7 et seq.). Art. 72 allows a party to avoid the contract when it is clear that the other party
will commit a fundamental breach, i. e. not paying the purchase price (see generally Art. 72 para. 9).
Art. 79 deals with the situation where there is an impediment beyond the control of the party in regard to
paying the purchase price (see generally Art. 79 paras 8, 23, 43 et seq.).
17 Huber, in: MünchKommBGB (2016), Art. 53 para. 12; Schnyder/Straub, in: Honsell, Kommentar
(1997), Art. 53 para. 13.

18 Huber, in: MünchKommBGB (2016), Art. 53 para. 12; Magnus, in: Staudinger Kommentar (2013),
Art. 53 para. 7.
Art. 54 para. 2; Mohs, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 53 para. 10.
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allow payment by cheque or bank draft. Even if the cheque has been sent so as to allow the
seller sufficient time to cash it, a cheque is not a sufficient method of payment under Arts
53 et seq. as the basic rule stipulated in Arts 53 and 59 states that the seller should not have
to endure any effort or expense in regard to the purchase price payment.21 If the parties
have agreed on payment by cheque or bank draft then, generally, performance will only
occur if the cheque or bank draft has been cashed. In regard to the question of whether the
payment was effected in time, when the seller actually accepted the cheque or bank draft is
decisive.22 Costs, which result from the payment by cheque or bank draft, must generally
be borne by the buyer.23 If the seller accepts a bank draft, even though the seller has no
obligation to do so, this is generally considered a deferment of payment and an acceptance
of a modification of the contract.24 The use of other payment methods, such as a
documentary letter of credit, is only available to the buyer if it has been agreed upon by
the parties or can be ascertained through trade usages and practices.25
11 The buyer’s duty to make non-monetary performances, such as advertising cam-
paigns, in addition to the duty to pay the purchase price, do not alter the nature of the
contract as a sale of goods contract as long as the non-monetary performance does not
outweigh the purchase price payment.26 The same is true if the seller grants the buyer
the right to substitute the purchase price27 or if the seller defers the payment of the
purchase price indefinitely.28
4. Payment clauses
12 In practice, commercial parties often use standard trade terms to fix payment
arrangements.29 Agreed clauses, like the Incoterms (in regard to the terms of delivery),
do not exist to the same extent for the mode of payment; an exception to this, however,
is the ICC Uniform Customs and Practice for Documentary Credits (UCP).30 In general
the applicable trade practices and usages are relevant to determine whether the
particular payment clause is applicable.31 Some of the payment clauses that have
become very popular in international trade are:32
Straight Payment Clauses (exchange goods against payment)
13 Net cash: the buyer has to pay the goods in a timely manner as is customary in the
particular trade after the buyer received the goods and the invoice. Art. 58(1) second
sentence is waived if “net cash” is used which means that the seller is obliged to perform
21 Hager, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 57 para. 9; Magnus, in: Staudinger
Kommentar (2013), Art. 53 para. 8; Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 53 para. 13;
Huber, in: MünchKommBGB (2016), Art. 53 para. 13; different opinion in Herber/Czerwenka, Kommen-
tar (1991), Art. 53 para. 3.
22 Magnus, in: Staudinger Kommentar (2013), Art. 53 para. 8; Schnyder/Straub, in: Honsell, Kommen-
tar (1997), Art. 53 para. 14; Magnus, in: Staudinger Kommentar (2005), Art. 53 para. 8; Benicke, in:
23 Mohs, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 53 para. 22; compare Landgericht
Duisburg (Germany) 17 April 1996 (cheque), CISG-Online 186.

24 Landgericht Hamburg (Germany) 26 September 1990 (bank draft), CISG-Online 21 (Pace).
25 Compare Oberster Gerichtshof (Austria) 6 February 1996 (Propane gas), CISG-Online 224 (Pace).
26 See Art 3(2); Magnus, in: Staudinger Kommentar (2013), Art. 53 para. 9.
28 OLG München (Germany) IHR 2001, 197.
30 The UCP 600 is in force since 1 July 2007 see http://store.iccwbo.org/Content/uploaded/pdf/ICC-
Users-Handbook-for-Documentary-Credits-under-UCP-600.pdf (last accessed 20 April 2017).

31 See Art. 9 paras 10, 20 et seq.; compare Magnus, in: Staudinger Kommentar (2013), Art. 53 para. 11.
32 A far more comprehensive overview of payment clauses and their meaning can be found in Liesecke
WM (1978) 3 pp. 1 et seq.
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in advance.33 Set-off and cash discount deductions are generally excluded.34 The buyer
has the opportunity to inspect the goods, Art. 58(3) is not excluded.35
Cash on delivery (COD): Payment is due when the goods are delivered to the buyer. 14
The buyer does not have the right to examine the goods or to object in any way.
Art. 58(3) is waived. The payment does not have to be in cash- other forms of payment
have become common, like, e. g., credit cards or cheques and can also fulfil the
requirement.36 The carrier generally has the authority to collect the payment. The clause
contains a set-off exclusion.37 The place of payment is therewith the place of delivery
since the carrier receives the payment as the seller’s agent.38 The payment is due when
the goods have been delivered.
Cash against Invoice: The buyer has to pay the purchase price after receiving the 15
invoice. If the invoice reaches the buyer before the goods were delivered, then the
payment is only due after the delivery of the goods.39
Cash before Delivery (CBD): The buyer has to pay the purchase price in advance. The 16
seller only has to deliver the goods after the purchase price payment has been received.40
Telegraph transfer (TT): The term is used in international business to refer to an 17
international credit transfer. The UNCITRAL Model Law on International Credit
Transfers (1992) is an attempt to unify the law of international credit transfers. The
model law was the model for the European Union Directive 97/5/EC41 on cross border
credit transfers. Credit transfers to which the Directive does not apply has to be
determined in accordance with private international law rules.42
As Mohs notes the CISG is only concerned with the discharging effect of the use of 18
TT on the buyer’s payment obligation. Therefore, payment is effected if the amount of
the purchase price is credited to the seller’s account and the seller can dispose of the
purchase price unconditionally.43
Documentary Payment Clauses
Cash against documents (CAD); documents against payment (D/P): the seller has to 19
dispatch the goods and has to tender the documents. The buyer has to pay the purchase
price when the documents are tendered without having received the goods. The buyer is,
therefore, obliged to perform in advance of receiving the goods.44 The question arises
whether the doctrine of strict compliance, as developed in regard to letter of credits,
applies in case the documents do not entirely conform. The literature points out the
comparability of CAD and documents against letters of credit.45 Since the buyer does not
33 See, for example, already E. Clements Horst v Biddel Bros [1912] AC 18 (HL); Liesecke WM (1978) 3
pp. 1, 8; Huber, in: MünchKommBGB (2016), Art. 53 para. 15.

34 Compare Bundesgerichtshof (Germany) BGHZ 14, 61 (62); 23, 131 (135); 94, 71, 76; Oberlandesger-
icht Hamburg (Germany) 5 October 1998 (Electronic parts), CISG-Online 473 (Pace).
Art. 53 para. 14.

36 The term is sometimes substituted by “collect on delivery”.
37 Bundesgerichtshof (Germany) NJW 1985, 550; Huber, in: MünchKommBGB (2016), Art. 53 para. 15.
39 Lögering, CISG und internationale Handelsklauseln (2008) 83; Magnus, in: Staudinger Kommentar
(2013), Art. 53 para. 15.

40 Lögering, CISG und internationale Handelsklauseln (2008) 79, 80.
41 OJ 1997 L 043, 25 (27 Jan 2007).
42 Mohs in: Schlechtriem/Schwenzer, Commentary (2016) Art. 53 para 11.
43 Mohs in: Schlechtriem/Schwenzer, Commentary (2016) Art. 53 para 12.
44 Compare Bundesgerichtshof (Germany) NJW 1987, 2435 seq.; Bundesgerichtshof (Germany) NJW
1988, 2608 seq.; Oberster Gerichtshof (Austria) 6 February 1996 (Propane gas), CISG-Online 224 (Pace);
Liesecke WM (1978) 3 pp. 1, 11; Lögering, CISG und internationale Handelsklauseln (2008) 85 et seq;
45 Maskow, in: Bianca/Bonell, Commentary (1987), Art. 57 para. 2.8.
3B2 9.1.580; Page size: 160.00mm 240.00mm
have the opportunity to inspect the goods due to having to perform in advance, a strict
compliance standard should apply. Art. 58(3) is waived in this case. The buyer does not
have the right to examine the goods before the purchase price payment or to refuse
payment due to non-conformity of the goods.46 The buyer can only claim any possible
non-conformity of the goods afterwards.47 The clause contains a set-off exclusion.48
20 Documents against Letter of Credit (L/C): The clause “documents against letter of
credit” is especially frequent in international trade. The buyer’s obligations are the same
as under D/P, in addition, however, the buyer has to order his bank to issue a letter of
credit in the amount of the purchase price.49 The ICC Uniform Customs and Practice
for Documentary Credits has to be taken into account too.50
21 Documents against Acceptance (D/A): The buyer has the same duties as under D/P.
However, the buyer does not make a cash payment but only when the documents are
presented with a bill of exchange.51
5. Duty to take delivery

22 In addition to pay the purchase price the buyer has to take delivery. The substance of
the duty to take delivery is substantiated by Art 60. The duty to take delivery is a
concrete one, an endorsing act is not enough.52
6. Further duties
23 Additional buyer’s duties can follow from the contract between the parties, usages
between the parties and trade usages.53 Those duties can comprise duties which are not
directly connected to the purchase price payment like duties to inform, to share
information or competition or cooperation agreements.54
7. Choice of payment debt

24 If the buyer has more than one purchase price payment due, one has to distinguish
between several payments arising out of the same contract and payments arising from
different contracts. In regard to the former Art. 8 and trade usages (Art. 9) will
determine to which debt the payment is to be applied to if the buyer has not specified
the payment. In regard to the latter, the CISG is silent. If the underlying contracts are all
CISG contracts the gap should be filled in accordance with the principles set out in
Art. 8 and Art. 9 CISG. If the payment debts arise not solely from CISG contracts, the
applicable domestic law will determine which debt will be paid by the purchase price.55

47 Compare Magnus, in: Staudinger Kommentar (2013), Art. 53 para. 17.
49 Compare Liesecke WM (1978) 3 pp. 1, 20, Huber, in: MünchKommBGB (2016), Art. 53 para. 15; see
Audiencia Provincial de Cantabria (Spain) 9 Jul 2013 (steel cable) CISG-Online 2487 where the letter of
credit did not cover the entire agreed purchase price. The buyer was held to be in breach of his obligation
under Arts 53, 54 CISG.
51 Lögering, CISG und internationale Handelsklauseln (2008) 89 et seq; Liesecke WM (1978) 3, 17, 18;
Magnus, in: Staudinger Kommentar (2013), Art. 53 para 19.

52 Magnus, in: Staudinger Kommentar (2013), Art. 53 para 32.
53 Magnus, in: Staudinger Kommentar (2013), Art. 53 para 33, eg the duty to obtain a foreign exchange
permit.
54 Magnus, in: Staudinger Kommentar (2013), Art. 53 para 36.
55 Gerechtshof-Hertogenbosch (Netherlands) 2 Jan 2007 CISG-Online 1434; Mohs in: Schlechtriem/
Schwenzer, Commentary (2016) Art. 53 para 27; compare PICC, Art 6.1.12.
3B2 9.1.580; Page size: 160.00mm 240.00mm

The question of which debt is repaid with the purchase price can be of importance in
regard to the accrual of interest and the statute of limitation.
8. Practical considerations
The usual rules in regard to burden of proof apply. Generally, the seller has to prove 25
that a payment obligation exists.56 The buyer on the other hand has to prove that he
performed that obligation.57 In addition, the buyer has to prove any discount the buyer
has received with respect to the purchase price.58

The relatively non-controversial nature of the general obligation to make payment 26
and accept delivery of the goods can be found in both the PICC and the PECL.59
Although not explicitly stated as an obligation on the buyer, it is reasonable to assume
that, under the PICC, the duty to make payments and accept delivery is an implied
obligation of all contracts.60 The duties to accept delivery and pay for the goods are also
part of the legislative framework of sales law in the United Kingdom61 and, in fact, are
seen as concurrent obligations.62
As with the CISG the US-UCC provides that “[t]he obligation of the seller is to 27
transfer and deliver and that of the buyer is to accept and pay in accordance with the
contract.”63 The German BGB as well stipulates that the buyer’s obligation is twofold: to
pay the purchase price and to take delivery of the goods.64
56 Oberlandesgericht Saarbrücken, Germany, 12 May 2010, Internationales Handelsrecht, 2012, 202,
available on the Internet at www.globalsaleslaw.org; Landgericht Kassel, Germany, 15 February 1996,

Neue Juristische Wochenschrift – Rechtsprechungsreport 1996, 1146.
57 OLG München (Germany) CISG-Online 145 (Pace); LG Kassel (Germany) CISG-Online 191 (Pace);

58 OLG Saarbrücken (Germany) 12 May 2010 CISG-Online 2155.
59 Chapter 7 PECL.
60 Art. 5.1.1 PICC.
61 S. 27 Sale of Goods Act 1979 (UK).
62 S. 28 Sale of Goods Act 1979 (UK).
63 § 2–301 UCC.
64 § 433(2) BGB.
3B2 9.1.580; Page size: 160.00mm 240.00mm
Section I
Payment of the price
Article 54
The buyer’s obligation to pay the price includes taking such steps and complying
with such formalities as may be required under the contract or any laws and
regulations to enable payment to be made.
Journal of Law and Commerce (2005–2006) 273; Osuna-Gonzalez, Buyer’s Enabling Steps to Pay the
Price: Article 54 of the United Nations Convention on Contracts for the International Sale of Goods, 25
Journal of Law and Commerce (2005–2006) 25; Magnus, Waehrungsfragen im Einheitlichen Kaufrecht,
Zugleich ein Beitrag zu seiner Lueckenfuellung und Auslegung, 53 RabelsZ (1989) 116.
Outline
1. Scope of the duty. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2. Currency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
a) Determination of the currency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
aa) CISG approach . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
bb) Private international law approach . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
cc) Certainty of the purchase price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
b) Replacement of the currency. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
c) Election of the currency by the seller . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
3. The buyer’s breach of his obligation(s). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
4. Practical questions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19

1 Art. 54 augments the buyer’s obligation to pay the purchase price by requiring the
buyer to comply with formalities as may be required under the contract (or any governing
law) to enable that payment. As a matter of history, the article is very similar to Art. 69
ULIS.1 By way of example, formalities that may be included in the contract may include
anything from the banal such as cash, cheque or preparation of payment in instalments,
to more elaborate financial methods like opening or amending a letter of credit,2 a bank
1 UNCITRAL YB (1974), p. 32 no. 35 a. The only relevant note about the history of the provision is
that the ‘steps’ obligation is one where breach brings in remedies under Arts 61–64 and would not relate
to the rules under anticipatory breach.
2 Secretariat Commentary on 1978 Draft, Art. 50 (now Art. 69) para. 2. Opening a Letter of credit:
Arbitral Award, International Court of Arbitration, 1 January 2003 (Fashion products), CISG-Online
1421 (Pace); Arbitral Award, CIETAC, February 2001 (Equipment, material and services) (Pace);
Bezirksgericht der Saane (Switzerland) 20 February 1997 (Spirits), CISG-Online 426 (Pace); Arbitral
Award, International Court of Arbitration, 1 January 1992 (Foam board machinery), CISG-Online 105
(Pace). Amending a letter of credit: Arbitral Award, Comisión para la Protección del Comercio Exterior
de México, 30 November 1998, Dulces Luisi v Seoul International, CISG-Online 504 (Pace); Arbitral
Award, CIETAC, 18 December 1996 (Lentil) (Pace).
778 Butler/Harindanath
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Section I. Payment of the price 2–3 Article 54

guarantee,3 payment of invoices,4 accreditation of the purchase price5 or even requiring a
signature on the original record of receipt.6 The failure to take any of these steps is likely
to be considered a fundamental breach if it results in the payment not being made.7 The
purpose of the provision is to ensure that the owed purchase price is in fact available to
the seller.
The phrase ‘any laws and regulations’ in Art. 54 begs the question as to which laws 2
apply. To ensure smooth payment transactions, private international law on foreign
exchange rules should govern where relevant to the payment.8 To hold the view that any
laws or regulations that may have an effect on the buyer’s payment need to be observed by
the buyer themselves should not be followed.9 The CISG generally balances the obligations
of the buyer and the seller to an extent. To put the burden on the buyer to observe all and
any laws and regulations puts too much of a burden on the buyer. There are two features
of Art. 54 worth exploring: the scope of the duty and the currency of the payment.
1. Scope of the duty

The buyer has to make such arrangements and has to fulfil all formal requirements 3
necessary that the contract (including trade practices and usages) or statutory provi-
sions demand to effect the payment at the buyer’s own expense. Some courts have
stressed that the obligation to take such steps exists even where the buyer’s manage-
ment structure has changed and, as a result, there could not be approval of a letter of
credit.10 There may be instances where the failure to open a letter of credit is actually
the seller’s fault and hence, by virtue of Art. 80, cannot be seen as a breach of
Art. 54.11 Sending instructions to a bank may not be enough; it must be the case that
there are sufficient funds capable of undergoing the international transaction.12
Interestingly, a court has ruled that confirmation by a bank of the letter of credit
may not fall within the buyer’s obligations.13 In this authors’ view, however, if it is the
3 Bank guarantee: Arbitral Award, Arbitration Court attached to the Hungarian Chamber of Com-
merce and Industry, 17 November 1995 (Mushrooms), CISG-Online 250 (Pace).

4 Regional Court in Nitra (Slovak Republic) 23 June 2006 (Raw material for women’s coats), CISG-
Online 1764 (Pace).

5 Handelsgericht des Kantons Zürich (Switzerland) 30 November 1998 (Lambskin coat), CISG-Online
415 (Pace).
6 Fovárosi Biróság Budapest (Hungary) 1 July 1997 (Used timber machinery), CISG-Online 306 (Pace).
7 Audiencia Provincial de Cantabria (Spain) 9 July 2013 (steel cable) CISG-Online 2487; Osuna-
Gonsalez, Buyer’s Enabling Steps to Pay the Price: Article 54 of the United Nations Convention on
Contracts for the International Sale of Goods, Journal of Law and Commerce (2005–06) 25; See Arts 61 et
seq. and Arts 71 and 72 in regard to the remedies.
8 Dölle/von Caemmerer, Art. 69 EKG, para. 3; Schlechtriem/Butler, CISG (2009), para. 210.
9 Mohs, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 54 para. 3.
10 Supreme Court of Queensland (Australia) 17 November 2000, Downs Investments v Perwaja Steel,
CISG-Online 587 (Pace): An irrevocable letter of credit from the buyer in favour of the seller was required
prior to shipment. Shortly before having to provide the letter of credit, the structure and management of
the buyer changed. Under this new management structure, the buyer was obliged to obtain permission
from an executive committee before it could provide a letter of credit. The buyer failed to provide a letter
of credit upon the seller’s request, as the executive committee could not communicate any instructions
within a short time.
11 Oberster Gerichtshof (Austria) 6 February 1996 (Propane), CISG-Online 224 (Pace).
Chamber of Commerce and Industry, 17 October 1995, CISG-Online 207 (Pace).

13 Landgericht Kassel (Germany) 21 September 1995 (Wooden poles), CISG-Online 192 (Pace).
Butler/Harindanath 779
3B2 9.1.580; Page size: 160.00mm 240.00mm
buyer’s obligation to effect payment, the bank’s confirmation of the letter of credit
should fall within the buyer’s sphere of responsibility.
4 The Federal District Court in New York emphasised in Hilaturas Miel, S. L. v
Republic of Iraq that Art. 54 itself is phrased purely in terms of the buyer’s performance
and does not require the buyer to accept alternatives where the seller cannot perform.14
Further, the buyer may be exempted from his liability under Art. 54 where the failure to
take steps was due to an impediment beyond their control under Art. 79.15
5 The question of how far the reference to statutory provision reaches is controversial.
Some argue (on the basis of Art. 54’s predecessor in the ULIS) that only the provisions
applicable in accordance with private international law rules would fall under the
reference.16 The modern general opinion is that the reference to statutory provisions is
wider: all the pertinent statutory provisions have to be taken into account, i. e. they are
relevant, for the timely purchase price payment by the buyer.17 Since the purpose of
Art. 54 is to ensure that the seller actually receives the purchase price payment, the latter
view is preferable. This is of particular practical relevance in regard to exchange control
regulations. Those will often originate in the buyer’s country. However, exchange
control regulations in the seller’s country or in third countries are also covered by the
ambit of Art. 54 if otherwise the actual payment cannot be effected. If such regulations
originate in the seller’s country the seller has, under the principle of good faith
(Art. 7(1))18, a duty to co-operate with the buyer to effect the payment.19
6 The term “steps” or “arrangements” cannot be strictly separated from “formalities”.20
Those terms encompass all steps the buyer has to take to enable the seller to, in actual
fact, be able to dispose of the money at the agreed time. This can apply, for example, to
the way the payment has to be made. The buyer has to ensure that they have enough of
the owed currency or authorise a bank to do so.21 The obligation of the buyer to have
enough convertible money is also covered. If, according to the contract or trade usages
or practices, the buyer does not have to pay in cash or by bank transfer but must use
another means of payment the buyer is obliged to take every necessary step to effect
payment, for example, the buyer might have to open a letter of credit or provide a bank
14 Federal District Court of New York (U.S.) 20 August 2008, Hilaturas Miel, S. L. v Republic of Iraq,
CISG-Online 1777 (Pace): The seller, Hilaturas Miel, had argued that under Art. 54 Iraq, the buyer, had
to offer alternative performance.
15 Compare Mohs, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 54 para. 8 in regard to the
breach of foreign exchange rules; see also Osuna-Gonsalez, Buyer’s Enabling Steps to Pay the Price:
Article 54 of the United Nations Convention on Contracts for the International Sale of Goods, Journal of
Law and Commerce (2005–06) 305.
16 Strohbach, in: Enderlein/Maskow, International Sales Law (1992), Art. 54 para. 5; Maskow, in:
Bianca/Bonell, Commentary (1987), Art. 54 para. 2.7 CISG.

17 Magnus, in: Staudinger Kommentar (2013), Art. 54 para. 5; Hager, in: Schlechtriem/Schwenzer,
Commentary (2005), Art. 54 para. 4; Herber/Czerwenka, Kommentar (1991), Art. 54 para. 3.

18 See in regard to the application of good faith between the parties to the contract Art 7 para. 24–34.
20 Witz, in: Witz/Salger/Lorenz, Kommentar (2000), Art. 54 para. 2, who argues that the term
“formalities” does not have an independent meaning.

21 Compare: Arbitral Award, Tribunal of International Commercial Arbitration at the Russian Federa-
tion Chamber of Commerce and Industry Arbitration, 17 October 1995, CISG-Online 207: The bank did
not transfer the foreign currency amounts to the seller on the grounds that there were no funds available
in the buyer’s account in freely convertible currency to pay for the goods. The buyer requested the
tribunal discharge it from liability since, in its view, the fact that it did not have available foreign currency
resources should be regarded as force majeure. The tribunal stated, inter alia, that, under Art. 54, the
buyer’s obligation to pay the price of the goods included taking such measures and complying with such
formalities as might be required to enable payment to be made. It was established that the only action
taken by the buyer was to send instructions to the bank for the amounts payable under the contract to be
transferred, but that it had not taken any measures to ensure that the payment could actually be made.
3B2 9.1.580; Page size: 160.00mm 240.00mm

guarantee.22 The same is true for exchange control regulations. It is the buyer’s
responsibility to apply for the necessary permits (and to appeal any unfavourable
decision).23 The rendering of illegal acts, on the other hand, is not required.24
The question arises further, in analogy to the New Zealand mussels case25, of whether 7
comparatively uncommon and/or atypical taxes, levies, or charges imposed by the
seller’s country have to be borne by the buyer. An analogy to the New Zealand mussels
case suggests that the purchase price does not include those charges, levies, or taxes
which do not exist in the buyer’s state as well. An exception has to be made if the seller
informed the buyer about the relevant levies or taxes relying on the buyer’s expert
knowledge (Art 35 (2)(b)), or the buyer had knowledge of those taxes and levies due
to special circumstances.26 However, unlike goods which can come in an indefinite
number of form, shape, and sizes and are subject to either no regulations or vastly
different regulations, the purchase price presents a far more uniform picture. Money has
to be transferred from the buyer to the seller and unless a cash payment is made, banks
will have to be involved. The buyer has therewith the assistance of an expert to afford
payment. Taxes, charges, and levies exist in every country and information about them
will be more easily attainable. Therefore, the threshold for the purchase price not
encompassing a tax or levy that is uncommon or atypical in the buyer’s country should
be higher than the threshold expressed by the Bundesgerichtshof in the New Zealand
mussels case. If the application of the tax, charge, or levy is uncertain or the tax, charge,
or levy in comparatively unique, only then are they excluded from the purchase price.27
The seller can be obliged in accordance with Art 7(1) CISG to cooperate with the buyer
to ascertain the relevant levies and taxes.28
2. Currency
The question of which currency should be used for payment is not one directly 8
addressed by the CISG. First and foremost, party agreement is decisive for the
determination of the currency. Further, the currency may be determined by the trade
usages and practices applicable to the contract. Therefore, prior dealings in a currency
may also be relevant in determining the currency. For example if two parties have
always dealt in US dollars then it may be inferred that the currency was intended to be
US dollars.29
22 See Audiencia Provincial de Cantabria (Spain) 9 July 2013 (steel cable) CISG-Online 2487; Witz, in:
Witz/Salger/Lorenz, Kommentar (2000), Art. 54 para. 3; Huber, in: MünchKommBGB (2007), Art. 54
23 Achilles, in: Ensthaler (8th ed.), HGB Kommentar (2015), Art. 54 para. 2. Exchange control regula-
tions which concern the validity of the contract or the payment clauses can in accordance with Art 4(a)
CISG make the contract invalid (Piltz, Internationales Kaufrecht (2008) para. 4-128; Magnus, in:
Staudinger Kommentar (2013), Art. 53 para 31).
24 Magnus, in: Staudinger Kommentar (2013), Art. 54 para. 6; Huber, in: MünchKommBGB (2016),
Art. 54 para. 4.
25 Bundesgerichtshof (Germany) 8 March 1995 (New Zealand mussels case) CISG-Online 144 (Pace), RJ
& AM Smallmon v Transport Sales Limited and Grant Alan Miller 22 July 2011 (trucks case) CISG-
Online 2215 (Pace).
26 Bundesgerichtshof (Germany) 8 March 1995 (New Zealand mussels case) CISG-Online 144 (Pace)
II.1.b.bb.
27 Compare Schlechtriem, Einheitliches Kaufrecht in den Entscheidungen des Bundesgerichtshof in
Canaris/Heldrich (eds) 50 Jahre Bundesgerichtshof Vol I Private Law (Beck, Munich, 2000) 407 (Pace)
criticising the decision of the Bundesgerichtshof in the New Zealand mussels case and advocating for a
threshold similar to the one suggested here.
29 Oberster Gerichtshof (Austria) 6 Feb 1996 (Propane), CISG-Online 224 (Pace).
3B2 9.1.580; Page size: 160.00mm 240.00mm
9 However, if the parties have not determined the currency themselves, it is disputed as
to how it should be determined. Three different approaches are put forward in practice
and in the literature.
a) Determination of the currency
10 aa) CISG approach. Some argue, for the sake of uniformity, that the solution should
be found by looking to the CISG when the parties’ intended currency is not deducible
from the agreement.30 Behind that approach is the idea that recourse to national laws in
an important question such as the currency of the purchase price would jeopardise the
aim of the CISG in harmonising international sales law. The currency question, there-
fore, falls within the ambit of the CISG so that the lack of a particular regulation of
that issue is an internal gap in the CISG which needs to be filled in accordance with the
principles of the CISG (Art. 7(2)).31 Especially in the literature, both argued solutions –
the “private international law approach”32 and the “certainty of the purchase price
approach”33 – burden this important issue unnecessarily with immense uncertainty and
add an unnecessary layer of legal argument and evidence. An approach in accordance
with CISG principles is, however, controversial. The predominant opinion applies the
currency at the place of payment.34 Another opinion applies the currency at the seller’s
place of business.35 Both views lead to the same result, i. e. the same currency, if the
place of payment is determined in accordance with Art. 57(1)(a). However, if Art. 57(1)
is not determinative, the latter view is for practical reasons the preferable one, since the
seller generally will want to use the purchase price in their place of business.36
11 bb) Private international law approach. The private international law approach37
rejects a CISG-based solution and advocates a solution in accordance with private
international law rules. The currency is determined in accordance with national law,
which one derives through private international law rules. A solution on the basis of the
CISG under Art. 7(2) cannot be considered, it is argued, since the question of currency
is an issue which does not fall within the ambit of the CISG.38
12 Under the ULIS, the buyer may have had the right to trump the agreement and have
the currency as the place of payment. Commentators have argued this should not be the
case under the CISG due to party autonomy.39
30 Huber, in: MünchKommBGB (2016), Art. 53 para. 19; Hager, in: Schlechtriem/Schwenzer, Commen-
tary (2005), Art. 56 para. 10; Hager/Maultzsch, in: Schlechtriem/Schwenzer, Kommentar (2008), Art. 54
para. 8; Schlechtriem/Butler, CISG (2009), para. 211; Mohs, in: Schlechtriem/Schwenzer, Commentary
(2016), Art. 53 para. 5.
31 See Art. 7(2) paras 47 et seq.
34 Kammergericht Berlin (Germany) 24 January 1994 (Wine), CISG-Online 130 (Pace); Benicke, in:
MünchKommHGB (2013), Art. 54 para. 7; Piltz, Internationales Kaufrecht (2008), para. 4–122.
35 Magnus, in: Staudinger Kommentar (2013), Art. 53 para. 20–23; Schlechtriem/Butler, CISG (2009),
para. 211.
Art. 53 para. 19.

37 Kantonsgericht Kanton Wallis (Switzerland) 30 Jun 1998 (Granite material), CISG-Online 419
(Pace); Maskow, in: Bianca/Bonell, Commentary (1987), Art. 54 para. 3.1; Herber/Czerwenka, Kommen-
tar (1991), Art. 53 para. 5; Mohs, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 53 para. 6.
38 Maskow, in: Bianca/Bonell, Commentary (1987), Art. 54 para. 3.1; Herber/Czerwenka, Kommentar
(1991), Art. 53 para. 5; Mohs, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 53 para. 6: Art. 57 is
not sufficient to extract a general rule in regard to the owed currency. Some German jurisprudence argues
that the German private international law has established a special connecting factor in regard to
currency, namely law of the place of payment.
39 Hager, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 54 para. 10.
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cc) Certainty of the purchase price. A third view considers the currency as part of 13
the question of certainty of the purchase price and applies Arts 14 and 5540. The
controversy about the relationship of those two articles41, however, taints also the
currency question. In the event that despite Art. 14, i. e. irrespective of a missing party
agreement about the purchase price, a valid contract between the parties exists, the
currency is to be determined in accordance with Art. 55. Therefore, the question of
whether the “price generally charged” (Art. 55) also encompasses the currency has to be
addressed. If that is not the case on the facts, this view resorts to the private international
law approach.
b) Replacement of the currency. Under ULIS it was controversial whether the buyer 14
could replace the currency, i. e. whether the buyer could pay with a different currency as
stipulated by the contract (either explicitly, implicitly or determined as discussed
above), for example, in the currency of the place of payment.42 The prevailing opinion
rejects this view for the CISG, since a one-sided authority to change something so
important like the currency in which the purchase price is to be paid in would be
contrary to the principles of the CISG.43 Of course, the parties are free to contractually
agree on such a right, or trade usages and practices might allow for currency replace-
ment. It is recognised that in exceptional cases and in accordance with the principle of
good faith (Art. 7(1))44 the buyer should be able to pay a currency other than the one
agreed. For example, if foreign exchange regulations prevent the buyer from paying in
the agreed currency.45 In those circumstances the seller could demand payment in the
currency of the buyer’s country.46
c) Election of the currency by the seller. Like a mirror image of the issue discussed 15
under 2.2., the question arises whether the seller has the right to demand the purchase
price payment in a different currency than the one contractually agreed upon if, for
example, the payment in the contractual agreed currency is not possible due to foreign
exchange regulations. This question is controversial.47 At the Vienna Conference, an
application to allow for choice of currency by the seller was rejected with the argument
that that issue was outside the ambit of the Convention.48 However, similarly to the
exceptional circumstances under which the buyer is allowed to elect another currency
than that agreed upon, the seller is able to demand the purchase price in another
currency, again in accordance with good faith (Art. 7(1)) and also in accordance with
the fundamental idea embodied in Art. 79. According to the latter an obligor does not
40Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 54 para. 26.

41See Art. 55 paras 4 et seq.
42 Compare von Cämmerer, in: Dölle (ed.), Kommentar zum Einheitlichen Kaufrecht (1976), Art. 57
para. 22.
43 Oberster Gerichtshof (Austria) 22 October 2001 (Gasoline and gas oil), CISG-Online 614 (Pace);
Oberlandesgericht Koblenz (Germany) 17 September 1993 (Logo for ink printers (chip)), CISG-Online 91
(Pace); Magnus, in: Staudinger Kommentar (2013), Art. 53 para. 28; Huber, in: MünchKommBGB (2016),
Art. 53 para. 20.
44 See Art. 7(1) paras 23 et seq.
45 Huber in: MünchKommBGB (2016), Art. 53 para. 20; Achilles, Art. 53 para. 1; Magnus, Währungs-
fragen im Einheitlichen Kaufrecht, Zugleich ein Beitrag zu seiner Lückenfüllung und Auslegung, 53
RabelsZ (1989) 116 (133).
46 For ULIS: LG Heidelberg (Germany) 21 April 1981 and OLG Koblenz (Germany) 21 January 1983
both cited in: Schlechtriem/Magnus, Art. 56 EKG, No 3.

47 Agreeing: Mohs, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 53 para. 9; Benicke, in:
MünchKommHGB (2013), Art. 54 para. 9; disagreeing: Magnus, in: Staudinger Kommentar (2013),
Art. 53 para. 30.
48 Official Records, Art. 50 no. 14 et seq.
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have to pay damages for an impediment outside his sphere of influence. However, the
obligor still will have to perform (cf. Art. 79(5)).49 The seller cannot, of course, freely
choose the replacement currency.50 Generally, the currency at the buyer’s place of
business should be the replacement currency and if that is the contractually owed
currency the replacement should be one which is reasonable for the buyer and in some
way relevant.
3. The buyer’s breach of his obligation(s)

16 The obligation(s) set out in Art. 54 are part of the buyer’s “obligation to pay the
price.” A breach of any of those obligations leads to the buyer’s liability set out in Arts
61 et seq.; not only to liability under Arts 71 and 72 (anticipatory breach).51 The breach
of an obligation under Art. 54 that results in no payment being made is a breach of
contract (Arts 61 et seq.). If the seller can show that that breach is fundamental the seller
may declare the contract avoided (Arts 64(1)(a) and 25).52 If the payment is made,
despite a breach of the preparatory obligations, but late or not in accordance with the
contract, or bears additional costs for the seller generally, Arts 61 et seq. are also
applicable with the exception of the provisions in regard to non-payment. If the breach
of obligations under Art. 54 is of no consequence, there is no liability for the buyer.53
17 Under Art. 63(1) the seller can fix an additional reasonable time period to allow the
buyer to perform his obligations. Under Art. 64(1)(b) the seller can avoid the contract if
the buyer does not perform his obligations within that additional time period. It follows
that the seller can avoid the contract without the need to prove a fundamental breach if
the buyer has not performed within the additional set time period: for example, if the
buyer does not arrange for a letter of credit to be issued within the time period set by
the seller.
18 The buyer will be exempt from the payment of the purchase price if the requirements
of Art. 79 CISG are met.54
4. Practical questions
19 Who is required to state the facts and who has to prove conformity with the general
rules? The seller has to prove the purchase price claim and the buyer has, if necessary, to
prove that he paid the purchase price.55
20 Art. 54 can be defined more closely or modified by contract. It is especially valuable
to define in the contract which efforts the buyer has to make in regard to exchange
control regulations, as well as the scope of the buyer’s liability.56
49Mohs, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 53 para. 9.

50Mohs, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 53 para. 9; Huber, in: Münch-
KommBGB (2016), Art. 53 para. 22; Magnus, in: Staudinger Kommentar (2013), Art. 53 para. 30.
51 Compare: Gabriel, Sale of Goods (2004), p. 168.
52 Compare: Supreme Court of Queensland (Australia) 17 November 2000, Downs Investments v
Perwaja Steel, CISG-Online 587 (Pace); Bezirksgericht der Saane (Switzerland) 20 February 1997 (Spirits),
CISG-Online 426 (Pace); Arbitral Award, ICC 7197/1992, 1 January 1992, CISG-Online 36 (UNILEX);
Arbitral Award, ICC 7585/1992, 1 January 1992 (Production line for foamed boards), CISG-Online 105
(Pace); Honnold, p. 324; Huber, in: MünchKommBGB (2016), Art. 54 para. 5.
Art. 54 para. 5.
Art. 54 para. 9.
56 Huber, in: MünchKommBGB (2016), Art. 54 para. 10; Witz, in: Witz/Salger/Lorenz, Kommentar
(2000), Art. 54 para. 7.
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The PICC allows the buyer to pay in any form used in the ordinary course of business at 21
the place for payment (Art. 6.1.7(1)). If the seller accepts payment by cheque. then only
under that condition will the cheque be honoured (Art. 6.1.7(2)).57 The payment might
also be made by transfer of funds (Art. 6.1.8). The PICC regulates quite specifically the
currency in which payment has to be made.58 Interestingly, the buyer generally has the
right to pay in the currency at the place of payment at the applicable rate of exchange
prevailing there when payment is due (Art. 6.1.9(3)). However, if the buyer pays late the
seller can request payment of the currency at the place of payment in accordance with
the rate at the time the actual payment is made (Art. 6.1.9(4)). Similarly, § 244 BGB, like
the PICC, allows the buyer to make payment in Euros even if another currency was
contractually agreed upon if the payment has to be made in Germany and it was not made
explicit in the contract that payment was only to be effected in the agreed currency.59
At common law, the presumptive method of payment is by means of legal tender,60 22
which is currency or coin.61 Some more recent jurisprudence indicates that a bank
cheque might also be legal tender.62 This rule can be deviated from by previous practice
between the parties or by trade custom and usage.63 Bridge argues that the waiver of the
buyer’s strict payment duty may over time produce a new implied agreement between
the parties or a custom or usage.64 For example, where credit is given, and the buyer is
subsequently invoiced for the price, it is highly likely that the common law rule will
have been displaced by an implied agreement that the buyer may pay by cheque.65
As with the CISG, the US-UCC supplements the buyer’s general obligation to pay 23
with the mandate that the buyer must actually ensure that the seller receives the
payment.66 Similarly, under the Sale of Goods Act 1979 (UK), it is implicit that the
buyer should take such steps given that the language of s 28 is that the buyer “must be
ready and willing to pay the price in exchange for possession of the goods”.
57See Art. 7:107 PECL which is identical with the PICC.
58Art. 6.1.9. PICC states: “If a monetary obligation is expressed in a currency other than that of the
place for payment, it may be paid by the obligor in the currency of the place for payment unless
(a) that currency is not freely convertible; or
(b) the parties have agreed that payment should be made only in the currency in which the monetary
obligation is expressed.
(2) If it is impossible for the obligor to make payment in the currency in which the monetary obligation is
expressed, the obligee may require payment in the currency of the place for payment, even in the case
referred to in paragraph (1)(b).
(3) Payment in the currency of the place for payment is to be made according to the applicable rate of
exchange prevailing there when payment is due.
(4) However, if the obligor has not paid at the time when payment is due, the obligee may require
payment according to the applicable rate of exchange prevailing either when payment is due or at the
time of actual payment.”
59 See also 7:108 PECL.
60 Gordon v Strange (1847) 1 Ex 477, 154 ER 203.
61 Bridge, International Sale of Goods (2013), 6.04; Burrows, in: Burrows/Finn/Todd, Law of Contract
in New Zealand (2016), para. 18.6.

62 Compare, e. g., Williams v Gibbons 1 NZLR [1994] 273 (CA); Burrows, in: Burrows/Finn/Todd, Law
of Contract in New Zealand (2016), 18.6. Note that the NZ Supreme Court held that a personal cheque
was not legal tender: Otago Station Estates Ltd v Parker [2005] 2 NZLR 734 (SCNZ).
63 Bridge, International Sale of Goods (2013), para. 6.04.
66 §§ 2–301, 2–511 UCC Rev.
3B2 9.1.580; Page size: 160.00mm 240.00mm
Article 55
Where a contract has been validly concluded but does not expressly or implicitly fix
or make provision for determining the price, the parties are considered, in the
absence of any indication to the contrary, to have impliedly made reference to the
price generally charged at the time of the conclusion of the contract for such goods
sold under comparable circumstances in the trade concerned.
Bibliography: Nemanja Pandurevi, Interplay Between Article 14 And Article 55 Of The United Nations
Convention On Contracts For The International Sale Of Goods (CISG), http://dx.doi.org/10.7251/
zrefis.v1i11.2355, Ahmad Tajudin, Article 55 on Open-Price Contract: A Wider Interpretation Neces-
sary?, Journal of Arts and Humanities Vol. 3 No. 3 (March 2014), 38 http://www.theartsjournal.org/
index.php/site/article/view/396/240; Gabriel, Buyer’s Performance under the CISG: Arts 53–60 Trends in
the Decisions, 25 Journal of Law and Commerce (2005–2006) 273; Saidov, Cases on the CISG decided in
the Russian Federation, 7 Vindobona Journal of International Commercial Law and Arbitration (2003)
37; Mistelis, Article 55: The Unknown Factor, 25 Journal of Law and Commerce (2005–2006) 295.
Outline
1. When does it apply? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
a) Missing determination of the purchase price. . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
b) Validity of the contract. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
2. How does it apply?. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
3. Burden of proof . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

1 Art. 55 must be read in conjunction with Art. 14(1) second sentence, which demands
that the price be determined by the parties – or is at least determinable – for a valid
contract. The situation envisaged by Art. 55 is as follows: Buyer (B) and Seller (S)
conclude an agreement in which there is no provision for determining the price. In the
event of a dispute between B and S, Art. 55 imposes an implied agreement to the price
“generally charged at the time of the conclusion of the contract for such goods sold
under comparable circumstances in the trade concerned.”1 This ‘trade-value’, however,
will only be the price if there was an “absence of any indication to the contrary.” There
are two questions that usually arise in Art. 55 jurisprudence. First, in what situations
does the provision apply? And secondly, how does one ascertain a given price? A
question which Art. 55 does not answer is in which currency the purchase price has to
be paid.2
2 Legal systems deal with the question of the undetermined purchase price substantially
differently. The discussions over the predecessor of Art. 55 (Art. 57 ULIS), were very
controversial, something which did not change during the Vienna Conference.3
1 Compare Bezirksgericht St Gallen (Switzerland) 3 July 1997 (Fabrics), CISG-Online 336 (Pace);
compare Magnus, in: Staudinger Kommentar (2013), Art. 55 para. 1.

2 Huber, in: MünchKommBGB (2016), Art. 55 para. 1; but see Art. 54 paras 9 et seq.
3 Mohs, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 55 para. 1 also with reference to Art. 57
ULIS in para. 2, and the history of the drafting of Art. 55 in para. 2; Huber, in: Münch-KommBGB
3B2 9.1.580; Page size: 160.00mm 240.00mm

1. When does it apply?
a) Missing determination of the purchase price. The first and foremost requirement 3
for the application of Art. 55 is that the contract neither explicitly nor impliedly stipulates
the price, nor that the contract allows the determination of the price. It is particularly
important to note that, when interpreting a contract in regard to the price, even if the
price or a way to determine it might not be explicitly mentioned, the price might still be
impliedly agreed upon.4 For example, through the implied inclusion of price lists which
the buyer knew about or ought to have known about, or through trade usages and
practices.5 Sometimes the price “generally charged at the time of conclusion” can be of
importance.6 Art. 55 is only applicable if, through interpretation of the contract, a price
cannot be determined.7
The price includes not only the actual sum agreed to be paid for the good but also 4
other means or instruments which have an impact on the sum agreed. Art. 55 might
find its application in situations where the parties have agreed on the actual sum to be
paid for the good, however, had no meeting of the minds on tools to determine the
ultimate purchase price, like, the exchange rate.
b) Validity of the contract. Art. 55 requires that – despite the fact that the parties have 5
not agreed upon a price – a valid contract may exist, which seems to contradict the
wording of Art. 14.8 Art. 55 has been under academic scrutiny since its inception due to
its prima facie conflict with Art. 14.9 Courts have noted the interplay between the two
(2016), Art. 55 para. 1; see in regard to the drafting history Honnold, Uniform Law (1999), para. 325.3.
See also infra under III. in regard to how the different legal systems deal domestically with that question.
4 Compare Oberster Gerichtshof (Austria) 10 November 1994 (Chinchilla furs), CISG-Online 117
(Pace).
5 Compare Magnus, in: Staudinger Kommentar (2013), Art. 55 para. 8; Bennicke, in: MünchKommHGB
(2013), Art. 55 para. 5; Huber, in: MünchKommBGB (2016), Art. 55 para. 2.

6 See Art. 14 paras 28, 29; Huber, in: MünchKommBGB (2016), Art. 55 para. 2.
7 See Legfelsóbb Birósag (Hungary) 25 September 1992 (Airplane engines), CISG-Online 63 (Pace): The
seller, a manufacturer of aircraft engines, made two alternative offers of different types of aircraft engines
to the buyer without quoting an exact price. The buyer chose the type of engine from the ones offered and
placed an order. The issue here was whether a valid contract was concluded. The Supreme Court found
that the offer and the acceptance were vague and, as such, ineffective since they failed to explicitly or
implicitly fix or make provision for determining the price of the engines ordered (Art. 14(1) CISG). The
Court did not apply Art. 55 since there was no market price for aircraft engines. Cour de Cassation
(France) 4 January 1995 (Electronic components), CISG-Online 138 (Pace): The purchase price is not
considered indeterminable if the parties had only agreed on a price revision clause. Arbitral Award,
Industry, 3 March 1995, CISG-Online 204: the Arbitral Tribunal found that the parties had not concluded
a contract for the additional sale of goods, because the seller’s proposal was not sufficiently definite in the
terms of Art. 14 CISG: the proposal indicated the goods and their quantity but it failed to indicate either
the price that was to be agreed upon by the parties at some future date or the mode of its determination.
8 See for a discussion on the history of the Vienna Conference Huber, in: MünchKommBGB (2016),
Art. 55 para. 4.
9 Honnold, Uniform Law (1999), para. 325.3. believes that the provision allows for open contracts
whereas Farnsworth, International Sales: The United Nations Convention on Contracts for the Interna-
tional Sale of Goods: Formation of Contract § 3.03. regards the contradiction as leaving the provision
redundant; Karollus, Judicial Interpretation and Application of the CISG in Germany 1988–1994, Cornell
Review of the Convention on Contracts for the International Sale of Goods (1995) 51–94; Eörsi, in:
Bianca/Bonell, Commentary (1987), Art. 55; see also Hondius, CISG and a European Civil Code, 71
RabelsZ (2007) 99–114. Cases where Art. 14 was applied instead of Art. 55 are: Kantonsgericht Fribourg
(Switzerland) 11 October 2004 (Chemical product), CISG-Online 964 (Pace); Arbitral Award, Tribunal of
3B2 9.1.580; Page size: 160.00mm 240.00mm
Article 55 6 Part III. Chapter III. Obligations of the Buyer
provisions but have not always been willing to resolve the conflict.10 The practical
difference in allowing Art. 14’s precedence over Art. 55 is that it brings the determination
of the price within the court’s ambit and neutralises external forces such as the market. In
the latter case the price is determined in accordance with the price “generally charged at
the time of the conclusion of the contract” whereas in the former, the courts can take all
relevant circumstances into account (Art. 8).11 As a result, courts have been more willing
to give Art. 14 priority.12 Art. 14 specifies that an offer is sufficiently definite where, at the
very least, it stipulates a method for calculating a price. Hence, it would seem that
Art. 55’s aim of preserving a contract without such a method is made redundant. The
obvious solution is to allow the price to be a sufficient, but not a necessary, condition of a
binding offer under the CISG. Therefore, failure to specify a price does not go to the
validity of the contract, thereby resolving the contradiction in Art. 55. However, this
solution, as noted in Butler and Schlechtriem, “draws the teeth out” of Art. 55 and
narrows its scope to a small lacuna of cases.13 First, the effect of the clause is to do away
with the doctrine of pretrium cetrium, and, by extension, the clause itself can only be put
into place where there is a valid agreement.14 Secondly, there must be no express or
implicit specification of the price, nor must there be provision for determining the price.15
Where there is a method for determining the price, Art. 14 should apply.16
6 Art. 55 may also not apply where there is an implicit right for the buyer to alter the
price.17 It does apply, however, in contingency clauses. For example where the buyer
states “we will pay $ 100 if it is of this standard” but does not specify what would be
paid if the standard is not met. However, this can only be so if the price was meant to be
kept open and not where it seems that parties wish to negotiate further.18 Further,
International Commercial Arbitration at the Russian Federation Chamber of Commerce and Industry,
3 March 1995, CISG-Online 204 (Pace). Cases holding the opposite view are: Arbitral Award, Tribunal of
9 April 2004, CISG-Online 1207 (Pace); Audiencia Provincial de Barcelona, (Spain) 27 November 2003
(Ski equipment rental), CISG-Online 1102 (Pace); Arbitral Award, Arbitration Court attached to the
Bulgarian Chamber of Commerce and Industry, 30 November 1998 (Production of automobiles), CISG-
Online 1832 (Pace).
10 Federal District Court of Pennsylvania (U.S.), 29 March 2004, Amco Ukrservice et al. v American
Meter Company (Pace).

11 Compare Oberster Gerichtshof (Austria) 10 November 1994 (Chinchilla furs) CISG-Online 117
(Pace) discussed in Schlechtriem/Butler, CISG (2009), para. 75.

12 Mistelis, Article 55: The Unknown Factor, 25 Journal of Law and Commerce (2005–06) 295.
14 Supreme Court (Czech Republic) 25 June 2008 (Manufactured paint) (Pace); Oberlandesgericht
München (Germany) 19 October 2006, CISG-Online 1394 (Automobiles) (Pace); Supreme Court of the
People’s Republic of China (China) 21 September 2005, CISG-Online 1611 (Exhibition) (Pace).
15 Mistelis, Article 55: The Unknown Factor, 25 Journal of Law and Commerce (2005–06) 285–297
argues the opposite.

16 Oberster Gerichtshof (Austria) 10 November 1994 (Chinchilla furs), CISG-Online 117 (Pace); general
opinion see Huber, in: MünchKommBGB (2016), Art. 55 para. 7; Magnus, in: Staudinger Kommentar
(2013), Art. 14 paras 31 et seq; Herber/Czerwenka, Kommentar (1991), Art. 14 para. 6.
17 Arbitral Award, Tribunal of International Commercial Arbitration at the Russian Federation Chamber
of Commerce and Industry, 16 February 1998, CISG-Online 1303 (Pace).

Chamber of Commerce and Industry, 22 November 1995, (Pace); Saidov, Cases on the CISG decided in
the Russian Federation, 7 Vindobona Journal of International Commercial Law and Arbitration (2003) pp
37–38 observes, however: “It is not clear why the Tribunal deemed it possible to apply Article 55. Such a
decision seems to run counter to the provision of the contract according to which in the situation that
took place in the case, a price was to be agreed upon by the parties. It is submitted that Article 55 could
only be applied where the parties intended to regard an open price contract as valid. Therefore, a price
could be determined according to Article 55 only if such a determination of a price stemmed from
interpretation of the contract. The decision does not make it clear whether the Tribunal interpreted the
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Art. 55 applies if the application of Part II of the CISG (Arts 14 to 24) is excluded, for
example, through Art. 9219, or because the parties have agreed to do so (Art. 6) or due
to trade usages and practices (Art. 9).20 In those cases it has to be noted, however, that
domestic law will determine the validity of the contract, since Arts 14 et seq. are not
applicable, therefore, Art. 4 will apply.21 Art. 55 is applicable only if the contract is valid
(without an agreed price) according to the applicable domestic law (unless of course the
parties have excluded Art. 55).
Generally, the controversy surrounding Art. 55 and Art. 14 is of little practical 7
relevance since Art. 55 is only applicable if it is found that the parties neither explicitly
nor impliedly agreed on a price or a price determination mechanism.22
2. How does it apply?

The legal consequence stipulated in Art. 55 is the rebuttable presumption that the 8
parties impliedly agreed upon a purchase price which would have been payable in
comparable purchases. The time of contract conclusion is decisive, not the time of
delivery.23 A fluctuation of the price after contract conclusion is of no relevance.24 The
generally charged price can be determined by three objective criteria:25 the price which
is: (a) paid for the same goods; (b) in the particular line of business or common
market, and (c) in comparable circumstances. The particular line of business is the
market to which both parties belong to.26 The term “comparable circumstance” refers
especially to contractual agreements in regard to, for example, transport costs,
insurance, or discounts.27 Where a uniform market or stock-exchange exists that price
will be determinative.28 To give full effect to Art. 55 it must be sufficient that a price
range is identifiable from which one can deduce the median price. The ability to
determine an absolutely certain price is not necessary.29 Furthermore, the price can
either be agreed to by the parties or set by an independent expert, and “it is sufficient
for the existence of a market price in the sense of Article 76(1) CISG if, owing to
regular business transactions for goods of the same type at a particular trade location,
agreement. On the basis of the information available, it seems that the parties’ intention was not to leave
the price open, but to come to an agreement to this effect. In such a case, Article 55 could not be applied.”
19 See Art. 92 para in regard to the few countries that still have a Art. 92 reservation in place.
20 Magnus, in: Staudinger Kommentar (2013), Art. 55 para. 5 and Art. 14 para. 35; Schlechtriem/

21 Magnus, in: Staudinger Kommentar (2013), Art. 55 para. 5 and Art. 14 para. 35; Schlechtriem/
22 See also Huber, in: MünchKommBGB (2016), Art. 55, para. 10.
23 However, compare Landgericht Neubrandenburg (Germany) 3 August 2005 (Pitted sour cherries),
CISG-Online 1190 (Pace) where the Court held that the determining the price later in accordance with
the seasonal price met the requirement of “determinable” in Art. 55 CISG.
24 Secretariat Commentary Art. 51 para. 3; Mohs, in: Schlechtriem/Schwenzer, Commentary (2016),
Art. 55 para. 16; Huber, in: MünchKommBGB (2016), Art. 55 para. 11; Benicke, in: MünchKommHGB
(2007), Art. 55 para. 10; Magnus, in: Staudinger Kommentar (2013), Art. 55 para. 9; Mistelis, Article 55:
The Unknown Factor, 25 Journal of Law and Commerce (2005–06) 295.
25 Compare Mohs, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 55 paras 14, 15; Benicke, in:
MünchKommHGB (2013), Art. 55 para. 7; Huber, in: MünchKommBGB (2016), Art. 55 para. 11.
26 Huber, in: MünchKommBGB (2007), Art. 55 para. 11; different place of seller’s business: Witz, in:


28 Achilles, Art. 55 para. 3.
29 Witz, in: Witz/Salger/Lorenz, Kommentar (2000), Art. 55 para. 3.
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a current price has been established.”30 It can be the usual list price for such goods at
the time of the conclusion of the contract.31
9 If the price cannot be determined by those objective criteria (for example, if there is not
a common market since the goods are produced solely for the buyer)32 the question of how
to proceed is controversial. Some authors suggest that when there is no common market to
determine the price from, one may consult the market from which businesses, like the
buyer, generally purchase.33 This solution, however, has its limits if a buyer’s market
cannot be determined. Another view assumes that in such a case the contract is invalid.34
A third view, and in this authors’ view preferable, is that in such cases a gap in accordance
with Art. 7(2) exists. Since the CISG does not give any guidance on how to close that gap it
has to be closed in accordance with the applicable domestic law. If the domestic law
stipulates a mechanism in regard to determining the purchase price this mechanism has to
be used. Only if the domestic law, too, does not provide any mechanism to determine the
price is the contract invalid.35 This view is consistent with the CISG’s overall philosophy to
keep contracts between parties alive as frequently as possible.
3. Burden of proof
10 The burden of proof, that despite the missing price agreement a valid contract between
the parties exists, rests on the party who asserts the contract. The question of whether
Part II of the CISG (Art. 92) is applicable is a legal question which does not need to be
proven by either party.36 Which party has to prove what the generally charged price is, is
controversial. According to one view, the price has to be determined ex officio.37 The
contrary view assumes that this is a question which the party who is asserting the
particular price has to prove.38 The burden of proof for the rebuttable presumption lies
with the party who asserts it.39 A party can discharge its burden of proof by showing what
price was paid for the goods at the stock exchange or by producing evidence in regard to
the common market, for example, a statement by the Chamber of Commerce.

11 Art. 5.1.7. PICC sets out a detailed provision how the price is to be determined if the
parties have not agreed upon it, ironing out some of the issues which have surfaced
under the CISG. Similarly to the CISG, Art. 5.1.7. (1) provides that the price generally
charged is the price “agreed” upon by the parties and if that price is not determinable, it
30 Oberlandesgericht München (Germany) 15 September 2004 (Furniture leather), CISG-Online 1013
(Pace). See also Stoll/Gruber, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 76 para. 4; similar
31 Oberlandesgericht Rostock (Germany) 10 October 2001 (frozen food), CISG-Online 671 (Pace).
32 Compare Achilles, Art. 55 para. 1; Legfelsóbb Birósag (Hungary) 25 September 1992 (Airplane engines),
CISG-Online 63.
33 Magnus, in: Staudinger Kommentar (2013), Art. 55 para. 9; different Achilles, Art. 55 para. 3: price at
the place of delivery; compare Legfelsóbb Birósag (Hungary) 25 September 1992, CISG-Online 63 (Pace).
34 Mohs, in: Schlechtriem/Schwenzer, Commentary (2010), Art. 55 para. 15; Witz, in: Witz/Salger/
Lorenz, Kommentar (2000), Art. 55 para. 11; Bundesgerichtshof (Germany), 27 June 1990, NJW (1990)
3077 in regard to the predecessor, Art. 57 ULIS.
35 Heuze|., Vente International (2000), pp. 313 et seq.
37 Magnus, in: Staudinger Kommentar (2013), Art. 55 para. 11 who points out that the parties have an
obligation to cooperate.
39 Witz, in: Witz/Salger/Lorenz, Kommentar (2000), Art. 55 para. 5.
3B2 9.1.580; Page size: 160.00mm 240.00mm

shall be the reasonable price. Further, Art. 5.1.7. makes it clear that the presumption is
that a valid contract between the parties has been concluded even if the price is missing.
In its following paragraphs, Art. 5.1.7 deals with the question of whether one party has
to the right to determine the price, or whether the price is to be determined by reference
to factors. In summary, the buyer will always have to pay a reasonable price.
The PECL also provides for a missing purchase price in its provisions. Art. 6:104 12
simply states that where the contract does not fix the price or the method of determin-
ing it, the parties are to be treated as having agreed on a reasonable price. Art. 6:105
deals with the unilateral determination by one party.
Section 8(1) of the Sale of Goods Act 1979 (UK) states that if the price in a contract of 13
sale is not fixed by the contract, the price may be left to be fixed in a manner agreed by
the contract, or may be determined by the course of dealing between the parties. If the
price is not determined or determinable, the buyer must pay a reasonable price (s 8(2)
SGA). What can be considered a reasonable price is a question of fact dependent on the
circumstances of each particular case (s 8(3) SGA). If the contract stipulates that the
valuation of the price should be concluded by a third party and the third party cannot or
does not make the valuation, the contract is deemed to be avoided (s 9(1) SGA). However,
if the goods or any part of them have been delivered to and appropriated by the buyer, the
buyer must pay a reasonable price for them (s 9(2) SGA).
The US-UCC provides for an open price agreement under § 2–305. When the parties 14
intend to have an enforceable contract but omit the price, “the price is a reasonable
price at the time for delivery.”
E. g. §§ 315, 316 German BGB deal generally with the instance when performance has 15
not been explicitly or impliedly determined by the contract. § 316 BGB allows the party
who can claim the performance to determine it by using a reasonableness standard.
3B2 9.1.580; Page size: 160.00mm 240.00mm
Article 56
If the price is fixed according to the weight of the goods, in case of doubt it is to be
determined by the net weight.
Bibliography: Gabriel, Buyer’s Performance under the CISG: Arts 53–60 Trends in the Decisions,
25 Journal of Law and Commerce (2005–2006) 273.
Outline
1. Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2. Practical considerations. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
IV. Comparable Rules . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

1 In the event that there is any doubt in regard to a purchase price based on weight,
then Art. 56 directs that the price will be fixed by the net weight. The provision is
identical to Art. 58 ULIS and its passage was not affected by any of the proposals for its
modification.1
2 The provision is seen as a rule of interpretation and is only used where there is
ambiguity as to whether the agreed price was to be determined on gross weight or net
weight.2 It is likely that the ambiguity raises a rebuttable presumption that it is the net
weight since the buyer should not, in the case of doubt, pay for the wrapping.3

1. Overview
3 Art. 56 requires that the purchase price is set by weight. This is not the case if the
purchase price is set by pieces or units and the weight is only used to specify those
items.4 Art. 56 is applicable, on the other hand, if an inclusive price has been agreed
upon for the entire weight.5
4 If the purchase price is set by weight it will be net weight, if in doubt, which means the
measured weight minus the wrapping.6 The time at which the weight is taken depends
first and foremost on party agreement and trade practices and usages.7 If the time cannot
be determined through agreement or trade practice and usages, the literature is divided on
1 Official Records, pp. 11, 122, Art. 52, Nos 1–6.
3 Hager/Maultzsch, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2008), Art. 56 para. 2;

4 For example, 100 units 1kg each. Magnus, in: Staudinger Kommentar (2005), Art. 56 para. 5; Benicke,
in: MünchKommHGB (2013), Art. 56 para. 1; Piltz, Internationales Kaufrecht (2008), para. 4–133.
Art. 56 para. 2; doubtfully Maskow, in: Bianca/Bonell, Commentary (1987), Art. 56 para. 2.4.
Huber, in: MünchKommBGB (2016), Art. 56 para. 3; Piltz, Internationales Kaufrecht (2008), para. 4–133.
3B2 9.1.580; Page size: 160.00mm 240.00mm

how to determine the weight. Some authors stipulate the time at which the risk passes to
the buyer as the decisive moment8. Other authors view the appropriate point to determine
weight as that when the goods arrive at the place of delivery.9 On a practical level, both
views will generally come to the same result. To determine the weight at the time the risk
passes seems to be the rational way to proceed since that is also the time which is decisive
for liability in regard to the non-conformity of the goods.10 Loss in weight after the
decisive time for measurement is at the expense of the buyer.
It has to be noted, however, that the net weight is only decisive “if in doubt”; in the 5
normal course of events party agreement and trade usages and practices trump.11
The usual rules in regard to burden of proof apply. This includes that the party who 6
claims that a divergent rule applies bears the burden of proof for it.12
IV. Comparable Rules

Comparable provisions can be found in § 380(1) HGB (Germany) and Art. 212(2) 7
OR (Austria). The US-UCC, on the other hand, does not know a comparable provi-
sion.13 Neither the PICC nor the PECL know a similar provision.
8 Mohs, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 56 para. 4; Schnyder/Straub, in: Honsell,

Art. 56 para. 2.
10 Benicke, in: MünchKommHGB (2013), Art. 56 para. 3; Ferrari, in: Ferrari et al., Internationales

11 For example, the clause “gross for net” means that the overall weight including the wrapping is
determinative for the price [Hager/Maultzsch, in: Schlechtriem/Schwenzer, Kommentar (German ed.
2008), Art. 56 para. 2].
KommBGB (2015), Art. 56 para. 4; Magnus, in: Staudinger Kommentar (2013), Art. 56 para 7.
13 Gabriel, Sale of Goods (2004), p. 170.
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Article 57
(1) If the buyer is not bound to pay the price at any other particular place, he must
pay it to the seller:
(a) at the seller’s place of business; or
(b) if the payment is to be made against the handing over of the goods or of
documents, at the place where the handing over takes place.
(2) The seller must bear any increases in the expenses incidental to payment which
is caused by a change in his place of business subsequent to the conclusion of the
contract.
Journal of Law and Commerce (2005–2006) 273; Ziegel, Report to the Uniform Law Conference of
Canada on Convention on Contracts for the International Sale of Goods (July 1981), Art. 57; Schroeter,
Vienna Sales Convention: Applicability to “Mixed Contracts” and Interaction with the 1968 Brussels
Convention, 5 Vindobona Journal of International Commercial Law and Arbitration (2001) 74; Forsyth/
Moser, The Impact of the Applicable Law of Contract on the Law of Jurisdiction under the European
Conventions, 45 International and Comparative Law Quarterly (1996) 190; Koch, Der besondere
Gerichtsstand des Klaegers/Verkaeufers im Anwendungsbereich des UN-Kaufrechts, RIW (1996) 379.
Outline
1. Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
2. Party agreement (Art. 57(1) first sentence) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
3. Payment at the seller’s place of business (Art 57(1)(a), (2)). . . . . . . . . . . . . . . 12
a) General application . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
b) Payment at the seller’s place of business. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
c) Change in the place of payment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
d) Means of payment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
4. Payment against the handing over of the goods or of documents
(Art. 57(1)(b)) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
a) Sale not involving carriage of the goods to the buyer . . . . . . . . . . . . . . . . . . 23
b) Sale of goods from storage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
c) Sale of goods involving the carriage of goods to the buyer. . . . . . . . . . . . . 25
d) Sale of goods in transit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
e) Payment against documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
5. Place of payment of monetary claims other than the purchase price. . . . . 31

1 Art. 57 governs the place where the purchase price has to be paid. It is the first of
three articles addressing the manner of payment; the other modality addressed being
time (Arts 58, 59). The main function of Art. 57 is to establish the place where the
purchase price has to be at the disposal of the seller at the relevant time. Art. 57 has also
been referred to by judges to determine the currency of the payment.1
1 See UNCITRAL, Digest of Case Law on the CISG, Art. 54 para. 6; see Kammergericht Berlin
(Germany) 24 January 1994, CISG-Online 130 (Pace) (currency of payment should, in case of doubt, be
that of the place of payment); Oberlandesgericht Koblenz (Germany) 17 September 1993 (computer chip),
3B2 9.1.580; Page size: 160.00mm 240.00mm

In practice Art. 57 is of relevance for two reasons: 2
First, since many countries render it impossible to export funds without a license, 3
payments made in such countries may be of little value to a seller. On the other hand,
buyers in “soft currency” countries may find it difficult to pay in “hard currency”
countries. If the parties have not specified the place for payment or the currency of
payment, except where there are practical difficulties with the parties’ agreement,
Art. 57 fills the gap.2
Secondly, Art. 57 is important in judicial practice because the place of payment 4
in numerous jurisdictions has an impact on the jurisdiction of State courts, as the
territorial jurisdiction of State courts may depend on the place of payment.3 In Europe,
two different legal instruments provide for the place of performance of the contractual
obligation as a special case of jurisdiction; this being in addition to the general
jurisdiction based on the domicile of the defendant. They are:
– The Brussels Convention of 27 September 19684 which was replaced by the EC
Regulation No 44/2001 (“Brussels Regulation”) applicable to European Union coun-
tries; and
– The Lugano Convention of 16 September 1988, as amended in 2007, applies to
Norway, Switzerland, and Iceland.5
It should be noted that the Brussels Regulation contains an autonomous definition of 5
the place of performance which in principle does not go back to the applicable contract
CISG-Online 91 (Pace) (currency of the place where the seller has his place of business is the currency in
which the price should be paid). See Art. 54.
2 Ziegel, Report to the Uniform Law Conference of Canada on Convention on Contracts for the
International Sale of Goods (July 1981), Art. 57 CISG.

3 Landgericht Krefeld (Germany) 20 September 2006 (Charcoal), CISG-Online 1459 (Pace); Schroeter,
Vienna Sales Convention: Applicability to “Mixed Contracts” and Interaction with the 1968 Brussels
Convention, 5 Vindobona Journal of International Commercial Law and Arbitration (2001) p. 74, paras
3.1, 3.2; Lookofsky, Understanding the CISG (2008), § 4.12. UNCITRAL, Digest of Case Law on the CISG,
Art. 57 para. 4. Also in common law the place of payment is significant to give an English or New
Zealand court, for example, jurisdiction [RS C Ord 11, r 1 (UK), HCR 219 (b)(iii) (NZ); FCR 8.2. (Aus)].
Further, an English court will not enforce a payment stipulation where payment would be illegal under
the law of the state where it is to be made [Goode, Payment Obligations in Commercial and Financial
Transactions, p. 25]. During the Vienna Conference the Federal Republic of Germany proposed that it
should be expressly stated that the place of performance did not found jurisdiction [Official Records,
p. 122, Art. 53 no. 3; see in regard to the discussion of the proposal: Official Records, pp. 368 seq., Art. 53
nos 27–35] since the purpose of the substantive rules determining the place of payment is merely to
allocate risks, not to establish a basis of jurisdiction. Furthermore, a change in the seller’s place of
business after the conclusion of the contract would potentially lead to a different place of payment and
therewith to the jurisdiction of a court not originally envisaged by the parties [see Hager, in: Schlech-
triem/Schwenzer, Commentary (2005), Art. 57 para. 11]. The proposal was rejected by the Vienna
Conference since matters of jurisdiction were not within the scope of the Convention [Official Records,
p. 122, Art. 53 no. 5; p. 369, Art. 53 nos 30, 31, 33].
4 See in regard to decisions discussing the place of performance in light of the Brussels Convention,
Art. 5(1): ECJ (6 Oct 1976) Rs. 12/76 = Slg. 1976, 1473, 1486 f (Tessili/Dunlop); ECJ (15 January 1987)
Rs. 266/85 = Slg. 1987, 239, 254 (Shenavai/Kreischer); Bundesgerichtshof (Germany) 26 March 1992
(Doors and windows), CISG-Online 67 (Pace); Sø og Handelsretten (Denmark) 1 July 1992 (Plastic
gloves), CISG-Online 459.
5 2007/712/EC: Council Decision of 15 October 2007; see, e. g., Oberlandesgericht Düsseldorf (Germany)
24 July 2007 (Coils), CISG-Online 1531; Kantonsgericht Nidwalden (Switzerland) 23 May 2005 (Farm
machines and spare parts), CISG-Online 1086 (Pace).
3B2 9.1.580; Page size: 160.00mm 240.00mm
law for determining the place of performance.6 Therefore, the procedural role of Art. 57
within the Brussels Regulation states will be limited.7

1. Overview
6 Art. 57 sets out a three step test for determining where the buyer has to pay the
purchase price:
(1) party autonomy is the paramount criterion (Art. 57(1) first sentence)
(2) Art. 57(1)(a) provides that the place of payment is to be the seller’s place of business
(3) however, if the payment is to be made against the handing over of the goods or of
documents, the place of payment shall be at the place where the handing over takes
place (Art. 57(1)(b)).
7 In line with the general tenor of the CISG, Art. 57(1) first sentence in conjunction
with Art. 6 makes the agreement between the parties on the place of payment one of the
most important criteria to be determined. Usages and practices between the parties
(Art. 57(1) first sentence in conjunction with Art. 9) are equally determinative. In the
absence of a party agreement on the place of payment or determinative usages and
practices between the parties, Art. 57(1)(b) provides that the place of payment will be at
the place where the goods are handed over if the contract provides for a step-by-step
performance. In all other scenarios Art. 57(1)(a) is applicable and provides for the
seller’s place of business as the default place of payment.
2. Party agreement (Art. 57(1) first sentence)

8 Art. 57(1) first sentence affirms the underlying principle of the CISG: party autonomy
is paramount. Therefore, the oral or written agreement between the parties in regard to
the place of payment determines first and foremost the place of payment. Often parties
6 Art. 5 Brussels Regulation states: A person domiciled in a Member State may, in another Member
State, be sued:
(a) in matters relating to a contract, in the courts for the place of performance of the obligation in
question;
(b) for the purpose of this provision and unless otherwise agreed, the place of performance of the
obligation in question shall be:
– in the case of the sale of goods, the place in a Member State where, under the contract, the goods
were delivered or should have been delivered,
– in the case of the provision of services, the place in a Member State where, under the contract,
the services were provided or should have been provided,
(c) if subparagraph (b) does not apply then subparagraph (a) applies.
Issues which have arisen under the Brussels Regulation to date are, for example, which court has
jurisdiction if there are multiple deliveries [Color Drack GmbH v LEXX International Vertriebs GmbH,
ECJ (3 May 2007) (case C-386/05, ECLI:EU:C:2007:262)]; differentiation between contract for goods and
contract for services and place of delivery in case of carriage of goods [Car Trim GmbH v Key Safety
Systems SRL reference for a preliminary ruling from the Bundesgerichtshof, CJEU (C-381/08;
ECLI:EU:C:2010:90; 2008/C301/29) Official Journal of the European Union (301/6) (22 November 2008)
(here unclear, whether the reference made to the court decision (issued on 25 February 2010 or the earlier
request for preliminary ruling?); see also Witz, The Place of Performance of the Obligation to Pay the
Prize: Art. 57 CISG, Journal of Law and Commerce (2005–06) 325.
7 Magnus, in: Staudinger Kommentar (2013), Art. 57 para 21; Huber, in: Huber/Mullis, The CISG
(2007), p. 313; Mohs in: Schlechtriem/Schwenzer, Commentary (2016), Art. 57 para. 26; see Oberster
Gerichtshof (Austria) 3 April 2008 (Violins), CISG-Online 1680 (Pace), which discusses the tension
between Art. 5 of the EC (Council or Brussels (EC just in numbering, not the issuing body – could be
EU instead?) Regulation and Art. 57 and Oberlandesgericht Köln (Germany) 21 December 2005, CISG-
Online 1201 (Pace).
3B2 9.1.580; Page size: 160.00mm 240.00mm

will use standardised payment terms in their contracts. In regard to the term “payment to
be made cash before delivery” the dominant opinion is that the place of payment is meant
to be the seller’s place of business.8 A High Court in Germany held that in the case of
“cash against delivery”, the place of payment is at the place of delivery.9 Predominant
opinion suggests that the term “documents against payment” in a contract indicates the
place where the documents have to be handed over as the place of payment.10 The place
of payment can follow from the use of INCOTERMS. The Court of Justice of the
European Union has determined that EXW (ex works) meant that the place of delivery
and the place of payment was the place of the seller.11
If the parties agreed for the buyer to pay the purchase price using documentary 9
credit, the place of payment is usually the place of the bank that opened or affirmed the
documentary credit.12 The place of payment remains unaffected by the documentary
credit if the bank does not pay. The fact that the bank does not execute its documentary
credit duty does not affect the independent payment duty of the buyer. A contractual
change of the place of payment does not follow from the fact that the parties have
agreed on payment with an acceptance of a draft.13
The nomination of a bank account itself does not determine the place of payment but 10
only names a paying agent where the debtor can perform his/her obligation with
discharging effect.14 However, some courts have assumed the seat of the debtor’s bank
as the place of payment if the parties had agreed to directly debiting of the debtor’s
account at that particular bank.15 Equally, if the seller has over a significant period of
time taken care of the costs of the purchase price transfer, this indicates that the place of
payment is the buyer’s place of business.16
Where the parties’ intention cannot17 be determined expressly or impliedly, the place 11
of payment can also be ascertained through usages or practices (Art. 9).18
8 Huber, in: MünchKommBGB (2016), Art. 57 para. 4; Huber, in: Huber/Mullis, The CISG (2007),
p. 309; Magnus, in: Staudinger Kommentar (2013), Art. 57 para. 7; Schnyder/Straub, in: Honsell, Kom-
9 Landgericht Nürnberg-Fürth (Germany) 27 February 2003 (Car accessories), CISG-Online No. 818.
The Court based its decision on Art. 57(1)(b) CISG, apparently regarding the clause as one which leads to
a step-by-step performance and thus triggers Art. 57(1)(b) CISG. In Huber’s and these authors’ view,
however, it is also arguable that the payment clause as such constitutes a direct agreement on the actual
place of payment thus falling under the Art. 57 CISG in its first sentence (see Huber, in: Huber/Mullis,
The CISG (2007), p. 309).
10 Huber, in: Huber/Mullis, The CISG (2007), pp 309 et seq.; Magnus, in: Staudinger Kommentar
(2013), Art. 57 para. 7; Mohs, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 57 para. 7. See also
in more detail in regard to payment against documents below 4.
11 Electrosteel Europe SA v Edil Centro SpA, C-87/10, ECLI:EU:C:2011:375 (30 March 2011 – the
reference to be checked, as the date of judgment is 9 June 2011).

12 Oberlandesgericht Düsseldorf (Germany) 24 July 2007, CISG-Online 1531; Ferrari in Ferrari/Kienin-
ger/Mankowski/Otte/Saenger/D. Staudinger, Internationales Vertragsrecht (2011) Art. 57 para. 6; Mag-

nus, in: Staudinger Kommentar (2013), Art. 57 para. 8; Eiselen in: DiMatteo/Janssen/Magnus/Schulze,
International Sales Law (2016) Ch 6 para. 122.
13 Corte die cassazione civ [VerSen] (Italy) Riv dir int priv proc 1983, 383 in regard to ULIS.
14 Zivilgericht Basel-Stadt (Switzerland) SZIER 1999, 190; Tribunale d’appello Ticino (Switzerland)
29 October 2003, CISG-Online 912; Ferrari In Ferrari/Kieninger/Mankowski/Otte/Saenger/Staudinger,

Internationales Vertragsrecht (2011) Art 57 para 7; Magnus, In: Staudinger Kommentar (2013), Art. 57
para. 8; Benicke, in: MünchKommHGB (2013), Art. 57 para. 4; opposite view: Mohs, in: Schlechtriem/
15 See LG Trier (Germany) IHR 2001, 35.
16 LG Bielefeld (Germany) IHR 2001, 199; Magnus, in: Staudinger Kommentar (2013), Art. 57 para. 8;
Mohs, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 57 para. 8.

17 OLG München (Germany) BB 1997, 2295; Magnus, in: Staudinger Kommentar (2013), Art. 57 para. 8.
18 Arrondissementsrechtbank Hertogenbosch (Netherlands) 6 May 1994 (Yarn), CISG-Online 453
(Pace), stating that previous place of payment was an established practice between the parties, see also
3B2 9.1.580; Page size: 160.00mm 240.00mm
3. Payment at the seller’s place of business (Art 57(1)(a), (2))

12 a) General application. Art. 57(1)(a) determines the place of payment as a default
rule. Namely if the parties have not agreed on a place of payment, no trade usages or
practices can be ascertained and the parties do not have an articulated step-by-step
procedure19, the seller’s place of business will be the place of payment.20 Art. 57(1)(a)
corresponds to the general common law approach if the express or implied terms of the
contract do not deal with that question or the place is not ascertainable through usage
or a course of dealing. Under common law it is for the debtor to seek out his creditor in
the first instance and pay him where ever they might be found.21
13 The seller’s place of business as a place of payment is often contractually agreed and,
therefore, of practical importance, especially if the buyer has to make an advanced
payment or if the buyer received a credit for the purchase price and, therefore, only has
to pay after the delivery of the goods.22 A case decided by the Oberster Gerichtshof is
representative of the scenarios anticipated by Art. 57(1)(a). In that case the goods were
delivered by mail, accompanied by an invoice and the buyer only had to pay the
purchase price after the goods had arrived.23 Often contracts which Art. 57(1)(a)
anticipates contain clauses like “net cash” or “net cash after receipt of the goods”,
“cash against invoice” or “cash before delivery”.24 Other scenarios where the general
opinion is that Art. 57(1)(a) applies are: the sale of goods which are in storage or are at
sea and the parties have not agreed any particular delivery and payment terms, as the
seller can deliver the goods only by instructing the holder of the goods to acknowledge
the buyer’s right to possession.25 That means that in practice, the seller is obliged to
perform in advance.26 Another example is the purchase inter absentees (Fernkauf), as in
Landgericht Bielefeld (Germany) 24 November 1998 (agency for sanitary products), CISG-Online 697
(Pace), stating that the place of payment shall be established in conformity with the practices between the
parties. In this particular case the parties had a long relationship and the place of payment had always
been the place of the seller’s business. However, to the contrary, see Corte Suprema di Cassazione (Italy)
7 August 1998 (women stockings), CISG-Online 538 (Pace), stating that a mere practice between the
parties, which may well depend on a tolerance on the part of the seller, is not sufficient to justify a
derogation from the general rule regarding the place of payment. Huber, in: MünchKommBGB (2016),
Art. 57 para. 3.
19 See Mazetto Company Ilc c Dégust-Mer Inc Court d’Appel de Quebec (Canada) 12 April 2011(frozen
lobster case) CISG-Online 2278 (Pace); Oberster Gerichtshof (Austria) 10 Nov 1994 (Chinchilla furs case)
20 The seller’s place of business has to be determined in accordance with Art. 10 CISG.
21 Robey & Co v Snaefell Mining Co Ltd (1987) 20 QBD 152. It has to be noted that the German default
rule is different in that the obligor must also transfer money at his own risk and his own expense to the
obligee at the residence of the latter (§ 270(1) BGB), but under German law it is sufficient for the buyer to
perform in a timely fashion if the buyer sends off the payment- it does not have to reach the seller. See
generally for a comparative overview: Lehner, Erfüllungsort und Gerichtsstand für Geldschulden im
nationalen Recht und im internationalen Einheitsrecht [place of performance and jurisdiction for money
debts under national law and the international uniform law] (1991); see also Schlechtriem/Butler, CISG
(2009), para. 214 with footnote 368; Forsyth/Moser, The Impact of the Applicable Law of Contract on the
Law of Jurisdiction under the European Conventions, 45 International and Comparative Law Quarterly
(1996) 190.
22 Schlechtriem/Butler, The CISG (2009), para. 214.
23 Oberster Gerichtshof (Austria) 11 November 1994 (Chinchilla furs), CISG-Online 117 (Pace); see also
ZG Kanton Basel-Stadt (Switzerland) 3 December 1997, CLOUT 221 (Bulgarian white urea), CISG-
Online 346 (Pace).
24 Koch, Der besondere Gerichtsstand des Klaegers/Verkaeufers im Anwendungsbereich des UN-
Kaufrechts, RIW (1996) 379; Achilles, in: Ensthaler (ed.), HGB- Gemeinschaftskommentar zum Handels-
gesetzbuch mit UN-Kaufrecht (2015), nach § 382, Art. 57 para. 4.
3B2 9.1.580; Page size: 160.00mm 240.00mm

“ex ship” or “delivery duty paid”, or where the buyer and seller have their places of
business at the same place but where the carrier has no authority to collect the
purchase price, because the seller must then perform his obligation before receiving
payment.27
b) Payment at the seller’s place of business. The buyer has to pay the purchase price 14
at the seller’s place of business. The seller’s place of business is determined by Art. 10. If
the payment is made by money transfer the buyer’s obligation to pay is only performed
when the money is credited to the seller’s account.28 The buyer is responsible for all the
costs associated with the payment transfer and all the formalities – not only in the
country from which the payment is sent, but also in the country in which the payment
is to be made – which are necessary to effect the payment.
The buyer bears the risk of the payment being delayed or lost.29 Unexpected delays in 15
the money transfer will often be exempted under Art. 7930 unless the seller is respon-
sible for the impediment that is causing the delay (Art. 80).31 If the seller has several
bank accounts the buyer has to transfer the money to the bank account in the seller’s
country.32
c) Change in the place of payment. If the seller changes his place of business after 16
the conclusion of the contract the buyer has to effect payment at the new place of
business.33 This follows implicitly from Art. 57(2).34 The buyer, therefore, continues to
bear the risk of the transmission even if it increased due to a change in the seller’s place
of business or other disadvantages, like the need to comply with additional foreign
exchange regulations.
To avoid having to accept payment at the “old” place of business the seller has to 17
inform the buyer promptly of the change of his place of business which has taken place
after the conclusion of the contract. Art. 27, according to which dispatch is sufficient to
effect notice, is not applicable in regard to the seller’s notice of change of place of
business since the change of business is entirely in the seller’s control.35 A transfer risk
which is only realised as a result of having sent the payment to the seller’s new place of
business is attributed to the seller analogue to Art. 80. Art. 57(2) and Art. 80 are also
applicable if the buyer effects payment to the seller’s original place of business due to a
notification failure or because of subrogation, for example in the case of assignment.36
The seller has to bear the additional costs of the money transfer associated with the 18
change of his business after the conclusion of the contract (Art. 57(2)), for example,
27 Bundesgerichtshof (Germany) 10 November 1994, IPRax (1996) 137 (139); Mohs, in: Schlechtriem/
Schwenzer, Kommentar (German ed. 2013), Art. 57 para. 14, 16.

28 Oberlandesgericht München (Germany) 9 July 1997 (Leather goods), CISG-Online 282 (Pace); see
also Bundesgerichtshof (Germany) 25 January 1988, BGHZ 103, 143 (on the law according to the German
BGB).
29 Oberlandesgericht München (Germany) 9 July 1997 (Leather goods), CISG-Online 282 (Pace); ZG
Kanton Basel-Stadt (Switzerland) 3 December 1997 (Bulgarian white urea), CISG-Online 346 (Pace).
30 Achilles, in: Ensthaler (ed.), HGB- Gemeinschaftskommentar zum Handelsgesetzbuch mit UN-
Kaufrecht (2015), nach § 382, Art. 57 para. 4; Mohs, in: Schlechtriem/Schwenzer, Commentary (2016),
Art. 57 para. 20. See also Art. 79 para. 47.
32 Piltz, Internationales Kaufrecht (2008), para. 4–141
34 Achilles, in: Ensthaler (ed.), HGB- Gemeinschaftskommentar zum Handelsgesetzbuch mit UN-
Kaufrecht (2015), nach § 382, Art. 57 para. 5; Magnus, In: Staudinger Kommentar (2013), Art. 57 para 16.
36 Karollus, UN-Kaufrecht (1991) p. 168 note 14; Achilles, in: Ensthaler (ed.), HGB- Gemeinschafts-
kommentar zum Handelsgesetzbuch mit UN-Kaufrecht, nach § 382, Art. 57 para. 5. See also Mohs, in:
3B2 9.1.580; Page size: 160.00mm 240.00mm
higher costs of the transfer of funds or foreign exchange but also loss of interest due to
an earlier transfer of the purchase price which the buyer had to undertake to effect
payment in time.37
19 The assignment of the purchase price claim can also influence the place of payment.
If the buyer has to pay the purchase price to the new creditor then the place of business
of the new creditor will be the new place of payment.38
20 d) Means of payment. The CISG does not contain any provisions regarding the means
of payment. If the contract does not contain any specific agreement the default rule is that
the buyer has to pay in cash in the currency of the place of payment. However, especially
in international trade, cashless payment is nowadays generally required either through
party agreement (Art. 6) or usage (Art. 9). Payment by cheque is always made on account
of performance. If the seller accepts the cheque and it is cashed, payment relates back to
the time at which the cheque was handed over.39 The buyer bears the costs of the payment
such as the costs of dispatching the cheque.40 The same applies to costs arising from
cheques not being cashed, though handed out for performance.41
4. Payment against the handing over of the goods or of documents

(Art. 57(1)(b))
21 Art. 57(1)(b) corresponds to Art. 58 and, therefore, will be the general default rule in
regard to the payment of the purchase price unless the parties have agreed otherwise or a
trade usage or practice determines the place of payment. Art. 58(1) lays down the basic
principle, as a default rule, that the price is to be paid concurrently with the handing over
of the goods or of documents. The concurrent character of these obligations again can in
the first instance derive from the contract (Art. 6), for example, from certain payment
terms like “cash against delivery” or “cash against documents”,42 or from trade usages or
practices between the parties (Art. 9).
22 In the case of such a step-by-step performance, Art. 57(1)(b) provides that the place
of the handing over of the goods determines the place of payment. Art. 57(1)(b)
stipulates for contracts where the obligation has to be performed concurrently at a
single place of performance: the place where the goods and the purchase price are
exchanged--since that is where the ‘contractual centre’ is.43 Five scenarios should be
distinguished:
23 a) Sale not involving carriage of the goods to the buyer. Huber aptly describes
contracts where the seller has no carriage obligations in regard to the goods as
“collection contracts.”44 The seller’s duty to deliver the goods is performed when the
37 Maskow, in: Bianca/Bonell, Commentary (1987), Art. 57 para. 2.9; Mohs, in: Schlechtriem/Schwen-
zer, Commentary (2016), Art. 57 para. 19; Magnus, In: Staudinger Kommentar (2013), Art. 57 para. 16.
38 Ferrari et al., Internationales Vertragsrecht (2011), Art. 57 paras 13 et seq; Magnus, In: Staudinger
Kommentar (2013), Art. 57 para. 18; Huber, in: MünchKommBGB (2016), Art. 57 para. 23; different
opinion Mohs in: Schlechtriem/Schwenzer, Commentary (2016), Art. 57 para. 21.
39 Hager, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 57 para. 9; compare also in more detail
Mohs, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 53 para. 14; see for the equivalent in English
law: Burrows/Finn/Todd, Contract Law (2016) para. 17.7.
40 Landgericht Duisburg (Germany) 17 April 1996 (Textiles), CISG-Online 186 (Pace).
41 Oberlandesgericht München (Germany) 9 July 1997 (Leather goods), CISG-Online 282 (Pace).
42 See Koch, Der besondere Gerichtsstand des Klägers/Verkäufers im Anwendungsbereich des UN-
Kaufrechts, RIW (1996) 379 (381).

43 Bundesgerichtshof (Germany) 4 April 1979, NJW (1979) 1782; Hager/Maultzsch, in: Schlechtriem/

3B2 9.1.580; Page size: 160.00mm 240.00mm

seller places the goods at the buyer’s disposal at the place named in the contract, this
being either at the seller’s place of business (Art. 31(c)) or at a place stipulated in
Art. 31(b), such as the place of the manufacture of the goods often stipulated by the
INCOTERM 2010 “EXW” (ex works). In concurrent contracts the purchase price has to
be paid against the handing over of the goods at the place where the goods are handed
over. In the case of a purchase inter absentees (Fernkauf), as in “ex ship” or “delivery
duty paid”, payment concurrently with the handing over of the goods is only feasible if
the carrier is authorised to collect payment of the price. If the carrier is not authorised,
Art. 57(1)(a) determines the place of payment.45
b) Sale of goods from storage. If goods are stored in a warehouse or on a ship, step- 24
by-step performance is nearly impossible. Either parties or their authorised representa-
tives would have to meet at the warehouse or on the ship to concurrently perform their
obligations. However, the general idea of selling stored goods is that the seller performs
his obligation to hand over the goods by placing them at the buyer’s disposal, for
example, at their warehouse (Art. 31(b)). Since the parties’ obligations are not per-
formed concurrently, Art. 57(1)(a) applies46 instead of Art. 57(1)(b). However, in the
rare circumstance where the parties do agree that the warehouse keeper is to hand over
the goods in return for payment of the price, Art. 57(1)(b) applies. If the seller instructs
the warehouse keeper to receive the purchase price and to hand over the goods
(analogous to Art. 58(2)), the situation is so similar to a step-by-step performance that
the application of Art. 57(1)(b) is justified.47 The place where the payment has to be
effected is the place of business of the warehouse keeper.
c) Sale of goods involving the carriage of goods to the buyer. The use of 25
Art. 57(1)(b) is also problematic in cases where the contract is for the carriage of goods
(Art. 31(a), F-Terms or C-Terms of the Incoterms 2010). There is a problem irrespec-
tive of whether the costs of carriage are to be borne by the seller (C-Terms) or the buyer
(F-Terms) since the parties do not meet at a place to exchange their performances.48 In
such cases, like in regard to the sale of goods stored in a warehouse, Art. 57(1)(a) is
applicable49 unless the parties have agreed otherwise (Art. 6) or a usage or practice exists
in that regard (Art. 9).50
However, as Hager and Huber point out,51 there are two exceptional scenarios where 26
Art. 57(1)(b) should be applicable to a sale of goods contract which involves the carriage
of goods. First, where the parties agree that payment has to be made against the handing
over of the goods on their arrival through the carrier, and second, where the seller
makes use of the seller’s right under Art. 58(2) and instructs the carrier to hand over the
goods only against payment of the price. In both situations the carrier requires the
45See para. 3 supra.

46See para. 3 supra.
49 Compare Bundesgerichtshof (Germany) 28 March 1979, NJW (1979) 1779 and Bundesgerichtshof
(Germany) 4 April 1979, NJW (1979) 1782 in regard to ULIS.

50 See Supreme Arbitration Court of the Russian Federation (Moscow) 27 Jul 201, CISG-Online 2520
(Pace); Huber, in: Huber/Mullis, The CISG (2007), p. 312.

51 Hager, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 57 paras 17 seq.; Huber, in: Huber/
Mullis, The CISG (2007), p. 312; see also Mohs, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 57
para. 12; Herber/Czerwenka, Kommentar (1991), Art. 57 para. 5; U. Huber, Der UNCITRAL-Entwurf
eines Übereinkommens über internationale Warenkaufverträge, RabelsZ 43 (1979) 413 (512); Magnus, in:
Staudinger Kommentar (2013), Art. 57 para. 12; different view: Witz, in: Witz/Salger/Lorenz, Kommentar
(2000), Art. 57 para. 10; Achilles, in: Ensthaler (ed.), HGB- Gemeinschaftskommentar zum Handelsge-
setzbuch mit UN-Kaufrecht, nach § 382, Art. 57 CISG para. 6.
3B2 9.1.580; Page size: 160.00mm 240.00mm
power for collection of the purchase price.52 Both situations are so similar to a step-by-
step performance that the application of Art. 57(1)(b) is warranted, since the centre of
the contract in both circumstances is the place where the obligation of the seller and
buyer is exchanged. Furthermore, the main aim of a step-by-step performance of
preventing the goods and purchase price from resting in the hands of one party is
achieved.53 The place of destination of the goods, therefore, is the place of payment.
27 d) Sale of goods in transit. Where goods are sold in transit, the same principles apply as
where the goods are handed over to a carrier for delivery to the buyer. Therefore, generally,
the place of payment will be the seller’s place of business (Art. 57(1)(a)). If the seller makes
use (by analogy) of his right of retention under Art. 58(2), Art. 57(1)(b) is applicable and the
place of destination of the goods is the place of payment. Where the goods are sold “afloat”
the parties normally agree “cash against documents”, so that by virtue of Art. 57(1)(b) the
place of payment is the place where the documents are handed over.
28 e) Payment against documents. If payment is to be made against documents, the place
where the documents are to be handed over must be determined by reference to the contract
(Art. 34).54 If “cash against documents” has been agreed, the documents are presented to the
buyer via intermediary banks, generally at the buyer’s place of business so that the latter
place is both the place of handing over and of payment.55 If the contract stipulates payment
by letter of credit, the letter of credit will as a rule be payable at the advising or confirming
with the bank (in the seller’s country) which means that the place of handing over and of
payment will be the place of the advising or confirming with the bank.56 Parallel to the
situation of the carriage of goods,57 if in accordance with Art. 58(2) the documents are
handed over by the carrier at the place of destination concurrently against payment of the
purchase price, that place will be the place of handing over and of payment.
29 It is unclear which ‘documents’ Art. 57(1)(b) is referring to. Art. 57(1)(b) and
Art. 58(1) and (2) are all dealing with the payment of the purchase price in regard to a
step-by-step performance. Documents in both articles, therefore, should have the same
meaning.58 To give full effect to Art. 58 and the underlying principle of the CISG to
facilitate commercial relationships, documents must include all documents which the
seller can use to perform their obligation to deliver the goods in accordance with Arts
30 and 3459 and not only traditional documents of title, such as a bill of lading or a
52 Compare Oberster Gerichtshof (Austria) 10 November 1994 (Chinchilla furs), CISG-Online 117
(Pace); but compare on the other hand Bundesgerichtshof (Germany) 4 April 1979 (utility vehicles),
NJW (1979) 1782 in regard to ULIS where the BGH was reluctant to apply Art. 59 No. 1 ULIS where the
seller exercised his right of retention.
53 Compare also U. Huber, in: Dölle (ed.), Kommentar zum Einheitlichen Kaufrecht (1976), Art. 72
EKG para. 2.
54 Compare Tribunal Supremo (Spain) 17 March 2011 (coffee case) CISG-Online 2521 (Pace) where the
Court held that if the parties agreed to delivery of goods and documents to third party seller affects
delivery to the agreed to third party.
55 Koch, Der besondere Gerichtsstand des Klaegers/Verkäufers im Anwendungsbereich des UN-
Kaufrechts, RIW (1996) 379 (381); Achilles, in: Ensthaler (ed.), HGB- Gemeinschaftskommentar zum
Handelsgesetzbuch mit UN-Kaufrecht (2015), nach § 382, Art. 57 CISG para. 6.
56 Mohs, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 57 para. 7; Benicke, in: Münch-
KommHGB (2013), Art. 57 para. 4.

57 See above para. 23.
58 Achilles, in: Ensthaler (ed.), HGB-Gemeinschaftskommentar zum Handelsgesetzbuch mit UN-
Kaufrecht (2015), nach § 382, Art. 57 CISG para. 6; Mohs, in: Schlechtriem/Schwenzer, Commentary
(2016), Art. 57 para. 11.
59 See discussion under Art. 58; Secretariat Commentary on 1978 Draft, Art. 53 para. 5 note 4; compare
Bundesgerichtshof (Germany) 3 April 1996, BGHZ 132, 290 (p 304); so probably Magnus, In: Staudinger
Kommentar (2013), Art. 57 para 13.
3B2 9.1.580; Page size: 160.00mm 240.00mm

warehouse receipt. To perform that obligation, the seller must tender documents which
give the buyer a right to take possession of the goods to the exclusion of the seller.
Party autonomy dictates that the parties can agree on step-by-step performance in 30
regard to any document. It follows from Art. 57(1)(b) that the place where that document
is handed over has to be taken as the place of payment. A different view is taken by Hager
and Maultzsch who see the basis for the place of payment as the place where the
document is handed over in the contract (Art. 57(1) in conjunction with Art. 6).60 They
argue that it would be systematically undesirable if Art. 57(1)(b) comprised a wider range
of documents than Art. 58.61 Even though the authors agree that it is desirable that there
is congruence between Art. 57(1)(b) and Art. 58, to allow extension of the meaning of
‘document by party agreement’ in regard to Art. 57(1)(b) does not significantly impinge
the system of the CISG since the CISG’s underlying principle is party autonomy. Art. 58
embodies the minimum standard in regard to documents. Therefore, papers which fall
under documents in Art. 58 are definitely documents under Art. 57(1)(b). In practice, it
will probably make no difference which view one follows.
5. Place of payment of monetary claims other than the purchase price

Art. 57 is only concerned with the buyer’s payment obligation. However, the CISG 31
knows other monetary obligations, like the payment of damages or the obligation to
pay restitution of the contract price after the avoidance of the contract, for which
there is no specific rule in the CISG. Therefore, there is a gap in regard to the place of
payment of those monetary obligations which must be filled. The overwhelming
opinion sees Art. 57 as an expression of the general principle that monetary obliga-
tions are to be performed at the place of business of the monetary creditor (unless the
parties have agreed otherwise).62 In the case of a damages claim, this would lead to
the place of business of the party which claims damages.63 The Austrian Oberster
Gerichtshof64 and the Cour d’Appel Paris65 have held that the CISG did not deal with
this issue and applied the applicable national contract law. The German Bundesge-
richtshof offered a third view when it held that the place of performance of the
obligation which forms the basis of the claim in question was a decisive factor.66 In
Liesecke, Die typischen Klauseln des internationalen Handeslverkehrs, WM 1978, Sonderbeilage Nr 3 for
Nr 15 (15 April 1978); Weber, Warenpapiere ohne Traditionsfunktion (1978) pp. 240 et seq.
61 Hager/Maultzsch, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2008), Art. 57 para. 24: e. g.,
the parties agree on the purchase price payment after the handing over of the delivery note. The delivery
note is only an instruction but does not transfer any rights in regard to the goods to the buyer and,
therefore, not a document in relation to Art. 58. However, Hager/Maultzsch argue that the interpretation
of the parties’ agreement in that case would lead to the place where the delivery note has to be handed
over as the place of payment of the purchase price.
62 Oberlandesgericht Braunschweig (Germany) 28 October 1999 (Meat), CISG-Online 510 (Pace);
Hager, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 57 para. 25 with further references in note
71; Huber, in: Huber/Mullis, The CISG (2007), p. 314; see also discussion in Magnus, In: Staudinger
63 Compare Oberlandesgericht Düsseldorf (Germany) 2 July 1993 (Veneer cutting machine), CISG-
Online 74 (Pace); Cour d’Appel Grenoble (France) 23 October 1996 (Stock equipment), CISG-Online 305
(Pace); Mohs, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 57 para. 29; Huber, in: Huber/
Mullis, The CISG (2007), p. 314; Benicke, in: MünchKommHGB (2013), Art. 57 para. 13.
64 Oberster Gerichtshof (Austria) 10 March 1998 (Merchandise case), CISG-Online 356 (Pace).
65 Cour d’Appel de Paris (France) 14 January 1998 (Elephants), CISG-Online 347 (Pace).
66 Bundesgerichtshof (Germany) 22 October 1980 (Cherry juice), NJW (1981) 1158 (under ULIS, obiter);
Bundesgerichtshof (Germany) 24 September 1986, BGHZ 98, 263 (272) (under ULIS) buyer’s claim for
damages on account of delivery of defective goods; Case 14–76 de Bloos v Bouyer ECJ, ECR 1976, p. 1497:
breach of an exclusive distribution agreement; Magnus, in: Staudinger Kommentar (2005), Art. 57 para. 22.
3B2 9.1.580; Page size: 160.00mm 240.00mm
these authors’ view, the gap can be filled under Art. 7(2) by using the general principle
embodied in Art 57. Therefore, monetary obligations are to be performed at the place
of business of the monetary creditor (unless the parties have agreed otherwise).
32 In regard to a claim stemming from restitution (Art. 81(2))67 the CISG also does not
provide express rules about the place of restitution (i. e. where the purchase price should
be restituted). The gap can be filled under Art. 7(2) based on Art. 57. Accordingly, the
buyer’s place of business is the place of repayment of the purchase price.68
33 The place of payment for payments arising due to penalty clauses and claims for
reimbursement is also to be determined by Art 57.69 The place of payment for payments
arising from interest claims is determined by the place of performance of the underlying
claim.70
34 General rules apply in regard to burden of proof. That means the party that asserts a
particular place of performance has to prove that this was agreed upon by the parties. If
the buyer claims additional costs under Art. 57(2) he has to prove those additional
costs.
35 The parties can contract out of Art. 57 or modify it.71 Generally, it is advisable to detail
exactly the place where payment is to be made to avoid misunderstandings. For the
avoidance of doubt it might be advisable to agree upon a choice of jurisdiction clause.

36 The default rule in regard to the place of payment, Art. 57(1)(a), corresponds to the
English, Italian, Danish and Greek approach where the payment has to be made if the
express or implied terms of the contract do not deal with that question or the place is
not ascertainable through usage or a course of dealing. Under common law it is for the
debtor to seek out his creditor in the first instance and to pay her or him where he
might be found72 while French and German law refers to the debtor’s residence (unless
the parties have agreed otherwise).73 Under the US-UCC the default rule of place of
payment is the place where the buyer receives the goods.74
37 The PICC states in 6.1.6.(1), in line with Art. 57 CISG, that first and foremost party
autonomy determines the place of payment. If the place of payment is not fixed by the
contract, the obligee’s place of business is decisive (Art. 6.1.6.(1)(a)). Art. 6.1.8. states
68 See Oberlandesgericht Düsseldorf (Germany) 2 July 1993 (Veneer cutting machine), CISG-Online 74
(Pace); Magnus, in: Staudinger Kommentar (2013), Art. 57 para. 23; Hornung, in: Schlechtriem/Schwen-
zer, Commentary (2005), Art. 81 paras 17, 18.
69 Magnus, In: Staudinger Kommentar (2013), Art. 57 para. 24.
70 Magnus, In: Staudinger Kommentar (2013), Art. 57 para. 24.
72 Robey & Co v Snaefell Mining Co Ltd (1987) 20 QBD 152 for common law; Stone, EU Private
International Law (2006) p. 84. It has to be noted that the German default rule is different in that the
obligor must also transfer money at his own risk and his own expense to the obligee at the residence of
the latter (§ 270(1) BGB) but under German law it is sufficient for the buyer to perform in a timely
fashion if the buyer sends off the payment- it does not have to reach the seller. See generally for a
comparative overview: Lehner, Erfüllungsort und Gerichtsstand für Geldschulden im nationalen Recht
und im internationalen Einheitsrecht [place of performance and jurisdiction for money debts under
national law and the international uniform law] (Thesis, Basel 1991); see also Schlechtriem/Butler, CISG
(2009), para. 214 note 368.
73 Stone, EU Private International Law (2006) p. 84; § 270 German Civil Code BGB.
74 § 2–310(a) UCC.
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Section I. Payment of the price 37 Article 57

that in case payment is made by fund transfer the place of payment is the obligee’s
financial institution. The PECL also replicates Art. 57 CISG, stating in Art. 2.106 that if
the place of payment is not fixed or determinable by the contract (Art. 2.106(1)) the
place for the money payment is the creditor’s place of business (Art. 2.106(1)(b)).
However, the PECL refers to the creditor’s place of business at the time of contract
conclusion (Art. 2.106(1)(b)). Should the seller, therefore, move his place of business
after the conclusion of the contract it will be his risk and expense to effect payment at
the new place of business. The PECL further regulates the place of performance in case
of multiple places of business: the one with the closest relationship to the contract
(Art. 2.106(2)). Although no counterpart rule is found in Art. 57 CISG, a general rule to
that effect is stated in Art. 10(a) CISG. Further, Art. 2.106(3) of the PECL corresponds
with Art. 10(b) CISG, stating that where a party has no place of business, performance
is to be effected at his habitual residence.
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Article 58
(1) If the buyer is not bound to pay the price at any other specific time, he must
pay it when the seller places either the goods or documents controlling their
disposition at the buyer’s disposal in accordance with the contract and this Conven-
tion. The seller may make such payment a condition for handing over the goods or
documents.
(2) If the contract involves carriage of the goods, the seller may dispatch the goods
on terms whereby the goods, or documents controlling their disposition, will not be
handed over to the buyer except against payment of the price.
(3) The buyer is not bound to pay the price until he has had an opportunity to
examine the goods, unless the procedures for delivery or payment agreed upon by the
parties are inconsistent with his having such an opportunity.
Bibliography: Davies, Documents that Satisfy the Requirements of CISG Art. 58, The Annals of the
Faculty of Law in Belgrade – Belgrade Law Review, Year LIX (2011) no. 3 pp. 39–66.(Pace); CISG-
Advisory Council Opinion no 11, Issues Raised by Documents under the CISG Focusing on the Buyer’s
Payment Duty, 2012. Rapporteur: Professor Martin Davies, Tulane University Law School, New Orleans,
U.S.A. (at http://www.cisg-ac.org); Gabriel, Buyer’s Performance under the CISG: Arts 53–60 Trends in
the Decisions, 25 Journal of Law and Commerce (2005–2006) 273.
Outline
1. Buyer’s right to examine the goods (Art. 58(3)) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
a) General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
b) Exclusion of the right to examine the goods . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
2. Time the purchase price becomes due. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
a) General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
b) Time payment is due . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
aa) General. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
bb) Particular cases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
(i) Goods delivered at the seller’s place of business . . . . . . . . . . . . . . 21
(ii) Goods delivered at the buyer’s place of business . . . . . . . . . . . . . . 22
(iii) Sale of goods in storage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
(iv) Sale involving carriage of goods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
(v) Sale of goods in transit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
3. Divergent agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
4. Documents. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
5. Rights of retention (Arts 58(1) second sentence and 58(2)) . . . . . . . . . . . . . . . 31
6. Payment ahead of time, part payment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
7. Application to other buyer’s obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36

1 Arts 58 and 59 not only stipulate the time of payment of the purchase price but also
the relationship between delivery and payment,1 as well as the buyer’s right to briefly
1 Secretariat Commentary on 1978 Draft, Art. 54 paras 1–3; Schlechtriem/Butler, CISG (2009),
para. 218; Huber, in: Huber/Mullis, The CISG (2007), p. 307.
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examine the goods even if the purchase price is due.2 Art. 58 is designed to minimise
risks for both parties; the risk to the seller from delivery before payment and the risk to
the buyer from payment for defective goods.
In accordance with Art. 57, Art. 58 again clearly states that party autonomy is para- 2
mount in regard to the determination of the issues dealt with in Art. 58 (Art. 58(1)).3 The
buyer’s duties set out in Art. 58 are often subject to derogation, especially due to trade
usages or practices in respect of payment clauses.4 For example, the conclusion of a
contract on the negotiation of a bill of exchange implicates the agreement on a deferment
of payment.5 The same applies to the granting of a credit in respect of goods on the part of
the seller.6
It has to be noted that the interest on late payments (Art. 78)7 in regard to the 3
purchase price is tied to the time the payment is due under Art. 58(1) first sentence. The
EU Directive On Combating Late Payment in Commercial Transactions,8 however,
provides for another regime as provided for by the CISG. Under Art. 3(1)(b) of the
Directive, interest shall – if the date or period for payment is not fixed in the contract –
become payable automatically, without the necessity of a reminder, 30 days following
the date of receipt by the debtor of the invoice or an equivalent request for payment, or
if the debtor receives the invoice or the equivalent request for payment earlier than the
goods, 30 days after the receipt of the goods. This regime deviates from Arts 58, 78
CISG and is more favourable for the buyer. Therefore, the question arises whether the
EU Directive and the subsequently implemented national laws prevail over the CISG
under Art. 90. The purpose of the CISG is to unify international sales law, which would
be seriously jeopardised if the EU Member States, which are simultaneously also CISG
Contracting States,9 followed the regime of the Directive and outside the EU the CISG
Member States would follow Arts 58 and 78 CISG. However, since the EU Member
States have discretion as to how they implement a directive, the adjustment of law
by directive is not an “international agreement” in terms of Art. 90.10 Furthermore,
Art. 6(2) of the Directive itself allows for Member States to implement a more
obligation-friendly regime than that set out in Art. 3 of the Directive.11
2 See in regard to Art. 58’s predecessors in the ULIS: Mohs, in: Schlechtriem/Schwenzer, Commentary
(2016), Art. 58 para. 3.

3 Art. 58(1) first sentence is based on an application by Argentina, Spain, and Portugal (Secretariat
Commentary on 1978 Draft, Art. 54 para. 3, see also in regard to the harmonising effect of Art. 58(1) first
sentence in regard to Art. 57: Secretariat Commentary on 1978 Draft, Art. 57 paras 36, 46).
4 Huber, in MünchKommBGB (2016), Art. 58 para. 2.
5 Landgericht Hamburg (Germany) 26 September 1990 (Fashion textiles), CISG-Online 21 (Pace),
EuZW (1991) 188, 191.

6 Oberlandesgericht München (Germany) 21 January 1998 (Thermal insulation material), CISG-Online
536 (Pace), IHR (2001) 197, 198 (deferment for an indefinite time).
7 The time for payment under Art. 58 also triggers the time interest begins to run under Art. 78 if
payment is not timely Oberlandesgericht Rostock (Germany) 27 July 1995 (Plants) CISG-Online 209
(Pace); Bundesgerichtshof (Germany) 8 March 1995 CLOUT 123; Oberlandesgericht Frankfurt (Germany)
18 January 1994 (Shoes) CISG-Online 144; Gabriel, The Buyer’s Performance Under the CISG: Arts 53–
60 Trends in Decisions, 25 Journal of Law and Commerce (2005–2006) 273, 281.
8 EC Directive 2000/35/EC of 29 June 2000, EC Official Journal, L 200, p. 35; see Schmidt-Kessel, Die
Zahlungsverzugsrichtlinie und ihre Umsetzung, NJW (2001) 97.

9 See for an up-to-date list of CISG Contracting States: http://www.uncitral.org (last accessed 18 Oct
2016). 24 of the 28 EU Member States have ratified the CISG (missing: Malta, UK, Ireland, and Portugal).
11 Compare: Hager/Maultzsch, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2008), Art. 58
para. 2 a; Schröter, UN-Kaufrecht und Europäisches Gemeinschaftsrecht § 6 para. 354.
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1. Buyer’s right to examine the goods (Art. 58(3))
4 a) General. As Huber points out, a good starting point with Art. 58 is an analysis of
the buyer’s right under Art. 58(3) to examine the goods. That right is relevant for the
different scenarios relating to the payment due dates set out in subparagraphs (1) and
(2).12 Art. 58(3) states that the buyer does not have to pay the purchase price before he
has the opportunity to examine the goods unless the parties’ agreement is inconsistent
with the buyer having such an opportunity. This means that the time when the payment
is due (which is generally determined either by party agreement or by Art. 58(1)) is
delayed until the buyer has the opportunity to examine the goods.13
5 It is generally agreed that the buyer’s examination right under Art. 58(3) is not
comparable with the examination right under Art. 38 and only allows for a short and
superficial inspection.14 The buyer might need to use a third person, like the carrier, to
realise his right under Art. 58(3) in a timely manner.15 The buyer will generally only be
able to detect profound defects or an aliud delivery.16 The opportunity (and obligation)
for the buyer to examine the goods more thoroughly in accordance with the standards
developed under Art. 3817 and to notify the seller of any defects, in accordance with
Art. 39, is not affected by Art. 58(3). As Huber points out, since any failure to notify the
seller of the non-conformity of the goods is dealt with by Art. 39 and not Art. 58(3), the
buyer can, as long as he meets the standards of Arts 38 and 39, still notify the seller of
any severe non-conformity or aliud delivery that the buyer could have noticed during
an Art. 58(3) examination at a later stage.18 The seller is under an obligation to facilitate
examination of the goods by the buyer (or his delegate), either by access to the goods at
the plant or respective instructions to the warehouse keeper or carrier.19
6 The German Supreme Court held that the synallagmatic relation between delivery
and payment allows the buyer to raise the defence in accordance with Art 58(3) that the

13 See St. Gallen Gerichtskommission Oberrheintal (Switzerland) 30 June 1995 (Sliding doors), CISG-
Online 425 (Pace); Amtsgericht Stendal (Germany) 12 October 2000 (Granite rock), CISG-Online 592
(Pace); Magnus, in: Staudinger Kommentar (2005), Art. 58 para. 24.
14 See St. Gallen Gerichtskommission Oberrheintal (Switzerland) 30 June 1995 (Sliding doors), CISG-
Online 425 (Pace); Kantonsgericht Schaffhausen (Switzerland) 25 February 2002 (Machines, devices and
replacement parts), CISG-Online 723 (Pace); Huber, in: MünchKommBGB (2016), Art. 58 para. 4; Mohs,
in: Schlechtriem/Schwenzer, Commentary (2016), Art. 58 para. 34; see also in regard to the differentiation
between Art. 58 CISG and Art. 38: Vogel, Die Untersuchungs- und Rügepflicht im UN-Kaufrecht (2000)
pp. 126 et seq.
Art. 58 para. 25.

16 See Kantonsgericht Schaffhausen (Switzerland) 25 February 2002 (Machines, devices and replacement
parts), CISG-Online 723 (Pace); Achilles, Art. 58 para. 7; Magnus, in: Staudinger Kommentar (2013),
Art. 58 para. 26; Huber, in: MünchKommBGB (2016), Art. 58 para. 4; Herber/Czerwenka, Kommentar
(1991), Art. 58, para. 8; Vogel, Die Untersuchungs-und Rügepflicht im UN-Kaufrecht (2000) pp. 126 et
seq; other opinion: Niggemann, Les Obligations de l’acheteuer sous la Convention des Nations Unies sur
les contrats de vente internationale de marchandises, Revue des droit des affaires internationales (1988)
27 (35).
17 Art. 38 paras 27 et seq.
18 Huber, in: MünchKommBGB (2016), Art. 58 para. 4; see also Honnold, Uniform Law (1999), Art. 58
para. 339.1. Compare: St Gallen Gerichtskommission Oberrheintal (Switzerland) 30 June 1995 (Sliding
doors), CISG-Online 425 (Pace).
19 Magnus, in: Staudinger Kommentar (2013), Art. 58 para. 25; Honnold, Uniform Law (1999), Art. 58
para. 338.
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seller did not fulfill all contractual duties even if the parties agreed on a choice of court
clause that all claims must be brought at the respective defendant’s seat.20
The place where the buyer can examine the goods is generally the place of delivery in 7
accordance with Art. 31.21 Where the goods are delivered at the seller’s place of
business, or by the seller to the buyer at the buyer’s place of business, or sold from
storage in a warehouse, it will be easy for the buyer (or his delegate) to examine the
goods. If the goods have to be sent long-distance, the buyer will usually instruct a
commercial inspection agency to act on the buyer’s behalf before they are loaded on the
carrier. Sending the goods long distance is, therefore, normally less onerous for the
buyer in regard to re-disposing of the goods than when the buyer has wrongfully
rejected the goods after they have arrived in the buyer’s country. These policies have
been recognised and reconciled by arrangements that the documents the seller must
tender for payment by letter of credit shall include a certificate of quality by an
independent inspection agency.22 As an alternative, the buyer could reasonably demand
the opportunity, personally or through an agent, to inspect the goods before they are
shipped. The buyer bears the costs for the inspection under Art. 58(3).
b) Exclusion of the right to examine the goods. Art. 58(3) contains an exemption if 8
the parties agreed on procedures for a delivery or a payment which is inconsistent with
the buyer having an opportunity to examine the goods. In such a case the buyer does
not have a right to examine the goods. Therefore, the due date for payment of the
purchase price is not deferred.
The exclusion of the right to examine under Art. 58(3) will often follow from trade 9
terms and usages. The most important case is where, as in the case of commodity sales,
“cash against documents” has been agreed. In a sale calling for payment “cash against
documents”, the buyer has to pay the price against the tender of documents. Since the
presentation of the documents is the requirement for being able to demand the purchase
price, the buyer has to pay without inspecting the goods notwithstanding whether the
goods have arrived or not.23 The same is true for the provision “L/C-documents against
letter of credit” or “D/A-documents against acceptance”.24 The position is generally the
same in regard to cash before delivery clauses like “COD-cash on delivery” or “cash against
delivery note”. Whether the clauses “cash against invoice” and “payable on receipt” also
preclude a brief examination of the goods by the buyer is a controversial question.25 The
buyer, however, can protect himself against the risk of paying before examination of the
goods, by agreeing to a term requiring the seller to submit certificates of quality.26
Other trade clauses do not exclude the buyer’s right of examination. For example, 10
clauses like “cash against documents upon arrival of the goods”, or “cash upon receipt
of the goods (and invoice)” allow the buyer to inspect the goods.27 An agreement that
20 Bundesgerichtshof (Germany) 26 Sept 2012, Internationales Handelsrecht 2012, 231 (Potato clay)
CISG-online 2348.
22 Goldstajin, The Contract of Goods Inspection, 14 American Journal of Comparative Law (1965).
23 Takahashi, Right to Terminate (Avoid) International Sales of Commodities, Journal of Business Law
(2003) 102, 114 (115); Magnus, in: Staudinger Kommentar (2013), Art. 58 para. 28; Mohs, in: Schlech-
24 Achilles, para. 8.2; Magnus, in: Staudinger Kommentar (2005), Art. 58 para. 28.
25 Magnus, in: Staudinger Kommentar (2013), Art. 58 para. 28; Hager/Maultzsch, in: Schlechtriem/
Schwenzer, Kommentar (German ed. 2008), Art. 58 para. 12; see Kantonsgericht Zug (Switzerland)
2 December 2004 (Dextrose), CISG-Online 1194 (Pace), where the important time for payment is the
arrival of the invoice and not the delivery of the goods.
26 Honnold, Uniform Law (1999), Art. 58 paras 338, 339.
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payment will be made against an open invoice does not present any problems when the
goods are being delivered by an independent carrier, because the buyer has to pay only
after the arrival of the goods. The buyer does not lose his right to examine the goods if
the seller exercises his right of retention in accordance with Arts 58(1) second sentence
and 58(2).28
2. Time the purchase price becomes due

11 a) General. Art. 58(1) first sentence stipulates as a general rule that the payment of the
purchase price is due as soon as the seller has placed the goods or documents representing
the goods at the buyer’s disposal.29 The actual handing over does not have to occur.30 It is
sufficient that the seller has done everything necessary at the right place and at the right
time so that the buyer can take over the goods. The “forward placement” should prevent
the buyer from delaying the purchase price payment unilaterally by delaying the actual
acceptance of the goods.31 The general rule can be deviated from in various ways (see
below paras 19 et seq.).
12 Arts 58(1) second sentence and 58(2) (in regard to a contract involving the carriage
of goods) allow for the seller to make the delivery of the goods or documents dependent
on the purchase price payment. Following from the latter and Art. 58(1) first sentence,
the general opinion is that the CISG assumes that generally delivery and purchase price
payment are performed step-by-step.32
b) Time payment is due
13 aa) General. Art. 58 governs the time the purchase price payment is due33 with the
result that at that time payment must be effected. The arrangement of the payment in a
timely manner is not sufficient. The buyer has to bear the risk of the change in the
exchange rate if the payment is delayed.34 Since international money transactions might
take some time, the buyer has to take the additional time into account. A special
reminder by the seller to pay the purchase price or notification eg bank account details
28 Magnus, in: Staudinger Kommentar (2013), Art. 58 paras. 29; Huber, in: MünchKommBGB (2007),
Art. 58 para. 8.
29 Handelsgericht Aargau (Switzerland) 21 June 2011 (cosmetic products case) CISG-Online 2432.
30 Compare: Tribunal Cantonal Valais (Switzerland) 20 December 1994 (Artificial stones), CISG-
Online 302 (Pace); Magnus, in: Staudinger Kommentar (2013), Art. 58 para. 10; Achilles, Art. 58 para. 3;
Herber/Czerwenka, Kommentar (1991), Art. 58 para. 3.
Art. 58 para. 12.

32 Bundesgericht (Switzerland) 20 December 2006 (Machines), CISG-Online 1426 (Pace); Handelsger-
icht des Kantons Aargau (Switzerland) 25 January 2005 (Floor tiles), CISG-Online 1091 (Pace); Land-
gericht Hamburg (Germany) 10 September 2003, CISG-Online 874; Magnus, in: Staudinger Kommentar
(2013), Art. 58 para. 7; Hager/Maultzsch, in: Schlechtriem/Schwenzer, Kommentar (German ed. 2008),
Art. 58 para. 2; Honnold, Uniform Law (1999), Art. 58 para. 339.2; Schlechtriem/Butler, CISG (2009),
para. 205; Achilles, Art. 58 para. 1; Lookofsky, The 1980 United Nations Convention on Contracts for the
International Sale of Goods, Art. 58 para. 2.44. Probably different – assuming seller’s duty to deliver in
advance- Landgericht Krefeld (Germany) 20 September 2006 (Charcoal), CISG-Online 1459 (Pace);
Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 58 para. 58; Piltz, § 4 para. 153. Compare: Sec-
tion 28 Sale of Goods Act 1979 (UK).
33 Oberlandesgericht Köln (Germany) 09 July 1997 (Video cameras and equipment), CISG-Online 495
(Pace); Magnus, in: Staudinger Kommentar (2013), Art. 58 paras 2, 9; Huber, in: MünchKommBGB
(2016), Art. 58 para. 11.
34 Corte Cubana de Arbitraje Comercial (Cuba) 23 Dec 2013, CISG-Online 2572. The Tribunal held
that even if the CISG did not contemplate the case of the modification of the exchange rate during the
period of late payment, in the case of indetermination of the place of delivery (Art. 57.1 a) and time (Arts,
58, 59) it is an inherent principle of protection of the creditor’s interest that the delay of the payment by
the buyer should not benefit the buyer.
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is not necessary. However, generally the buyer has the right to be issued an invoice.35 In
some cases corrections in regard to the timing have to be made which will be discussed
below.36 However, those corrections should not lead one to assume, as some voices in
the literature suggest,37 that Arts 58(1) and 58(3) only govern the payment date at which
the buyer has to undertake the necessary acts to effect payment.38
The time of payment of the purchase price is in principle the time when the seller places 14
the goods or documents at the disposal of the buyer (Art. 58(1) first sentence). Since
Art. 58(1) second sentence states that the seller can make the handing over of the goods or
documents dependent on the payment, it follows that “disposal” and “handing over” do
not have the same meaning.39 For the purchase price to be due, it is sufficient that the
seller has done everything necessary at the right place and at the right time so that the
buyer can take over the goods or documents without any difficulty; the actual handing
over is not necessary.40 “Predating” should prevent the buyer from delaying unilaterally by
delaying the actual acceptance of the goods at the time the purchase price payment is due.
The time when the goods or documents are placed at the disposal of the buyer is, 15
however, not in itself decisive with respect to the time the payment is due.
First and foremost the parties can determine the time of payment by agreement.41 Trade 16
practices and usages can also be determinative.
Secondly, if the buyer exercises his right under Art. 58(3), the time the payment is 17
due is extended until the buyer is able to inspect the goods.42 From the right to examine
goods it follows that the buyer must have a reasonable time after the inspection to effect
the payment of the purchase price. “Reasonable time” will depend, for example, on the
amount payable and possible currency regulations. As Huber neatly summarises that
the time payment is due, is when the buyer inspects the goods in accordance with
Art. 58(3),43 the goods placed at the disposal of the buyer + time to examine the goods
in accordance with Art. 58(3) + reasonable time to pay.
Third, if the buyer did not know and could not have known when the goods or 18
documents would be at his disposal, the time at which the buyer is notified of such
becomes decisive.44 This notice is sent at the seller’s risk.45 Art. 27 does not apply in
35Piltz, Internationales Kaufrecht (2008), para. 4–147.

36See below paras 19 et seq.
37 Schnyder/Straub, in: Honsell, Kommentar (1997), Art. 58 paras 8 et seq.
40 Tribunal Cantonal Valais (Switzerland) 20 December 1994 (Artificial stones), CISG-Online 302
(Pace); Achilles, Art. 58 para. 3; Magnus, in: Staudinger Kommentar (2013), Art. 58 para. 10.
41 For example the Bundesgericht (Switzerland) held in one case that the parties had derogated from
the principle of a step-by-step performance in a case where they had agreed on payment of 30 per cent of
the price upon ordering of the goods, 30 per cent at the beginning of assembly, and 30 per cent at the
completion of installation, the final 10 per cent to be paid after successful start-up of the facility:
Bundesgericht (Switzerland) 18 January 1996 (Plant for purification of exhaust gases), CISG-Online 214
(Pace); see also Handelsgericht Aargau (Switzerland) 5 November 2002 (inflatable triumphal arch) CISG-
Online 715 (Pace); see also Oberlandesgericht München (Germany) 21 January 1998 (Thermal insulation
material), CISG-Online 536 (Pace), where the granting of an interest free, not terminable commercial
credit meant that the time the payment was due was not at the time when the goods or documents were
placed at the disposal of the buyer but the claim for the purchase price was deferred sine die.
42 See above paras 2 et seq.
44 See Maskow, in: Bianca/Bonell, Commentary (1987), Art. 58 para. 2.4. (notice requirement based on
Art. 7(1)); Magnus, in: Staudinger Kommentar (2013), Art. 58 para. 11; Herber/Czerwenka, Kommentar
(1991), Art. 58 para. 4; U. Huber, Der UNICITRAL-Entwurf eines Übereinkommens über internationale
Warenkaufverträge, 43 RabelsZ (1979) 413 (515); different view: Schnyder/Straub, in: Honsell, Kommen-
tar (1997), Art. 58 paras 8 et seq. (Art. 58 only governs the time of payment).
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regard to a seller’s notification since Art. 27 is not applicable to such notification. The
notification sent in order to bring about the delivery does not expressly fall under
the ambit of Art. 27. Furthermore, Art. 27 is not tailored to declarations which give rise
to obligations on the part of the addressee.46 It follows that the buyer must have a
reasonable time after the inspection to effect the payment of the purchase price, similarly
to the previous scenario. Furthermore, the buyer still has the right to examine the goods
in accordance with Art. 58(3). The time from when the goods were dispatched by the
seller until the seller receives payment can, therefore, be longer than the one anticipated
by the seller.
19 Fourth, the meaning of “placing at the buyer’s disposal” depends on the particular
type of contract involved and, therefore, the time payment is due might differ depend-
ing on the type of contract.47
20 bb) Particular cases. The time the purchase price payment becomes due is generally,
as stated above, dependent on the seller making the goods or documents available to the
buyer, which means to have done everything necessary at the right time and at the right
place so that the buyer can take over the goods without any difficulty. Party agreement
and in addition trade practices and usages determine what is necessary, alternatively
Arts 31 et seq. apply. In regard to certain types of contracts it is not sufficient for the
seller to place the goods and documents merely at the disposal of the buyer:
21 (i) Goods delivered at the seller’s place of business. If the buyer has to take over the
goods at the seller’s place of business or at some other location (Art. 31(c) and
(b)),48 the goods are at the buyer’s disposal, and the price becomes due under the first
sentence of Art. 58(1) when the seller has taken the necessary preparatory steps;
particularly by identifying the goods to the contract and giving the buyer notice of that
fact.49 The notification sent in order to bring about delivery does not expressly fall in the
ambit of Art. 27. Furthermore, Art. 27 is not tailored to declarations which give rise to
obligations on the part of the addressee.50 Therefore, the notice is sent at the seller’s own
risk. If that were not the case, the purchase price payment might become due without
the buyer becoming aware of the fact. After the notice has reached the buyer, the buyer
must be allowed a reasonable period within which to collect and pay for the goods. That
is also indicated by the fact that the buyer is only obliged to pay the price if he has had
an opportunity to examine the goods (Art. 58(3)).51
22 (ii) Goods delivered at the buyer’s place of business. If the seller has to transport the
goods and tender them to the buyer at his place of business52 or at some third place, the
goods are at the buyer’s disposal as soon as the seller tenders them to him at that
place.53 When the goods are tendered, payment becomes due by virtue of Art. 58(1)
first sentence. The buyer, of course, has the right under Art. 58(3) to examine the goods
before payment. If the seller has agreed to deliver the goods to another location and the
parties have not agreed to a fixed time for delivery, the seller is required to give prior
46 Noussias, Die Zugangsbedürftigkeit von Mitteilungen nach dem Einheitlichen Haager Kaufgesetzen
und nach dem UN-Kaufgesetz (1981) pp. 126, 130 et seq.; Schlechtriem/Butler, CISG (2009), p. 94.
47 See below paras 19 et seq.
48 See Incoterms – Ex Works.
49 Obergericht des Kantons Zug (Switzerland) 5 Mar 2013 (Marble slabs case) CISG-Online 2471;
Secretariat Commentary on 1978 Draft, Art. 29 para. 16 and Art. 81 para. 7.

50 Noussias, Die Zugangsbedürftigkeit von Mitteilungen nach dem Einheitlichen Haager Kaufgesetzen
und nach dem UN-Kaufgesetz (1981) pp. 126, 130 et seq.; Schlechtriem/Butler, CISG (2009), p. 94.
51 Obergericht des Kantons Zug (Switzerland) 5 Mar 2013 (Marble slabs case) CISG-Online 2471.
52 See Incoterms – Delivered Duty Paid.
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notice to the buyer so as to enable the buyer to take over the goods in good time to
effect payment.54 If the seller sends the notice after the seller has delivered the goods the
buyer must be allowed a reasonable period within which to take delivery and effect
payment.55 What a “reasonable time” is will depend on the circumstances, including the
amount payable.56 The notice is sent at the seller’s risk.57 However, only where the
carrier is authorised to collect payment can the buyer comply with his obligation (linked
to the tender of the goods) to pay the price at the place of where the goods have to be
handed over. If the carrier is not so authorised, the seller is obliged to perform in
advance of the buyer and, pursuant to Art. 57(1)(a), the place of payment is, therefore,
the seller’s place of business.58 The buyer must be allowed a reasonable period to pay the
purchase price in those circumstances to give him a chance to pay in time.
(iii) Sale of goods in storage. If the goods are sold from storage in a warehouse 23
(Art. 31(b)) the goods are placed at the buyer’s disposal when the seller has created the
opportunity for the buyer to collect the goods and the warehouse keeper is prepared to
hand over the goods acknowledging the buyer’s right to possession of the goods.59 The
purchase price is due the moment the goods are at the buyer’s disposal at the
warehouse, however, the buyer has a right to examine the goods in accordance with
Art. 58(3) and the time the payment is due will be delayed until the buyer has exercised
that right. In regard to the timing of the payment, consideration has to be given as to
whether the buyer knew or ought to have known that the goods were at his
disposal.60 Using Art. 58(2) analogously then, the seller must have the right to instruct
the warehouse keeper to only hand over the goods against payment and to allow the
seller at the same time to endow an authority to collect payment from the warehouse
keeper.61 Generally, in practice, however, the parties will agree special payment terms,
such as “cash against delivery note” or “cash against documents” so that it is not
necessary to place the goods at the disposal of the buyer. Often in those cases the right
under Art. 58(3) is also excluded.62
(iv) Sale involving carriage of goods. When goods are sent by carrier, the goods are at 24
the buyer’s disposal when the carrier has tendered the goods to the buyer at the place of
destination.63 The time the payment is due is delayed here as well until the buyer has
exercised his right to examine the goods (Art. 58(3)) if he wishes to do so. It is
important to consider the time for payment if the buyer did not know that the goods
were at his disposal.64 If the goods are lost or destroyed during transport after the risk
was vested in the buyer, then the purchase price is due at the time the goods would have
been at the disposal of the buyer in the normal course of events.65 The timeframe in
which payment can be made depends on where the place of performance for the
54Hager, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 58 para. 5.

55Maskow, in: Bianca/Bonell, Commentary (1987), Art. 58 para. 2.4; Mohs, in: Schlechtriem/Schwen-
56 Maskow, in: Bianca/Bonell, Commentary (1987), Art. 58 para. 2.4.
58 See Art. 57 paras 11–13.
59 Compare: Mohs, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 58 para. 14 (formulated
slightly differently); Magnus, in: Staudinger Kommentar (2013), Art. 58 para. 12; Achilles, Art. 58 para. 3.
63 As in regards to the use of documents see below paras 26 et seq.
Art. 58 para. 7.
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payment is.66 If the seller has made use of the right of retention provided in Art. 58(2),
the seller can dispatch the goods with the price to be paid to the carrier concurrently
with the handing over of the goods. If the last carrier has authority to collect the
payment, the place of performance for the payment under Art. 57(1)(b) is the place of
exchange, so the timeframe for the payment will be relatively short. If the seller does not
exercise his right of retention the seller must perform his obligation before the buyer, in
which case the place of payment will then be the seller’s place of business (Art. 57(1)(a))
and the buyer will enjoy a longer period within which to transfer payment.67
25 (v) Sale of goods in transit. The sale of goods in transit is governed by the same rules
as the sale of goods involving transport by a carrier. Only when the goods are handed
over at the place of destination does payment of the price become due in accordance
with Art. 58(1) first sentence. For his protection the seller must be given, analogous to
Art. 58(2), the right to make the handing over of the goods subject to payment of the
price to the carrier. The buyer must be able to exercise his right under Art. 58(3).
However, generally the sale of goods in transit will be effected by documents so that it is
not pertinent whether the goods are placed at the disposal of the buyer but rather
whether the documents are handed over. Often the right to examine under Art. 58(3)
will also be excluded.68
3. Divergent agreements
26 As already mentioned in numerous places, the parties can deviate from all parts of
Art. 58 by agreement: the step-by-step performance; the time the payment is due; the
right to examine the goods, and possible rights of retention. The contract can contain
explicit terms in regard to the time of payment, such as prevalent payment clauses69 or
clauses which have an indirect impact on the application of Art. 58, such as, for
example, Incoterms which govern the place of performance for the delivery of the
goods and therewith stipulate the place where the seller has to place the goods at the
disposal of the buyer.70 Courts have also found that an agreement to divert from Art. 58
can also follow impliedly from the contract programme agreed upon by the parties. For
example the Swiss Bundesgericht held that the parties had derogated from the principle
of step-by-step performance in a case where they had agreed on payment of 30 per cent
of the price upon ordering of the goods, 30 per cent at the beginning of assembly, and
30 per cent at the completion of installation, the final 10 per cent to be paid after
successful start-up of the facility.71
66 Compare: Art. 57 paras 11, 18.

67 Achilles, Art. 58 para. 3; see also Lookofsky, The United Nations Convention on Contracts for the
International Sale of Goods, Art. 58 para. 246.
Art. 58 para. 18.

69 See Art. 53 paras 11 et seq.; see in regard to the liability to pay in advance due to an irrevocable credit
clause Oberster Gerichtshof (Austria), 6 February 1996, ZfRV (1996) 248 (252 seq.).
Art. 58 para. 20.

71 Bundesgericht (Switzerland) 18 January 1996 (Plant for purification of exhaust gases), CISG-Online
214 (Pace); see also Handelsgericht Aargau (Switzerland) 5 November 2002 (Inflatable triumphal arch)
CISG-Online 715 (Pace); see also Oberlandesgericht München (Germany) 21 January 1998 (insulation
materials) CISG-Online 536, where the granting of an interest free, not terminable commercial credit
meant that the time the payment was due was not at the time when the goods or documents were placed
at the disposal of the buyer but the claim for the purchase price was deferred sine die.
3B2 9.1.580; Page size: 160.00mm 240.00mm
4. Documents
Art. 58(1) and (2) equate documents with goods in respect of placing the goods at the 27
disposal of the buyer and in regard to the handing over of the goods. This applies to cases
where the parties have agreed that the seller has to tender the documents to the buyer. In
regard to the due date of payment, the decisive moment is when the seller has made the
documents available to the buyer, not the time the goods were placed at the disposal of
the buyer. Documents are normally placed at the buyer’s disposal by presenting them at
his bank (in the case of “cash against documents”) or at a second bank in the seller’s
country (if payment by letter of credit has been agreed).72 If a carrier is entrusted with
presenting the documents and collecting payment, the purchase price must be paid to the
carrier concurrently with the handing over of the documents (Art. 58(2)).73 The use of
documents is particularly important in cases where the direct exchange of goods for
money is not possible or extremely difficult, for example where a carrier is used, especially
in overseas trade, and also where goods are sold from storage in a warehouse or
transported by the seller to the buyer’s premises at the seller’s risk. The use of documents
in such cases ensures the step-by-step performance by both parties and accelerates the
performance of the transaction. Often in cases where the parties have agreed on a
“document sale” they will also have agreed upon on the exclusion of Art. 58(3).
Art. 58(1) and (2) do not define which documents are governed by the provisions. 28
Traditional documents of title controlling the disposition of the goods, like a bill of lading
or a warehouse receipt, are covered by the provisions since the handing over of such
documents is the equivalent to the delivery of the goods. The purchase price payment,
therefore, becomes due upon their presentation (Art. 58(1)). However, there is a variety of
documents used in commercial sales contracts to bring about delivery, for example,
delivery order, delivery warrant, or bill of delivery or bills issued under the CMR and
CIM Conventions governing carriage by road and rail.74 To take account of those trade
practices which use such a variety of documents, other than the traditional documents of
title to effect delivery, “documents” in Art. 58(1) and (2) should be understood to include
all documents the seller can use to perform his obligation to deliver the goods in
accordance with Arts 30 and 34.75 This means that the documents’ use must give the
buyer a right to take possession of the goods to the exclusion of the seller. That
requirement is satisfied if the documents contain a promise, by the person entitled to
possession of the goods, that that person will deliver them. This is indicated, for example,
by a certificate of obligation or accepted delivery order, or a certificate which entitles the
holder to issue instructions concerning the goods during the course of their transport.76
The German Bundesgerichtshof77 has held that Art. 58 should be applied to docu- 29
ments which allow the buyer access to the goods excluding the seller (for example,
72
See also Art. 57 paras 25 et seq.
73
See above para. 23.
74 Weber, Warenpapiere ohne Traditionsfunktion (1978) pp. 303–321; Digenopoulos, Die Abwandlung
der CIF und FOB Geschäfte im modernen Überseekaufrecht (1978) pp. 145 et seq.; Sevón, Obligations of
the Buyer under the Vienna Convention on the International Sale of Goods (1990) p. 335.
75 General opinion: Huber, in: MünchKommBGB (2016), Art. 58 para. 25; Mohs, in: Schlechtriem/
Schwenzer, Commentary (2016), Art. 58 para. 16; Ferrari et al., Internationales Vertragsrecht (2011),
Art. 58 para. 21; see also Secretariat Commentary on 1978 Draft, Art. 53 para. 5 note 4; other opinion:
Padovini, Der internationale Kauf: Von der Haager Konvention zur Wiener Konvention – Erfahrungen
und Aussichten, ZvglRWiss (1987) 87 (89).
76 Sevón, Obligations of the Buyer under the Vienna Convention on the International Sale of Goods
(1990) p. 335.
77 Bundesgerichtshof (Germany) 3 April 1996 (Cobalt sulphate), CISG-Online 135 (Pace).
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warehouse warrants) but that Art. 58 should not be applicable to certificates of quality
or certificates of origin. This seems to concur with the opinion in the literature which, in
regard to documents of carriage, takes the view that whether the documents allow the
owner to retrospectively issue instructions in regard to the retention of the goods or
diversion during the transport of the goods (like a duplicate of a consignment note or a
CMR consignment note) is decisive for Art. 58. Art. 58 shall govern those documents.78
Quay or board receipts are not governed.79
30 A third opinion holds that Art. 58 governs documents of proof, such as board
receipts.80
5. Rights of retention (Arts 58(1) second sentence and 58(2))

31 Art. 58(1) and (2) not only link the time for payment with the placing of the goods or
documents at the buyer’s disposal, but also establish reciprocal rights of retention.81 For
the buyer, the right of retention follows from the fact that only the placing of the goods
at his disposal causes payment to become due (Art. 58(1) first sentence). One court has
held that the buyer has the right to retention until a proper invoice has been furnished.82
The seller derives his right of retention from Art. 58(1) second sentence as regards
deliveries at his or the buyer’s place of business or a third place. The seller has a right of
retention until the payment of the purchase price. The provision does not affect the
time the purchase price is due, which already eventuates with the placement of the
goods at the disposal of the buyer, since the right of retention is linked to the handing
over of the goods.83 The right of retention does not abolish the buyer’s right to examine
the goods under Art. 58(3). The seller does have to grant the buyer the opportunity to
examine the goods unless that right has been excluded by agreement.84
32 Art. 58(2) gives the seller a right of retention as regards a sale involving carriage of
goods, a sale of goods in transit, or a sale of goods stored in a warehouse which requires
that the goods or documents are only handed over against the payment of the purchase
price. That requires in turn instructions to the carrier in regard to the collection of the
purchase price. Such instructions are rare in practice.85 The conclusion can be drawn
from Art. 58(2) that the seller can only make the dispatching of the goods dependent
on the payment86 if the parties so agreed. The buyer’s right to examine the goods
78 Herber/Czerwenka, Kommentar (1991), Art. 58(9); Magnus, in: Staudinger Kommentar (2013),
Art. 58 (20),(21); Achilles, Art. 58 para. 2; Karollus, p. 170.

79 Compare: Magnus, in: Staudinger Kommentar (2013), Art. 58 paras 20, 21; Huber, in: Münch-
KommBGB (2016), Art. 58 para. 26; Fleischmann/Schmidt-Kessel in DiMatteo/Janssen/Magnus/Schulze,

International Sales Law (2016) Ch 13 para. 78.
80 Enderlein/Maskow/Strohbach, Internationales Kaufrecht (1991), Art. 57 para. 8.1. (depending on the
contractual agreement other documents, like insurance documents, or certificates of quality, shall be
governed by Art. 58); Maskow, in: Bianca/Bonell, Art. 58 para. 3.1; Wiegand, Die Pflichten des Käufers
und die Folgen ihrer Verletzung, Berner Tage (1991) pp. 143, 155, 156.
81 Handelsgericht des Kantons St Gallen (Switzerland) 14 June 2012 (Bio fruits case) CISG-Online 2468;
Huber, in: MünchKommBGB (2016), Art. 58 paras 22, 23.

82 AG Geldern (Germany) 17 Aug 2011 (Corn), CISG-Online 2302. The court held that in regard to the
cross border trade between the Netherlands and Germany the furnishing of a proper invoice was an
implied term of the contract.
Art. 58 para. 22.

Art. 58 para. 6; Ferrari et al., Internationales Vertragsrecht (2011), Art. 58 para. 25.
85 Compare: Magnus, in: Staudinger Kommentar (2013), Art. 58 para. 15; Huber, in: MünchKommBGB
(2016), Art. 58 para. 23.

86 Different Art. 72(1) ULIS, Herber/Czerwenka, Kommentar (1991), Art. 58 para. 5; Magnus, in:
Staudinger Kommentar (2005), Art. 58 para. 1; Huber, in: MünchKommBGB (2016), Art. 58 para. 23.
3B2 9.1.580; Page size: 160.00mm 240.00mm

(Art. 58(3)) has to be observed, too.87 Art. 58(2) can be applied analogously to the sale
of goods in stock; the seller has the right to instruct the warehouse keeper to only hand
over the goods against the payment of the purchase price.88
Art. 58 lays down express rights of retention only for delivery and payment. However, 33
it must also apply to other obligations, provided that they are of some substance
(following from Art. 71).89 If the threat of a breach of such obligations gives rise to
rights on account of an anticipatory breach of contract, their actual breach justifies a
right of retention.90 For example, a right of retention exists if the buyer does not provide
the agreed securities or if the buyer does not execute the agreed advertisement.
6. Payment ahead of time, part payment

The buyer’s payment ahead of time amounts to a breach of contract. The seller can 34
refuse such payment.91 If the seller accepts payment ahead of time the seller can only
claim a possible currency loss if they have reserved that right at acceptance.92
The seller can also decline part payments. If the seller accepts part payment they can 35
invoke the usual remedies in regard to the rest of the purchase price without having to
reserve that right.93
7. Application to other buyer’s obligations

Unless the parties have agreed otherwise Art 58 is by way of analogy applicable to 36
other obligations of the buyer, especially duties to cooperate. Therefore, the buyer has to
immediately fulfil those obligations once the seller has offered the goods to the buyer
and the buyer has had the opportunity to inspect them in accordance with Art. 58(3).
The core idea of Art. 58 is also applicable to those additional obligations. The moment
the buyer can take over the goods, the buyer has to in return fulfil his/her duty so that
the seller is not forced to perform in advance.94
The usual rules in regard to the burden of proof apply. Generally, the seller has to 37
prove the time of payment, whereas the buyer has to prove that the payment occurred
in time.95 Departure from that general rule can occur due to the rule that the party who
Art. 58 para. 15; Huber, in: MünchKommBGB (2016), Art. 58 para. 23.
89 See Handelsgericht des Kantons St Gallen (Switzerland) 14 June 2012 (bio fruits case) CISG-Online
2468.
90 General opinion: Huber, in: MünchKommBGB (2016), Art. 58 para. 24; Magnus, in: Staudinger
Kommentar (2013), Art. 58 para. 23; Achilles, Art. 58 para. 6; different view: Schnyder/Straub, in: Honsell,
91 General opinion: Huber, in: MünchKommBGB (2016), Art. 58 para. 28.
Art. 58 para. 12; Huber, in: MünchKommBGB (2016), Art. 58 para. 28; Ferrari et al., Internationales
Vertragsrecht (2011), Art. 59 para. 10; different opinion: Schnyder/Straub, in: Honsell, Kommentar
(1997), Art. 58 paras 85, 86 with extensive arguments.
93 General opinion: Magnus, in: Staudinger Kommentar (2013), Art. 58 para. 32; Herber/Czerwenka,
Kommentar (1991), Art. 58 para. 12; different opinion: Schnyder/Straub, in: Honsell, Kommentar (1997),
Art. 61 paras 52 et seq. with extensive arguments.
95 Sixth Civil Court of First Instance, City of Tijuana, State of Baja Califoria (Mexico) 14 July 2000
(wood), CISG-Online 571; Mohs, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 58 para. 38;
Ferrari et al., Internationales Vertragsrecht (2011), Art. 58 para. 37.
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claims the deviation from the principle has to prove it, for example, a liability to
perform in advance instead of step-by-step performance.96
38 Art. 58 is not mandatory and parties can agree to a completely different regime in
regard to the interaction between delivery of the goods and purchase price payment.
However, the parties should attach importance to agreeing to the exact time of the
purchase price payment and to agreeing on mechanisms which notify the buyer on the
time the payment is due. If the sale is based on documents, the parties should be careful
to exactly describe the documents.97

39 Neither the PICC nor the PECL have specific provisions dealing with the time the
purchase price is due. However, both have provisions dealing generally with the time of
performance. The PICC embodies the general rule in Art. 58 that performance has to
eventuate step-by-step. Art. 6.1.4 of the PICC states that the parties are bound to render
their performances simultaneously to the extent that the performances of the parties can
be rendered simultaneously, unless circumstances indicate otherwise. The PECL state in
their Art. 7:102 that a party has to effect its performance: “(1) if a time is fixed by or
determinable from the contract, at that time; (2) if a period of time is fixed by or
determinable from the contract, at any time within that period unless the circumstances
of the case indicate that the other party is to choose the time; (3) in any other case,
within a reasonable time after the conclusion of the contract.”
40 Overall, there should not be a great divergence from the CISG in regard to the time
payment is due.
41 At common law the general rule is that party agreement determines the time of
payment.98 In certain circumstances, terms in respect of the time of payment have been
implied into contracts.99 Only in three scenarios (recognised under equitable principles) in
the past has the jurisprudence found that the time fixed for payment is of the essence in
the contract.100 S 10(1) of the Sale of Goods Act 1979 (UK) expressly states that, unless a
different intention appears from the terms of the contract for the sale of goods, stipulations
as to time of payment are not of the essence in the contract. S 28 of the SGA sees payment
as being concomitant with the delivery which suggests a closer approach to Art. 58 CISG
than the approach often found in textbooks.101 S 34 of the SGA stipulates that “unless
otherwise agreed, when the seller tenders delivery of goods to the buyer, he is bound on
request to afford the buyer a reasonable opportunity to examine the goods for the purpose
of ascertaining whether they are in conformity with the contract and, in the case of a
contract for sale by sample, of comparing the bulk with the sample.”
96 Compare: Benicke, in: MünchKommHGB (2013), Art. 58 para. 17; Huber, in: MünchKommBGB
(2016), Art. 58 para. 30.

97 Compare: Huber, in: MünchKommBGB (2016), Art. 58 para. 31.
98 Chitty on Contracts (2015) para. 21–053.
99 Chitty on Contracts (2015) paras 21–053; 21-011; see also Bowes v Shand (1877) 2 App Cas 455, 463,
464.
100 (1) Where the parties have expressly stipulated in their contract that the time fixed for performance
must be exactly complied with (see Musen v Van Diemen’s Land Co [1938] Ch 253); (2) Where the
circumstances of the contract or the nature of the subject-matter indicate that the fixed date must be
exactly complied with (e. g. a contract for the sale of goods where a time is fixed for delivery, Bowes v
Shand (1877) 2 App Cas 455, 463, 464); (3) Where time was not originally of the essence of the contract,
but one party has been guilty of undue delay, the other party may give notice requiring the contract to be
performed within a reasonable time (compare s 48(3) Sale of Goods Act 1979 (UK): Shawton Engineering
Ltd v DGP International Ltd [2006] 1 BLR 1 [44]).
101 Compare Schlechtriem/Butler, CISG (2009), para. 219 with note 385.
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Under § 271(1) of the German BGB first and foremost party agreement determines 42
the time of payment.102 If the parties have not fixed a time for the payment of the
purchase price the default rule in § 271(1) BGB stipulates that the obligor can demand
the performance immediately. If the parties have agreed upon a time of payment
§ 271(2) BGB determines that the obligee (i. e. the buyer) can pay before the payment
is due, however, the obligor (i. e. the seller) is not permitted to demand the payment
before the agreed time.
The US-UCC also provides the buyer with a right to inspection absent agreement to 43
the contrary.103 Under the UCC the buyer does not have the right to inspect before
payment when the goods are to be shipped and payment is by documentary ex-
change.104 Further, the UCC explicitly states that the determination of what the parties
have agreed to regarding the buyer’s right to inspect can be determined from trade
usage, course of performance and, of course, their dealing with each other.105
102 Note that § 271 BGB is a general provision in regard to the time of performance.
103 § 2–513 UCC.
104 § 2–513(3)(b) UCC.
105 § 2–513(3)(a) UCC.
3B2 9.1.580; Page size: 160.00mm 240.00mm
Article 59
The buyer must pay the price on the date fixed by or determinable from the
contract and this Convention without the need for any request or compliance with
any formality on the part of the seller.
Outline

1 Art. 59 states that the purchase price has to be paid at the agreed, or otherwise
determinable, time without the need for the seller to remind the buyer of the payment
or to comply with any other formalities. Art. 59, therefore, clarifies that paying late is a
breach of the contract which triggers the legal consequences set out in Arts 61 et seq. A
demand note is therefore unnecessary. Art. 59 embodies one of the CISG’s general
principles (Art. 7(2)) and is, therefore, applicable to other monetary claims.1

2 The time of payment is determined either by the agreement of the parties or by
Art. 58. The buyer has to have effected the payment at that particular time. It is not
sufficient under Arts 58 and 59 if the buyer took the necessary steps for the payment to
reach the seller.2 The late payment results automatically in a breach of contract and
triggers the remedies set out in Arts 61 et seq., 78. It is important to note that, contrary
to German law, a demand note is not required.3
3 However, according to general opinion some exceptions to the rule in Art. 59 exist to
prevent unfair hardship. The time that payment is due can be extended if the buyer
takes advantage of his right to examine the goods under Art. 58(3); if the buyer did not
know or was under no obligation to know when the goods or documents would be
available to the buyer during a step-by-step performance,4 or if the buyer does not know
the exact amount of the purchase at the time the purchase price is due.5 In the two latter
1 Compare: Magnus, in: Staudinger Kommentar (2013), Art. 59 para. 10; Huber, in: MünchKommBGB
(2016), Art. 59 para. 1; Murray, in: Digest, pp. 450 seq.

Art. 59 para. 2.
3 Compare: Oberlandesgericht München (Germany) 21 January 1998 (Thermal insulation material),
CISG-Online 536 (Pace); Oberlandesgericht München (Germany) 9 July 1997 (Leather goods), CISG-
Online 282 (Pace); Mohs, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 59 para. 1.
4 See Art. 58 paras 4–6.
5 See Oberlandesgericht München (Germany) 9 July 1997 (Leather goods), CISG-Online 282 (Pace): the
Court in this case indicated that knowing the amount owed was a requirement of Art. 59. In this
particular case the Court held that the purchase price was due at least when the invoices were presented
to the buyer. It was immaterial that, at the time payment was due, the buyer claimed not to have had the
invoices. Since in accordance with Art. 59 the buyer does not need to be reminded of the payment the
payment was due the moment the invoices were presented (after the agreed payment date); compare:
Magnus, in: Staudinger Kommentar (2013), Art. 59 para. 5; Huber, in: MünchKommBGB (2016), Art. 59
para. 3; Herber/Czerwenka, Kommentar (1991), Art. 59 para. 3.
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cases the seller will have to act to affect the time of the payment under Arts 58, 59, e. g.,
by informing the buyer about the delivery or by sending an invoice.6
Party agreement7 or trade usages and practices often determine that the payment is only 4
due after the seller sent the invoice.8 The Incoterms, e. g., under A 1 generally envisage that
the seller has to invoice the buyer before the buyer has to pay the purchase price.9 Whether
the buyer can demand a receipt for his payment depends first and foremost on the
agreement between the parties or the trade usages and practices.10 However, under the
duty of cooperation between the parties, embodied in the CISG (Art. 7(1)), it should be
deduced that the obligee generally can demand a receipt from the obligor.11

The PICC does not contain an equivalent to Art. 59. However, from its Arts 5.1.3 (co- 5
operation between the parties) and 5.1.4 (duty to achieve a specific result; duty of best
efforts) it can be inferred that under the PICC the buyer would have to pay the purchase
price on time without any further notifications or demand notes from the seller.
Similarly to the general opinion expressed in regard to Art. 59, those PICC provisions
indicate that the seller would be obliged to facilitate the purchase payment if necessary.
Similarly, PECL does not contain any equivalent to Art. 59. However, from the contract 6
paradigm stipulated by PECL, it can be inferred that the seller does not need to remind
the buyer of the timing of the purchase price payment but the buyer will be in breach of
contract if they have not affected payment in time. Under German law the obligor of a
claim for payment is in default if they do not perform within thirty days after the due date
and receipt of an invoice or equivalent statement of payment without the obligor having
to issue a demand notice. If the time at which the invoice or payment statement is
received by the obligor is uncertain, an obligor who is not a consumer is in default by
thirty days at the latest after the due date and receipt of the consideration (§ 286(3) BGB).
In accordance with s 10(1) Sale of Goods Act 1979 (UK) the time of payment is 7
generally not an essential term of the contract. The seller, therefore, will have to demand
payment if the buyer does not pay for remedies to be triggered.
There is no similar provision in the US-UCC. 8
6 Benicke, in: MünchKommHGB (2016), Art. 59 para. 1; Herber/Czerwenka, Kommentar (1991),
Art. 59 para. 3.
7 OLG Köln (Germany) 3 April 2006 (Strawberry plants case) CISG-Online 1218 (Pace); Handelsgericht
des Kantons St Gallen (Switzerland) 11 February 2003 (Audio CDs), CISG-Online 900 (Pace) held that
the fact that the buyer demanded the payment could result in the delay starting only with the reminder
(however, in this particular case the time the payment was due was unclear).
8 See AG Geldern (Germany) 17 Aug 2011 (Potato clay), CISG-Online 2302 where the Court held that
in cross border trade between the Netherlands and Germany the issuing of an invoice was an implied
term of the contract.
9 Compare: Ramberg, ICC Guide of Incoterms, comments to A1; Mohs, in: Schlechtriem/Schwenzer,
Commentary (2016), Art. 59 para. 5; Huber, in: MünchKommBGB (2016), Art. 59 para. 3.
10 See OLG Köln (Germany) 3 April 2006 (Strawberry plants case) CISG-Online 1218 (Pace); Herber/
Czerwenka, Kommentar (1991), Art. 59 para. 3; Magnus, in: Staudinger Kommentar (2013), Art. 59
para. 8; Huber, in: MünchKommBGB (2016), Art. 59 para. 3.
11 Fountoulakis, IHR (2005) 244; Huber, in: MünchKommBGB (2016), Art. 59 para. 3.
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Section II
Taking delivery
Article 60
The buyer’s obligation to take delivery consists:
(a) in doing all the acts which could reasonably be expected of him in order to
enable the seller to make delivery; and
(b) in taking over the goods.
Bibliography: Danov, Die Abnahmepflicht des Käufers im Bereich der internationalen Handelsgeschäfte
nach UN-Kaufrecht (2008), available at http://www.utzverlag.de/buecher/40817les.pdf.
Outline
1. Content of the duty to take delivery. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
a) The taking of the delivery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
b) Other acts of participation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
2. Refusal to take delivery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

1 Art. 60 determines the content of the buyer’s duty to take delivery of the goods. Note
that the buyer’s obligation to take delivery already follows from Art. 53. A breach of the
buyer’s duty to take delivery results in the application of Arts 61 et seq. It should be
noted that Art. 64(1)(b) stipulates that a breach of duty to take delivery may result in
the avoidance of the contract. The delineation of the duty to take delivery, especially the
duty to participate (Art. 60(a)), from other duties of the buyer is of immense practical
importance.
1. Content of the duty to take delivery

2 a) The taking of the delivery. Art. 60(b) provides that the duty to take delivery
obliges the buyer to physically take over the goods at the place of delivery at the time of
delivery.1 The duty also encompasses the duty to unload the delivered goods or to load
them on the buyer’s own mode of transport and to bear the costs for those activities,
unless otherwise agreed between the parties or if to do so would be contrary to trade
1 Compare: Landgericht Aachen (Germany) 14 May 1993 (Electronic ear device), CISG-Online 86
(Pace); Juzgado de Primera Instancia de Almendralejo (Spain) 2 Sept 2013 (Wine) CISG-Online 2565,
where Art. 60 was mentioned by the Court when determining acceptance of the goods; Magnus, in:
Staudinger Kommentar (2013), Art. 60 para. 5; Huber, in: MünchKommBGB (2016), Art. 60 para. 2;
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Section II. Taking delivery 3–6 Article 60

usages and practices.2 The place of delivery and the time of delivery are determined first
and foremost in accordance with party agreement. Otherwise Art. 31 determines the
place of delivery.3 The general opinion, however, holds that the place of destination is
determinative in cases of a contract involving the carriage of goods (Art. 31(a)) and
travelling goods.4 The buyer generally has to take delivery immediately when the goods
are timely.5 In exceptional circumstances the buyer, however, must be granted a short
period of time if the buyer has to undertake some measures to take delivery and the
buyer was not able to foresee the time of the delivery.6
The duty to take delivery applies not only to goods but also to documents which the 3
seller has to hand over in accordance with Art. 34 or rather which represent the goods.7
Generally, in the case of goods in storage, the buyer does not physically take delivery but
receives the relevant documents.8 The same is true for document sales like cash against
documents or cash against letter of credit. The buyer’s duty in such cases is the uptake
of the documents.
The acquisition of the goods does not result in an acceptance of the goods. The buyer 4
is still able to complain about the breach of contract or to enforce the available remedies
for late delivery or delivery to the wrong place.9
b) Other acts of participation. Under Art. 60(a) the buyer has the duty to carry out 5
all acts necessary which can reasonably be expected from the buyer to make the delivery
possible.10 Often such duties of cooperation will be stipulated in the contract, for
example, through agreed Incoterms and the duties listed under B. Some argue that the
Incoterms can be generally used as an interpretation aid in regard to the buyer’s
cooperation duties.11 When the buyer has to cooperate depends on the circumstances
of the contract. Generally the cooperation has to be early enough to allow the seller to
deliver on time.
The duty to cooperate can encompass a range of different measures. For example, 6
if the seller has to deliver at the buyer’s place of business, the buyer must keep facilities
ready for the delivery (for example, oil tanks, storage space). He might have to obtain
the necessary import authorisations,12 and in rare cases export authorization.13 He may
also have to organise the contract in regard to the carriage of the goods or the
2Magnus, in: Staudinger Kommentar (2013), Art. 60 para. 5; Achilles, Art. 60 para. 1.
3Magnus, in: Staudinger Kommentar (2013), Art. 60 para. 5; Huber, in: MünchKommBGB (2016),
Art. 60 para. 2.
Art. 60 para. 5.
5 Mohs, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 60 para. 4; Achilles, Art. 60 para. 1;

6 General opinion: Mohs, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 60 para. 4; Achilles,
Art. 60 para. 1; Huber, in: MünchKommBGB (2016), Art. 60 para. 2; Magnus, in: Staudinger Kommentar
(2013), Art. 60 para. 7.
Art. 60 para. 3; Achilles, Art. 60 para. 1.65.

Art. 60 para. 3; Herber/Czerwenka, Kommentar (1991), Art. 60 para. 7.

Art. 60 para. 3; Herber/Czerwenka, Kommentar (1991), Art. 60 para. 2; Achilles, Art. 60 para. 1.
10 Compare: Arbitral Award, Tribunal of International Commercial Arbitration at the Russian Federa-
tion Chamber of Commerce and Industry Arbitration, 24 January 2002 (Case iron products), CISG-
Online 88 (Pace).
11 Magnus, in: Staudinger Kommentar (2013), Art. 60 para. 10; Achilles, Art. 60 para. 2.
12 Compare: the Incoterms in regard to import authorisations.
13 For example: EXW, compare A2 B2 of the Incoterms.
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nomination of a ship14 (for example FOB,15 FCA). The buyer is also under the duty to
inform,16 especially in regard to peculiarities in the countries where the goods will be
delivered to. He may also be under duties in regard to issuing a release order.
7 The buyer’s duty under Art. 60(a) has to be distinguished from other ancillary duties of
the buyer. This is especially important since Art. 64(1)(b) stipulates a right to avoid the
contract if the buyer breaches his cooperation duty to make delivery possible. This right
does not apply in regard to the breach of the buyer’s other ancillary duties. Three duties
of cooperation are surrounded by controversy in respect of whether they arise as duties
under Art. 60(a), or are mere ancillary duties: the buyer’s duty to make certain plans and
data available to the seller which are necessary to manufacture the goods;17 the duty to
specify the goods,18 and the obligation to sell to a certain market, in regard to exclusive
purchasing obligations, and in regard to price controlling.19 Only the second group of
cases has a direct impact on the taking of the delivery and should, therefore, as the general
opinion has stated, be a duty to cooperate that, if breached, allows the seller to avoid the
contract. In regard to the first set of duties, even though it is very remote from the duty to
take delivery, it can be argued that without the cooperation of the buyer there can never
be goods which can be delivered and that therefore it should be seen as a cooperation
duty. The third set of cases clearly does not affect the taking of delivery and should be
classified as ancillary duties.
2. Refusal to take delivery

8 The buyer cannot circumvent or delay the time that the purchase price payment is
due by not taking delivery.20 If the buyer does not take delivery the seller can invoke the
remedies stipulated in Arts 61 et seq. Art. 64(1)(b) allows the seller to avoid the contract
after the seller has set an additional time period. In the case that the buyer justifiably
rejects the taking of delivery of the goods, the seller cannot invoke Arts 61 et seq. For
example, if the seller delivers earlier (Art. 52(1)) or a surplus quantity (Art. 52(2)) then
Arts 61 et seq cannot be invoked. In cases of other breaches of contract, especially in
regard to late delivery or the delivery of non-conforming goods, the question of whether
the breach is fundamental arises. If the breach is fundamental the buyer is allowed to
refuse the delivery of the goods.21 Even in the case of a fundamental breach the buyer
can be obliged under Art. 86 to take delivery of the goods temporarily to ensure the
14 Compare: Arbitral Award, CIETAC China International Economic and Trade Arbitration Commis-
sion Arbitration (China) 22 March 2001 (Mung beans), CISG-Online 1442 (Pace); Arbitral Award,
CIETAC China International Economic & Trade Arbitration Commission Arbitration (China) 8 March
1996 (Horsebeans), CISG-Online 1245 (Pace).
15 Compare: Oberlandesgericht Karlsruhe (Germany) 8 February 2006 (Wheat), CISG-Online 1328
(Pace).
16 US District Court SD New York (U.S.) 10 May 2002 (Chemicals), CISG-Online 653.
17 General opinion: ancillary duty: see Magnus, in: Staudinger Kommentar (2013), Art. 60 para. 10;
cooperation duty: Hager, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 60 para. 2.

18 Cooperation duty: Magnus, in: Staudinger Kommentar (2013), Art. 65 para. 6; Mohs, in: Schlech-
triem/Schwenzer, Commentary (2016), Art. 65 para. 8; U. Huber, Der UNCITRAL-Entwurf eines Über-
einkommens über internationale Warenkaufverträge, RablesZ (1979) 413 (518); for ancillary duty:
Bennicke, in: MünchKommHGB (2013), Art. 64 para. 7; Knapp, in: Bianca/Bonell, Commentary (1987),
Art. 65 paras 2.6, 3.2; Herber/Czerwenka, Kommentar (1991), Art. 65 para. 7.
19 General opinion: ancillary duty: Hager, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 64
para. 8; Huber, in: MünchKommBGB (2016), Art. 60 para. 3; cooperation duty: Herber/Czerwenka,
Kommentar (1991), Art. 64 para. 4 in regard to especially agreed duties.
20 Compare: Oberlandesgericht Düsseldorf (Germany) 28 May 2004 (TV sets), CISG-Online 850 (Pace).
Art. 60 para. 14; Achilles, Art. 60 para. 3; Herber/Czerwenka, Kommentar (1991), Art. 53 para. 11; Bridge,
The International Sale of Goods (2013) para 12.09, 12.10.
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Section II. Taking delivery 9–14 Article 60

preservation of the goods, however, this is of course not taking delivery in accordance
with Art. 60. If the breach is not fundamental the buyer does not have the right to refuse
to take delivery of the goods. However, in some situations the buyer has the right to
refuse even if the breach is not fundamental under Art. 7(1) (good faith).22 For example,
if the seller did not have to deliver the goods to the buyer’s place of business or if the
buyer has already demanded rectification of the defect and the goods are such that they
must taken back to the seller for repair.
The burden of proof conforms with general principles: the seller has to prove the 9
existence and the content of the duty to take delivery; the buyer has to prove the
adequate and orderly performance of that duty.23
Art. 60 is not mandatory and can be modified by agreement. It is especially sensible 10
for the contract to include the right to refuse delivery. The seller is advised to be allowed
to fulfil the acts which constitute the taking of the delivery himself.24

Similarly to Art. 60 CISG, Art. 5.1.3 PICC imposes on each party the duty to 11
cooperate with the other when such cooperation may reasonably be expected for the
performance of that party’s obligations. This is aided by Arts 5.1.4. and 5.1.5., which
oblige a party to make their best effort to achieve performance. Arts 6.1.14 to 6.1.17 deal
with the specific scenario that a party is responsible to obtain public permission for the
performance (this is the party that has its place of business in that State, that requires
the permission and, therefore, will often be the buyer).
§ 433(2) of the German BGB stipulates for a contract for the sale of goods that the 12
buyer has the duty to pay the purchase price and to take delivery of the goods. However,
generally the duty to take delivery and perform all acts necessary for the buyer to affect
the taking of delivery is classified as an ancillary duty (unless the contract stipulates
otherwise).25
S 37 of the Sale of Goods Act 1979 (UK) sets out the buyer’s liability if the buyer does 13
not take delivery within a reasonable time when the seller is ready and willing to deliver
the goods, and requests the buyer to take delivery. The buyer is generally liable to the
seller for any loss occasioned by his neglect or refusal to take delivery, and also for a
reasonable charge for the care and custody of the goods.
§ 2–503(1)(b) US-UCC requires that “unless otherwise agreed, the buyer must furnish 14
facilities reasonably suited to the receipt of the goods.” This places a duty on the buyer to
provide a proper place for delivery.26 In addition, § 2–301 UCC states that the buyer has
to take any reasonable steps necessary to enable the seller to make delivery.
22 Compare: Hager, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 60 para. 3; Herber/Czer-
wenka, Kommentar (1991), Art. 53 para. 11; contrary view: Magnus, in: Staudinger Kommentar (2013),
Art. 60 para. 21; only in very extreme circumstances: Huber, in: MünchKommBGB (2016), Art. 60
para. 9.
23 Achilles, Art. 60 para. 4; Huber, in: MünchKommBGB (2016), Art. 60 para. 10.
25 See: Weidenkaff, in: Palandt (ed.), Kommentar (2009), § 433 para. 36.
26 Gabriel, Sale of Goods (2004) p. 176.
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Section III
Remedies for breach of contract by the buyer
1 This section on the remedies available to the seller for breach of contract by the buyer
does not contain a full description of all the remedies available, their modalities and
conditions. For example, it does not contain details on damages but simply refers to the
section on damages that is common to the buyer and the seller (Arts 74–77).
2 This is due to the structure of the CISG which describes remedies and their
modalities in different parts of the convention. In order to have a fuller picture of all
the remedies and recourses available to the seller and their modalities, one must read
this section along with Arts 71–73 (anticipatory breach), Arts 74–77 (damages), Art. 78
(interests), Arts 79–80 (exemption of liability), Arts 81–84 (effect of avoidance), Arts
85–88 (preservation of the goods), Arts 25–26 (fundamental breach and notice of
avoidance) and Art. 28 (limitation on the granting of specific performance). In some
circumstances (see Art. 69) the passing of risk may also be a consequence of the breach
of an obligation.1 Full comments on these other articles will be provided in other parts
of this book.2
3 This section, Section III on the remedies available to the seller (Arts 61–65) of chapter
III – “Obligations of the Buyer” parallels Section III on the remedies available to the
buyer (Arts 45 to 52) of Chapter II – “Obligations of the Seller”.
1Enderlein/Maskow, International Sales Law (1992), p. 234.

2For a look at remedies not article by article but remedy by remedy, one could look for example at Liu
Chengwei, Remedies in International Sales – perspectives from CISG, Unidroit Principles and PECL
(2007).
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Article 61
(1) If the buyer fails to perform any of his obligations under the contract or this
Convention, the seller may:
(a) exercise the rights provided in articles 62 to 65;
(b) claim damages as provided in articles 74 to 77.
(2) The seller is not deprived of any right he may have to claim damages by
exercising his right to other remedies.
(3) No period of grace may be granted to the buyer by a court or arbitral tribunal
when the seller resorts to a remedy for breach of contract.
Bibliography: Enderlein/Maskow, International Sales Law (1992), p. 234; Honnold, Uniform Law (2009),
paras 276 et seq.; Koch, Editorial remarks: Commentary on Whether the UNIDROIT Principles of
International Commercial Contracts May Be Used to Interpret or Supplement Articles 63 and 64 of the
CISG, s. II (2)(c) (Pace); Malaurie/AynÜs/Gautier, Droit civil - Les contracts spéciaux (2003) para. 324;
Schlechtriem, Uniform Sales Law - The UN-Convention on Contracts for the International Sale of Goods
(1986), Arts 61; Schlechtriem/Schwenzer, Commentary (2016), Art. 61; Zweigert/Kötz, Comparative Law
(1998) p. 497.
Outline
1. Remedies available to the seller (Art. 61(1)) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2. Damages can be cumulated with other remedies (Art. 61(2)). . . . . . . . . . . . . . 6
3. Court may not grant a period of grace (Art. 61(3)). . . . . . . . . . . . . . . . . . . . . . . . . 7

The substance of this article has not changed since its 1978 Draft.1 This article is 1
meant to gather all the remedies available to the seller (at least a reference to all of
them) in one article of the CISG irrespective of the nature of the breach by the buyer.
This is a novel approach – the ULIS listed separate remedies for each type of breach.2
Art. 45 is the parallel article on the remedies available to the buyer and in some respect
the language of the two articles is identical.

1. Remedies available to the seller (Art. 61(1))
Art. 61(1) CISG lists the remedies available to the seller for any failure of the buyer 2
“to perform any of his obligations under the contract and this Convention”. His main
obligations under the Convention are to pay the price (Arts 54–59) and to take
delivery (Art. 60 CISG). The contract may include many more obligations.3 As
1Then Art. 42 in 1977, see Doc. B(1), UNCITRAL YB (1977), p. 50.

2Schlechtriem, Uniform Sales Law – The UN-Convention on Contracts for the International Sale of
Goods (1986), p. 75. See Arts 61–64, 66–68 and 70 ULIS.
3 It should be noted that many contractual obligations may in fact fall under the obligation to pay and
the obligation to take delivery as these obligations are defined very broadly as including the taking of any
step necessary to enable payment and delivery, see Arts 54 and 60. An obligation to issue a letter of credit
for example would be part of the obligation to pay.
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mentioned above, the source of the breach is here irrelevant – the remedies are in
principle available whatever the nature of the breach of contract or of the convention,
though of course there will be modalities and limitations to each of these remedies –
not every breach will be a fundamental breach for example and, therefore, the right to
avoid the contract will in some cases be qualified.4
3 It should be noted that there is no requirement to prove any fault or negligence on
the part of the buyer. The failure by the buyer to perform an obligation is all the seller
has to prove.5 Some national legal systems adopt a concept of fault or negligence, even
though in the case of the contract of sale the fault can often be presumed from the non-
performance. The CISG clearly rejects such an approach.6 There may however be an
exemption of liability for damages available to the buyer under some circumstances.7
4 Art. 61(1)(a) merely refers the reader to the articles that follow (Arts 62–65) detailing
the remedies which the seller is entitled to exercise. Art. 61(1)(b) however states that
the seller may “claim damages as provided in Articles 74 to 77.” It should be noted
that Art. 61(1)(b) is the source of the right to claim damages and should always be cited
as such – Arts 74–77 do not mention the right to damages but simply state their
modalities.8
5 It should be noted, however, that the list of remedies for breach found at Art. 61(1) is
not as comprehensive as it could be. There is for example no mention of the right to
interests (Art. 78), the right of the seller to retain the goods in some circumstance
(Art. 85) or the right to sell the goods to a third party (self help) in some circumstances
(Art. 88). Although Art. 61(1)(b) refers to Arts 74–77 on some of the modalities of the
right to damages, there is no reference in Art. 61 et seq. to the exemption of liability for
damages (Arts 79–80), the effect of avoidance (Arts 81–84), the definition of a
fundamental breach (Art. 25) or the limitation on the granting of specific performance
(Art. 28). In some circumstances (Art. 69) the passing of risk may also be a consequence
of the breach of an obligation.9
2. Damages can be cumulated with other remedies (Art. 61(2))

6 Art. 61(2) states that the seller is not deprived of his right to claim damages even if
he exercises his right to other remedies.10 This allows the seller to ask for specific
performance and still claim damages for delay in performance for example, or allows
him to avoid the contract and claim damages if, for example, he cannot resell the goods
and make the expected profit.
4See Arts 64(1)(a) and 25, for example.

5Oberlandesgericht Koblenz (Germany) 17 September 1993 (logo for ink printers), CISG-Online 91
(Pace).
6 Honnold, Uniform Law (2009), paras 276 et seq.; Mohs, in: Schlechtriem/Schwenzer, Commentary
(2016), Art. 61 para. 5.

7 Art. 79.
8 For cases that have properly pointed to Art. 61(1)(b) as the source of the right to damages, see for
example: Cour d’appel de Colmar (France) 12 June 2001 (air-conditioning system for trucks), CISG-
Online 694 (Pace) and Landgericht Aachen (Germany) 03 April 1990 (shoes), CISG-Online 12 (Pace).
10 See also Art. 63(2) preserving the right to damages for delayed performance when an additional
period of time is granted.
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Section III. Remedies for breach of contract by the buyer 7–9 Article 61
3. Court may not grant a period of grace (Art. 61(3))

The statement in Art. 61(3) that “no period of grace may be granted to the buyer by 7
a court or arbitral tribunal when the seller resorts to a remedy for breach of contract”
may seem to go without saying to jurists trained in the common law tradition. This is
one of those provisions of the CISG that have been written to counter a rule common
in a specific legal tradition and which therefore makes little sense to someone from
another tradition11 – ‘why is there a need to say this?’ would ask the common law
trained jurist.
The reason is that under French law, for example, when a party seeks to rescind a 8
contract (résolution), the tribunal may grant a period of grace.12 The CISG rejects this
approach and therefore prevents the court or tribunal from granting such a period of
grace, thus removing a judicial discretion which would have brought uncertainty to
international trade.13 Only the aggrieved party may at his discretion grant an additional
period of time.14
What if the additional period of time fixed by the seller was not “of reasonable 9
length” as required by Art. 63(1)? Could the court or tribunal order a lengthening of the
period of time as a court or tribunal could do under 7.1.5(3) PICC15 or would this be
forbidden under Art. 61(3) as a court granted grace period? The alternative would be to
deny the right to avoid the contract at the end of an additional period of time of
unreasonable length. It is suggested that the solution proposed by Unidroit should be
followed as the right interpretation of the CISG. The purpose of Art. 61(3) is to prevent
a court or tribunal from granting a grace period, but if an additional period has been
granted by the seller, the court or tribunal should be able to determine whether it is of
reasonable length and if not, in this author’s opinion it is better to let the court lengthen
11 For another example see Art. 29 which effectively states that consideration is not required for the
modification or termination of the contract, a provision that makes sense only in the common law
tradition.
12 Art. 1184 of the French Civil Code, as it stood before the recent reform of contract law, and which
applied generally to all synallagmatic (bilateral) contracts provided that a court could grant such a period
of grace and applied to the contract of sale, even though the more specific Art. 1654 which applies to the
rescission of contracts of sale by the seller makes no mention of such a period of grace. Malaurie/Aynès/
Gautier, Droit civil – Les contracts spéciaux, 2003 para. 324. See also Zweigert/Kötz, Comparative Law
(1998) p. 497; Honnold, Uniform Law (2009), para. 278. The new version of the Code integrating a
reform of contract law which came into force on 1 October 2016 also allows a court, in some
circumstance to grant such a period of grace, see new Art. 1228.
13 Mohs, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 61 para. 18. In this, the CISG follows
Art. 64 ULIS.
14 Arts 47(1) and 63(1). Courts have affirmed that only a party can grant an additional period of time,
not a court: U.S. District Court, S.D. of New York (U.S.) 23 July 1997 (fashion accessories), Helen
Kaminski Pty., Ltd. v. Marketing Australian Products d/b/a Fiona Waterstreet Hats, Inc., CISG-Online
297 (Pace); and Rechtbank van Koophandel, Hasselt (Belgium) 5 May 1999 (cloth), Leithauser G.M.B.H.
& CO v. Willem van Praet, CISG-Online 1340 (Pace) (UNILEX English summary of the latter case relied
on by this author, original Flemish not consulted). One case seems to have ignored Art. 61(3): the
Cassational Board of the Supreme Economic Court of the Republic of Belarus refused to quash a decision of
a lower court which granted a period of grace to the buyer for paying a debt it was ordered to pay in an
arbitration award that had been recognised for enforcement by the lower court. The court seemed to
reason that because the statute allowing for the extension was a matter of enforcement of judgements or
awards rather than a substantive right governed by the CISG, it was applicable notwithstanding the CISG.
The Court wrote: “There are no legal rules applicable on the stage of enforcement of court ruling in
international law.” Cassational Board of the Supreme Economic Court (Belarus) 31 July 2006 (goods
involved unclear from the decision) CISG-Online 2048 (Pace).
15 “If the additional period of time allowed is not of reasonable length it shall be extended to a
reasonable length”, Art. 7.1.5(3) PICC.
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Article 61 10 Part III. Chapter III. Obligations of the Buyer
the additional period than to deny the seller the right to avoid the contract, otherwise
the right to avoid the contract would be submitted to too much discretion on the part of
the court or tribunal.16 In any event the CISG makes a distinction between a grace
period (Art. 61(3)) and an additional period of time (Art. 63(1)).

10 Art. 61(1) has a parallel in Art. 8:101 PECL but not in the PICC. The right to
damages notwithstanding the exercise of the right to another remedy (Art. 61(2)) is
recognised by Art. 8:102 PECL. It is also recognised by Art. 7.3.5(2) PICC (cumulating
with termination) and Art. 7.1.5(2) (may claim damages during the additional period of
time). Art. 61(3) has no exact equivalent. As mentioned above, Art. 7.1.5(3) PICC
allows the court or tribunal to extend the additional period of time for performance if
it was unreasonably short.
16 See a fuller discussion under Arts 63(1) and 64(1)(b). See also Robert Koch, Editorial remarks:
Commentary on Whether the UNIDROIT Principles of International Commercial Contracts May Be

Used to Interpret or Supplement Articles 63 and 64 of the CISG, s. II (2)(c) (Pace).
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Article 62
The seller may require the buyer to pay the price, take delivery or perform his
other obligations, unless the seller has resorted to a remedy which is inconsistent with
this requirement.
Bibliography: Bianca/Bonell, Commentary (1987), Art. 62; Honnold, Uniform Law (2009) para. 348;
Knapp, in Bianca/Bonell, Commentary (1987), Art. 62; Mohs, in: Schlechtriem/Schwenzer, Commentary
(2016), Art. 62; Piliounis, The Remedies of Specific Performance, Price Reduction and Additional Time
(Nachfrist) under the CISG: Are these worthwhile changes or additions to English Sales Law? 12 Pace
International Law Review 1 (13 et seq.) (Pace); Zweigert/Kötz, Comparative Law (1998), pp. 470 et seq.
Outline
1. The right to specific performance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
a) The right to demand payment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
b) The right to demand the taking of delivery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
c) The right to demand the performance of other obligations. . . . . . . . . . . . . 7
2. Limitations on the right to specific performance. . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
a) Resort to an inconsistent remedy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
b) Art. 28 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
III. Comparable rules . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

Art. 62 grants the seller the right to demand the specific performance of any 1
obligation owed to him by the buyer, including the payment of the price. The substance
of this article has not changed since its 1978 draft. It departs from the rules found at
Art. 61(1) ULIS which, to some extent, made specific performance of the obligation to
pay available only when the reselling of the goods was not reasonably possible.1 Art. 62
parallels Art. 46 (buyer’s right to specific performance) and must be read in conjunction
with Art. 28.
On the availability of the remedy of specific performance, the civil and common law 2
traditions greatly differ. In the common law tradition, the normal remedy for breach of
contract would be damages. Specific performance would normally not be available. In
the civil law tradition, however, the aggrieved party is entitled to demand the perfor-
mance of the obligation (exécution en nature) at least in principle (the efficiency or
strength of enforcement of court orders for such performance being a different issue).2
Art. 62 adopts, at least in principle, the position of the civil law tradition – specific 3
performance is available as of right for any breach of any obligation of the buyer,
1 This limitation of the availability of specific performance for the obligation to pay was linked in the
ULIS to the concept of ipso facto avoidance which has been abandoned by the CISG. See Mohs, in:
Schlechtriem/Schwenzer, Commentary (2016), Art. 62 paras 1 et seq. Specific performance was however
more readily available for obligations other than payment and taking of delivery; see Art. 70(2) ULIS.
2 For an excellent, short and comprehensive account of the difference between civil law and common
law see Zweigert/Kötz, Comparative Law (1998), pp. 470 et seq., although it does not discuss the right to
enforce the obligation to pay (as opposed to paying damages) which Art. 62 specifically provides for. See
also Mohs, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 62 paras 2 et seq.
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including the obligation to pay the price. In practice, however, the general availability of
specific performance under the CISG will be limited, particularly in common law
jurisdictions, by Art. 28.

1. The right to specific performance
4 a) The right to demand payment. The right to demand the specific performance of
the obligation to pay the price is probably the most controversial part of this provision.
During the negotiations of the Convention the delegation of the United States proposed
that the buyer may require payment unless “in the circumstances the seller should
reasonably mitigate the loss resulting from the breach by reselling the goods”.3 This would
have made the CISG similar to the law in most common law jurisdictions.4 This was in
fact also effectively the solution adopted by the ULIS, the predecessor of the CISG.5
5 In the end, however, the American proposal and the approach adopted by the ULIS
were rejected and there is, therefore, no need for the seller to mitigate his loss6 – he is
entitled to ask for the payment of the price without having to try to sell the goods to a
third party. The CISG adopts a pure civil law formulation of the rule. In practice,
however, it is very likely that in the vast majority of cases where the seller has possession
of the goods and there is a market for these goods, the seller will opt to cut his losses,
attempt to avoid the contract as soon as possible (Art. 64)7 and resell the goods (maybe
even using Arts 85 and 88) rather than seek an order for specific performance of the
obligation to pay that would have to be enforced in the buyer’s country. In practice,
therefore, the theoretical differences between the civil law and the common law may not
be as important as they may seem. In addition, Art. 28 will often mean that sellers will
have to mitigate their loss by reselling the goods.8 There will however be instances
where the seller will prefer to seek the specific performance of the obligation to pay.9
6 b) The right to demand the taking of delivery. The seller is also entitled to demand
that the buyer take delivery of the goods (unless of course the buyer avoids the contract
for cause, Art. 49). There is however hardly any cases where a court has been asked to
do this,10 again a reflection that in practice, the remedy of specific performance is not
3 UNCITRAL YB (1977), p. 133.
4 See for example, for the United States, § 2-709 UCC and for Singapore ss. 49 and 50 of the Sale of
Goods Act, Statutes of Singapore, c. 393.
5 Art. 61(2) ULIS.
6 Some authors who see a large role for Art. 7(1) on good faith have suggested that in blatant cases,
insistence on the payment of the price may be against good faith, Mohs, in: Schlechtriem/Schwenzer,
7 It should be noted that the seller must avoid the contract before he can sell the goods. See Bianca/
Bonell, Commentary (1987), Art. 62 para. 10.

8 See infra at para. 10.
9 For example, Arbitral Award, ICC 7197/1992 (goods involved unclear from the summary of the
award), CISG-Online 36 (Pace), where the seller sought an order for the buyer to issue a letter of credit.
There are similar cases mainly from Germany, see for example: Landgericht Mönchengladbach, (Ger-
many) 15 July 2003 (filter), CISG-Online 813 (Pace).
10 UNCITRAL, Digest of Case Law on the CISG, Art. 62 para. 2, including footnote 5. The Digest only
mentions one Chinese case where the court ordered the buyer to take delivery: Zhejiang High People’s
Court (PR China) 24 April 2008 (garments), CISG-Online Case 2058 (Pace) and one German case where
the court made a general statement on the availability of such remedy: Oberlandesgericht München
(Germany) 8 February 1995 (cars), CISG-Online 143 (Pace). One more German case is also mentioned
but this author is unable to read the original German: Landgericht Hamburg, Kammer 4 für Handelssa-
chen (Germany) 5 November 1995 (cobalt sulphate), CISG-Online 215 (Pace).
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particularly attractive to traders11 who probably prefer avoidance and damages or
recourses under Arts 85 and 88.
c) The right to demand the performance of other obligations. The seller may also 7
demand the performance of other contractual obligations. It should be noted however
that the obligations to pay and to take delivery are defined so broadly by Arts 54 and 60
that obligations such as the obligation to issue a letter of credit or the obligation to
identify the vessel on which the goods must be loaded may be interpreted as part of the
obligation to pay12 and the obligation to take delivery respectively. However, with
respect to any contractual obligation of the buyer to specify the form, measurement or
other features of the goods, one should also refer to Art. 65 which is lex specialis.
2. Limitations on the right to specific performance

a) Resort to an inconsistent remedy. The seller may not require performance when 8
he “has resorted to a remedy which is inconsistent with this requirement.”13 Obviously,
if the seller resorts to avoidance (Art. 64) he may not require the performance of any
obligation under the contract. Similarly, if the seller fixes an additional period of time
for the performance under Art. 63, he may not, during that period of time, require
performance under Art. 62.14 A sale of the goods to third parties under Art. 88 would be
inconsistent with requiring the taking of delivery but not with requiring the payment of
the remaining of the price.15
The seller may however claim damages in addition to requiring performance provided 9
that the damages are not in lieu of performance but relate to the delayed performance
(moratory damages) and related expenses.16 When the seller requires the buyer to pay, he
may also ask for interest on the sum due (Art. 78).
b) Art. 28. The largest exception to the right to claim specific performance is Art. 28 10
which states that “a court is not bound to enter a judgement for specific performance
unless the court would do so under its own law in respect of similar contracts of sale not
governed by this Convention”. A full explanation of Art. 28 will be found under that
article but it is important at this point to note that any uniformity of law that might
have been accomplished through Art. 62 is severely compromised and rendered almost
illusory through Art. 28. Effectively, courts in common law jurisdictions will continue to
refuse to grant specific performance and will usually require the seller to mitigate his
loss by reselling the goods when he still has them. Civil law courts will grant specific
performance if so requested. In this respect the CISG provides no improvement on the
ULIS which had the same compromise and therefore did not lead to true uniformity.17
In any event, even without Art. 28, uniformity would have been lacking as the method
and efficiency of the enforcement of specific performance orders vary greatly from
jurisdiction to jurisdiction.18
11 See Piliounis, The Remedies of Specific Performance, Price Reduction and Additional Time
(Nachfrist) under the CISG: Are these worthwhile changes or additions to English Sales Law? 12 Pace
International Law Review 1 (13 et seq.) (Pace).
12 See for example Arbitral Award, ICC 11849/2003 (fashion products), CISG-Online 1421 (Pace).
13 Art. 62.
14 Knapp, in Bianca/Bonell, Commentary (1987), Art. 62 para. 3.4.
15 Art. 88 allows the seller to compensate himself for his reasonable expenses and then states that he
must account to the buyer for the rest.

16 See also Art. 63(2) in fine.
17 In this respect Art. 28 follows the solution adopted by its predecessor Art. 16 and Art. VII ULIS.
18 Zweigert/Kötz, Comparative Law (1998), pp. 470 et seq.
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11 There has been some debate as to whether Art. 28 applies to the right to require
performance of payment, since, in common law jurisdictions, an “action for the price”
is not seen as a “specific performance” (Art. 28),19 but this author agrees with the
majority view that since the CISG is an international instrument, it must not be in-
terpreted with reference to domestic law categories and that the wording of Art. 28
(“specific performance”) therefore does encompass the right to require payment.

12 The PICC and PECL are more detailed on the right to require performance. A stand-
alone article provides for the right to require the payment of money owed (7.2.1 PICC/
9:101 PECL), which would include the price. As is the case in Art. 62, there are no
restrictions on that right in the PICC but the PECL states that there is no right to
require payment if the creditor “(a) … could have made a reasonable substitute
transaction without significant effort or expense; or (b) [the creditor/seller’s] perfor-
mance would be unreasonable in the circumstances”.20 The PECL forces the creditor
(the seller in our case) to mitigate his loss by denying the right to require payment if he
can sell the goods to a third party – adopting the common law approach rejected by the
CISG.
13 PICC and PECL have a separate article for the right to require performance of non-
monetary obligations but that right is restricted (unlike in the CISG) by a series of
exceptions. A party cannot require performance if the performance is impossible in law
or in fact,21 is unreasonably expensive or burdensome,22 is of an exclusively personal
character23 or is not asked within a reasonable time.24 Even more interestingly the PICC
and the PECL force the creditor (the seller in our case) to mitigate his loss by denying
the right to require performance if the seller “may reasonably obtain performance from
another source”.25
14 It is unlikely however that on these points the PICC and PECL could be used in the
interpretation of Art. 62 as the duty to mitigate akin to 7.2.2 PICC was clearly rejected
during the negotiations of the CISG.26 In fact Art. 62 provides for no exception
whatsoever and therefore the exceptions introduced PICC and PECL cannot easily be
used in interpreting the CISG.
15 Art. 62 provides that the seller cannot require performance after resorting to an
inconsistent remedy.27 Can he resort to an “inconsistent” remedy after requiring per-
formance i. e. can the seller who has required performance but has not received it, later
ask for avoidance instead, for example?28 Art. 7.2.5(1) PICC provides that a party that
has required performance of a non-monetary obligation but has not obtained it “within
a period fixed or otherwise within a reasonable period of time” may invoke any other
19 Mohs, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 62 paras 2 et seq.; Honnold, Uniform
Law (2009) para. 348.

20 Art. 9:101(2) PECL.
21 Art. 7.2.2(a) PICC or “unlawful or impossible” Art. 9:102(2)(a) PECL.
22 Art. 7.2.2(b) PICC or “performance would cause the debtor unreasonable effort or expense”
Art. 9:102(2)(b) PECL.

23 Art. 7.2.2(d) PICC or Art. 9:102(2)(c) PECL.
24 Art. 7.2.2(e) PICC or Art. 9:102(3) PECL.
25 Art. 9:102(2)(d) PECL.
27 Art. 9:103 PECL states positively that “The fact that a right to performance is excluded under this
Section does not preclude a claim for damages”.

28 Knapp in: Bianca/Bonell, Commentary (1987), Art. 62 paras 3.6 et seq.
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Section III. Remedies for breach of contract by the buyer 16 Article 62

remedy.29 Interestingly, the heading of Art. 7.2.5 is “Change of remedy”. It seems that
Art. 7.2.5 PICC could be a good indication of how Art. 62 should be interpreted –
nothing in the CISG prevents a party from changing the remedy sought.30
More importantly, the PICC and PECL do not have any equivalent of Art. 28 and 16
therefore even a common law court must order specific performance. In consequence of
this, the PICC also provide for a way of enforcing such a court order through a judicial
penalty resembling the astreinte of French law.31 Although this solution seems appro-
priate, it is so different from Arts 62 and 28 that on this point the PICC cannot really
help with the interpretation of the CISG.
29 It also provides for the right to invoke any other remedy when a court’s order for specific
performance cannot be enforced; Art. 7.2.5(2) PICC.

30 There may however be restrictions to this right in domestic procedural laws.
31 For a description of the astreinte in English, see Zweigert/Kötz, Comparative Law (1998), pp. 476
et seq.
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Article 63
(1) The seller may fix an additional period of time of reasonable length for
performance by the buyer of his obligations.
(2) Unless the seller has received notice from the buyer that he will not perform
within the period so fixed, the seller may not, during that period, resort to any
remedy for breach of contract. However, the seller is not deprived thereby of any
right he may have to claim damages for delay in performance.
Bibliography: Honnold, Uniform Law (2009), para. 351; Huber, in: Huber/Mullis, The CISG, p. 331;
Knapp, in: Bianca/Bonell, Commentary (1987), Art. 63; Koch, Editorial remarks: Commentary on
Whether the UNIDROIT Principles of International Commercial Contracts May Be Used to Interpret
or Supplement Articles 63 and 64 of the CISG, s. II(2)(c) (Pace); Honnold, Uniform Law (2009),
para. 351; Zeller, Editorial remarks on art. 63 and 64(1)(b) (Pace).
Outline
1. The fixing of an additional period of time of reasonable length (63(1)) . 3
a) Fixing an additional period of time . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
b) Of reasonable length. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
2. The suspension of other remedies during the additional period of time
(63(2)). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

1 Art. 63 CISG provides a remedy almost identical to what was provided by the ULIS.1
The final version of this article is almost identical to its 1978 draft.2 Art. 63 has its
parallel in Art. 47 (additional period of time set by the buyer). Art. 63 must be read in
conjunction with Arts 64 (avoidance), 25 (fundamental breach), 26 (avoidance must be
notified) and 27 (notice effective if sent).
2 As will be seen elsewhere, the seller may avoid the contract if the breach of the contract
by the buyer amounts to a fundamental breach (Arts 64(1)(a), 25 and 26). However, when
a breach by the buyer of his obligation to pay or to take delivery does not amount to a
fundamental breach, the seller may first fix an additional period of time of reasonable
length under Art. 63 and, if the buyer does not perform during that period, only then is
the seller entitled to declare the contract avoided under Art. 64(1)(b).
1. The fixing of an additional period of time of reasonable length (63(1))

3 a) Fixing an additional period of time. The fixing of an additional period of time for
performance will be a process very familiar to civil law jurists whether they are from the
1 See Arts 62(2) (payment) and 66(2) (taking delivery) ULIS which both provided that the seller could
set an additional period of time at the end of which he could declare the contract avoided.
2 The only change: the article “the” was dropped before the word “performance”.
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French tradition (mise en demeure) or the German tradition (Nachfrist). It will however
be an unfamiliar process for common law jurists. Although there is no doubt that
Art. 63 was inspired by the civil law tradition, it is very important to remember that we
should not attempt to use domestic law to interpret the CISG3 especially since Art. 63 is
in fact different in purpose and effect from both the mise en demeure and the Nachfrist.4
In particular, Art. 63 does not obligate the seller to grant an additional period of time
and the seller in cases of fundamental breach may avoid the contract without granting
such an additional period of time.5 It would therefore be preferable not to refer to the
remedy provided by Art. 63 as mise en demeure or Nachfrist as this may mistakenly
suggest an interpretation based on domestic law.
When a buyer does not pay for goods not yet delivered or does not take delivery, it is 4
often more practical and efficient for the seller to seek avoidance on the basis of a
fundamental breach of the contract6 and enter into a substitute transaction with a third
party and if need be, seek damages against the original buyer.7 However, as mentioned
above, in cases not amounting to a fundamental breach or where it is not certain
whether a breach is fundamental,8 the seller may use Art. 63 to grant an additional
period of time for the buyer to perform his obligation to pay or to take delivery. At the
end of the period, the seller will be entitled to avoid the contract (Art. 64(1)(b)). It
should be noted that the obligation to pay includes “taking such steps and complying
with such formalities as may be required under the contract or any laws and regulations
to enable payment to be made” (Art. 54) and therefore refusing to issue a letter of credit
in conformity with the contract for example would be a refusal to make payment.9
Similarly the obligation to take delivery includes “doing all the acts which could
reasonably be expected of [the buyer] in order to enable the seller to make delivery”
(Art. 60) which would include for example the naming of the ship in an FOB contract.10
The seller may also fix an additional period of time for the performance of any 5
obligation of the seller other than payment and taking delivery, though it is hard to see
what concrete advantage the seller gains from granting such an additional period of
time since it will not entitle him to avoid the contract under Art. 64(1)(b) which applies
only to cases of non-performance of the obligation to pay or to take delivery. With
respect to obligations other than these two, the seller will need to prove a fundamental
breach (Arts 64(1)(a) and 25) in order to avoid the contract. The granting of an
additional period of time will therefore not make avoidance any easier.
The seller must notify the buyer of the additional period of time. The period should be 6
precise (until a certain precise date or so many days after the date of the notice for
example) rather than imprecise through the use of vague words such as “within a few
days”.11 According to Art. 27, the seller will be entitled to rely on the notice if it is sent by
means appropriate in the circumstances even if its delivery is delayed or never takes place.
3Art. 7(1).
4Zeller, Editorial remarks on art. 63 and 64(1)(b) (Pace).
5 Art. 63 “is not mandatory and need not be used in order to avoid the contract if the delay in
performance amounts to a fundamental breach”, Secretariat Commentary on 1978 Draft, Art. 59 (now
Art. 63), para. 8(Pace). See also Knapp, in: Bianca/Bonell, Commentary (1987), Art. 63 para. 2.7.
6 Arts 64(1)(a) and 25.
7 Arts 61(1)(b) and 75.
8 For an example where the seller was mistaken about whether the breach was fundamental and should
have given a notice of additional time, see Cour d’appel de Grenoble (France) 4 February 1999 (pure
orange juice), CISG-Online 443 (Pace).
9 Honnold, Uniform Law (2009), para. 351. See also for example Arbitral Award, ICC 11849/2003
(fashion products), CISG-Online 1421 (Pace).

10 Incoterms 2010, FOB, para. B7.
11 Honnold, Uniform Law (2009), para. 351 (referring to para. 289).
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7 b) Of reasonable length. The additional period of time must be of reasonable length.
As is to be expected, there can be no definite determination in the jurisprudence or
doctrine of what constitutes a reasonable period of time, as each case will be as
different.12 Here are however a few useful guidelines. The period of time should be of
reasonable length from the time of the notice rather than from the time of the original
failure to perform – the fact that the performance is already late would not make a one
day additional period reasonable.13 The seller’s interest can certainly be taken into
account and if there is a falling market, it would be reasonable for the seller to set a
period that would reflect the urgency of the situation.14 On the other hand the period
must allow the buyer enough time to perform.
8 In this author’s view, one circumstance to take into account in determining whether
the period is of reasonable length is the means by which the notice is being sent (even
though the risk of a problem in the transmission of the notice is borne by the buyer). If
the notice has been sent by post and under normal circumstances it could take a week
for the notice to get to the buyer in the other country, it would not be reasonable to
expect the buyer to perform two days after the notice was sent. The seller will therefore
be encouraged to use electronic means of communications when appropriate in order to
be able to reasonably reduce the additional period of time.
9 What is the consequence if the additional period of time is not of reasonable length?
Either the notice is invalid and therefore avoidance is not available at the end of the
period, or the notice remains valid and a court or tribunal can extend the period to what
would be a reasonable length, at which time avoidance could be declared. This author
shares the majority view that the proper approach is to extend the time period to what
would be a reasonable period of time, at which point avoidance can be declared.15 As a
matter of practice, by the time a court or tribunal gets to decide whether the period of
time was of reasonable length, it is likely that a reasonable length of time will have
passed which might explain why there are very few cases discussing what constitute an
unreasonable period of time.16
2. The suspension of other remedies during the additional period of

time (63(2))
10 The second paragraph of Art. 63 states that during this additional period of time the
seller may not resort to any other remedy – the seller must let the buyer perform
unhindered. There are two exceptions to this rule. First, if the buyer informs the seller
that he will not perform during that period, the seller may resort to other remedies,
including avoidance (Art. 64(1)(b) in fine). If however the buyer were to inform the
12 It is impossible to mention all cases here. An example where an additional period of time was
deemed reasonable is the case of a 20-day additional period for the issuance of a letter of credit when the
contract itself granted only 15 days for such issuance and a letter of credit can normally be issued in a
matter of hours, see Arbitral Award, ICC 11849/2003 (fashion products), CISG-Online 1421 (Pace).
13 See for example Tribunal de Grande Instance de Strasbourg (France) 22 December 2006 (cathode ray
tubes), CISG-Online 1629 (Pace) where a seven day period was deemed totally unreasonable given the
circumstances (“tout à fait déraisonnable au regard des circonstances”) notwithstanding a one month and
four day period before the notice was sent.
15 See Robert Koch, Editorial remarks: Commentary on Whether the UNIDROIT Principles of
International Commercial Contracts May Be Used to Interpret or Supplement Articles 63 and 64 of the
CISG, s. II(2)(c) (Pace); Mohs, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 63 para. 9; Huber,
in: Huber/Mullis, The CISG, p. 331. See also this case: Oberlandesgericht Karlsruhe (Germany) 14 Feb-
ruary 2008 (antique Jaguar sports car), CISG-Online 1649 (Pace).
16 For a case holding an additional period to be of unreasonable time see Tribunal de Grande Instance
de Strasbourg (France) 22 December 2006 (cathode ray tubes), CISG-Online 1629 (Pace).
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seller that he will not perform during the period because the period is unreasonable
short – the seller could have recourse to other remedies, but presumably could not avoid
the contract under Art. 64(1)(b) until a reasonable period of time has passed. Second,
the seller is not deprived of his right to claim damages for delay in performance
(moratory damages).

Art. 7.1.5 PICC and Art. 8:106 PECL are the equivalent to Arts 63 and 64(1)(b). The 11
principles behind these articles are the same – if an additional period of reasonable
length is fixed, the aggrieved party will be able to avoid the contract even in the absence
of a fundamental breach, but during that period, no recourse to most other remedies
will be possible.
In some respects, however, the rules of the PICC and PECL are so different from the 12
CISG that, in this author’s view, they cannot be used in interpreting the CISG. For
example, Art. 64(1)(b) clearly limits the right to avoid the contract after the Art. 63
notice to breaches of the obligation to pay and to take delivery. Art. 7.1.5(3) PICC
extends the right to avoid the contract to a breach of any obligation though Art. 7.1.5(4)
PICC states that the right to avoid does not exists when the obligation breached was
“only a minor part of the contractual obligation of the non-performing party.” This
criterion (minor part) is different from the concept of fundamental breach. Art. 8:106
PECL goes even further by abandoning the “minor part” exception and allowing
avoidance for any breach of an obligation not remedied after the end of the reasonable
additional period. These choices are clearly different from the CISG’s and therefore
should not be used in interpreting the CISG.
Art. 63(2) only mentions damages as an exception to the principle of not being able 13
to resort to any remedy during the additional period. In addition to damages, the PICC
and PECL both mention that the aggrieved party is also entitled to “withhold perfor-
mance of its own reciprocal obligation” during the additional period.17 This could be
useful in filling what seems to be a gap in the CISG: Art. 71 does not specifically
mention an actual delay in performance by the other party as a valid reason to suspend
one’s own performance. It would seem however to stem from the general principles of
the CISG (Art. 7(2)) as logically exposed by the PICC and PECL which share the same
principles on this point.
The CISG is silent as to the consequences of the time period being of unreasonable 14
length. Art. 7.1.5(3) PICC and Art. 8:106(3) PECL lend support to the view that the
period should be extended to a reasonable length of time. These articles also provide
that the aggrieved party can in the same notice granting an additional period state that
the contract will be avoided automatically at the end of the period. The CISG is silent on
that possibility but since it is not prohibited by any provision of the CISG, this author is
of the view that it should be allowed (see discussion infra under Art. 64).
17 Art. 7.1.5(2) PICC and Art. 8:106(2) PECL.
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Article 64
(1) The seller may declare the contract avoided:
(a) if the failure by the buyer to perform any of his obligations under the
contract or this Convention amounts to a fundamental breach of contract; or
(b) if the buyer does not, within the additional period of time fixed by the seller
in accordance with paragraph (1) of article 63, perform his obligation to pay
the price or take delivery of the goods, or if he declares that he will not do so
within the period so fixed.
(2) However, in cases where the buyer has paid the price, the seller loses the right
to declare the contract avoided unless he does so:
(a) in respect of late performance by the buyer, before the seller has become
aware that performance has been rendered; or
(b) in respect of any breach other than late performance by the buyer, within a
reasonable time:
(i) after the seller knew or ought to have known of the breach; or
(ii) after the expiration of any additional period of time fixed by the seller in
accordance with paragraph (1) of article 63, or after the buyer has declared
that he will not perform his obligations within such an additional period.
Bibliography: Honnold, Uniform Law (2009), para 356; Knapp, in: Bianca/Bonell, Commentary (1987),
Art. 64; Koch, Editorial remarks: Commentary on Whether the UNIDROIT Principles of International
Commercial Contracts May Be Used to Interpret or Supplement Articles 63 and 64 of the CISG,
s. II(4)(a) (Pace); Mohs, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 64.
Outline
1. The right to declare the contract avoided (64(1)) . . . . . . . . . . . . . . . . . . . . . . . . . . 4
a) In cases of fundamental breach (Art. 64(1)(a)). . . . . . . . . . . . . . . . . . . . . . . . . . 6
b) In cases where the buyer does not perform or declares he will not
perform notwithstanding a notice granting additional time
(Art. 64(1)(b)) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
2. Losing the right to declare the contract avoided (Art. 64(2)). . . . . . . . . . . . . . 11
a) In respect of late performance by the buyer (Art. 64(2)(a)). . . . . . . . . . . . 14
b) In respect of any breach other than late performance by the buyer
(Art. 64(2)(b)) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21

1 Art. 64 provides for the right to avoid the contract either because of a fundamental
breach (Art. 25) or because the buyer has failed to pay or take delivery after an
additional period of time for performance has been granted (Art. 63). The article also
provides deadlines for the exercise of the right to declare the contract avoided when the
buyer has already paid the price.
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Art. 64 provides a remedy that is significantly different from the ULIS which in some 2
instances provided for the ipso facto avoidance of the contract without a need for any
declaration and notification.1
The final version of Art. 64 is almost identical to its 1978 draft. Art. 64 has its parallel in 3
Art. 49 (avoidance by the buyer). Art. 64 must be read in conjunction with Arts 63 (setting
an additional period of time), 25 (fundamental breach), 26 (avoidance must be notified)
and 27 (notice effective if sent) as well as with Art. 72 (avoidance due to an anticipatory
breach), Art. 73 (avoidance in instalment contracts) and Arts 81–84 (effects of avoidance).
1. The right to declare the contract avoided (64(1))

The CISG abandons the ipso facto avoidance of the contract that was found in the 4
ULIS. In all instances the avoidance of the contract must be declared.2
The right to avoid the contract will be available to the seller when there has been a 5
fundamental breach (a) or when an additional period of time has been granted to the
buyer to pay or take delivery (b).
a) In cases of fundamental breach (Art. 64(1)(a)). The seller may declare the 6
contract avoided “if the failure by the buyer to perform any of his obligations under
the contract or this Convention amounts to a fundamental breach of contract”
(Art. 64(i)(a)). The definition of what constitutes a fundamental breach is found at
Art. 25. In such instances the seller does not have to grant an additional period of time
for performance to the buyer and may declare the contract avoided immediately. The
avoidance of the contract due to an anticipatory fundamental breach is governed by
Art. 72 and the avoidance in the context of an instalment contract, by Art. 73.
b) In cases where the buyer does not perform or declares he will not perform 7
notwithstanding a notice granting additional time (Art. 64(1)(b)). In some cases, a
breach by the buyer of his obligation to pay the price or his obligation to take delivery
may not be fundamental, or it may be uncertain whether it is fundamental. In such
instances, avoidance can be obtained as of right, whether the breach is fundamental or not,
after the seller has granted an additional period of time for performance under Art. 63(1).
It should be noted however that under Art. 64(1)(b), avoidance is available only for a 8
breach of the buyer’s obligation to pay or his obligation to take delivery of the goods. It
should be noted that these obligations are very broadly defined. “The buyer’s obligation
to pay the price includes taking such steps and complying with such formalities as may
be required under the contract or any laws and regulations to enable payment to be
made.”3 “The buyer’s obligation to take delivery consists: (a) in doing all the acts which
could reasonably be expected of him in order to enable the seller to make delivery; and
(b) in taking over the goods.”4
The seller is entitled to declare the contract avoided if the buyer does not perform by 9
the end of the addition period of time (provided it was of reasonable length5) or, even
earlier if the buyer “declares that he will not [perform] within the period so fixed.”6
1 See Arts 61(2) and 62 ULIS although Art. 66 ULIS did require a declaration.
2 Arts 64(1) and 26.
3 Art. 54.
4 Art. 60.
5 See discussion supra under Art. 63(1).
6 Art. 64(1)(b).
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10 Some case law has allowed the seller to give a combined notice of an additional
period of time and declaration of avoidance – ‘you have the following additional period
of time and if you do not perform by the end of that period (or if you notify me that
you will not perform) the contract will be avoided at that time.’7
2. Losing the right to declare the contract avoided (Art. 64(2))

11 The second paragraph limits in time the right to declare a contact avoided. However
these time limits only apply “in cases where the buyer has paid the price”.8 This is
understood to mean that the total price has been paid.9 There is no such limit in cases
where the buyer has not fully paid the price.10
12 The rules are rather detailed and complicated but the principle is rather simple –
when the buyer has performed his main obligation (payment) the seller’s right to avoid
the contract must be exercised in a timely fashion so that the buyer knows where he
stands and that he is not surprised long after his payment by a declaration of avoidance.
13 From a practical viewpoint, it remains however that in most cases, the seller is
unlikely to seek avoidance of, or have grounds to avoid, a contract for which he has
been paid in full11 and therefore Art. 64(2) will be used only in exceptional cases.12
14 a) In respect of late performance by the buyer (Art. 64(2)(a)). In respect of late
performance by the buyer, the seller loses his right to declare the contract avoided
unless he does so “before the seller has become aware that performance has been
rendered” (Art. 64(2)(a)).
15 Art. 64(2)(a) is concerned with late performances i. e. obligations that have been
performed, but performed late. The first example would be the late performance of the
buyer’s obligation to pay. Art. 64(2) only applies to cases where the buyer has paid the
price, but he may have paid it late. The seller may have a right to declare the contract
avoided either because the late payment constitutes a fundamental breach or because he
has fixed an additional period of time which has now passed (Art. 64(1)). However, the
seller must declare the contract avoided before he becomes aware that the buyer has
made the payment. If the payment is made but the seller is not yet aware of that
payment he may still declare the contract avoided, putting the onus on the buyer to give
7 See Koch, Editorial remarks: Commentary on Whether the UNIDROIT Principles of International
Commercial Contracts May Be Used to Interpret or Supplement Articles 63 and 64 of the CISG, at
section II(4)(a) where he cites Oberster Gerichtshof (Austria) 28 April 2000 (jewellery), CISG-Online 581
(Pace) in which the Austrian Supreme Court held that a notice of an additional period of time which also
stated that the seller “would refuse to accept payment of the purchase price should [the buyer] not
perform its obligation within the additional period of time fixed” should be understood as a conditional
declaration by the seller to then avoid the contract. Therefore, a single notice, if worded properly, could
be used as both the Art. 63 notice of an additional period of time and the Art. 64(1) declaration of
avoidance. To the same effect, see: Bezirksgericht der Saane (Switzerland) 20 February 1997 (spirits),
CISG-Online 426 (Pace). See also Art. 7.1.5(3) PICC and Art. 8:106(3) PECL which explicitly adopt this
approach.
8 Art. 64(2).
9 Secretariat Commentary on 1978 Draft, Art. 60(2) (now Art. 64(2)), para. 8 (Pace).
10 Of course, recourses to avoidance, like all recourses under the CISG, would also be subjected to the
limitation period found in the United Nations’ Convention on the Limitation Period in the International
Sale of Goods (New York, 14 June 1974) as amended by the Protocol to the 1974 Limitation Convention
(Vienna, 11 April 1980) which came into force on 1 August 1988, whenever that convention applies, or
by the limitation period or prescription period found in the relevant domestic law when that convention
does not apply.
11 Honnold, Uniform Law (2009), para 356.
12 This is evidenced by the fact that the UNCITRAL, Digest of Case Law on the CISG, Art. 64 para. 12
concluded that “Article 64(2) has given rise to very little case law”.
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prompt notice of payment to the seller. The obligation that is performed late may also
be the obligation to take delivery or any other contractual obligation (which would lead
to a fundamental breach).
One issue that has been raised is the meaning of “late performance”. Clearly “late 16
performance” is meant to apply when the performance is late according to the contract
but is still “performable” and has in fact been performed. It has been debated whether,
when the seller has issued a notice granting an additional period of time (Arts 63(1) and
64(1)(b)) and that time has passed, the buyer can still perform “late” (Art. 64(2)(a)).
Performance during the additional period of time would have been late under to the
contract, but the seller may not declare the contract avoided during that period of time
(Art. 63(2)). After the end of that period of time, can the buyer still perform thus
preventing the seller from declaring the contract avoided (assuming payment has been
made and the seller is aware of the late performance)?
The Secretariat’s Commentary suggests that when a buyer performs late, after the 17
additional time period granted to him has passed, Art. 64(2)(b) should apply rather
than Art. 64(2)(a),13 meaning that the seller could still declare the contract avoided
within a reasonable time after the end of the additional period, even though he is aware
that the obligation has been performed. This interpretation of the Secretariat assumes
that performance after the expiry of an additional period of time (Art. 63(1)) is not a
“late performance” since Art. 64(2)(b) can only apply “in respect of any breach other
than late performance”. Some authors have supported this position.14
This author shares the view that the position taken by the Secretariat’s Commentary 18
is not supported by the text of Art. 64(2) which only speaks of “late performance”
making no distinction between a performance which is late according to the contract
and one which is very late – a performance after the end of an additional period of time
is a late performance and should be governed by Art. 64(2)(a), not (b).15
The buyer should be allowed to perform until the contract is declared avoided. In 19
fact, after the expiry of the additional period of time, the seller is still entitled to ask for
the performance of the obligation (Art. 62)16 since it is only during that additional
period of time that he may not exercise the right to demand specific performance
(Art. 63(2)). If after the end of the additional period of time, the seller may still demand
performance, it would be odd to say that the seller may declare the contract avoided
even after the buyer has performed the obligation. This situation should be governed by
Art. 64(2)(a).
What if the buyer gives notice that he will not perform within the additional period 20
of time? Can he still perform after he has given this notice? Although this may sound
counterintuitive, the answer should be that he can still perform. The only effect that
Art. 63(2) gives to the declaration that the buyer will not perform is to free the seller
from his obligation not to resort to any remedy during the additional period – i. e. the
seller may immediately declare the contract avoided. However, even after being notified
that the buyer will not perform, the seller is still free to ask for specific performance and
13 Secretariat Commentary on 1978 Draft, Art. 60(2) (now Art. 64(2)), para. 11 (Pace) states: “If the
buyer performs after the additional period fixed pursuant to art. 59(1) [draft counterpart of art. 63(1)] or
after he has declared that he will not perform within that additional period of time, the seller loses the
right to declare the contract avoided if he does not do so within a reasonable time after the expiration of
the additional period or within a reasonable time after the buyer has declared that he will not perform
within that additional period of time.” [emphasis added]
14 Knapp, in: Bianca/Bonell, Commentary (1987), Art. 64 paras 3.10 seq.
16 Whether a court has to grant specific performance will be determined by Art. 28, but in principle, the
remedy of specific performance is available.
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therefore the obligation of the seller is still performable as a late performance and
should therefore be governed by 64(1)(a), not (b).
21 b) In respect of any breach other than late performance by the buyer (Art. 64(2)(b)).
Provided that the buyer has paid in full, “the seller loses the right to declare the contract
avoided unless he does so […] in respect of any breach other than late performance by
the buyer, within a reasonable time (i) after the seller knew or ought to have known of
the breach; or (ii) after the expiration of any additional period of time fixed by the seller
in accordance with paragraph (1) of Art. 63, or after the buyer has declared that he will
not perform his obligations within such an additional period” (Art. 64(2)(b)).
22 As we have seen above, Art. 64(2)(b)(ii) does not apply to obligations that have been
performed though late i. e. after the expiration of the additional period of time for
performance. Art. 64(2)(b)(ii) only applies to obligations that have not been performed.

23 Art. 7.1.5 PICC and Art. 8:106 PECL are the equivalent to Art. 64(1)(b). For how they
affect the interpretation of Art. 64(1)(b) see the discussion supra under Art. 63.
24 Art. 7.3.2(2) PICC is the equivalent of Art. 64(2). They are substantially similar in
using the concept of “a reasonable time” but the PICC clearly states that the aggrieved
party may terminate the contract after a late performance, thus taking a very different
approach from that taken by Art. 64(2)(a).
25 A discussion of the PICC and PECL equivalents of the concept of fundamental
breach (Art. 64(1)(a)) will be left for discussion supra under Art. 25 infra.
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Article 65
(1) If under the contract the buyer is to specify the form, measurement or other
features of the goods and he fails to make such specification either on the date agreed
upon or within a reasonable time after receipt of a request from the seller, the seller
may, without prejudice to any other rights he may have, make the specification
himself in accordance with the requirements of the buyer that may be known to him.
(2) If the seller makes the specification himself, he must inform the buyer of the
details thereof and must fix a reasonable time within which the buyer may make a
different specification. If, after receipt of such a communication, the buyer fails to do
so within the time so fixed, the specification made by the seller is binding.
Bibliography: Knapp, in: Bianca/Bonell, Commentary (1987), Art. 65; Mohs, in: Schlechtriem/Schwenzer,
Commentary (2016), Art. 65.
Outline
1. Purpose of Art. 65 and the mechanism it sets in place . . . . . . . . . . . . . . . . . . . . . 3
a) Demanding by notice that the buyer make a specification within a
reasonable period of time . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
b) When the buyer is in breach, the seller may make a specification with
notification and fix a reasonable period of time for the buyer to make
a different specification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
2. Criticism of Art. 65 – a cumbersome process which will not be used most
of the time . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
a) Avoidance more readily available under Arts 63 and 64(1)(b) and will
normally be preferred . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
b) Even if avoidance is only available under Art. 64(1)(a), it will still be
available in most cases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
c) Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

Art. 67 ULIS, the predecessor of Art. 65, had its origin in § 375 of the German 1
Commercial Code (HGB).1 Art. 65 follows its predecessor Art. 67 ULIS almost word for
word with the exception that unlike the ULIS, Art. 65 does not grant the seller the
option to avoid the contract if the buyer refuses to make the specifications,2 this remedy
being dealt with in a general fashion under Art. 64.
Art. 65 introduces a very specific rule that brings a specific remedy to a specific 2
instance of non-performance of an obligation by the buyer. In this sense it is a lex
specialis which adds a remedy to a specific kind of breach of obligation by the buyer but
without taking away any of the other remedies available to the seller. It seems to be a
leftover from the ULIS which had specific remedies for specific breaches and therefore
seems to go against the approach generally adopted by the CISG which does not define
1
2
For a short history of Art. 65 CISG, see Knapp, in: Bianca/Bonell, Commentary (1987), Art. 65 paras
1.1 et seq.
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specific remedies for each specific breach. During the negotiations on the CISG it was
proposed that Art. 65 be abandoned, a proposal which, in the view of this author,
unfortunately failed.3

1. Purpose of Art. 65 and the mechanism it sets in place
3 When the contract provides that the buyer “is to specify the form, measurement or
other features of the goods” and he fails to do so “on the date agreed upon or within a
reasonable time after receipt of a request from the seller”, Art. 65 allows the seller to make
the specification himself – what civil law jurists will see as a form of specific performance
by substitution without the need for a court judgment (thus avoiding Art. 28).4 One
should note that Art. 65 applies when the buyer has an obligation to make specifications
(“under the contract the buyer is to specify”) – if the contract can be performed because it
contains specifications, the seller must perform according to the contractual specifications
even if the buyer has the option to change these specifications but in fact does not do so.5
4 a) Demanding by notice that the buyer make a specification within a reasonable
period of time. Art. 65 provides that the buyer may fail to make a specification in either
of two ways. Most of the time, the contract will provide for a specific date by which the
buyer must make a specification. If the buyer failed “to make such specification […] on
the date agreed upon” (Art. 65), i. e. on the date provided by the contract, the seller will
be allowed to make the specification himself without first having to ask the buyer to
make the specification (though as we will see (infra paras 7–9), he will have to give the
buyer the opportunity to make a different specification).
5 If however the contract does not provide for a specific date on which the buyer must
make a specification, the seller himself will be able to make the specification only if the
buyer fails to make the specification “within a reasonable time after receipt of a request
by the seller” (Art. 65). It should be noted that the reasonable time period starts to run
from the time the buyer receives the notice and the burden is on the seller to make sure
the notice is received.6 Such a request is not necessary when the contract states a specific
date by which the buyer must make the specification – before that date the seller could
not request that the specification be made as the seller is entitled to do so until the date
specified and, after that date, the seller may make the specification himself without
sending a request and therefore such a request would be pointless.
6 Could a request for the buyer to make a specification nonetheless be sent after a
contractual deadline for the buyer to do so has passed, thus purportedly granting an
additional period of time for performance akin to the notice under Art. 63? The better
question would be: why would a seller do this since in such a case he would already be
entitled to make the specification? Under such circumstances, this author would not
recommend that such a request be sent as it would delay the performance of the
contract – at the end of the additional period of reasonable time, if the buyer has not
made the specification, the seller would then make the specification he could have made
3Knapp, in: Bianca/Bonell, Commentary (1987), Art. 65 para. 1.3.

4Mohs, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 65 para. 1.
5 Mohs, in: Schlechtriem/Schwenzer, Commentary (2016) Art. 65 para. 4. Secretariat Commentary on
1978 Draft, Art. 61 (now Art. 65), para. 5: “the buyer’s failure to make the specification would constitute a
breach of the contract only if the buyer was obligated to do so, not if he was merely authorized to do so.”
Note that Art. 65 is in Section III on “Remedies for breach of contract by the buyer”.
6 This is an exception to the rule found in Art. 27.
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in the first place and will still need to wait a second reasonable period of time to give a
chance to the buyer to change the seller’s specification (see infra paras 7–9). In addition,
this could lead to confusion with a notification under Art. 63(1). The 65 request is
different from an Art. 63(1) notification in that such a request would not need to fix a
specific period of time (a reasonable time period is provided by Art. 65) and it would
need to be received by the seller (Art. 65(1)) unlike the notification of an additional
period which need only be sent (Art. 27). A request sent after a specific date for
performance has passed could lead to confusion and should be avoided – the seller
should simply specify the form, measurement or other features and give notice to the
buyer (see infra paras 7–9).
b) When the buyer is in breach, the seller may make a specification with notifica- 7
tion and fix a reasonable period of time for the buyer to make a different specifica-
tion. Once the buyer is in breach of his obligation to make a specification (the
contractual deadline has passed or a reasonable time has passed after a request to
make the specification was received), the seller may make such a specification himself. It
should be noted that this is an optional remedy – the seller “may make the specification
himself” but does not have to do so and could resort to other remedies, remedies which
will remain available even if he chooses to make the specification (“without prejudice to
any other rights he may have” Art. 65(1)).
If the seller chooses to make the specification himself (1) he must do so “in accordance 8
with the requirements of the buyer that may be known to him” (Art. 65(1)); (2) he must
“inform the buyer of the details thereof” and (3) he “must fix a reasonable time within
which the buyer may make a different specification” (Art. 65(2)). The seller must there-
fore send a notice to the buyer informing him of the details of the specification chosen
and wait for the time period he fixed (which must be reasonable) to pass. The time period
starts to run only “after receipt of such a communication” (Art. 65(2)).7 During that time
the buyer “may make a different specification” (Art. 65(2)) and so notify the seller.
Therefore the seller by making the specification himself effectively grants an addi- 9
tional period of time to the buyer who will be able to make the specification himself
even though the deadline to do so has already passed. If however the buyer does not
react by the end of the reasonable period of time after receipt of the notice, “the
specification made by the buyer is binding” (Art. 65(2)). To this author, this is a long
and convoluted process filled with risks: the seller bears the risk that the notice is not
received, that the time he fixes is not of reasonable length and that he failed to make the
specification “in accordance with the requirements of the buyer that may be known to
him”, noting that, according to some authors,8 the word “may” might imply construc-
tive knowledge i. e. what he should have known as opposed to what he actually knew.9
2. Criticism of Art. 65 – a cumbersome process which will not be used

most of the time
a) Avoidance more readily available under Arts 63 and 64(1)(b) and will normally 10
be preferred. One of the main issues with respect to Art. 65 is how it relates to the
remedy of avoidance. As we have mentioned above, unlike Art. 67 ULIS, Art. 65 does
not specifically provide for the remedy of avoidance when the buyer fails to make a
specification though it specifically reserves all other remedies, including avoidance.
7 Again the burden is on the seller to make sure that the notice is received, yet another exception to
Art. 27.
8 See for example Knapp, in: Bianca/Bonell, Commentary (1987), Art. 65 paras 2.9 et seq.
9 This seems to be also supported by the French version of Art. 65: “dont il peut avoir connaissance.”
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Avoidance will certainly be available under Art. 64(1)(a) when the breach amounts to a
fundamental breach. The issue that has divided the doctrine is whether avoidance will
also always be available without a fundamental breach under Art. 64(1)(b) after an
additional period of time has been set and has passed (Art. 63). This remedy is strictly
reserved for breaches of the obligation to pay and the obligation to take delivery
(Art. 64(1)(b)). Some authors are of the view that the breach of an obligation to make
a specification, being neither an obligation to pay or to take delivery, may not lead to
avoidance under Arts 63 and 64(1)(b).10 With all due respect, this author, with many
others11 and the Secretariat’s commentary,12 is of the view that since the obligation to
take delivery is defined as “doing all the acts which could reasonably be expected of him
in order to enable the seller to make delivery” (Art. 60(a)), the obligation to make a
specification is normally part of the obligation to take delivery – unless the buyer makes
a specification, the seller is unable to deliver. Therefore, in this author’s view, the
remedy of avoidance under 64(1)(b) is always available when the buyer has breached his
obligation to make a specification.
11 That being the case, most sellers in most circumstances will prefer that route – they
will prefer to avoid the contract and sell the goods to a third party (presuming a market
for them) rather than continue with a sale to a buyer who is obviously not that
interested in getting the goods. One difficulty arises however when the seller wants to
seek damages in addition to avoidance – it is hard to estimate the damages when the
specifications of the goods to be sold have not been determined. This may encourage
the seller to make the specification but once it is made he may no longer avoid the
contract for lack of specification. And there is always the risk that the buyer will
override the specification made by the seller and reduce the latter’s profit to a minimum
in cases where the determination of specifications affects the profits.
12 b) Even if avoidance is only available under Art. 64(1)(a), it will still be available in
most cases. Even if the authors I disagree with were right in their view that a breach of
the obligation to make a specification is not a breach of a largely defined obligation to
take delivery (Art. 60) and therefore cannot lead to avoidance under Art. 64(1)(b), in
most cases such a breach would in any event constitute a fundamental breach as it
would prevent the seller from performing its main obligation to deliver the goods
(Art. 30) and would result “in such detriment to the [seller] as substantially to deprive
him of what he is entitled to expect under the contract” (Art. 25).
13 c) Conclusion. Recourse to Art. 65 will therefore, in my view, be very rare as it
establishes a cumbersome process and most sellers will prefer to avoid the contract, a
point which seems to be supported by the fact that there are hardly any court cases
reported in which the article is invoked.13 However whenever the seller prefers to use
Art. 65, he should carefully follow the detailed process provided by the article.
10 See for example Knapp, in: Bianca/Bonell, Commentary (1987), Art. 65 para. 2.6.
11 See Mohs, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 65 para. 21, Honnold, Uniform Law
(2009), para. 357.
12 Secretariat Commentary on 1978 Draft, Art. 61 (now Art. 65), para. 6.
13 UNCITRAL, Digest of Case Law on the CISG, Art. 65, para. 1 states: “Court decisions or arbitral
awards which have implemented or cited article 65 are very rare” and cites only four cases where Art. 65
is mentioned and in three of these cases the article does not apply – the other case is in a language this
author unfortunately does not understand.
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The PICC do not have an equivalent to Art. 65. The PECL adopts a similar though in 14
some respects fundamentally different remedy at Art. 7:105 PECL. The PECL provision
is however so significantly different from Art. 65 that this author is of the view that it
should not be used in interpreting it.
The most important difference is that Art. 7:105 PECL applies to all obligations which 15
“may be discharged by one of alternative performances” and is therefore not a specific
remedy for the buyer’s failure to make a specification. The consequence of this is that
unlike Art. 65, Art. 7:105 PECL is not linked exclusively to cases that make the obligation
to deliver impossible, and therefore a breach under Art. 7:105 is not necessarily funda-
mental.14
The article is also structured very differently and is too dissimilar to be of much help 16
in understanding Art. 65. For example, under Art. 7:105 PECL if the breach is funda-
mental, there is no need to request the other party to make the choice of the alternative
performance as the right to choose passes to the other party automatically. Since in my
opinion, the breach under Art. 65 is always fundamental, if the PECL were to apply,
there would never be a need for a notice. However, under the 7:105 PECL, if the breach
is not fundamental, then a notice granting an additional reasonable period of time is
required before the choice can be made by the other party.
14 See supra paras. 10–11.
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Chapter IV
Passing of Risk
Article 66
Loss of or damage to the goods after the risk has passed to the buyer does not
discharge him from his obligation to pay the price, unless the loss or damage is due to
an act or omission of the seller.
Bibliography: Bollée, The Theory of Risks in the Vienna Sale of Goods Convention, Paris I thesis (1999)
(Pace); Erauw, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 203; Erauw, in: Flechtner/
Brand/Walter, Drafting Contracts (2007), p. 383; Flambouras, Transfer of Risk in the Contract of Sale
involving Carriage of Goods: A Comparative Study in English, Greek Law and the United Nations
Convention on Contracts for the International Sale of Goods, Oxford thesis (1999) (Pace); Hachem in
Schlechtriem & Schwenzer, Commentary on the UN Convention on the International Sale of Goods, 4th
edition (2016); Oberman, Transfer of risk from seller to buyer in international commercial contracts: A
comparative analysis of risk allocation under the CISG, UCC and Incoterms, Laval thesis (1997) (Pace);
Romein, The passing of risk – A comparison between the passing of risk under the CISG and under
German law (1999) (Pace); Schmitthoff, The Risk of Loss in Transit in International Sales, in: Honnold
(ed.), Unification of the Law Governing International Sales of Goods (1966), p. 172.
Outline
1. Price-risk . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
2. The risk transferred but reduced through the use of a remedy
for the buyer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
3. An act or omission by the seller – posterior alleviation of risk . . . . . . . . . . . 15
a) Risk can stay with the seller or return to the seller . . . . . . . . . . . . . . . . . . . . . 15
b) Terminology. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
c) Burden of proof . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
4. Determining which risks are transferred to the buyer . . . . . . . . . . . . . . . . . . . . . 27
a) Theory and court practice. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
b) Loss or damage: physical loss and deterioration – value lost . . . . . . . . . . 29
c) Loss of documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
d) Legal risks: embargoes and unforeseen restrictions . . . . . . . . . . . . . . . . . . . . . 34
e) Delays and special needs for transportation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
f) Economic risk . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
g) The risk of insolvency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
5. Contractual risk . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
6. Damage caused by the goods themselves. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49

1 The CISG rules about the seller’s performance (Arts 31–34) and Arts 66–70 about the
passing of risk are related. When the seller performs the delivery in accordance with the
contract of sale, the risk passes at the time and place determined by the Convention.
2 The time at which risk passes is determined by Arts 67–69 (see infra). The parties
may deviate by agreement from that default risk allocation (Art. 6). An Incoterm, e. g.
FOB or CIF, may have been used or the standard contract terms that became applicable
may bring about another partitioning. The parties’ intention should be sought, which
gives rise to issues of interpretation. Beyond this, party practices and the particular
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Chapter IV. Passing of Risk 3–7 Article 66

business section’s trade usages intervene to determine whether and when risk passes.
First, however, the sale must have been completed legally before one can speak of
delivery.1
The notion of risk is central to the relationship between the two parties in a sale of 3
goods. The corresponding CISG articles must be read in connection with other
dispositions. Loss may occur in combination with a breach in which case the risk may
still be with the seller or revert back to him (Art. 70 – see infra). Avoidance may
terminate the sales agreement in which case risk will be covered by Arts 81–84
concerning the effects of avoidance and the manner in which restitution needs to be
made.
The risk discussed in Chapter IV of the CISG is limited to the value of the goods. In 4
the worst-case scenario, the entire value could be lost when the goods have completely
degenerated or have been lost. More serious risks may be associated but are in essence
not governed by the dispositions of Arts 66–70, e. g. the risk that the goods sold bring
damage to other goods of the buyer or do personal harm. Similarly the goods delivered
could cause liability in tort to the goods of third parties – depending on the circum-
stances, it may be necessary to distinguish these issues from the passage of risk to the
seller.2
The effect of the sales agreement on the property in the goods sold is not covered by 5
the CISG (Art. 4). In situations where national law links the passing of risk to the
passing of property title, this would be superseded by the CISG, where ownership is not
the key to where the risk is allocated. In one case, a stallion was delivered to a potential
buyer, first for training and on the condition precedent that this would be successful;
the actual property transfer had not occurred. The court stated this was entirely separate
from the issue of the passing of risk, because on the latter point the parties had made a
partial agreement to pay a minimum sum at conclusion of the agreement, in regard to
which the risk was assumed by the buyer after he fetched the horse. When the stallion
died of colic the sum paid was forfeited, indeed before the property title was passed and
without it ever passing.3
The burden of proof with regard to risk transfer is often connected to the problem of 6
proving the conforming performance of the seller’s obligation to deliver the goods and
the timing of this performance. It is the buyer’s burden to prove that the goods were not
conforming at that point in time – see infra.

1. Price-risk
Art. 66 provides that once risk has passed, the buyer has the price risk, i. e. the buyer 7
must pay the price despite loss or damage to the goods. The buyer acquires the price
risk the moment the seller is divested of the risk of loss. The rule of Art. 66 is
contractual by nature and relates to the performance of the buyer’s obligation to pay
1 This was illustrated in the decision of Oberlandesgericht Hamm (Germany) 23 June 1998 (Furniture),
CISG-Online 434 (Pace); also referred to in Magnus, in: Staudinger Kommentar (1994), Art. 69 para. 25,
where furniture was kept in stock for an Austrian seller (after it was produced in Hungary), in
preparation for transport to a German customer/buyer. The buyer, however, had the option to buy on
call from that stock (entailing identification of the goods – an aspect under Art. 69, infra). When the
goods were damaged, the obligation of the buyer to fetch them had legally not arisen and risk had not
passed.
2 Erauw, in: Flechtner/Brand/Walter, Drafting Contracts (2007), pp. 394–396.
3 Oberlandesgericht Schleswig-Holstein (Germany) 29 October 2002 (Stallion), CISG-Online 717 (Pace).
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(Art. 53). The article repeats or reaffirms Art. 53. The payment obligation applies
subject to Art. 58 – see supra.
8 Before the risk with regard to the goods passes and in order to assure conforming
delivery, the seller must procure the goods, preserve them, repair them if necessary and
duly bring them to the point of delivery which is contractually agreed or determined by
the CISG. If they are lost or undergo accidental damage during this process, he must re-
supply them because his obligation remains.
9 If the risk is still with the seller and loss occurs due to an impediment not within the
seller’s control (force majeure) then the loss is the seller’s. However, the seller’s risk of
being liable for the buyer’s damages is alleviated by Art. 79 (see infra).
10 If loss or damage to the goods occurs after the parties have performed their
obligations and while the goods are under the control of the buyer, the rule that the
buyer has to bear the loss of value is self-evident. This reflects the economic risk after
purchase, a matter beyond the scope of the Convention.
2. The risk transferred but reduced through the use of a remedy for
the buyer
11 Art. 66 also covers damage or loss occurring after the passing of risk, but flowing
from old defects that existed before the passing of the risk – see also, in this regard,
Art. 36(2) supra. Art. 66 indeed contemplates that there may have been a breach by the
seller. In that case the rules on non-conforming delivery specify the consequences of
such a breach. If goods deteriorate or are lost by reason of the seller’s breach itself, then
only the remedies for such breach must be argued and applied, not the question of
passing of risk. Art. 66 only reminds us that the buyer will be left with his primary
obligation to pay the price. The provision explains that the buyer enjoys no automatic
exceptions and finds no automatic liberation from his payment obligation through the
fact that loss or damage occur after risk of loss has passed.
12 Art. 66 looks like it introduces a principle of “pay first, discuss later”. However, if the
seller has committed a fundamental breach, this could be seen as crass punishment for
the buyer. This explains the existence of Art. 70 (see infra), which states that if indeed
the seller committed a fundamental breach, and such breach is notified, the passing of
risk under Chapter IV (Arts 67–69) does not impair the application of any remedy for
the buyer. This includes his right and his option to avoid the agreement entirely,
whereby Art. 66 does not apply. In that hypothetical the relationship would need to be
resolved under the consequences of avoidance (i. e. Arts 81–84), making the risk revert
to or stay with the seller.
13 The value to be paid by the buyer can be the full price or a reduced price in
conjunction with Arts 50–51. In a case decided by the Higher Regional Court of
Koblenz (Germany)4 the buyer had not completed the declaration of avoidance
correctly. The appeals court therefore looked at the buyer’s remedy of price reduction.
The buyer had bought bottles which either broke or became unsterile after the delivery
“ex factory” due to a mistake the seller made in the packaging. The court dramatically
reduced the price to zero (see infra para. 22).
14 With regard to paying first and discussing later, in the hypothetical of a fundamental
breach, the buyer also has the possibility to use the remedy of Art. 71(1), i. e. the
exceptio non adimpleti contractus (recognized in Art. 80).
4 Oberlandesgericht Koblenz (Germany) 14 December 2006 (Sterile bottles), CISG-Online 1408 (Pace).
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3. An act or omission by the seller – posterior alleviation of risk

a) Risk can stay with the seller or return to the seller. Once the risk has passed, the 15
buyer has the price risk, meaning the buyer must pay even though the goods in his
possession are damaged or lost. Art. 66 provides for this, but the same article also
introduces the possibility of passing the performance risk back to the seller. This relief
does not come from Art. 70, because this deals with the effect of a seller’s fundamental
breach, a matter beyond the scope of Art. 66. Rather, the relief comes from the last
words of Art. 66 providing that the buyer is discharged (he must pay “unless”) from his
price obligation if “the loss or damage is due to an act or omission of the seller”. There
is, thus, mitigation to the strictness of the rule of Art. 66. The UNCITRAL Digest states
that the “unless”- clause in Art. 66 is distinct from the lack of conformity under Art. 36
(1) and (2).5
The Digest found a suggestion that seller could be held liable for deterioration of 16
goods after delivery was possible, but buyer would need to provide proof the damage
was due to seller’s actions or omissions, such as for a case where sheep were transported
on an overloaded truck suffering physical damage.6
b) Terminology. The first appearance of the phrase “due to an act or omission of the 17
seller” in the ULIS had brought surprise. It introduced a possible right of set-off for a
tort the seller may have committed. This would be uncharacteristic under the Conven-
tion, because both tort and set-off fall outside the scope of the CISG. However, the
vague wording seems to introduce the fault concept into the Convention’s treatment of
mutual contractual obligations. The seller may find his obligations to care, repair and
eventually to re-deliver, all reborn again, with no clear time-limit and under a vague
standard (of liability). In effect, this is how the risk will finally be allocated by decision
of a judge.
So what does it mean when the seller bears the risk of loss or damage due to his “act 18
or omission”? The text of Art. 66 requires clarification; this was asked for in the
diplomatic conference for the preparation of CISG, but not given. The final CISG text
refers only to the seller’s own actions and mentions the seller’s “omission”, suggesting
that the CISG exception merely covers – with quaint phrasing – the possibility that a
seller’s breach of contract has caused the particular damage or loss. The terms do not
introduce a higher standard than is relevant for the application of Art. 79; it holds the
seller to a standard of reasonableness, such as the need to provide qualitative transpor-
tation.7
Once such action or omission is proven, then passing of risk becomes irrelevant and 19
Arts 45 et seq. become available to the buyer.8 When the exception applies, presumably,
the buyer’s obligation to pay the whole price or to pay part of it is postponed or even
waived and the obligations of the seller are reborn in part or entirely. It is conceivable,
in this situation, that neither of the parties carries the risk. However, taking a dynamic
view of the “passing” of risk (the title of Chapter IV), it looks more logical to decide that
risk simply did not pass to the buyer. If the seller were to cure or to replace the lost or
5UNCITRAL Digest of case law (2012), p. 319 (No. 6).

6UNCITRAL Digest of case law (2012) at p. 320 cites Oberlandesgericht Schleswig-Holstein (Germany)
22 August 2002 (Sheep), CISG-Online 710, which nevertheless found no such proof. The Digest also
states that in four arbitral decisions of tribunals functioning under rules of the Russian Federation
Chamber of Commerce and Industry and the Western Siberia Circuit, the buyers did not succeed in
providing such proof.
7 Hachem, in: Schlechtriem/Schwenzer/Hachem, Commentary (2016), Art. 66 paras 22–25.
8 Hachem, in: Schlechtriem/Schwenzer/Hachem, Commentary (2016), Art. 66 para. 28.
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damaged goods with substitute goods then the obligation to pay the price would ensue
as the risk moves on to the buyer.
20 This exception can be interpreted broadly or narrowly. The drafting literally allows
the buyer to suspend or withhold payment for a variety of reasons connected to the
behaviour of the seller. It is possible (or probable) that only those acts or omissions that
amount to a breach of an obligation of the seller (different from breach of contract)
would be sufficient.9 In any case, it is a complex or “disturbing” exception.
21 One could wonder whether this exception will be applied if the parties choose to use
Incoterms, where the effect would again be to offer an equitable exception to the passing
of price risk under any specific term with regard to the time of the agreed passing of the
risk. Of course Incoterms do not settle the payment obligation nor the consequences of
the seller’s breach of contract. They do determine when the risk passes and can
therefore influence the working of Art. 66.
22 An application in the above-mentioned German decision by the Higher Regional
Court in Koblenz of 14 December 2006 is illustrative of this point.10 The goods
delivered were bottles that were to be kept sterile with non-porous foil and stacked
properly, but were not. This poor performance was apparently done by the seller before
the risk passed. That sale concerned a delivery “Ex factory” (since Incoterms 1990
replaced by “Ex Works”). The appeals court described the normal passing of risk. It
stressed the independent nature of the remedy of price reduction usable apart from the
requisite notification of the non-conformity of the goods or the lapse of time to protest
breach according to Art. 39.11 This brought the court to refer to Art. 66, namely to the
exception in the last phrase. It took pains to mitigate the risk and even completely took
it away. Art. 66 presupposes that the damage does not fall within the responsibility of
the seller, but on the other hand, if the loss is caused by a breach by the seller, this is
reversed. The court found an apparent breach before the transfer of risk. It found that it
could apply the reduction of the price and it reduced the price to zero.12 Such use of the
exception in Art. 66’s last phrase looks like a patch against the buyer losing his normal
remedies.
23 The burden of proving this type of shortcoming of the seller is on the buyer.13
24 c) Burden of proof. Art. 66 simply imposes the burden of proof regarding the buyer’s
eventual claims for compensation of the loss the buyer suffered (after the risk passed).
When pork ribs were sent from a U.S. seller to a Canadian buyer after keeping them for
some time in frozen storage, it was for the buyer to prove the non-conformity at the
time of delivery. The court found no proof of deterioration and spoiling at the time of
the transfer of risk.14 Indeed, the burden can be heavy and the buyer better beware.
25 Another case illustrates the difficulty of proving that damage is due to the seller. The
buyer had to bear the risk of the loss of much of a ship’s cargo of barrels containing
bitumen. It was the buyer’s insurance company that took legal action. It explained that
9Huber, in: Huber/Mullis, The CISG (2007), p. 317.

10Oberlandesgericht Koblenz (Germany) 14 December 2006 (Sterile bottles), CISG-Online 1408 (Pace).
11 See supra Art. 39 and the mitigation in Art. 44. This author thinks the court should have applied
Art. 44 with a clearer motivation (See Huber, in: Huber/Mullis, The CISG (2007), p. 248), or otherwise
might have wanted to seek a solution parallel to Art. 50.
12 This is indeed a possibility, see supra Art. 50 and Huber, in: Huber/Mullis, The CISG (2007), p. 254.
13 Landgericht Flensburg (Germany) 24 March 1999 (Meat), CISG-Online 719 (Pace), where delivery
was under the default rule at the premises of the seller and the buyer carried the risk for the
transportation and resold the goods on the same day as he took delivery. He had not protested for non-
conform delivery.
14 Federal Appellate Court, 7th Circuit (U.S.) 23 May 2005 (Pork ribs), Chicago Prime Packers, Inc. v
Northam Food Trading Co., CISG-Online 796 (Pace).
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the seller had chartered a decrepit boat that had been on its way to the scrap-yard and
put it back at sea with the filthy cargo. The loading was not done as asked. Furthermore,
the seller chose a one-ship carrier-company without insurance. The judge could not be
convinced this was a faulty choice. He told the claimant that one would not choose a
luxury vessel for this.15 This type of situation remains to be judged in fact; a different
outcome is seen in the above-mentioned case of the packaging of bottles for transport,
where application was made of the exception of Art. 66’s last phrase.
If the seller claims to have the right to payment because the risk passed from him to 26
the buyer, he has to prove that transfer.16 This proof will usually be the transport
document or a notification of receipt, depending on the agreed delivery conditions.
4. Determining which risks are transferred to the buyer

a) Theory and court practice. The CISG contains no definition of the types of risk 27
covered by the rules on transfer of risk, leaving uncertainty. First, one must look at the
risks that fall within the scope of the Convention.17 The Draft UNCITRAL Digest offers
illustrations of this notion18. The wording used in the CISG is “loss or damage” (Arts 66
and 68) and “goods (that) have perished or deteriorated” (Art. 82(2)(b)).
A number of judicial decisions have been decided on aspects of “the loss or damage” 28
that fall under Art. 66 determining that the risk for such loss or damage passes.
Decisions have mentioned elements that shall not be understood as harm to the goods:
e. g. delay in delivery after the handing over to the carrier.
b) Loss or damage: physical loss and deterioration – value lost. Physical risks to the 29
goods, including their entire destruction, are covered by the concept of “loss”. For living
creatures sold as goods, this includes sickness or death.19
Disappearance of the goods, including theft, misplacing the goods, transfer to a 30
wrong address or person, and mixing up the goods with other goods are included. That
is a broad notion that encompasses:
– occurrences in transporting the goods from one party to the other;
– in handling and storage20, including the risk of natural processes leading to a decline
in quality (resulting from whichever cause, such as lack of care, bad packaging,
melting, thawing21, shrinking, loss of weight or strength or taste, or appearance).
15 Appellate Court of Vaud (Switzerland) 26 May 2000 (Tar in drums), CISG-Online 1840 (Pace), see
infra at Art. 67, No. 34 for more discussion on the facts.

16 Oberlandesgericht Hamm (Germany) 23 June 1998 (Furniture), CISG-Online 434; also referred to by

17 For example, the liability of the seller for death or personal injury is beyond the scope (Art. 5). In
complex agreements a part concerning services may entail a certain risk in conjunction with a sale but not
governed by CISG.
18 See also Erauw, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), pp. 293 et seq.
19 The exclusion of death or personal injury in Art. 5, is only for damage caused “by the goods to any
person”. On a positive note, the benefit of acquiring any fruits, by-products or offspring of live goods (e. g.
the right to the foal of a mare) passes together with the risk – finding its cause in property law and as such
not decided by CISG. See Nicholas, An Introduction to Roman Law (1962), p. 180.
20 Romein, The passing of risk – A comparison between the passing of risk under the CISG and under
German law (1999) (Pace); see also Oberman, Transfer of risk from seller to buyer in international
commercial contracts: A comparative analysis of risk allocation under the CISG, UCC and Incoterms,
Laval thesis (1997) (Pace) and Flambouras, Transfer of Risk in the Contract of Sale involving Carriage of
Goods: A Comparative Study in English, Greek Law and the United Nations Convention on Contracts for
the International Sale of Goods, Oxford thesis (1999) (Pace).
21 A sale of Chilean deep-frozen raspberries: Commercial Court Hasselt (Belgium) 2 May 1995, CISG-
Online 371 (Pace).
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31 Risk of physical loss or deterioration also encompasses the risk of other persons
causing damage to the goods or, indeed, their disappearance.22
32 One must also assess the amount of compensation that will be due as a result of the
risk. Other than the goods themselves, this might include the cost of repackaging,23 the
expense of handling and replacing and moving the goods, such as when they need to be
recounted.
33 c) Loss of documents. The risk of loss of documents relating to the goods, in this
author’s opinion, passes together with the risk for the goods. In other words, the risk of
loss rules of the Convention apply as easily to documents as to goods. The time and
place to hand documents over is normally the same as for goods (Art. 34), but the
Digest indicates that absent agreement, the delivery of documents may be expected just
in time of their use for taking delivery of the goods or for their import. Thus, if the
documents are lost before they are delivered, the risk should or could be treated
similarly. Remedies for non-conforming delivery of documents may, rather more
exceptionally – according to the Digest – include avoidance, which would stop risk
relating to those documents from passing.
34 d) Legal risks: embargoes and unforeseen restrictions. It was at first uncertain
whether legal risk passes together with physical risk, especially considering the differ-
ence with the text of the ULIS – the predecessor treaty. Such risk comprises the chance
that an authority will intervene, confiscate, or forbid the possession, intended use or
further commercial exploitation of the goods.24 It is the risk that through the operation
of law a party would be deprived of the right to make the intended valuable use of the
goods.
35 The wording of the CISG seems to exclude the literal application of its risk of loss
rules to legal risk.25 However, it is rational to allocate legal risks along the given line of
the CISG and court decisions have made this rule clear. A Hungarian arbitration
decision about a FOB sale of caviar stock from Yugoslavia via Hungary to Cyprus
illustrates this point.26 The Hungarian buyer picked up the goods in Yugoslavia at the
seller’s address27 on 28 May 1992 after which the UN embargo against Yugoslavian
goods was declared. The buyer could make a partial customs clearance but could not get
permission to re-export from Hungary. The parties had not made a specific agreement
22 Landgericht (District Court) Darmstadt (Germany) 12 March 2013 (Shoes), CISG-Online 2446
(Pace), rejected a claim for payment by seller for a delivery of shoes from Italy to Germany that got
lost, when seller could not provide proof of delivery to the carrier.
23 Costs of repackaging and of inspection were asked (but rejected) in Arbitral Award, CIETAC, 7 April
1999 (PVC Suspension resin), CISG/1999/20, CISG-Online 1244 (Pace).

25 Schwenzer/Fountoulakis/Dimsey, International sales law, 2nd Edit., Oxford, Hart Publ. Co., 2012,
p. 484 say it is at least uncertain whether the article refers to legal risk, but mention the Hungarian
arbitration case (on caviar) discussed presently. B. Piltz, Internationales Kaufrecht – Das UN Kaufrecht in
Praxisorientierter Darstellung, 2nd Edn, Munich, Beck, 2008, p. 228 (No. 4-270) was more outspoken: “it
does not govern risks of sovereign intervention”. Hachem, in: Schlechtriem/Schwenzer/Hachem, Com-
mentary (2016), Art. 66 paras 10–11 writes that if it were unforeseeable that government would introduce
new rules then this would be at the risk of seller if risk had not yet passed, although he could exonerate
himself via Art. 79 (force majeure) but he must try and overcome the impediment; Hachem states that
obtaining export or import licences is not relevant in the discussion about risk, because that concerns the
parties’ obligations.
26 Arbitral Award, Arbitration Court of the Hungarian Chamber of Commerce and Industry, 10 De-
cember 1996 (Caviar stock), CISG-Online 774 (Pace). The FOB term ought not to have been used, given
the delivery was to a carrier (indicated by the buyer) for land transport.
27 In the case cited the agreement was to fetch the goods and the term used was “FOB Kamion
Kladovo” – the Yugoslav town (Serbia) where seller was established.
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relating to such risk, but in general terms the risk had passed. The arbitrators found that
on the basis of force majeure the damage of this measure fell on the buyer who carried
the risk after delivery. When parties use an Incoterm this includes an agreement
concerning the risks as to obtaining customs clearance for export and for receiving
import permission or import quotas – thus with Incoterms the risk regarding those
matters is allocated.
The risk of an impediment beyond control of the parties striking out the performance 36
(“force majeure”) is discussed under Art. 79 (see infra), but this risk is to be allocated in
accordance with Art. 66.28 In the so-called “dioxin-crisis” over the levels of PCB-
contamination in meat that broke out late May 1999 in Belgium and later had
repercussions in the rest of Europe, the newly introduced restrictions on the sale of
pork meat were a force majeure that struck the party that carried the risk at the time of
their unexpected introduction.29 Belgian pork meat was delivered in Germany and
payment was made on the first day the new restrictions were introduced, leading
customs to seal up the meat and block it – at the risk of the buyer.30 The same would
apply if animals bought as product were to subsequently fall under a legal measure of
compulsory culling. Thus, if the parties have not adopted a specific trade term or have
not stipulated how they wish to deal with specific legal risks, they should be treated
under the Convention’s risk of loss rules.
The loss of the buyer who bears risk of loss is limited to the price paid or still to be 37
paid. If there is also a breach on the seller’s part, then the buyer’s loss may be reduced
accordingly (see the comment infra on Art. 70 paras 11–12).31
e) Delays and special needs for transportation. Delay in delivery (which might occur 38
in combination with a case of deterioration in the quality of the goods over the extra
time) can constitute a breach of contract and this may prevent risk from passing.32 The
Digest indicates how courts applied the provision for the passing of risk, also to the loss
through delay.33
The possibility of delayed delivery may seem to be an aspect of “legal risk”, but it is 39
not the same: it is a risk associated with contracting to perform by a particular date, and
non-performance by that date is simply a breach of contract. The same comments apply
mutatis mutandis to delivery at the wrong place.
Delay caused by third parties may indeed have to do with risk. If the third party is an 40
independent carrier, the party that nominates the carrier normally carries the liability
28 Bollée, The Theory of Risks in the Vienna Sale of Goods Convention, Paris I thesis (1999) (Pace),
pp. 276–277 – a factor of risk.

29 Court of First Instance Ypres (Ieper) (Belgium) 18 February 2002 (Pork meat), CISG-Online 747
(Pace). The case did not allow for the application of the rule of hardship – “imprévision”.
30 Appellate Court Gent (Belgium) 16 June 2004 (Pork meat), CISG-Online 988 (Pace).
31 Thus if the seller has breached, there may be a partial return of the goods for lack of “delivery”, and
speaking in terms of risk there will be less to compensate.

32 The same is true if the seller delivers to the wrong place for ULIS, see Neumayer, Dölle Einheitliches

33 District Court Arnhem (Netherlands) 17 July 1997 (Artwork – painting) (Unilex database) and
affirmed – on other grounds – in Appellate Court Arnhem (Netherlands) 9 February 1999 (Artwork –
painting) (Unilex database). In Arbitral Award, CIETAC CISG/1999/20, 7 April 1999 (PVC-resin), CISG-
Online 1244 (Pace), the Chinese buyer of PVC Suspension resin, that he bought from a seller in the U.S.,
was claimant in the arbitration; he requested compensation of the liquidated damages he himself had to
pay to his own customer for his own delay in delivery. He had re-sold the goods and then the packaging
broke on transport from America and the goods had to be repacked and re-inspected, causing delay. The
tribunal rejected the entire claim for the loss caused by the leaking packaging and by the delay vis-à-vis a
customer. The risk was for the first buyer (except if the seller did not provide for adequate packaging),
because the delivery was done at the beginning of the transport (CFR).
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for his choice. However, if Incoterms CFR/CIF or CPT/CIP are used, the seller chooses
a carrier but the risk is borne by the buyer. With the Incoterms DAT/DAP the risk of
transport lies with the buyer, so any delay in transportation cannot be attributed to the
seller. In this sense, provisions as to the special transportation needs for certain sensitive
goods should be detailed and the risk should be allocated to one of the parties (see
infra). Indeed, special agreements or separate clauses can bring clarity over the obliga-
tions in respect of transport and care, thereby localizing the risk with those who
perform those obligations.34 In disputes about the damaging consequences of a poor
choice of carrier, judges have allocated the risk purely or mechanically on the basis of
the goods passing the ship’s rail and refrain from readily penalizing the party that was
to contract with the carrier (and eventually the insurer). An exception is the case where
the parties had negotiated about the risk of transportation under a CFR-term in such
detail that they effectively concluded a separate agreement about the risk relating to the
temperature condition of the goods during transport.35
41 f) Economic risk. Economic risk has to do with the fluctuation of the value of goods
on the market. At the time of the conclusion of a sales agreement the price is fixed (or is
determinable) in the currency contractually provided for. The market price of the goods,
as well as the currency exchange rate, may fluctuate after the conclusion of the
agreement. Later fluctuations of the market price can bring an advantage either to the
seller (when there is an intermediate drop in price) or to the buyer (when there is a
price increase).36 The terms of Arts 66–70 do not apply to the issue of fluctuation in
market price or exchange rate fluctuation. The risk of these events passes at the time of
the valid conclusion of the agreement.
42 It would be wrong to consider a change in the attribution of the creating artist to a
piece of artwork as a risk that passes to the buyer. The identity of the creator of a work
of art or an antique is part of the authenticity of the good. Changes in perception or in
analysis of such characteristics are at most an economic risk, which, depending on the
circumstances of the case, do not as a rule pass to the buyer together with or as risk
pertaining to the product.37
43 g) The risk of insolvency. The risk of insolvency of one’s contracting party in the sale
relationship is beyond the CISG. In two closely related cases a delivery was made to a
third party that subsequently went into receivership, whereby the buyer suffered loss.
The court only looked into this from the angle of seeking eventual fault with the seller
for delivering at that destination – however as the parties agreed on this change of place
of delivery, the risk passed and fell on the buyer.38
34See Erauw, in: Flechtner/Brand/Walter, Drafting Contracts (2007), p. 392.

35Arbitral Award, CIETAC, 23 February 1995 (Jasmine formaldehyde), CISG-Online 568 (Pace); the same
as Arbitral Award, CIETAC 23 February 1995, CISG-Online 971 (Pace), where the product was jasmine
aldehyde and much emphasis had been put on the temperature not being allowed to rise. See approval from
Hachem, in Schlechtriem/Schwenzer, Commentary (2016), Introduction to Arts 66–70, para. 3.
36 See Schmitthoff, The Risk of Loss in Transit in International Sales, in: Honnold (ed.), Unification of
the Law Governing International Sales of Goods (1966), p. 172; Bollée, The Theory of Risks in the Vienna
Sale of Goods Convention, Paris I thesis (1999) (Pace), p. 271.
37 The Digest described a case in which a painting represented at the time of sale to be the work of a
famous artist was later shown to be misattributed. The court, invoking Arts 69(1) and 36(1), dismissed
the buyer’s claim because, at the time of delivery, there were no indications that the artist was not the
painter. This seems incorrect. The case points to non-conforming delivery, for which the seller should
eventually be liable. Delivering a wrongly attributed painting may be attacked under the national law
governing misrepresentation or error in substance because such rules are matters of validity.
38 Oberlandesgericht Oldenburg (Germany) 8 September 1998 (Raw salmon), CISG-Online 1887 (Pace)
and Oberlandesgericht Oldenburg (Germany) 22 September 1998 (Raw salmon), CISG-Online 508 (Pace).
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5. Contractual risk
The CISG only explicitly refers to the “passing” of risk. It logically leaves us to put the 44
risk with the seller before it passes, and subsequently with the buyer after it passes.
Before a contract is concluded, all risk including legal, economic and physical risk, lies
with the seller. These basics are not expanded in CISG; they are self-evident.
Perhaps the most important risk has to do with the kind of obligations a party takes 45
on as a result of the contractual negotiations. Thus, there is the risk of non-satisfactory
performance (as in choosing your business-partner – insolvency, incompetence and the
like) that can be called contractual risk and applies to both buyer and seller. The CISG
imposes on the seller an obligation to make a conforming delivery, generally measured
at the time the risk passes (Arts 35–37). This should suffice as the Convention is
oriented towards contractual provisions and offers what the crucial performance phase
of the transaction requires – namely detail as to the obligations imposed for a legally
effective “delivery” – the “handing over” of the right thing. The buyer will, in exchange,
have to pay good money.
The different possible deficiencies regarding the matter of conformity are mentioned 46
in Art. 35. If there is lack of conformity at the time that risk normally passes to the
buyer, the seller’s “liability” for that breach does not pass to the buyer (Art. 36). The
rule of breach trumps the passing of risk.39 Art. 70 (see infra) provides guidance
concerning the relation of risk passing and the occurrence of a fundamental breach.
The risk of loss or deterioration of the goods covers the buyer’s risk of having to pay 47
the price for what is either not entirely there or is not there in its full value. This price
risk – the obligation to pay notwithstanding the loss or reduced value – is a negative
way of defining the risk that undoubtedly does pass to the buyer. Art. 66 describes the
effect of this “passing” in terms of the law’s choice not to discharge the buyer of his as-
yet-unperformed obligation.
There may also be risk caused by the way the parties structure their legal relationship. 48
For example, part of the risk associated with a non-conforming delivery involves the
costs of transporting and of insuring during transport, as well as the costs of handling
and storage. Depending on what the buyer paid to the seller for the goods, which may
include the cost of those services, the seller may lose that value, because getting a
replacement product delivered to the same place will be an additional cost. These costs
will be higher if the goods were to be delivered at or near the buyer’s establishment. The
allocation of such risk is to be decided by the agreement or by an Incoterm and by price
negotiations. These transport costs are a matter of contractual risk even if they were not
included in the product price and needed to be contracted out to other entities. If the
parties have by agreement added other financial consequences to the delivery of non-
conforming goods, such as a liquidated damages clause (which is not expressly
addressed in the Convention) the contractual risk is greater.
6. Damage caused by the goods themselves

The risk of loss for goods sold under a sales contract is altogether different from the 49
risk of damage later caused by the goods sold. The sold goods can deteriorate and can
damage persons or other property or can in turn also disturb processes, by their failure.
39 The remedies for material defects can be cut-off (Arts 38 and 39); so risk for breach can indeed
effectively pass, at the deadline for giving notice of lack of conformity indicated by Art. 39 (which must be
read in conjunction with Arts 40 and 44). See also the discussion of Art. 70.
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This other damage raises issues of contractual or tortuous liability between buyer and
seller, or tortuous liability vis-à-vis third parties who suffer damage to their property or
economic loss.40
50 With respect to contractual liability between buyer and seller, recovery for this
damage is exclusively based on breach of contract (lack of conformity) and the damages
fall under Art. 74 – the article that orders full compensation for broadly defined losses.
51 A seller’s liability for such damages would be based on a breach by delivery of non-
conforming goods even though the damage caused, shown to be within the chain of
causality, might occur after the time of delivery (Art. 36(2)). The appearance of such
damage, of course, could be the first indication that something was wrong with the
goods all along. The risk for this damage also passes to the buyer when the delivery is
duly made or when the deadline for notice of non-conformity under Art. 39 (see also
Arts 40 and 44) expires.
52 Claims under tort law, of course, are beyond the scope of CISG and outside the
possible extensions of its principles by way of gap-filling (Art. 7(2)). However, even
contractual liability for damage caused to other property of the buyer cannot be simply
identified with or subsumed under the rubric of the passing of risk. The Convention’s
risk of loss rules clearly limit their ambit to loss or damage to “the goods” (i. e., the
goods sold) – Arts 66 and 68 – or “in respect of goods sold”– Art. 68.

53 In the PECL there are no comparable provisions as this set of model rules does not
explicitly discuss the issue of transfer of risk.41 It can however be argued that the articles
on place and time of performance (Art. 7:101 and Art. 7:102) implicitly address transfer
of risk. The DCFR on the other hand contains a provision (Art. 5:101) almost identical
to Art. 66.
40
See Erauw, in: Ferrari/Flechtner/Brand, Draft Digest and Beyond (2003), p. 296.
41
The Common European Sales Law CESL of the European Parliament and Commission contains
comparable rules in Chapter 14 (Effects on passing of risk), such as Art. 140, which follows Art. 66 CISG.
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Article 67
(1) If the contract of sale involves carriage of the goods and the seller is not bound
to hand them over at a particular place, the risk passes to the buyer when the goods
are handed over to the first carrier for transmission to the buyer in accordance with
the contract of sale. If the seller is bound to hand the goods over to a carrier at a
particular place, the risk does not pass to the buyer until the goods are handed over to
the carrier at that place. The fact that the seller is authorized to retain documents
controlling the disposition of the goods does not affect the passage of the risk.
(2) Nevertheless, the risk does not pass to the buyer until the goods are clearly
identified to the contract, whether by markings on the goods, by shipping documents,
by notice given to the buyer or otherwise.
Bibliography: Hachem, in: Schlechtriem/Schwenzer, Commentary (2016); Ramberg, To What Extent do

Incoterms 2000 Vary Articles 67(2), 68 and 69 CISG? 25 Journal of Law and Commerce (2005) 220
(Pace); Valioti, Passing of Risk in International Sales Contracts: A Comparative Examination of the Rules
on Risk under CISG and Incoterms 2000, Nordic Journal of Commercial Law (2004) 2 (Pace); Von
Hoffmann, Passing of Risk in International Sales of Goods, in: Sarcevic/Volken (eds) International Sale of
Goods (1986), p. 286.
Outline
1. Handing over the goods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
a) Carriage involved in a sale under CISG . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
b) If no place of delivery was determined risk passes when the goods are
handed over to the first carrier . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
c) Handing over to the first carrier independent carrier . . . . . . . . . . . . . . . . . . . 9
d) Delivery at a particular place . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
2. Clearly identifying the goods. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
3. Art. 67’s relationship with terms agreed by the parties . . . . . . . . . . . . . . . . . . . . . 23
a) Agreed terms regarding risk . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
b) Interpretation of the trade terms used . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
c) Incoterms and the CISG . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
aa) Incoterms in general. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
bb) EXW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
cc) FCA and FOB. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
dd) CFR or CPT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
ee) CIF or CIP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
ff) DDP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
III. Comparable rules . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47

Because of the distance the goods have to travel in an international sale, it is 1
important to know at which point the risk of loss or damage to the goods passes from
the seller to the buyer. Article 67 indicates the passing of risk in a sale which involves
the carriage of goods, which means this rule will be applicable in the majority of the
international sales. If no carriage is involved, risk passes under the rule of Art. 69.
The ULIS linked the passing of risk to the delivery of the goods as it is the case in the 2
Incoterms. The drafters of the CISG preferred not to link the passing of risk with the
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concept of “delivery” in order to avoid confusion and to be able to provide different

rules for the delivery and the passing of risk.1 This appears to be only a difference in
legislative technique, as the rules on the passing of risk of the CISG largely correspond
with those of the ULIS.2
3 In practice, parties often agree on the point of risk transfer in their contract of sale,
explicitly, or through the use of an Incoterm. But if the contract of sale does not provide
a solution, the CISG’s default rules will apply.

1. Handing over the goods
4 a) Carriage involved in a sale under CISG. Chapter IV of Part III of the CISG (Arts
66–70) determines the place where and time when risk passes. It provides different rules
depending on whether the sales agreement involves the carriage of the goods (Art. 67),
whether the sale relates to goods in transit (Art. 68), or whether the transaction does not
fit into the prior two categories (Art. 69). The UNCITRAL Digest (2012) explains that if
the contract is silent about carriage, Art. 69 rather than Art. 67 will govern.3
5 The distinctions controlling which rule applies are not clear to all, as the Digest
illustrated. In international sales, logically, the large majority of transactions involve
carriage, thus Art. 67 will usually be applicable. Professor Honnold intimated that sales
not involving carriage were typically domestic4, or were otherwise the unusual case
where one may presume the seller had his own trucks for distribution. Art. 67 should
indeed apply whenever the goods are to be handed over to an independent carrier,
including to a forwarding agent. The parties decide where, when and how the goods
must be delivered.
6 The question of whether the contract “involves carriage of the goods” so that Art. 67
applies depends on the parties’ agreement, which most often does exist.5 This is
independent of whether it is the seller or the buyer who shall arrange for carriage.
Indications in the contract are: who arranges for transport and for insurance. In one
case, a contract provision requiring the buyer “to pick up” the goods and to “take the
goods to” his facilities in another country was held to mean that the contract “involved
carriage of the goods” and thus was governed by Art. 67 while – more importantly – the
contract also included an “FOB” delivery term, which implies sea transportation. A
clause requiring the buyer to pick up or the seller to deliver to the buyer would not
“involve carriage” because there must be a third-party carrier involved. Hachem
specifies that agreements simply about who carries costs do not necessarily relate to
the passing of risk.6
1
Honnold, Documentary History (1989), pp. 31–41.
2
Hachem, in: Schlechtriem/Schwenzer/Hachem, Commentary (2016), Art. 67 para. 2 referring to
Art. 19(3) ULIS.
3 UNCITRAL, Digest of Case Law (2012), p. 325, Art. 69 para. 2.
4 Although the application of the CISG depends on the domicile of the parties and not on whether the
goods pass a frontier.

5 Enderlein/Maskow, International Sales Law (1992), p. 257 – “absence of agreement is rare”; Lookofsky,
Understanding the CISG in Scandinavia (2002), p. 111 – “realities of sales contract life”, “a large
percentage of contracts deviate as to the passing of risk”. That would be the case if either explicitly or
implicitly the contract provides for transport after its conclusion, say Schwenzer/Fountoulakis/Dimsey,
International sales law (2012), p. 491.
6 Hachem in Schlechtriem/Schwenzer, Commentary (2016), Art. 67, para. 10 who cites decisions by
Audiencia Provincial de Cordoba (Spain) 31 October 1997 (goods not specified), CISG-Online 502 and
BGH (Germany) 11 December 1996 (Marzipan), CISG-Online 225.
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b) If no place of delivery was determined risk passes when the goods are handed 7
over to the first carrier. Art. 67 (1) offers a double rule for two possibilities. The first
hypothetical is where the sale “involves carriage” but there is no particular place to hand
the goods over; the second hypothetical is where the seller is bound to hand the goods
over to a carrier at a particular place. This runs parallel to the terms of Art. 31 which
also distinguishes between the seller having to hand over the goods to the carrier and
delivering them at a particular place.
If the seller is not bound to hand the goods over at a particular place, risk passes 8
when the goods are “handed over” to the first carrier for transmission to the buyer, as
agreed. It is the rule under CISG that if the sale involves carriage, absent a stipulation by
the parties, the goods must be handed over to the first carrier (Art. 31(a)).7 The parties
agree on the choice of the first carrier for transmission.
c) Handing over to the first carrier independent carrier. The text is clear as to the 9
first carrier for multimodal transport. It is understood that the first carrier is (similar to
Art. 31) an independent carrier. The majority opinion is that one looks at this first
independent carrier, whether this is a party doing a domestic leg of the transport or an
international leg; for a long stretch or short. Von Hoffmann looked closely at this, trying
to define the “first carrier” and he found we ought to include the vehicles of the seller in
order to have risk treated uniformly throughout the transport.8 However, this does not
seem to be a good solution. “Independent” has to be understood as not comprising the
seller’s own staff or own means of transport or those of an auxiliary.9 It is logical that
the risk remains with the seller as long as the goods are under his supervision.
Under Art. 67(1) the words “when the goods are handed over”, i. e. as they are 10
brought into the legal control or “custody” of the carrier, are not as specifically defined
as, for example, the place of loading onto the carrier’s vessel.10 It certainly entails that,
7 Valioti, Passing of Risk in International Sales Contracts: A Comparative Examination of the Rules on
Risk under CISG and Incoterms 2000, Nordic Journal of Commercial Law (2004) 2 (16) (Pace) – who
indicates uniform treatment throughout the transport is thus assured; Vanheusden, Leveringsvoorwaar-
den in Internationale Overeenkomsten: Trade Terms en Incoterms (2005), pp. 61–62. Under Incoterms
the carrier is the same: Van de Veire, in: Debattista (ed.) Incoterms in Practice (1995), p. 119. For an
application of Art. 67 see Amtsgericht Duisburg (Germany) 13 April 2000 (Pizza boxes), CISG-Online 659
(Pace), about pizza boxes damaged in transport from Italy to Germany. Although the rule in Art. 67(1) is
formulated in the negative (“not bound…at a particular place”), this does not imply that the seller has a
burden of proof to demonstrate that handing over at a particular place was not agreed or that the
delivery had become an obligation for the seller to bring the goods. The default rule for delivery is to the
first carrier at the seller’s place of business.
8 Von Hoffmann, Passing of Risk in International Sales of Goods, in: Sarcevic/Volken (eds) Interna-
tional Sale of Goods (1986), pp. 286–287 saw that vehicles of the seller (its truck bringing the goods to the
station or airport) tended to be excluded. He also found it illogical and unnecessary that the risk stayed
with the seller as long as he takes care of the goods. He argued that once goods are loaded and traveling, it
is hard to determine the location of the occurrence or the measure of any combined damage to them. The
movement of the goods towards the buyer was initiated when the seller started his own transport and he
generally holds insurance for that. He can turn over the insurance to the buyer, as with some Incoterms.
Von Hoffman proposed this solution to avoid the problems of locating where the damage has occurred in
multimodal transportation. However, if the goods would be damaged in this pre-transportation by the
seller, he will not get a clean B/L. Often he will need this clean B/L in order to be paid under a L/C. Even
if that would not be the case, it will be clear that the damage occurred while the risk was still with the
seller.
9 Seller must not de facto exert control over the transporter, says Hachem, in Schlechtriem/Schwenzer,
Commentary (2016), Art. 67, para. 11; in the case of affiliated corporations the company’s statutes may
need to be consulted. At para. 15 he explains that handing goods over to an independent freight
forwarder should be sufficient for risk to pass; seemingly in order not to invite questions of whether
such a party acted as agent or decided autonomously on the transport issues.
10 Neumayer, in: Dölle Einheitliches Kaufrecht (1976), p. 659.
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under the control of the carrier, the warehousing and handling within the confines of a
carrier’s facilities would be at the risk of the buyer. With reference to goods handled in a
harbour, this looks more like the Incoterm FAS (free alongside ship). However, if
stowage was contracted out to a harbour authority or to stowage firms different from
the carrier, the goods would indeed not yet be “handed over” to the carrier.
11 In comparison with the Incoterm FCA (Free Carrier)11, we see potential differences as
to the place where risk passes. For all Incoterms, the place of delivery and passing of risk
coincide.
12 Before the 2000 version of the Incoterm FCA, the goods needed to be put onto the
carrier’s mode of transportation, leaving the risk of eventual storage before loading and
of further handling, plus the risk of the loading itself with the seller. This presumes that
the term is FCA at place other than the seller’s premises.12
13 Incoterms 2000 made it clear that as to the term FCA, the words “placing the goods at
the disposal of the carrier” were meant to be identical with the terms “handing over the
goods” of the CISG.13 Through that statement, the ICC indicated that it understood
“handing over the goods” under the CISG to mean that the buyer was left with the
responsibility for loading the goods on the carrier he nominated.
14 Then, in Incoterms 2010, for the passing of risk under FCA a distinction has to be made
between delivery at the seller’s premises and delivery at any other place. In the former
case, risk passes – as before – when the goods have been loaded by the seller on the means
of transport provided by the buyer. In the latter case, risk passes when the goods are
placed at the disposal of the carrier still on the seller’s means of transport ready for
unloading. See below for further comparison with C-terms and D-terms of Incoterms.
15 The words “(handing over) in accordance with the contract of sale” do not introduce
the need for the delivery to be in conformity to the agreement in terms of Art. 35.
16 The last sentence of Art. 67(1) reminds us that the seller retaining documents that
control the disposition of the goods, does not affect the passage of the risk. That is
similar to the transfer of title being beyond the convention’s rules.
17 d) Delivery at a particular place. If a particular geographical place is mentioned as
the place of delivery, this defines the location at which the handing over to the
appointed carrier must occur, and thus where risk will pass. When the indicted place
is either the establishment of seller or buyer this rule does not apply – instead Art. 69
does.
18 In practise a “place” is typically determined through the use of an Incoterm, which
would prevail (Art. 6); in such cases this could concern handing over to another carrier
than the first.14
2. Clearly identifying the goods

19 When the sales contract involves carriage, Art. 67(2) formulates a strict condition
before risk can pass to the buyer; namely, the goods must be clearly identified to the
contract, as the text states: “whether by markings on the goods, by shipping documents,
by notice given to the buyer or otherwise”. This offers some flexibility. In application of
Art. 27 the transfer risk of such notice containing identification is with the buyer.
11 We presume, for this hypothetical, that no particular place was named as an addition to the standard
Incoterm.
12 The term FCA – “at seller’s premises” puts the obligation of loading with the seller. This includes
stowage and trimming but not securing and lashing. The term EXW is delivery unloaded.
13 Incoterms 2000, ICC-Publication No. 560 (1999), p. 10.
14 Hachem in Schlechtriem/Schwenzer, Commentery (2016), Art. 67, paras 25, 26.
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It is a basic principle that risk of loss cannot pass until the goods in question are 20
identified and then the effect is ex nunc (“not… until”) and not retro-active.15 This is a
general concern throughout several rules in Chapter IV (see infra at Art. 69). The case
mentioned supra in the discussion of Article 66 about furniture to be bought by a
German buyer with an Austrian seller on call from a stock of goods held at his
disposition, could have been decided as an application of this principle – the court
explained that no contract had actually materialized, thus risk did not pass.16
Under the comparable Incoterms 2010, the wording is slightly different. In the 21
section describing the obligations of the parties, it explains that for delivery to be
performed the goods must be “clearly identified as the contract goods”. This requires
the same specification or individualisation and should not be different from the CISG.17
The difficulty in this regard is with bulk goods, such as transported in tanks, silo’s or 22
the hold of a ship, not being identified at time of shipment.18
3. Art. 67’s relationship with terms agreed by the parties

a) Agreed terms regarding risk. Under Art. 6, parties have freedom of contract and 23
they may deviate from the provisions of the CISG governing the passing of risk, or, for
that matter, any aspect of risk. A reference to trade terms, like the Incoterms, should not
be taken as an exclusion of the Convention, but only as a deviation on certain aspects of
the convention.19
The use of commercial terms for shipping is pervasive.20 Trade terms typically make 24
parties decide who will pay the price of transportation and handling (economic risk). In
the language of Art. 67, contracts including such a trade term generally “involve
carriage” in the contract, because they also make parties decide who provides carriage
and who pays for it. However, by employing a trade term parties typically (at least
partly) derogate from the CISG. They opt out of some aspects of the default rules on
passing of risk and, while involving carriage, they at the same time overrule the
application of Art. 67 (below). This makes the application of Art. 67 not straightfor-
ward; they rather limit its practical relevance.21
15 This was required under ULIS and described by Neumayer, in: Dölle Einheitliches Kaufrecht (1976),
pp. 657–659. For CISG see Piltz, Internationales Kaufrecht (2008), p. 229. And see Hachem in Schlech-
triem/Schwenzer, Commentary (2016), Art. 67, para. 35 – “thus resulting in splitting of the risk”, a point
much disputed in the Vienna Conference.
16 Oberlandesgericht Hamm (Germany) 23 June 1998 (Furniture), CISG-Online 434 (Pace); also
referred to in Magnus, in: Staudinger Kommentar (1994), Art. 69 para. 25.

17 Ramberg, To What Extent do Incoterms 2000 Vary Articles 67(2), 68 and 69 CISG?, 25 Journal of
Law and Commerce (2005) 220–221 (Pace), who explains the difficulty for bulk goods, where the bulk
needs to be broken for delivery of part of the goods.
18 Hachem in Schlechtriem/Schwenzer, Commentary (2016), Art. 67, paras 31–34: he plausibly argues
that in case part of a bulk shipment would get lost or damaged, notification of identification of the bulk is
necessary but is not sufficient for the seller to be relieved of risk; seller may not liberate himself by
performing pro rata or only vis-à-vis particular buyers of a part by freely allocating risk through posterior
identification of parts of the bulk; there is no “risk community” and a buyer retains his right on the basis
of contract if undamaged goods remain available in part – without losing out to another buyer of a part.
Hachem rightly concludes that seller must remain liable.
19 See Honnold/Flechtner, Uniform Law (2009), Art. 6 para. 76; UNCITRAL Digest of case law (2012),
p. 315 (No. 7) says parties often agree, “using trade terms… or by incorporating the standard terms or
the general business conditions of the seller or the buyer”.
20 There is broad agreement, but descriptions differ: see Kritzer/Butler, Roadmap to Incoterms (2000),
http://www.cisg.law.pace.edu/cisg/incoterms2000.html; Ziegel/Samson, Report to the Uniform Law Con-

ference of Canada on Convention on Contracts for the International Sale of Goods (1981), Art. 67 (Pace):
“in practice agreements will be made”.
21 Hachem in Schlechtriem/Schwenzer, Commentary (2016), Art. 67, para. 4.
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25 b) Interpretation of the trade terms used. The true content and significance of the
trade terms used in a particular sale, is not always clear. There are differences in the
definitions of the same trade term in the various sets of trade terms. Surely many
business people are not well aware of the precise meaning or legal content of such
terms, and are not familiar with the differences between them.22 On the positive side,
this leaves the business world the chance to develop terms freely and to adapt them to
changing needs. On the downside, parties’ true intentions in employing a trade term are
often not clear.
26 When the parties have used a trade term, therefore, an important problem of
interpretation arises for which we must look to Art. 8(3). This article provides that, in
determining the intent of the parties, all circumstances shall be considered, including
negotiations, practices between the parties, usages and any subsequent conduct of the
parties.
27 A clear contract term prevails over the rules of the CISG. When parties to a sales
agreement use a standard Incoterm, the exercise of their autonomy is both narrow and
clear. This calls for the full incorporation into the agreement of the definition of the
particular term as “codified” trade practice.
28 Where the parties have used a general trade term and have used it correctly,
interpretation may still be necessary. If parties have made unclear references or used
confusing terms, the applicable national law must be sought to fill in the gaps regarding
the terms of delivery and the passing of risk. The national law so applicable may look to
the Incoterms for guidance on the meaning of trade terms.
29 Art. 68 should be referred to for the separate rule for goods sold in transit, which also
requires a comparison with the use of Incoterms.
c) Incoterms and the CISG
30 aa) Incoterms in general. If parties consider carriage, they very often use Incoterms
or usages in shipping. Besides, the Incoterms which were promulgated by the ICC in
Paris have the support of the world business community. Other terms and rules relating
to passage of risk may be used for international sales, but they are usually local trade
usages in particular localities or in particular trades.23 This author suggests, however,
that if parties used letter-words such as the Incoterms, one must nowadays proceed
from the presumption that Incoterms should guide their interpretation.
31 Commercial partners have, in the past, been considered bound by an Incoterm even
when their contract did not expressly refer to any such term. This was because they had
regularly contracted under Incoterms in the past so that subsequently they would be
bound on the basis of Art. 9(1) to a usage they had formed between them.24 However, in
this author’s opinion, an Incoterm can in principle only be relied on when the parties
make a clear reference to it. Incoterms do require a contractual reference (with
exception of the usage between parties – just mentioned).25 We could only consider an
22 Perhaps the framers of ULIS and after them the UNCITRAL Commission that prepared the CISG
ought to have promulgated their own shipping terms; but that was not practicable, because trade terms
need to be adapted to trade practice. Moreover, the ICC was invited by the drafters of the ULIS to state
her opinion about including an interpretation of the trade terms CIF and FOB. The ICC asked not to
incorporate this matter because this interpretation could interfere with the interpretation provided by the
Incoterms.
23 There were other terms promoted by CMEA (1968/1976) and by the United Nations Economic
Commission for Europe. Particular terms exist for certain harbours and in certain sectors of trade.
24 Honnold/Flechtner, Uniform Law (2009), Art. 9(1) para. 115; Bonnel, in: Bianca/Bonell, Commentary
(1987), Art. 9 para. 3.5.

25 See also Schwenzer/Fountoulakis/Dimsey, International sales law (2012), p. 489 and Hachem in
Schlechtriem/Schwenzer, Commentary (2016), Art. 66, para. 13. Although in U.S. District Court, SD of
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Incoterm rule to be established as an international usages and thus as a usages that the
parties “ought to have known” absent their own reference to such term, if a specific
term were accepted by all in a particular trade or business-sector to always apply save
where alternate choice is stipulated.26
The UNCITRAL Digest (2016) illustrates that there is a need to know how the CISG 32
and Incoterms interact. It states that court decisions have found the terms ‘CIF’, ‘C&F’
and ‘list price ex works’ and the terms that have replaced them, ‘CFR’, ‘FOB’, ‘FOT’ and
‘FCA’ to be consistent with article 67(1), citing two cases (1992 and 1997), but nothing
more (at Art. 67, No. 3).
Incoterms import entire standardized terms into the contract by way of incorporation. 33
However, the acceptance of reference to such contract-based rules is neither complete nor
necessarily in full harmony with the provisions of law of the CISG. In this author’s
opinion, however, national courts and arbitration tribunals work well with this dichotomy
of applying a particular agreed term and applying the CISG in the margin. Agreed
Incoterms, for example, determine the place of physical “delivery” of the goods and of
the passing of the risk very clearly, but do not provide or indicate the law governing every
aspect of the contract of sale. Effectively, when in dispute, judges and arbitrators
determine the place and time of transfer, thereby applying the Incoterms and then they
proceed to complement and mitigate their application through interpretation under the
rules and theory of the CISG. Rules under the CISG pertaining to the alleviation of risk or
to the addition of remedies (including rules on compensation of damages) are then simply
applied from the CISG as the default set of (complementary) rules.
bb) EXW. We know two cases where the buyer incurred loss after the goods were 34
delivered at the seller’s premises, but they are applications of the CISG default delivery
mode of Art. 31, not with the explicit use of the Ex Works term.27 They give us no
guidance with the Incoterm.
In a 2006 decision of the Appellate Court Koblenz (Germany), the court found an 35
“Ex factory” term and then proceeded to reverse the risk by using the remedy of price
reduction.28
cc) FCA and FOB. The terms FCA and FOB are used often. As indicated supra, the 36
intention of the framers of the Incoterms, i. e. the ICC in Paris, was to align the FCA
Incoterm 2000 with the default rule under the CISG when transport is involved.
Although this intention is not repeated in the introduction of Incoterms 201029 the
FCA rule was not changed.
Texas, Houston Division (U.S.) 7 February 2006 (Explosive boosters), CISG-Online 1177 (Pace) the court
seems to have implied the application of the CIF term because the parties involved in the particular trade
must have known of this usage.
26 Several authors are – as this author – reluctant to conclude for application where parties remained
silent: Magnus, in: Staudinger Kommentar (2005), Art. 67 and Neumayer/Ming, Convention de Vienne
(1993), p. 120. However Dalhuizen, International Commercial, Financial and Trade Law (2000), p. 273
would go far in giving pre-eminence to the Incoterms. The example of a business sector where the usage
related to a certain Incoterm is generally accepted as established, seems to be the sale of petroleum:
Bridge, International Sale of Goods (2007), para. II. 50 and Erauw, in: Flechtner/Brand/Walter, Drafting
Contracts (2007), p. 387.
27 In Oberlandesgericht Schleswig-Holstein (Germany) 29 October 2002 (Stallion), CISG-Online 717
(Pace). In Landgericht Flensburg (Germany) 23 March 1999 (Meat), CISG-Online 719 (Pace) over meat
deteriorating in quality, delivery was at seller’s premises and the buyer suffered loss.
28 Oberlandesgericht Koblenz (Germany) 14 December 2006 (Sterile bottles), CISG-Online 1408 (Pace).
See commentary on Art. 66, No. 22.

29 The “introduction” of Incoterms 2010 is considerably shorter than the introduction of Incoterms
2000, in the hope that traders will actually read it.
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37 Under the Incoterm FOB delivery is described in section A4 and the risk passes at
delivery following sections A5 and B5. For FOB before Incoterms 2010, delivery was said
to occur in a symbolic way: at the moment when the railing of the ship is passed. A case
has been reported where the goods first shifted across the perpendicular of the railing and
then swayed back under the derrick and fell before the ship, giving “a spectacle of
liabilities”.30 This has been changed in FOB Incoterms 2010, where delivery occurs and
risk passes when the goods have been placed on board the vessel. The drafters did not use
the word loaded, because this would imply that seller must assure stowage and trimming
– which he need not. The FOB term, in effect, brings the risk for the completion of the
handling, with regard to the stowage on-board, including trimming, securing and lashing,
always to the buyer. If the customs of the port impose another point of delivery, these
customs will have priority over the FOB term in the Incoterms. Whereas for Incoterms
2000 this was – albeit vaguely – indicated in the introduction31, Incoterms 2010 now
incorporate the priority of port customs in the FOB rule.32
38 Ramberg, an authority on Incoterms, has indicated that loading operations in
harbours have changed, so that the FOB term is no longer appropriate for container
trade. The reason is, that it is the carrier who puts the container on board and not the
seller himself. Therefore risk passing would better occur when the seller hands over the
goods to the carrier. That is why the use of the term FCA is much more appropriate,
whereby the resulting risk-transfer is indeed identical to the situation under Art. 31(a)
in conjunction with Art. 67(1).33
39 In a case where caviar was imported into Hungary from Yugoslavia, the term for
delivery was “FOB Kladovo” (being the seller’s city), and the risk regarding the import
declaration and customs applying a newly imposed UN embargo was placed with the
buyer. This is correct, because obtaining the import licence is an obligation of the buyer
under the Incoterms.34 An FOB term was sanctioned in the case of pollution of goods
(white conundrum) by wind and water on route from China to Japan, after they had
been brought on-board – which was trouble for the buyer.35
40 dd) CFR or CPT. In a case for the sale of 2000 tonnes of bitumen from a Swiss seller
to a Brazilian buyer and to be delivered from Singapore to Kenya by a Greek ship under
30 25 In the words of (the later Lord) Devlin J in Pyrene & Co v Scindia Steam Navigation Co. [1954] 2
QB 402 (419); reported by Zeller, Is the Ship’s Rail Really Significant?, Nordic Journal of Commercial Law
(2005) 2 (5) and cited by Malfliet, The relation between CISG and Incoterms, Gent University Master’s
thesis: (2009 unpublished), p. 86.
31 Incoterms 2000, Paris, ICC Publication 560, 1999, 20: “To some extent it is therefore necessary to
refer to the custom of the port […]”.

32 Incoterms 2010, Paris, ICC Publication 715E, 2010, 88. A5: “Transfer of risks” refers to A4
“Delivery” which reads “In either case, the seller must deliver the goods […] in the manner customary
at the port.”
33 Ramberg, To What Extent do Incoterms 2000 Vary Articles 67(2), 68 and 69 CISG?, 25 Journal of
Law and Commerce (2005) 219 (Pace): “While, traditionally, maritime transport required the seller
(shipper) to deliver the goods to the ship, the use of so-called cellular vessels receiving goods stowed in
containers implies delivery of the goods to the carrier rather than to the ship. In practice, the goods are
either received at so-called container freight stations (CFS) or container yards (CY) for subsequent
loading of the containers on-board the ship. Hence, the traditional terms FOB, CFR and CIF, where the
goods are to be placed on-board and the risk passes when the goods pass the ship’s rail, became
inappropriate in such traffic. FCA is now available for use instead of FOB, while CPT and CIP could be
used in place of CFR and CIF. As has been said, CPT and CIP conform with the principle of handing over
the goods to the first carrier adopted in CISG Article 31(a).”
34 Arbitral Award, Arbitration Court of the Hungarian Chamber of Commerce and Industry, 10 De-
cember 1996 (Caviar stock), CISG-Online 774 (Pace).

35 High People’s Court Ningxia Autonomous Region (China) 27 November 2002 (White conundrum),
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a flag of commodity and a non-insured one-ship-company, the term was “C and F
(Incoterm 1990)”, the CFR term.36 Many warnings about stocking the heavy tar-
containers were given, but the ship hit high seas and a large part of the stacked-up
drums fell over, bent and tore and spilled the sticky tar. This term lets the seller
organize the transport (no liability in choosing was imposed) and puts the delivery at
the boat’s rail, leaving risk for the stowing and the subsequent sea journey to the buyer.
(We have indicated supra, that the insurer substituting for the buyer could not prove a
breach by the seller to mitigate the buyer’s risk.)
The CPT-term of Incoterms 2010 was used for delivery of fluid chemicals from The 41
Netherlands to Germany (Carriage Paid To Kreuzlingen) in which case the buyer was
informed late that contamination had taken place with biodiesel. This had occurred
during storage with an agent for seller in Holland, before delivery, and thus risk was on
the side of seller.37
A contract for the delivery of mushrooms from Germany to Argentina, under CFR 42
(costo y frete) made an express deviation to that rule, stating that the seller was liable to
maintain the intrinsic qualities of conditions suitable for consumption. Still the buyer
ended up carrying the risk, because he could not prove that the deterioration took place
during that long trip and not afterwards when other handling took place.38
ee) CIF or CIP. In a CIETAC arbitration39, the parties to a sale that went under the 43
term “CIF New York” had an exchange over precautionary measures the seller of
jasmine aldehyde from China needed to take, i. e. to keep the temperature of the stored
goods low enough while lying in port during transport to New York. The seller took
insufficient care to assure direct transport and during the vessel’s stop-over excessive
heat accumulated causing leakage of the goods. The tribunal found that notwithstanding
the CIF clause that lets risk pass when goods cross the ship’s railing (as with FOB)40, the
parties entered into a separate contractual agreement on the point of caring for the
temperature risk. The tribunal made the seller responsible for the damage according to
Art. 66 because there was a separate party agreement. In this author’s opinion, even
though the reference was to that agreement, the court could have considered applying
the last phrase of Art. 66: “due to an (…) omission of the seller”.
A U.S. District Court looked at comparable facts, also under a CIF term, about a 44
shipment of ignition boosters where particularly detailed conditions of packaging,
stacking and transportation had been requested. When the badly stacked and poorly
stowed load caved in, the court decided differently, i. e. against the buyer. Risk had
passed at the ship’s railing and CIF prevailed, so payment was due, considering there
was an insurer and as the seller had not personally been held to ensure the compliance
with the guidelines that were given.41
36
Tribunal Cantonal de Vaud (Switzerland) 26 May 2000 (Tar in drums), CISG-Online 1840 (Pace).
37
District Court Rotterdam (Netherlands) 1 October 2014 (Chemicals), CISG-Online 2558 (Pace). The
court spoke simultaneously of a breach of conformity under Arts 35 and 36.
38 Cámara Nacional de Apelaciones en la Comercial (Argentina) 31 October 1995 (Mushrooms), CISG-
Online 299 (Pace). See the disputed leakage of PVC suspension resin on its way from U.S. to China in:
Arbitral Award, CIETAC CISG/1999/20, 7 April 1999 (PVC Suspension resin), CISG-Online 1244 (Pace)
where the Incoterm was CFR and the risk in transport was on the buyer.
39 Arbitral Award, CIETAC, 23 February 1995 (Jasmine aldehyde), CISG-Online 568 (Pace); same
Arbitral Award, CIETAC, 23 February 1995, CISG-Online 971 (Pace) where the product is also called
piperonal aldehyde or pepper propanal.
40 In Incoterms 2010, this criterion has been changed to “placing on board”.
41 U.S. District Court, SD of Texas, Houston Division (U.S.) 7 February 2006 (Explosive boosters),
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45 ff) DDP. To “place the goods at the disposal” of buyer under the terms DDP and
DAP it is sufficient when the goods are ready for unloading; at buyer’s risk.42
46 Two cases are posted on CISG-Online with a complication around the Incoterm
DDP43 – both about deliveries of salmon from a Norwegian seller to a German buyer
under the obligation to deliver at buyer’s address (DDP). The seller knew that the
salmon was intended to be smoked in Denmark so he delivered directly to the company
doing the fish-smoking. This company declared bankruptcy, thereby causing loss. The
appeals court found the change of delivery address was made under agreement from
previous deliveries and this had been accepted by the buyer (there was no breach) –
thus the risk had passed.
III. Comparable rules

47 Neither the PICC nor the PECL contain provisions in relation to the passing of risk.
42 Hachem in Schlechtriem/Schwenzer, Commentary (2016), Art. 67, para. 21, which is distinct from
the terms of the C-group where the loading of the goods must be completed by seller.
43 Oberlandesgericht Oldenburg (Germany) 8 September 1998 (Raw salmon), CISG-Online 1887 (Pace)
and Oberlandesgericht Oldenburg (Germany) 22 September 1998 (Raw salmon), CISG-Online 508 (Pace).
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Article 68
The risk in respect of goods sold in transit passes to the buyer from the time of the
conclusion of the contract. However, if the circumstances so indicate, the risk is
assumed by the buyer from the time the goods were handed over to the carrier who
issued the documents embodying the contract of carriage. Nevertheless, if at the time
of the conclusion of the contract of sale the seller knew or ought to have known that
the goods had been lost or damaged and did not disclose this to the buyer, the loss or
damage is at the risk of the seller.
Bibliography: Bridge, The Transfer of Risk under the UN Sales Convention 1980 (CISG), FS Kritzer (2008),
p. 77.
Outline
1. Terminology. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2. Carrier and documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
3. Retroactive allocation of risk. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
4. Loss or damage to the goods. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Art. 68 states the general rule to be applied when goods are sold afloat. In these 1
situations risk passes at the time of conclusion of the contract. However, an exception
exists ‘if the circumstance so indicate’ that provides that the risk shall pass ‘retro-
spectively’ from the time the goods were handed over to the carrier. Art. 68 continues
by providing that the risk remains with the seller if at the conclusion of the contract the
seller knew or ought to have known that loss or damage had already occurred to the
goods and this fact was not disclosed to the buyer.

1. Terminology
Examination must be given to the basic terminology used within the article. As 2
specified in Art. 7, “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”, as such
terms such as ‘sold’ and ‘goods’ should not be interpreted within domestic guidelines.
Instead, the terminology that may have a particular domestic meaning should be
considered within the international framework. Consequently, ‘sold’ should not be
interpreted to imply the passing of property,1 nor should ‘goods’ be interpreted to include
anything other than the traditional understanding of international sales in which goods
can be identified before or after the risk transfers to the buyer.2
1 See Bridge, The Transfer of Risk under the UN Sales Convention 1980 (CISG), FS Kritzer (2008),
p. 77 (p. 95).
2 See id at 95.
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2. Carrier and documents

3 Under the second sentence of Art. 68, the risk is borne by the buyer “from the time the
goods were handed over to the carrier who issued the documents embodying the contract
of carriage.” It must be noted that there is no reference, as in Art. 67(1), to “documents
controlling the disposition of the goods.”3 Instead it is sufficient that the documents prove
the existence of the contract of carriage. Absent such documents, the rule does not apply.
If the transport involves a chain of carriers, as is the case with multimodal transport, it is
the handing over to the carrier who issued the documents in question that is relevant.4
3. Retroactive allocation of risk

4 The second sentence of Art. 68 concerns the retroactive allocation of risk that occurs
‘if the circumstances so indicate’. The language of Art. 68 has been criticized specifically
in relation to the allocation of risk in international sales.5 This has occurred simply from
the phrase ‘if the circumstances so indicate’ as the language does little to assist the
determination of when circumstances indicate the parties desire a different risk alloca-
tion than that found in the general rule. Moreover, while CIF contracts traditionally
include retroactive risk allocation6 because of the transferability of insurance that
traditionally contains detailed provisions specific to the risk allocation,7 this is not
necessarily the case in contracts that contain an FOB designation as the insurance is
often not transferable.8 Consequently, the “transfer of the insurance policy implies that
the buyer takes over responsibility for the entire shipment, including unknown transit
damage that occurred before the sale.”9
4. Loss or damage to the goods

5 Art. 68 has been criticized as the article fails to provide clear resolution on some of the
more common issues within international transport. For example, Art. 68 is clear in
resolving issues that arise when the seller knows or should have known of the loss or
damage to the goods prior to the conclusion of the contract. In these situations, risk
remains with the seller if he has failed to disclose this information to the buyer.10
However, the resolution is far from clear in situations where the seller becomes aware of
the loss or damage to the goods after the contract has been concluded but before the
3 This omission was a deliberate on the part of the drafters. See Schlechtriem, Uniform Sales Law – The
UN-Convention on Contracts for the International Sales of Goods (1986) (Pace). As such, it is irrelevant
that documents are negotiable instruments or otherwise allow for the goods to be disposed of upon
receipt of the documents. Instead, the contract fro carriage – without additional documents, is all that is
needed.
4 See Hager, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 68 para. 4 a.
5 For example, see Hager, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 68 para. 8.
6 But note that a Chinese tribunal did not backdate the risk in a case involving a CIF sale of fishmeal,
where the contract was concluded some 12 days after the goods were loaded on board the ship; however,
one should note it is not clear from the translation that the Incoterms were incorporated: Arbitral Award,
CIETAC, 1 April 1997 (Pace).
7 See Honnold, Uniform Law (1982), p. 372; von Hoffmann, Passing of Risk in International Sales, in:
Sarcevic/Volken (eds), International Sale of Goods (1986), p. 265 (p. 294).

p. 77 (p. 96).
9 See Honnold, Risk of Loss, in: Galston/Smit (eds), International Sales: The United Nations Conven-
tion on Contracts for the International Sale of Goods (1984), Ch. 8 paras 1–15.
10 Art. 68: “Nevertheless, if at the time of the conclusion of the contract of sale the seller knew or ought
to have known that the goods had been lost or damaged and did not disclose this to the buyer, the loss or
damage is at the risk of the seller.”
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goods are appropriated to the contract. In these situations, Art. 68 and corresponding
articles are silent concerning the use of retrospective risk allocation. Some commentators
argue the phrase ‘if the circumstances so indicate’ can be extended to resolve this issue,
however, it is reasonably clear that the drafters did not intend such an extension.11 As
such, commentators are split as to the ability of a seller to appropriate goods that have
been lost or damaged where the seller ‘knows or should know’ of the loss.
Bridge argues that “even the knowing seller should be allowed in CIF contracts to 6
appropriate the goods after the loss has occurred.”12 He makes this argument asserting a
practical approach, stating “if the seller were not allowed to appropriate and thus
transfer the risk to a particular buyer, that seller, depending upon the relevant law,
might be exposed to a damages action for non-delivery by the buyer.”13 Of course, this
is correct law and is most likely the correct interpretation if one bases the primary
argument on a practical and economic understanding in the international commercial
world. As traders participating in this industry consider the buying and selling of cargo
as a financial contract and not really from a contract that results in obtaining goods.
While this is the generally the accepted approach, which has gained a slight majority of
support, it is also clear from the Legislative History that alternative views exist which are
followed in some regions of the world.14
Controversy also surrounds the terminology and phrasing within the last sentence of 7
Art. 68 stating, if the seller fails to disclose the loss or damage “the loss or damage is at
the risk of the seller.” This phrasing could be interpreted as the seller bearing only the
loss or damage it failed to disclose. However, the full extent of the seller’s exposure in
these situations remains unclear. Some authorities argue that when the seller fails to
disclose loss or damage that had occurred before the making of the contract the seller
would be liable not only for the loss or damage that the seller knew or should have
known but also for all subsequent damage “which is causally connected with the
original damage”15 In contrast, Honnold “supports holding transit loss on the seller
but is doubtful about the basis and advisability of a ‘causally connected’ limitation.” At
present the majority opinion leans toward the phrase encompassing only the damage
that the seller knew or ought to have known about, by the time of the conclusion of the
contract16 without extension into the causally connect realm. However, one could easily
think of situations in which the seller should also bear the risk of subsequent loss or
damage directly connected to the original damage.
One should note, Art. 68 should not be interpreted to supplant domestic law into the 8
provisions of the CISG by creating situations in which the sale of a non-existent or no-
longer-existent good is void.17 Under Art. 68, it remains possible for the sale to be valid
even though the goods had already been destroyed at the time the contract was
11 Schlechtriem, Uniform Sales Law – The UN-Convention on Contracts for the International Sales of
Goods (1986) (Pace). For the complete discussion, see Legislative History, Summary Records of Meetings
of the First Committee, 32nd Meeting 1 April 1980 (Pace).
12 Bridge, The Transfer of Risk under the UN Sales Convention 1980 (CISG), FS Kritzer (2008), p. 77
(96). In contrast, see Schlechtriem/Schwenzer, Commentary (2016), Art. 68 para. 20.

13 Id.
14 See Garro, Reconciliation of Legal Traditions in the U. N. Convention on Contracts for the
International Sale of Goods, 23 International Lawyer (1989) 443–483.

15 Nicholas, in: Bianca/Bonell, Commentary (1987), Art. 68 para. 2.3.
16 Hager bases his approach on the different wording of the Draft Convention and to the linkage
between the second and third sentences of Art. 68. See Hager, in: Schlechtriem/Schwenzer, Commentary
(2016), Art. 68 para. 5.
17 An Indian proposal to consider invalidity under a domestic law did not receive support. See A/Conf.
97/SR.32 at 6–7 § 38–41, Official Records, p. 404. For further discussion, see Schlechtriem, Uniform Sales
Law – The UN-Convention on Contracts for the International Sales of Goods (1986) (Pace) at 496–501.
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concluded. Art. 68 presupposes that a valid contract may be formed in this situation as
it fails to void the contract but instead leaves the risk with the seller.
9 Finally, one should consider the practical situation that exists in the international
community and with the use of Incoterms. Art. 68 provides the general rule that risk
passes when the contract is concluded. However, this general rule is likely to be
displaced in many instances as the parties will have elected to include the Incoterms18
and as such the circumstances of the case will call for the general rules displacement.19
10 One should note the derogation from the articles of the CISG is permissible within
the CISG.20 Under Art. 6 the parties may “derogate from or vary the effect of any
[Convention] provisions.”21 In fact “a very large percentage of such contracts contain
trade terms (CIF, C&F, FOB, FAS, CPT, CIP, etc.) clearly designed to regulate the
passing of risk”22 and thereby displace the otherwise applicable law. In these situations,
as expressly stipulated in Incoterms 2010, under FOB, CIF and CFR contracts, the risk
passes when the goods pass the ship’s rail at the port of shipment.23

11 The PICC contain no provisions in relation to passing of risk. The PECL contain no
provisions in relation to passing of risk. This is not necessarily surprising, as von Bar
and Drobnig point out the passing of risk is “genuinely a contract issue” which is
“usually dealt with by agreement of the parties.”24 However, one should note this is not
necessarily the case in relation to consumers.25 The Directive on Consumer Rights
contains of provision which specifies that the place and the “rules concerning the
determination of the conditions for the transfer of the ownership of the goods and the
moment at which such transfer takes place” should remain subject to national law as
such the Directive has no impact upon the determination.26
18 For a further discussion of the Incoterms, see Gabriel, Contracts for the Sale of Goods: A
Comparison of US and International Law (2009) pp. 297–325.

19 “[W]here the parties have agreed no trade terms at all, the regulation under the CISG will apply. But
these cases are rare.” Enderlein/Maskow, International Sales Law (1992), p. 257.
20 See Lookofsky, The United Nations Convention on Contracts for the International Sales of Goods, in:
Blanpain (ed.), Encyclopaedia of Laws (1993), p. 112.

21 Art. 6.
22 Lookofsky, The United Nations Convention on Contracts for the International Sales of Goods, in:
Blanpain (ed.), Encyclopaedia of Laws (1993), p. 112.

23 See Incoterms 2010. See also for discussion on the previous version of Incoterms (containing similar
provisions): Ramberg, ICC Guide to Incoterms 2000: Understanding and Practical Use (1999), p. 16.
24 von Bar/Drobnig, The Interaction of Contract Law and Tort and Property Law in Europe: A
Comparative Study (2004), pp. 329–330.

25 EC Directive on Consumer Rights, Art. 23 Passing of risk:
“1. The risk of loss of or damage to the goods shall pass to the consumer when he or a third party, other
than the carrier and indicated by the consumer has acquired the material possession of the goods.
2. The risk referred to in paragraph 1 shall pass to the consumer at the time of delivery as agreed by the
parties, if the consumer or a third party, other than the carrier and indicated by the consumer has
failed to take reasonable steps to acquire the material possession of the goods.”
European Commission, The Proposal for a Directive on Consumer Rights, EUROPA, (Oct 2008).
26 Directive 2011/83/EU of the European Parliament and of the Council of 25 October 2011 on
consumer rights, amending Council Directive 93/13/EEC and Directive 1999/44/EC of the European
Parliament and of the Council and repealing Council Directive 85/577/EEC and Directive 97/7/EC of the
European Parliament and of the Council, para 38.
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Article 69
(1) In cases not within articles 67 and 68, the risk passes to the buyer when he takes
over the goods or, if he does not do so in due time, from the time when the goods are
placed at his disposal and he commits a breach of contract by failing to take delivery.
(2) However, if the buyer is bound to take over the goods at a place other than a
place of business of the seller, the risk passes when delivery is due and the buyer is
aware of the fact that the goods are placed at his disposal at that place.
(3) If the contract relates to goods not then identified, the goods are considered not
to be placed at the disposal of the buyer until they are clearly identified to the contract.
Bibliography: Bridge, The Transfer of Risk under the UN Sales Convention 1980 (CISG), FS Kritzer
(2008), p. 77; Ramberg, To What Extent do Incoterms 2000 Vary Articles 67(2), 68 and 69?, 25 Journal of
Law and Commerce (2005–2006) 219.
Outline
II. Commentary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1. Goods placed at buyer’s disposal – at the seller’s place of business . . . . . . . 2
2. Goods placed at buyer’s disposal – other than at the seller’s place of
business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
3. Identification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
4. Incoterms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

In the situation that neither Arts 67 nor 68 applies to the case at hand, Art. 69 1
provides the residual rules on risk of loss.1 Art. 69 provides the basic rule that the risk is
on the buyer from the moment he takes over the goods or when he commits a breach of
contract in not taking delivery of the goods that have been placed at his disposal.2 Of
course, goods are only considered to be placed at the buyer’s disposal after they have
been identified to the contract.3 In addition to these basic residual rules, a special rule
applies to situations in which the buyer is bound to take over the goods at a place other
than the seller’s place of business. In situations such as this, risk is transferred when
delivery is due and the buyer is aware that the goods have been placed at his disposal.4
Consequently, Art. 69 can be divided into two separate considerations, cases where the
good are handed over at the seller’s place of business (Art. 69(1)), and cases in which
the goods are to be handed over somewhere else (Art. 69(2)).
1 Although some commentators have read Art. 69 as being limited to domestic sales and thereby find it
of limited use, it is clear from the language of Art. 69 that the sale of goods can be an international one
under the CISG even when the goods never cross national boundaries. This is of course, because of the
practical possibility of the buyer and seller’s place of business being located in different states, while the
seller secured warehouse space or otherwise has a branch in the same state as the buyer. See Bridge, The
Transfer of Risk under the UN Sales Convention 1980 (CISG), FS Kritzer (2008), p. 77 (p. 97). This of
course refers to the applicable law questions raised in Art. 1.
2 Art. 69(1).
3 Art. 69(3).
4 Art. 69(2).
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II. Commentary
1. Goods placed at buyer’s disposal – at the seller’s place of business
2 According to Art. 69(1), when the goods are to be delivered at the seller’s place of
business, the buyer undertakes risk of loss from the moment he takes over the goods or
when he commits a breach of contract in not taking delivery of goods that have been
placed at his disposal. The primary issue within Art. 69 is the requirements that needs
to be satisfied to ‘place the goods at the buyer’s disposal.’ Unfortunately, Art. 69 is silent
on the issue;5 however, what is clear is that the drafters did not intend to impose a
notice obligation on the seller. Instead, the standard seems to be merely the buyer’s
awareness of the goods being ready for collection.6
3 Of course, several issues can arise in ‘taking over the goods.’ If delivery is to take
place on a specific date and the buyer takes over the goods on that date, the risk passes
when the goods are actually accepted.7 In addition, and equally simplistic is the
situation where the buyer takes over the goods before the agreed date of delivery. In
this situation, the risk passes to the buyer when he takes over the goods.8 Art. 69(1) also
adopts the reasonably pragmatic approach to situations where the seller is incapable of
delivering the goods on the contractually specified date. In this situation the risk
remains with the seller until the buyer takes over the goods.9
4 Complications arise when the seller has placed the goods at the disposal of the buyer
but the buyer has failed to take over the goods. At the point in time that the buyer is
aware of the goods readiness, the question becomes how much time the buyer has
before the buyer is in breach of contract. In the absence of specific time provisions in
the contract, the standard seems to be that of a reasonable time. However, this is not
expressly contained within the language of the articles; instead it must be inferred from
the seller’s obligation to deliver within a reasonable time.10 One should note, this is not
intended to imply that the ‘reasonable time’ shall be the same for both parties. Instead it
stands to reason that ‘reasonable time’ will depend upon the nature of the goods and the
circumstances of the case.
5 Case law is also relatively quiet. See Appellate Court Köln (Germany) 9 July 1997 (Video camera case),
CISG-Online 495 (Pace) drawing a distinction between Art. 67 – risk passes when handed over to first
carrier – and Art. 69 – buyer takes over goods; District Court Arnhem (Netherlands) 17 July 1997,
Kunsthaus Math. Lempertz v Wilhelmina van der Geld, CISG-Online 548 (Pace), holding that if buyer is
to collect goods at seller’s place, risk passes when buyer takes goods; Appellate Court Oldenburg
(Germany) 22 September 1998 (Raw salmon case), CISG-Online 1306 (Pace) holding that the passage of
risk when the buyer takes over the goods at place other than seller’s place of business- processing plant;
Lookofsky/Henschel, Comments on Issues Relating to the Passing of Risk (2004) (Pace) commenting on
Randers County Court (Denmark) 8 July 2004 (Mobile grain dryer case), CISG-Online 2152 (Pace)
holding that risk passes when delivery is due and the buyer is aware of the fact that the goods are placed
at his disposal at that place- such as assisting in the unloading of the good; Appellate Court Schleswig-
Holstein (Germany) 29 October 2002 (Stallion case), CISG-Online 717 (Pace) the passage of risk when
the buyer is to collect goods at seller’s place: risk passes when the buyer takes the goods, despite the fact
that the buyer elected to use a carrier; Oberlandesgericht Linz (Austria) 23 January 2006 (Auto case),
CISG-Online 1377 (Pace) risk passes to the buyer when he takes over the goods.
6 Bridge, The Transfer of Risk under the UN Sales Convention 1980 (CISG), FS Kritzer (2008), p. 77
(p. 99).
7 See Sevon, Passing of Risk, Presentation of Schweizerisches Institut für Rechtsvergleichung ed.,
Wiener Übereinkommen von 1980, Lausanner Kolloquium 1984 (1985), pp. 191–206, 203–204 (Pace).
8 See id at 204.
9 See id.
p. 77 (p. 99).
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Moreover, the final phrase within Art. 69(1) should be read to limit the provision to 5
cases in which the buyer has delayed taking delivery. But one should not take a
restricted view of this issue. Instead it is clear from the drafting committee that the
provision should include “those situations in which the goods could not be delivered
because of other breaches of the contract by the buyer, such as when the buyer has not
obtained a required import license in a timely fashion.”11
2. Goods placed at buyer’s disposal – other than at the seller’s place of

business
Art. 69(2) makes clear that where delivery is not at the seller’s premises, risk is 6
transferred to the buyer when delivery is due and the buyer is made aware that the
goods are at his disposal in a place other than the seller’s place of business. Of course,
this is most likely to occur in situations where the goods are left in the hands of a third
party, such as a warehouse or similar location. In situations such as this, placing the
goods at the buyer’s disposal must also mean that the seller has done all that is
necessary for the buyer to take possession.12 Certainly this must mean the buyer is
entitled to withdraw the goods from the control of the third party. However, one should
not confuse this requirement with the requirement to deliver documents. Of course, it is
possible in some situations for the goods to be placed at the buyer’s disposal without the
need for documents. In some situations it is possible for the seller to provide instruc-
tions for the bailee to hold the goods for the buyer.13
3. Identification
Art. 69(3) requires that goods be “clearly identified to the contract” before risk can 7
pass to the buyer. Like Art. 67, Art. 69 presupposes identification of the goods. As such,
the goods are first considered to be placed at the disposal of the buyer when such
identification takes place: by marking, notice, etc.14 Of course, the identification must be
in line with the seller’s rights and obligations under the contract.
4. Incoterms
The most obvious differences between the CISG and Incoterms relate to Art. 69. 8
Incoterms 2010 specify that risk passes as soon as the goods have been made available to
the buyer at the delivery point.15 This is true without any further limitations and/or
requirements, such as the buyer committing a “breach of contract by failing to take
delivery.”16 Moreover, under the Incoterms, the seller has the duty to notify the buyer
that the goods are available for him or that they have been delivered.17 In situations
11 Schlechtriem, Uniform Sales Law – The UN-Convention on Contracts for the International Sales of
Goods (1986), p. 90 (Pace).

12 See Secretariat Commentary on 1978 Draft, Art. 81 (now Art. 69) para. 7.
13 See id. para. 8.
14 A similar provision in exists in Arts 67(2) and 67(3).
15 For example, in EXW and the D-terms (DAT, DAP and DDP). See also (for a discussion of the prior
Incoterms 2000) Ramberg, To What Extent do Incoterms 2000 Vary Articles 67(2), 68 and 69?, 25 Journal
of Law and Commerce (2005–06) 219 (221).
16 Art. 69.
17 For a discussion of the prior version of Incoterms 2000 (which contained similar provisions) see
Incoterms 2000: ICC Official Rules For The Interpretation of Trade Terms (1999) Clause A7; see also
Ramberg, To What Extent do Incoterms 2000 Vary Articles 67(2), 68 and 69?, 25 Journal of Law and
Commerce (2005–06) 219–222.
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Article 69 9 Part III. Sale of Goods
such as this, the seller’s failure to notify the buyer would constitute a breach of contract,
entitling the buyer to the remedies for breach of contract under the CISG.18

9 The PICC and PECL contain no provisions in relation to passing of risk.
18 See Art. 74.
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Article 70
If the seller has committed a fundamental breach of contract, articles 67, 68 and 69
do not impair the remedies available to the buyer on account of the breach.
Bibliography: Bridge, The Transfer of Risk under the UN Sales Convention 1980 (CISG), FS Kritzer
(2008), p. 77; CISG-AC Opinion no 9, Consequences of Avoidance of the Contract, 15 November 2008.
Rapporteur: Professor Michael Bridge, London School of Economics, London, United Kingdom (at http://
www.cisg-ac.org).
Outline

At its most basic, Art. 70 provides that the risk transfer rules in Arts 67–69 do not 1
impair the remedies available to a buyer against a seller who has committed a
fundamental breach of contract. The seller is not rescued from the consequences of his
fundamental breach by the pure coincidence that damage to the goods occurred.1
In general, this means the buyer is entitled to pursue the following remedies because 2
of the seller’s fundamental breach of contract: the right to declare the contract avoided,2
to require delivery of substitute goods,3 to require repair of the goods where this is not
unreasonable,4 to reduce the price5 and to claim damages.6
In relation to these remedies, Art. 70 is significant in that it allows the buyer to insist 3
on the delivery of substitute goods under Arts 46 or 47 or to declare the contract
avoided under Art. 49(1)(a) or (b) even though the goods have been lost or damaged
after the passage of the risk of loss under Arts 67, 68 or 69.
The Pace website in 2016 already indicates three decisions (from a Finnish court in 4
1997, Chinese arbitration in 2003 and French Appeals Court in 2013) relating to
Art. 70, but this author finds none of them apply it; CISG-Online rightly does not refer
to them.
The UNCITRAL Digest (2012) does not show any application in court practice. For 5
Art. 70 to apply we must presume the buyer suffers loss through an occurrence after the
legal delivery and also is frustrated because the seller has committed a fundamental
breach. In this author’s opinion, the application of Art. 70 is, in those rare cases, ousted
by the buyers’ use of an adequate remedy – that is unless Art. 82 prohibited the use of a
remedy – which imposes the return of the goods back to the seller. In an instance where
the buyer applies a remedy, the seller might, however, rebut that the returned goods
show defects. In such a case he is better to rely on Art. 82 for his purpose, because this
puts a burden on the buyer to show he is not at fault, rather than on Art. 70, which does
1 Hachem, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 66 para. 21 and Art. 70, para. 2.
2 See Art. 49(1)(a).
3 See Art. 46(2).
4 See Art. 46(3).
5 See Art. 50.
6 See Arts 74 et seq.
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not address the seller. This may be why we see no applications: for the buyer it only
states the evident fact that remedies are there and the seller takes punishment for a
serious breach and perhaps seeks mitigation for goods diminished in value through
other channels.

6 One should note the article specifically limits its applications to breaches that are
fundamental in nature. As such, it has been argued that the article does not apply in
situations where the buyer has attached an additional period of time for the seller to
perform.7 Of course, this is correct as the seller’s inability to perform within the
‘additional period of time’ gives rise to the aggrieved party being able to avoid the
contract, but the text does not technically classify this as a fundamental breach.8 In the
situation where a breach occurs that is not fundamental in nature, the general rules on
passage of risk will apply. In most instances this will leave the risk of loss or damage to
be borne by the buyer. Of course, the seller is responsible for a “lack of conformity
which exists at the time when risk passes to the buyer.”9
7 According to the Secretariat Commentary, “[i]n essence, article 70 provides that
where goods are damaged while in storage or transit and the buyer bears the risk of such
damage, the buyer may, nevertheless, avoid the contract if, prior to such damage, there
was a deficiency in the goods sufficiently serious to amount to a fundamental breach of
contract. In this situation, ‘the sense of the words used in article 70 is … that the risk’s
having passed to the buyer under article 67, 68 or 69 is no obstacle to its being
retrospectively passed back by the remedy of avoidance’ (Nicholas, Bianca-Bonell
Commentary, Guiffrè: Milan (1987), p. 510.). However, where the prior deficiency was
not so serious as to amount to a fundamental breach of contract, the buyer cannot shift
back responsibility for damage while in storage or transit by avoiding the contract.”10
8 The main area of concern in relation to Art. 70 has to do with the consequences of
this article in light of Art. 82. This is because Art. 82 limits the buyer’s ability to avoid
the contract to situations in which the buyer can make restitution of the goods in
substantially the same condition in which he received them. Of course there are
exceptions to the general rule, the most important in this instance is when restitution
is impossible and not due to the buyers act or omission.11 In this instance the buyer is
excused from restituting the goods. Reading Art. 70 in combination with Art. 82 makes
commentators argue that the risk reverts back to the seller.12 However, when does this
reversion of risk occur? Bridge, looking at the case where the buyer avoided the sale,
7 Michael Bridge writes: “The CISG … treats avoidance in such circumstances (additional period of
time) as a separate case from fundamental breach, though it may be that in some circumstances the
seller’s lateness will also amount to a fundamental breach.” See Bridge, The Transfer of Risk under the
UN Sales Convention 1980 (CISG), FS Kritzer (2008), pp. 77–105 (103). See also Art. 49(1).
8 Art. 49.
9 Art. 36(1).
10 Secretariat Commentary on 1978 Draft, Art. 82 (now Art. 70) cited by Nicholas, in: Bianca/Bonell,
Commentary (1987), Art. 70 para. 2.3. Schwenzer/Fountoulakis/Dimsey, International sales law (2012),
p. 505 say the effect is: “risk passes retroactively to the seller where the buyer resorted to the remedies of
avoidance or has claimed substitute goods”, clarifying this “does not deal with damage to goods which is
caused by the seller’s breach of contract, solely with accidental losses or damages that occur in spite of a
fundamental breach of contract”.
11 See Art. 82(2)(a).
12 See CISG-AC Opinion no 9, para. 3.18 footnote 57: “Article 70 in substance would leave the risk with
the seller where the seller commits a fundamental breach of the contract.”
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asserts that the risk of loss is on the seller and states “it does not matter whether it
always was or whether it was transferred back to the seller”.13
When the buyer holds goods in his possession while waiting for substitute goods or 9
after avoiding the contract, the buyer does not bear the risk, but does have an obligation
to preserve the goods pursuant to Arts 86–88. The risk would also logically not pass to a
buyer to whom the seller has communicated that he will remedy a non-conforming
delivery of documents or goods that were tendered before the date of maturity.14
In the situation of avoidance, the effect of the avoidance is to place the “transit risk 10
on seller.” For another remedy, in case the buyer has requested substitute goods, the risk
reverts to the seller for the goods he must replace.
It is important to note that the effect of Art. 70 is not confined to reversing the 11
incidence of risk in respect of damage or loss while the goods are in transit. Nicholas
argues that the seller’s risk may extend to damage or loss occurring after the buyer has
received the goods. Of course, he makes this assertion based on a partial delivery of
goods amounting to a fundamental breach of contract.15 In the situation where the non-
conforming goods are damaged or lost, even while in the possession of the buyer, as
long as the non-conformity amounts to a fundamental breach, the buyer is entitled to
avoid the contract.16 Provided the loss or damage was not the fault of the buyer, the risk
will revert to the seller.
The buyer must, of course, have assured that he has the benefit of calling on 12
remedies, through timely notice of the breach under Art. 39.17 That being so, it is useful
to state that the buyer gets the option to eventually accept delivery or retain possession
of the goods that are doubly defective (i. e. not in conformity plus damaged by another
cause) and opt to apply another remedy such as requesting compensation of damages.
In addition, partial avoidance is possible when the requirements of Art. 51 have been 13
satisfied. As such, partial avoidance of the contract will allow the aggrieved party to
declare avoidance in relation to the portion of the shipment in non-conformity and to
then shift the risk back to the seller in relation to the non-conforming goods.18
However, the goods in conformity with the contract will remain in the hands of the
buyer and as such the risk will remain with the buyer in relation to those goods.

The PICC and PECL contain no provisions in relation to passing of risk. The 14
Incoterms 2010 contain no provisions that contemplate breach of contract or the
consequences in relation to passing of risk.
13 Bridge, The Transfer of Risk under the UN Sales Convention 1980 (CISG), FS Kritzer (2008), p. 102.
14 Arts 34 and 37.
15 See Nicholas, in: Bianca/Bonell, Commentary (1987), Art. 70, para. 2.5.
16 Honnold/Flechtner, Uniform Law (2009), Art. 70.
17 See discussion on Art. 39.
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Chapter V
Provisions Common to the Obligations
of the Seller and of the Buyer*
Section I
Anticipatory breach and instalment contracts
1 Arts 71–73, found in Section I of Chapter V of the Convention, contain provisions on

anticipatory breach and instalment contracts. A link uniting these three articles lies in
their focus on the situation where before the due date for the performance of the
contract by one party, the other party has grounds to suspect that the other party will
not perform the contract at the due date. Arts 71 and 72 are concerned solely with this
situation whereas Art. 73 is not confined to cases of an anticipated failure to perform as
it also contains rules on avoidance, in the context of instalment contracts, where an
actual breach has been committed. In light of this common thread between Arts 71–73,
it is helpful to explore the basis for the Convention’s position which grants a party
remedies where it faces the risk that the performance by the other party will not be
forthcoming at the future due date.1
2 One way to justify the availability of remedies before the due date of performance is
to argue that there is an implied duty, imposed on the parties, not to impair each other’s
expectations that the contract will be performed.2 This justification emphasises the
protection of the parties’ reasonable expectations, the promotion of reliance on
contracts and the security of business transactions,3 and, arguably, certainty that parties
need to have regarding their legal positions4 when they have grounds to suspect that the
performance at the due date will not be forthcoming. The said duty can be potentially
derived from a variety of sources. For example, if good faith is recognised as a general
principle underlying the Convention,5 this duty can be said to flow from this general
* The author is grateful to Stefan Kröll, Sarah Green, Stephen Girvin, Nelson Enonchong, Paul Mora
and Tanya Corrigan for their comments on the first edition of this commentary.
1 Articulating and agreeing on the reasons justifying the availability of remedies before the due date of
performance is likely to have an impact on the Convention’s practical application as well as to contribute
to achieving its uniformity aspirations (for similar views expressed in the context of domestic law, see
Vold, The Tort Aspect of Anticipatory Repudiation, 41 Harvard Law Review (1928) 343; Taylor, The
Impact of Article 2 of the U. C.C on the Doctrine of Anticipatory Repudiation, 9 Boston College
Industrial and Commercial Law Review (1967–1968) 941 (“express announcement of the logical basis
for the doctrine will at least result in a greater predictability as to its application by the courts”). Cf.
Kreitner, Multiplicity in Contract Remedies, in: Cohen/McKendrick (eds), Comparative Remedies for
Breach of Contract (2005), p. 28 (“unification theories attempt too much to explain too little…The
theories are methodologically unsound because they work on a level of abstraction too high to solve
concrete problems”). Many of the arguments presented below were developed earlier (in the context of
the UNIDROIT Principles) in Saidov, Anticipatory Non-Performance and Underlying Values of the
UNIDROIT Principles, Uniform Law Review (2006) 795.
2 See, e. g., § 2–609(1) UCC.
3 For similar statements in the context of domestic legal systems see, e. g., Robertson, The Doctrine of
Anticipatory Breach of Contract, 20 Louisiana Law Review (1959–1960) 120.

4 See Ze, Anticipatory Breach of Contract – the PRC System and English Comparisons, Lloyd’s
Maritime and Commercial Law Quarterly (1993) 253 seq.

5 See Art. 7(2).
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Section I. Anticipatory breach and instalment contracts 3 Intro. to Art. 71–73

principle since good faith is often interpreted as requiring the parties’ continuous
commitment to the bargain.6 This duty can also be implied on the basis of Art. 8(2): it
can be argued that because the contract is a legally binding agreement giving rise to
legal rights and obligations, a reasonable person would almost always interpret the
statements and conduct of the parties as implying that nothing would be done to impair
each other’s contractual expectations. Every contract, by the very fact of its conclusion,
generates the parties’ mutual expectation that it will be performed7 and many provisions
of the Convention reflect its commitment to protecting this expectation. This, coupled
with the general principles of pacta sunt servanda (contracts must be performed)8 and
favour contractus (keeping the contract in existence as long as possible),9 surely
constitute a sufficient basis for implying the duty not to impair contractual expecta-
tions.10
There are a number of other considerations and policies which may explain the 3
Convention’s allowing recourse to remedies prior to the date of performance. First, if
every commercial contract is viewed as an instrument of allocating market risks, it can be
contended that by allowing a party, whose legitimate expectation has been disturbed, to
eliminate or reduce its losses by having recourse to remedies, the Convention’s provisions
are nothing more than a means of allocating risks in a fair and reasonable manner.11
Secondly, in the marketplace the contract can be an effective ‘commercial resource’
having a present value.12 On this view, an anticipated failure to perform may impair the
party’s ability to rely on the contract (for example, to obtain credit or to assign its
rights13), thereby damaging its present value. Thirdly, allowing a party to have recourse to
remedies before the due date for the performance may avoid a waste of resources and
promote economic efficiency.14 For example, where the manufacturer has grounds to
expect that the buyer will not perform the contract and will not want the goods intended
to meet the buyer’s highly particular needs, not beginning or stopping (as they case may
be) the manufacture will certainly avoid wasting the resources. Avoiding the contract
(Art. 72) will allow the manufacturer to release itself from the contract and channel its
resources in a different direction. Art. 71 will enable the manufacturer to suspend the
manufacture, thereby preventing the possibility of unwanted performance, and to clarify
6See, e. g., Carter, Adequate Assurance of Due Performance, 10 Journal of Contract Law (1996) 6.
7See Carter, Breach of Contract (1984) p. 226.
8 See, e. g., Magnus, General Principles of UN-Sales Law, 59 RabelsZ (1995) 469 (480) (Pace); Huber,
CISG – The Structure of Remedies, 71 RabelsZ (2007) 13 (17 seq.).

9 Bonell, in: Bianca/Bonell, Commentary (1987), Art. 7 para. 2.3.2.2 (Pace).
10 A similar view has already been taken by some commentators (see Bridge, Issues Arising Under
Articles 64, 72 and 73 of the United Nations Convention on Contracts for the International Sale of
Goods, 25 Journal of Law and Commerce (2005–2006), 405 (412) (Pace); Bernstein/Lookofsky, Under-
standing the CISG (2003), p. 132 note 102.
11 See also official comment on § 2–609(1) UCC (“Once he has been given reason to believe that the
buyer’s performance has become uncertain, it is an undue hardship to force him to continue his own
performance”) in Uniform Commercial Code: Official Text and Comments (2003), p. 172.
12 Mustill, Anticipatory Breach of Contract: The Common Law at Work (1989–1990) pp. 44 et seq.;
Strub, The Convention on the International Sale of Goods: Anticipatory Repudiation Provisions and
Developing Countries, 38 International Comparative Law Quarterly (1989) 457 (480) (Pace).
13 Gulotta, Anticipatory Breach – A Comparative Analysis, 50 Tulane Law Review (1976) 929.
14 Carter/Phang/Phang, Performance Following Repudiation: Legal and Economic Interests, 15 Journal
of Contract Law (1999) 100 (107 seq., 121); Vold, The Tort Aspect of Anticipatory Repudiation, 41
Harvard Law Review (1928) 368 seq.; Carter, Adequate Assurance of Due Performance, 10 Journal of
Contract Law (1996) 6. This view has already been expressed in the context of the Convention; see
Murray/Flechtner, Sales, Leases and Electronic Commerce: Problems and Materials on National and
International Transactions (2003), p. 300, cited in Seliazniova, Prospective Non-Performance or Antici-
patory Breach of Contract (Comparison of the Belarusian Approach to CISG Application and Foreign
Experience), 24 Journal of Law and Commerce (2004) 111 (Pace).
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Intro. to Art. 71–73 4 Part III. Chapter V. Provisions Common to Seller and Buyer
the situation regarding the buyer’s position.15 The availability of remedies for anticipated
non-performance may also, to some extent, deter the parties from committing anticipa-
tory non-performance and this would certainly be in line with the Convention’s principle
of the preservation of contract.
4 Finally, it is important to set out some of the main criticisms of the doctrine of
anticipatory breach, many of which were put forward during the 1980 Vienna Diplo-
matic Conference. First, it has been argued that the provisions place unjustified
confidence in the party’s ability to predict an anticipated failure to perform16 thereby
giving too much power to this party.17 Such an empowerment has been said to be
dangerous as it may lead to abuse.18 The right to terminate the contract for anticipatory
breach, for example, may provide a party with an opportunity to exploit the other
party’s unstable position and a convenient route of escaping from a bargain which
turned out to be unprofitable or undesirable.19 Even the right of suspension can be
abused where the party who is doubtful about its own ability to perform may invoke
this right to delay its performance by relying on the other party’s unstable situation.20
These criticisms become particularly acute where the party under suspicion is from a
developing country. It has been suggested that not only is there greater room for abuse
(for the conditions of economic and political instability, which may be present in some
such countries, may create an appearance of instability)21 but also the consequences of
exercising the remedies may impose harsher consequences on business persons from
developing countries where, for example, there may be particular difficulties with
communication or storage facilities.22 In short, the underlying concern was that the
availability of remedies for anticipatory breach would reinforce the weaker bargaining
position of developing countries in international trade.23 According to another criticism,
the doctrine of anticipatory breach leads to the extension of obligations that the party
has assumed under the contract and to the acceleration of liability.24 Thus, since a
party’s failure to provide adequate assurance may lead to serious legal consequences, it
15 For the discussion of the relevance of economic considerations to the CISG and a more detailed
discussion of similar examples, see Saidov, The Law of Damages in International Sales – The CISG and
other International Instruments (2008) pp. 19, 125 seq.
16 See the statements made by Mr Inaamulah (Pakistan) at the 1980 Vienna conference, 28 March
1980, A/CONF.97/C.1/L.224 (Pace) and Mr Mehdi (Pakistan), 10 April 1980, A/CONF.97/L.23 (Pace).
17 See the statement made by Mr Shafik at the 1980 Vienna Conference, 3 April 1980, A/CONF.97/C.1/
L.249 and 250 (Pace).

18 See, e. g., Vilus, Provisions Common to the Obligations of the Seller and the Buyer, in: Sarcevic/
Volken (eds), International Sale of Goods: Dubrovnik Lectures (1986), p. 242, (pp. 244 seq.) (Pace).
19 See ibid.; see also Beale, Remedies for Breach of Contract (1980) p. 67 (stating, in the context of the
right to terminate the contract more generally, that this remedy enables the party to escape from what has
turned out to be bad bargain).
20 One party’s suspension of performance may also cause damage to the other party; see Strub, The
Convention on the International Sale of Goods: Anticipatory Repudiation Provisions and Developing
Countries, 38 International Comparative Law Quarterly (1989) 457 (477).
21 See ibid.
22 “At seaports where adequate storage facilities do not exist one may see piles of industrial products on
the ground, exposed to the weather. These conditions intensify the harshness that results from immediate
cancellation by buyer or seller. On the other hand, in countries like the U.S., where merchants enjoy
efficient systems of communication, preservation, storage and transportation, a rule permitting immedi-
ate cancellation for any sort of breach may be less harsh” (Michida, Cancellation of Contract, 27
American Journal of Comparative Law (1979) 279 (280 seq.)).
23 See Strub, The Convention on the International Sale of Goods: Anticipatory Repudiation Provisions
and Developing Countries, 38 International Comparative Law Quarterly (1989) 457 (501).
24 See, e. g., Taylor, The Impact of Article 2 of the U. C.C on the Doctrine of Anticipatory Repudiation,
9 Boston College Industrial and Commercial Law Review (1967–1968) 919; Peel, Treitel on the Law of
Contract (2007) p. 848.
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Section I. Anticipatory breach and instalment contracts 4 Intro. to Art. 71–73

is effectively forced to provide such an assurance to prevent adverse consequences,
although doing so is more than the contract requires.25 The party’s liability can be said
to be accelerated where, after the contract has been avoided for anticipatory breach, the
other party is awarded damages prior to the date when the contract was to be
performed.26 While all these criticisms did not prevent the introduction of remedies
for an anticipated failure to perform into the Convention, it is submitted that these
aforementioned concerns are valid and need to be taken into consideration in inter-
preting the respective provisions of the CISG in order to maintain a fair balance
between the rights and interest of both parties.27
25 See Carter, Adequate Assurance of Due Performance, 10 Journal of Contract Law (1996) 5; Carter,
Suspending Contract Performance for Breach, in: Beatson/Friedman (eds), Good Faith and Fault in
Contract Law (1995), p. 485 (pp. 514 seq.).
26 See Taylor, The Impact of Article 2 of the U. C.C on the Doctrine of Anticipatory Repudiation, 9
Boston College Industrial and Commercial Law Review (1967–1968) 919; Peel, Treitel on the Law of
Contract (2007) p. 848.
27 For a more detailed discussion in the context of the UNIDROIT Principles of International
Commercial Contracts, see Saidov, Anticipatory Non-Performance and Underlying Values of the UNI-
DROIT Principles, Uniform Law Review (2006) 800 seq.
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Article 71
(1) A party may suspend the performance of his obligations if, after the conclusion
of the contract, it becomes apparent that the other party will not perform a
substantial part of his obligations as a result of:
(a) a serious deficiency in his ability to perform or in his creditworthiness; or
(b) his conduct in preparing to perform or in performing the contract.
(2) If the seller has already dispatched the goods before the grounds described in
the preceding paragraph become evident, he may prevent the handing over of the
goods to the buyer even though the buyer holds a document which entitles him to
obtain them. The present paragraph relates only to the rights in the goods as between
the buyer and the seller.
(3) A party suspending performance, whether before or after dispatch of the goods,
must immediately give notice of the suspension to the other party and must continue
with performance if the other party provides adequate assurance of his performance.
Bibliography: Pejovic, Stoppage in Transit and Right of Control: “Conflict of Rules”? 20 Pace Interna-
tional Law Review (2008) 129; Strub, The Convention on the International Sale of Goods: Anticipatory
Repudiation Provisions and Developing Countries, 38 International Comparative Law Quarterly (1989)
457; Vanwijck-Alexandre, Anticipatory Breach and Instalment Contracts in the CISG, 3–4 International
Business Law Journal (2001) 353; von Ziegler, The Right of Suspension and Stoppage in Transit (and
Notification thereof), 25 Journal of Law and Commerce (2005–2006) 353; CISG-AC Opinion no 1,
Electronic Communications under CISG, 15 August 2003. Rapporteur: Professor Christina Ramberg,
Gothenburg, Sweden (http://www.cisg-ac.org).
Outline
1. The exercise of the right of suspension. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
a) The nature of events giving rise to the remedy of suspension . . . . . . . . . 4
aa) ‘Substantial part’ . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
bb) Serious deficiency in the ability to perform. . . . . . . . . . . . . . . . . . . . . . . . . 10
cc) Conduct in preparing to perform or in performing the contract . 12
b) The standard of prognosis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
aa) General. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
bb) Circumstances arising after the conclusion of the contract. . . . . . . . 16
cc) ‘Becoming apparent’ . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
dd) Source of information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
c) Obligations which can be suspended. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
d) Parties’ derogation from the right to suspend . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
e) Relationship between Arts 71 and 80 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
f) Notice of suspension . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
2. Stoppage in transit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
a) General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
b) The exercise of the right of stoppage. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
3. Suspension and burden of proof . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
4. Adequate assurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
a) General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
b) Meaning of ‘adequate assurance’ . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
c) Failure to provide adequate assurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
d) Burden of proof . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
5. Cessation of suspension . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
6. Damages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
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Section I. Anticipatory breach and instalment contracts 1–2 Article 71

Where, after the conclusion of the contract, it becomes apparent that one party will 1
not perform a substantial part of its obligations, the other party has the right to
suspend the performance of its obligations.1 A similar remedy can be found in some
domestic legal systems2 and international instruments.3 The main purpose of the right
of suspension is to promote dialogue and cooperation between the parties, to preserve
their contract4 and to encourage performance.5 This remedy is often said to be in line
with the expectations of business persons since a normal response of a merchant
suspecting a breach is thought to be that of contacting the other party and attempting
to find a solution.6 It can also be viewed as aiming to maintain a fair balance between
the parties: while there is a need to provide security to the party who expects an
anticipated failure to perform, there is equally a need to treat such situations with
caution and not to resort to drastic remedies, such as avoiding the contract. In
addition, where an anticipated failure to perform is expected to relate to a substantial
part of the obligations but is not expected to be of fundamental character justifying the
avoidance of the contract,7 suspending performance again offers an innocent party a
reasonable and convenient means of protecting itself as it is now able to refrain from
performing until adequate assurances from the other party are received.
The remedy of suspension can be said to perform several functions. It may induce the 2
party under suspicion to restate its commitment to performing the contract.8 It may
also discourage the innocent party from invoking dispute resolution9 thereby freeing
judicial resources and avoiding incurring transaction costs associated with bringing a
formal action.10 It can also perform a function similar to that of mitigation of loss.11 It is
often the case that by suspending its performance or preparation to perform, the party
1Art. 71.
2See, e. g., § 2–609 UCC.
3See Art. 73 ULIS, Art. 7.3.4 PICC, and Art. 8:105(1) PECL.
4 Carter, Adequate Assurance of Due Performance, 10 Journal of Contract Law (1996) 3; also
Oberlandesgericht Köln (Germany) 19 May 2008, CISG-Online 1700 (Pace) (rationalising the right of
suspension in terms of ‘functional synallagma’, seeking to ‘secure the claim’ and exert pressure on the
party under suspicion).
5 See Oberlandesgericht Karlsruhe (Germany) 20 July 2004, CISG-Online 858 (Pace).
6 Landgericht Kassel (Germany) 21 September 1995, CISG-Online 192 (Pace) (‘it would have been [a]
reasonable commercial practice to discuss any suspicions … in order to achieve an appropriate

solution’); Carter, Suspending Contract Performance for Breach, in: Beatson/Friedman (eds), Good
Faith and Fault in Contract Law (1995), p. 485 (p. 499).
7 See Art. 72.
8 Carter, Suspending Contract Performance for Breach, in: Beatson/Friedman (eds), Good Faith and
Fault in Contract Law (1995), p. 485 (p. 492).

9 Ibid.
10 Taylor, Self-Help in Contract Law: An Exploration and Proposal, 33 Wake Forest Law Review (1998)
848 (see further pp. 847 seq. for a much more extensive discussion of advantages and disadvantages of
self-help remedies).
11 See Art. 77. For a detailed discussion of the rationale of the mitigation rule under the CISG, see
Saidov, The Law of Damages in International Sales – The CISG and other International Instruments
(2008), pp. 125 seq.
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Article 71 3–4 Part III. Chapter V. Provisions Common to Seller and Buyer
avoids incurring unnecessary costs or losses12 thereby preventing the occurrence of

waste of resources and contributing to economic efficiency.13
3 The structure of the remedy of suspension is set out in three paragraphs of Art. 71.
The first paragraph specifies the grounds giving rise to this remedy.14 The second
paragraph provides for the seller’s remedy of stoppage in transit which can be regarded
as a manifestation of the seller’s right of suspension in a specific situation.15 The third
paragraph provides for the suspending party’s duty to give notice of suspension to
provide an opportunity for the other party to give adequate assurance of performance.16
Suspension can be exercised not only in relation to the main obligations, such as the
delivery of the goods17 and payment of the price,18 but also in relation to the
preparation to perform19 and ancillary obligations.20
1. The exercise of the right of suspension

a) The nature of events giving rise to the remedy of suspension
4 aa) ‘Substantial part’. A party has the right to suspend when it becomes apparent
that a substantial part of the other party’s obligations will not be performed as a result
of: (a) a serious deficiency in the other party’s ability to perform or in its creditworthi-
ness; or (b) its conduct in preparing to perform or in performing the contract.21 The
first difficulty in applying this provision lies in determining what constitutes ‘a
substantial part of obligations’. The only guideline that can be inferred from the
Convention itself is that an anticipated failure to perform ‘a substantial part of the
obligations’ does not have to amount to a ‘fundamental breach’ as defined by Art. 25
and referred to in Art. 72.22 While it may be difficult to distinguish between the two
12 This will be the case, for example, where the manufacturer of goods (specifically designed for the buyer’s
needs) who had grounds to suspect that the buyer would not accept and pay for the goods, initially
suspended the manufacture and later avoided the contract after it transpired that the buyer was indeed
unable or unwilling to perform. Had the manufacturer carried on performing the contract by manufacturing
the goods which suited nobody but the buyer, the seller’s performance would have been wasteful. Another
example is where there are grounds to suspect that the seller will not deliver the goods and the buyer
suspends its obligations to open a letter of credit thereby not incurring the banking fee. If, after it became
clear that the seller would not perform the contract, the buyer avoids the contract, the buyer can be said to
have avoided incurring unnecessary cost and not to have lost an opportunity to use its money elsewhere.
13 See further Carter, Suspending Contract Performance for Breach, in: Beatson/Friedman (eds), Good
Faith and Fault in Contract Law (1995), p. 485 (p. 492).

14 See Art. 71(1).
15 See Art. 71(2).
16 See Art. 71(3).
17 See, e. g., Belarusian Chamber of Commerce and Industry International Court of Arbitration (Belarus)
5 October 1995, ATT v Armco, CISG-Online 861 (Pace); Arbitral Award, Tribunal of International
Commercial Arbitration at the Russian Federation Chamber of Commerce and Industry, 29 February
2000, in: Rozenberg (ed.), Praktika Mezhdunarodnogo Kommercheskogo Arbitrazhnogo Suda pri TPP RF
za 1999–2000gg. (2002), pp. 233 seq.
18 See, e. g., Kantonsgericht Appenzell Ausserrhoden (Switzerland) 10 March 2003, CISG-Online 852 (Pace).
19 For example, the manufacturer can suspend procurement of raw materials or the buyer can suspend
its establishing a letter of credit; see Honnold/Flechtner, Uniform Law (2009), Art. 71 para. 386.
20 See Arbitration Court of the Chamber of Commerce and Industry of Budapest (Hungary) 5 December
1995, Vb 94 131 (Pace) (where the tribunal held that the seller had justifiably suspended its duty to repair
the goods).
21 Art. 71(1).
22 See, e. g., Landgericht Berlin (Germany) 15 September 1994, CISG-Online 399 (Pace) (with further
reference to scholarly writings); Bennett, in: Bianca/Bonell, Commentary (1987), Art. 71 para. 3.1.
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standards in practice, the distinction needs to be maintained because the amendment
proposed by the Egyptian delegation at the 1980 Vienna conference which made
suspension conditional upon anticipatory fundamental breach was rejected.23
A few general guidelines on the meaning of the term ‘a substantial part’ of the 5
obligations can be given. The contract must be considered as a whole with a view to
determining the importance that the parties attached to a particular obligation.24 The
determination of what constitutes ‘a substantial part of the obligations’ cannot depend
on one party’s subjective intentions and state of mind, unless the other party either
knew or could not have been unaware of such intentions.25 The question that needs to
be answered is whether it would be apparent to a reasonable person in the same
position as the innocent party that a failure to perform a substantial part of obligation
will occur.26 It is only this interpretation (known as ‘objective interpretation’) that will
be capable of maintaining a fair balance between the parties and reducing the likelihood
of the suspending party abusing its right. Eventually, the issue is to be resolved on a
case-by-case basis.27 Some of the relevant factors include the importance that the
contract itself attaches to a particular obligation,28 the parties’ negotiations, past deal-
ings, practices, conduct subsequent to the emergence of the grounds for expecting an
anticipated failure to perform,29 trade usage30 and the size of an anticipated failure
relative to the entire set of obligations.31
An instance of the importance of the latter factor can be found in a case32 where the 6
court held that the non-conformity in 420 kg of frozen bacon (which was, in the court’s
words, ‘only a minor part of one instalment’) out of the entire quantity of 22,400 kg to
be delivered in several instalments could not be considered an anticipated failure to
perform a ‘substantial part of obligations’. In another case33 of non-conformity in the
delivered instalments, the tribunal’s decision correctly implied that the increased
mercury levels in crude oil condensate, which caused the buyer difficulties in processing
the condensate and selling the goods downstream, made it apparent to the buyer that a
substantial part of the obligations under several instalment contracts would not be
performed.34 In cases involving an anticipated delay of delivery, the requirement of
23 See proceedings at the Vienna Diplomatic Conference, 4 April 1980, A/CONF.97/C.1/L.249, L.250,
L.251 (Pace); for further discussion, see Strub, The Convention on the International Sale of Goods:
Anticipatory Repudiation Provisions and Developing Countries, 38 International Comparative Law
Quarterly (1989) 457 (494).
24 See Fountoulakis, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 71 para. 19.
25 See Art. 8(1).
26 See Art. 8(2). For a similar view in the context of Art. 73 ULIS, see Cohn, The Defence of
Uncertainty: A Study in the Interpretation of the Uniform Law on International Sales Act 1967, 23
International Comparative Law Quarterly (1974) 520 (523 seq.).
27 For similar statements, see, e. g., von Ziegler, The Right of Suspension and Stoppage in Transit (and
Notification thereof), 25 Journal of Law and Commerce (2005–2006) 353 (Pace).

28 See Hornung, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 71 para. 9.
29 See Art. 8(3).
30 See Art. 9.
31 See Huber/Mullis, The CISG (2007), p. 340.
32 Oberlandesgericht Hamm (Germany) 22 September 1992, CISG-Online 57 (Pace).
33 Netherlands Arbitration Institute (Netherlands) 15 October 2002, Case 2319 (Pace).
34 One of the factors the tribunal took into account was the long term nature of the parties’ relationship
which gave rise to a shared understanding of the parties regarding the required levels of mercury in the
condensate. Although this point was addressed in the context of the question of whether the goods were
non-conforming, it would seem that this consideration may also be relevant for dealing with the question
of whether an anticipated failure relates to a substantial part of obligations. Since the remedy of
suspension aims to strike a fair balance between the interests of both parties, the legitimate expectations
of the party under suspicion should probably be taken into account. Art. 71, of course, stops short of
introducing the foreseeability rule (which is a part of the ‘fundamental breach’ test) for the purposes of
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‘substantiality’ has been met where it was clear that the seller would only be able to
deliver the goods after the date by which the buyer committed itself to deliver to its
customer.35 In a similar vein, there is likely to be an anticipated failure to perform a
substantial part of obligations where the seller, by indicating its inability to deliver by
the due date with no further indications about the possible delivery date, places the
buyer in the position of uncertainty about its ability to meet the delivery deadline in its
sub-sale contract.36
7 The buyer’s failure to take the required steps and to comply with formalities which
would enable it to make a payment37 may, in addition to such a failure often being an
actual breach, also be an indication that a substantial part of the buyer’s obligations will
not be performed. In several cases, for example, the buyer’s failure to open a letter of
credit on time has been treated as an indication of a serious deficiency in its creditworthi-
ness38 which, in turn, meant that a substantial non-performance (i. e., non-payment) was
likely to occur.39 In one case,40 the buyer failed to meet its contractual obligation to
provide a bank’s confirmation that the letter of credit would be opened as soon as the
goods are examined. While not treating the failure to do so as a fundamental breach,41 the
decision nevertheless implied that the failure was sufficiently serious to justify an
expectation of the non-performance of a substantial part of obligations.
8 Where an anticipated failure does not relate to or is not connected with the primary
duties of the parties (i. e., those set out in Arts 30 and 53) the ‘substantiality’ require-
ment may still be met. Thus, it may be a term of the contract that the buyer must ensure
that the confidential information it receives from the seller in the course of the latter’s
performance of the contract will not be revealed to any third party. If the buyer then
enters into dealings with the seller’s competitor, thereby creating the danger that the
duty of confidentiality will be breached, the seller can be said to have grounds to suspect
that an anticipated failure of a substantial part of obligations will occur.42
9 As noted above, an anticipated failure to perform a substantial part of obligations
must result from: (a) a serious deficiency in the other party’s ability to perform or in its
creditworthiness; or (b) its conduct in preparing to perform or in performing the
contract.43 By specifying the grounds for suspension, the drafters intended to increase
the objectivity of these grounds. This, however, did not prevent the scope of the
applying the ‘substantiality’ requirement because of the less drastic consequences of the remedy of
suspension.
36 See Kantonsgericht Appenzell Ausserrhoden (Switzerland) 10 March 2003, CISG-Online 852 (Pace).
37 See Art. 54.
38 See Supreme Court of British Columbia (Canada) 21 August 2003, Mansonville v Kurtz, CISG-Online
1017, para. 79 (Pace); Arbitral Award, CIETAC CISG/1996/11, CISG-Online 1033 (Pace).
39 See Art. 71(1)(a).
40 Landgericht Kassel (Germany) 21 September 1995, CISG-Online 192 (Pace).
41 It is submitted that the reasoning of the court in relation to whether a fundamental breach has been
committed can, in principle, also be relevant to dealing with the ‘substantiality’ requirement. Thus, the
court referred to the seller’s conduct subsequent to the buyer’s failure to provide the required confirma-
tion which demonstrated that the seller was nevertheless willing to perform (see ibid.). Similarly, suppose
that, at first, the seller makes it clear to the buyer that it will not regard the buyer’s failure as having any
legal significance and does not think that it gives any indications whatsoever about the buyer’s financial
standing. Later, however, the seller justifies its own non-performance by reference to its right to suspend
arising from the buyer’s anticipated failure to perform a substantial part of obligations. The buyer would
certainly argue (correctly, it is submitted) that the seller should be prevented from relying on Art. 71 as its
earlier statements and conduct demonstrated that it did not attach any importance to the buyer’s
obligation to provide the said confirmation.
42 See Arbitral Award, CIETAC CISG/2002/29 (Pace).
43 Art. 71(1).
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provision from being broad enough to cover virtually any circumstance affecting a
party’s ability to perform.44
bb) Serious deficiency in the ability to perform. A serious deficiency in the seller’s 10
ability to perform can arise, for example, from: a strike at the seller’s factory,45 production
overload,46 loss of factory caused by fire or natural phenomena,47 a failure to procure an
export licence, an export embargo, an outbreak of war,48 or the disappearance of the
goods and the seller’s inability to find them.49 The reference to a serious deficiency in a
party’s creditworthiness is primarily relevant to the buyer, but it may be applicable to the
seller as well.50 For example, the circumstances may indicate that the seller lacks funds to
purchase the goods from its supplier, to buy materials necessary for the manufacture of
the contract goods, or to carry out the manufacture.
A serious deficiency in the buyer’s ability to perform or in its creditworthiness51 may 11
flow, for instance, from: it being declared bankrupt; informing the seller that it will
purchase the goods from an alternative supplier;52 its purchasing the equipment from
the seller’s competitors thereby giving rise to fears that the seller’s expertise would
become known to the latter (which, if occurred, would be a breach of a term of the
contract);53 or where in case of an FOB contract there is insufficient storage space on
board a vessel.54 An indication of such a deficiency may also be apparent from the
buyer’s failure to pay for previous deliveries,55 to make a contractually required partial
advance payment, or to open a letter of credit at the contractual due date.56
cc) Conduct in preparing to perform or in performing the contract. The latter two 12
instances mentioned in the previous paragraph may equally fall within the scope of
Art. 71(1)(b) as they can evidence an anticipated failure to perform a substantial part of
obligations resulting from the buyer’s conduct in performing the contract. Another
example of such conduct is where the buyer actually fails to comply with its contractual
duty to provide a bank’s confirmation that a letter of credit will be opened upon the
occurrence of an event specified in the contract thereby giving rise to fears that the
payment will not be made.57
44 See Fountoulakis, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 71 para. 21; cf. Honnold/Flecht-
ner, Uniform Law (2009), Art. 71 para. 389; Flechtner, Remedies under the New International Sales Conven-
tion: The Perspective from Article 2 of the U. C. C., 8 Journal of Law and Commerce (1988) 53 (95) (Pace).
45 See, e. g., Bennett, in: Bianca/Bonell, Commentary (1987), Art. 71 para. 2.6; Fountoulakis, in:

48 See ibid., p. 705, note 24.
49 See Oberlandesgericht Hamm (Germany) 23 June 1998, CISG-Online 434 (Pace) (where the goods
disappeared from the premises of the warehouse firm which was declared bankrupt).
50 For a similar view, see Enderlein/Maskow, International Sales Law (1992), p. 286; Vanwijck-Alex-
andre, Anticipatory Breach and Instalment Contracts in the CISG, 3–4 International Business Law
Journal (2001) 360.
51 For an unsuccessful attempt to define the notion of a ‘serious deficiency in [the buyer’s] credit-
worthiness’ in case law, see Bundesgericht (Switzerland) 17 July 2007, CISG-Online 1515 (Pace).
52 District Court, Pennsylvania (U.S.), 10 September 2013, Roser Technologies, Inc v Carl Schreiber
GmbH, CISG-Online 2490 (Pace).

53 See Arbitral Award, CIETAC CISG/2002/29 (Pace) and the accompanying text.
54 See Enderlein/Maskow, International Sales Law (1992), p. 286.
55 Federal District Court, New York (U.S.), 29 May 2009, Doolim Corp v R Doll, LLC, CISG-online
1892 (Pace).
56 See Federal District Court, New York (U.S.), 29 May 2009, Doolim Corp v R Doll, LLC, CISG-online
1892 (Pace).
57 See Landgericht Kassel (Germany) 21 September 1995, CISG-Online 192 (Pace), and the accompany-
ing text.
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13 The seller’s conduct in preparing to perform or in performing the contract58 which

can give rise to an anticipated failure to perform a substantial part of obligations
includes: the seller’s failure to procure the goods or materials necessary for the
manufacture of the goods on time; late delivery of samples (or delivery of defective
samples), as required by the contract, for the buyer’s approval which will prevent the
seller from manufacturing and delivering the goods on time;59 the seller’s failure to
comply with the contractual duty to provide documents certifying that the goods are
free from rights or claims of third parties60 which creates grounds for suspicions that the
goods, when delivered, will not be free from any such rights or claims; the seller’s
failure61 to comply with the schedule of the contractually stipulated trial-run and to
execute it properly, thereby making it clear that the trial-run will not be completed
successfully within the required time frame62 and; the seller’s failure to get permission to
export the goods to the specified countries and to perform its contractual duty of
nominating the port of loading.63
b) The standard of prognosis
14 aa) General. Because a failure to perform is expected to occur in the future, while the
remedy can be invoked as soon as the grounds for an anticipated failure become known,
Art. 71 contains a probability standard which requires that grounds giving rise to
suspension ‘become apparent’ after the conclusion of the contract. Although it is not
possible to give a precise definition of this standard, the text, structure and legislative
history of the Convention provide a few general guidelines.
15 The standard of ‘becoming apparent’ needs to be contrasted with the standards of
being ‘clear’ in Art. 72(1) as well as with ‘good grounds’ in Art. 73(2). The majority
view is that the standard in Art. 71 requires a lower degree of likelihood than that
required by Arts 72(1)64 and 73(2).65 This can be explained66 by the less strict
preconditions for invoking these provisions67 and the less drastic nature and effects of
remedies provided for in these articles.68 Although such a distinction may be possible in
58See Art. 71(1)(b).

59See, Arbitral Award, ICC 8786, January 1997, CISG-Online 749 (Pace).
60 See Federal Arbitration Court for the Western Siberia Circuit (Russia) 6 August 2002, O. I. L. Otto
International Leasing Aktiengesellschaft v Zernopererabatyvayuschiy kombinat Barnaulskaya melnitsa

(Pace).
61 See Arbitral Award, CIETAC CISG/1996/36 (Pace).
62 “The second contingent of engineers hired by [the Seller] departed from China on 25 August 1994,
one month earlier than previously scheduled at a time when the trial-run adjustment was not finished …
[The Seller]’s third contingent of engineers arrived in Shanghai in October 1994 and departed for France
to purchase spare parts on 1 November 1994. They returned to Shanghai in early December 1994
without any parts. Under these circumstances, [the Buyer] had reason to believe it was impossible for
[the Seller] to finish adjustment in the timeframe, i. e., by 6 November 1994” (ibid.).
63 See Oberster Gerichtshof (Austria) 6 February 1996, CISG-Online 224 (Pace) (the Supreme Court
discussed the buyer’s right to suspend by reference to Art. 80 and not Art. 71).
64 See, e. g., Honnold/Flechtner, Uniform Law (2009), Art. 71 para. 388; Fountoulakis, in: Schlechtriem/

65 See Fountoulakis, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 71 para. 30, Art. 73
para. 24.
66 See, e. g., Fountoulakis, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 71 para. 30.
67 Art. 71 refers to anticipated failure to perform a substantial part of obligations while Art. 72 can be
invoked where it is clear that a fundamental breach will occur; similarly, Art. 73(2) allows a party to avoid
the contract for the future where there are good grounds to conclude that there will be a fundamental
breach with respect to future instalments.
68 Art. 71 authorises the suspension of the contract and Art. 72 allows that a contract be avoided.
Art. 73(2) allows that the contract be avoided for the future.
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theory, it is doubtful whether it is workable in practice.69 Further, it was the drafters’
intention to inject a greater degree of objectivity into the standard and prevent the right
of suspension from being invoked on the basis of purely subjective fears: the more
objective the standard, the greater the chances that the remedy of suspension will be
invoked on the basis of genuine doubts about future performance.70 To implement this
aspiration, the question of whether it is ‘apparent’ that a substantial part of obligations
will not be performed is to be judged from the standpoint of a reasonable person in the
position of the party invoking Art. 71.71
bb) Circumstances arising after the conclusion of the contract. The circumstances 16
giving rise to the right of suspension must become apparent ‘after the conclusion of the
contract’. To be clear, however, such circumstances may well exist before the conclusion
of the contract. What is crucial to the question of whether the right of suspension can be
exercised is whether or not the relevant circumstances became apparent after the
contract had been made. Viewed in light of the considerations underlying Art. 71 (i. e.,
the need to maintain a fair balance between the parties, to interpret the provision
‘objectively’ by reference to the ‘reasonable person’ standard, and to minimise the
possibility of abuse), this requirement can be said to serve the function of allocating the
risks in a reasonable manner. If, prior to or at the time of the conclusion of the contract,
a party who relies on Art. 71 knew or ought to have known of the other party’s
circumstances which might impair its ability to perform, then it can be deemed to
have assumed the risk of such circumstances.72 This approach encourages prudent and
responsible contracting and it is evident that the Convention does not protect parties
who thoughtlessly or carelessly enter into contracts.73 A party may then be required to
make inquiries, prior to entering into the contract, about the other party’s circum-
stances in order to enable itself to invoke the right of suspension in the future.
However, the extent of such a duty is unclear and there are considerations which 17
dictate that a cautious approach be taken. In international transactions, it may be
difficult and expensive for a party to engage in the examination of the other party’s
69 See, e. g., Schlechtriem, Uniform Sales Law: The UN-Convention on Contracts for the International
Sale of Goods (1986), p. 95 (“the different formulations do not require different degrees of certainty –
such a requirement would hardly be practicable anyway”).
70 Thereby reducing the scope for abusing this right, e. g., where a party who is not certain about its
ability to perform uses suspension to gain time by delaying performance; see Carter, Suspending Contract
Performance for Breach, in: Beatson/Friedman (eds), Good Faith and Fault in Contract Law (1995), 485
(513). For the view that the rule leaves much room for subjective judgment, see Ziegel, The Remedial
Provisions in the Vienna Sales Convention: Some Common Law Perspectives, in: Galston/Smit (eds),
International Sales: The United Nations Convention on Contracts for the International Sale of Goods
(1984), pp. 9 seq.
71 See Art. 8(2). There is still a question of the extent to which that ‘reasonable person’ needs to be
tailored to the likeness of the party invoking the right to suspend. The question may be particularly
relevant in the context of international transactions where differences are exacerbated; for the suggestion
in the context of Art. 25, see, Will, in: Bianca/Bonell, Commentary (1987), Art. 25 para. 2.2.2.2.1 (Pace).
For the exploration of the notion of a reasonable person, including the possibility of relying on the
‘detached reasonable person’ standard in the common law systems, see, e. g., Howarth, The Meaning of
Objectivity in Contract, 100 Law Quarterly Review (1984) 265; DiMatteo, The Counterpoise of Contracts:
The Reasonable Person Standard and the Subjectivity of Judgment, 48 South Carolina Law Review (1997)
293.
72 See Bundesgericht (Switzerland) 17 July 2007, CISG-Online 1515 (Pace) (‘If the vending party knew
that the solvency was poor prior to the conclusion of the contract and the solvency had not deteriorated
since then, it was not entitled to stop the goods’); Landgericht Darmstadt (Germany) 29 May 2001, CISG-
Online 686 (Pace); Vanwijck-Alexandre, Anticipatory Breach and Instalment Contracts in the CISG, 3–4
International Business Law Journal (2001) 358. A similar rationale underlies a number of other provisions
of the CISG, see, e. g., Arts 25, 35(3), 42(2), 74. More generally, see also Arts 8 and 9.
73 See Enderlein/Maskow, International Sales Law (1992), p. 284.
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Article 71 18 Part III. Chapter V. Provisions Common to Seller and Buyer
position74 and the necessity of doing so would create an obstacle to international trade
which would run counter to the Convention’s purpose.75 In addition, a party being
seen as making detailed inquiries about the other party may, arguably, contribute to the
creation of an atmosphere of mistrust amongst business partners in international trade.
A balanced and fair approach is not to require a party to make detailed inquiries but, at
the same time, to assume that it is aware of the other party’s circumstances to the same
extent as a reasonable person in its position would have been.76 The extent of this
party’s duty to make inquiries is that which a reasonable person would have
exercised.77 While this guideline is, admittedly, vague, it manifests an approach which
is very much in line with the Convention’s approach of relying on broad rules and
standards which acquire a discernible meaning and content only in light of the facts of
a particular case.
18 One important consideration that has emerged from the cases is whether there have
been any changes between the circumstances of which the party was aware before
making the contract and the circumstances as they have developed since the conclusion
of the contract. It follows, from the discussion in the previous paragraph, that if the
seller, for example, had been aware of the buyer’s financial problems before the contract
was made, then it cannot, generally, exercise its right of suspension on the ground of the
deficiency in the buyer’s creditworthiness since, by entering into the contract despite its
knowledge, it can be deemed to have assumed this risk.78 However, a further deteriora-
tion in the buyer’s financial standing may occur and/or a more serious extent (than that
which was reasonably apparent prior to the making of the contract) of the buyer’s
problems may become apparent after the contract was made.79 Where this is the case,
the right of suspension may still be invoked provided that the change or difference
between what was apparent prior to the making of the contract and what was apparent
and/or occurred after that time was sufficiently serious to justify the shifting of the risk
74 See the statements made by Mr V. Kruse (Danish delegation) at the 26th meeting of the 1980 Vienna
Diplomatic Conference, 27 March 1980, A/CONF.97/C.1/L.185, L.209 (Pace); von Ziegler, The Right of
Suspension and Stoppage in Transit (and Notification thereof), 25 Journal of Law and Commerce (2005–
2006) 353 (362) (Pace).
75 See the statement made by Mr Rognlien (Norwegian delegation) at the 26th meeting at the 1980
Vienna Diplomatic Conference, 27 March 1980, A/CONF.97/C.1/L.185, L.209 (Pace).

76 For a similar position, see Hornung, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 71
para. 15; von Ziegler, The Right of Suspension and Stoppage in Transit (and Notification thereof), 25
Journal of Law and Commerce (2005–2006) 353 (362) (Pace).
77 See, e. g., Hornung, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 71 para. 15; von Ziegler,
The Right of Suspension and Stoppage in Transit (and Notification thereof), 25 Journal of Law and
Commerce (2005–2006) 353 (362) (Pace).
78 See, however, Arbitral Award, Tribunal of International Commercial Arbitration at the Russian
Federation Chamber of Commerce and Industry, 29 February 2000, in: Rozenberg (ed.), Praktika
Mezhdunarodnogo Kommercheskogo Arbitrazhnogo Suda pri TPP RF za 1999–2000gg. (2002), where
the tribunal stated that the fact of concluding a new contract with the buyer despite outstanding
payments for deliveries made by the seller under previous contracts did not in itself necessarily lead to
the conclusion that the seller was willing to make further deliveries without receiving the payment by the
buyer. Considering that the seller was clearly aware of the problems with the buyer’s ability to pay, it is
unfortunate that the tribunal did not explain why it did not regard the seller as having assumed the risk of
non-payment by the buyer. One relevant circumstance mentioned in the decision was that the parties
made a ‘protocol’, subsequent to the conclusion of the contract, in which the buyer’s difficult financial
position was recognised and it can be speculated that the making of the protocol was indicative of a
further deterioration in the buyer’s financial standing since the contract was concluded. If so, it may have
been the case that the tribunal took the view that the risk assumed by the seller under the contract was
different, so far as its extent was concerned, from the risk that has actually materialised (see the discussion
in the main text).
79 See Bundesgericht (Switzerland) 17 July 2007, CISG-Online 1515 (Pace).
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back to the buyer. In one case,80 the court held that the seller was entitled to suspend the
performance of its obligations despite the fact that the seller was aware that the buyer
faced a risk of insolvency before the making of the contract. The decision appears to
imply that the buyer’s conduct subsequent to the conclusion of the contract (i. e., the
buyer’s persistent failure to pay between 1995 and 2002) revealed a greater degree of
financial difficulties than was apparent to the seller prior to concluding the contract. In
other words, although the nature or type of risk (i. e., buyer’s creditworthiness) was
apparent to the seller, it was the serious difference between the extent of that risk as it
was apparent before the contract and as it became apparent or developed after the
contract had been made that seems to be the basis for the decision. It is no doubt
correct that it is not only the nature and type of risk but also its extent that is relevant
for the purposes of the assumption of risk under Art. 71.81
cc) ‘Becoming apparent’. While the standard of ‘becoming apparent’ does not 19
require absolute certainty, it is usually interpreted as requiring a ‘high’82 or ‘substan-
tial’83 degree of likelihood. Clearly, any real content can only emanate from such
obscure guidelines by means of its filtering through the facts of a particular case. The
task is then to identify those types of circumstances which can make it apparent that a
substantial part of obligations will not be performed.
For example, there is little doubt that the buyer’s unequivocal refusal to take delivery 20
will meet the standard of ‘becoming apparent’.84 Many of the reported cases, however,
have arisen in connection with the buyer’s conduct relating to its obligation to pay.
Thus, the buyer’s failure to comply with its contractual duties to make a down
payment,85 to open or to extend the duration of a letter of credit,86 to provide a valid
bank guarantee of its performance,87 or to supply a bank confirmation that a letter of
credit will be opened upon meeting certain conditions88 can give rise to an expectation
that there is a high degree of likelihood of a substantial part of obligations not being
80See Cour de Cassation (France) 20 February 2007, CISG-Online 1492 (Pace).

81For the discussion of a similar theme in the context of the foreseeability rule in Art. 74, see Saidov,
The Law of Damages in International Sales – The CISG and other International Instruments (2008),
pp. 113 seq.
82 See Oberster Gerichtshof (Austria) 12 February 1998, CISG-Online 349 (Pace); Fountoulakis, in:

84 Bundesgerichtshof (Germany) 27 November 2007, CISG-Online 1617 (Pace). However, if the buyer
has indicated that there would be a delay in taking delivery, the question of whether that delay would
constitute a breach of a ‘substantial part’ of the buyer’s obligations would have to be answered in order to
decide whether the seller has the right to invoke Art. 71.
85 See Arbitral Award, CIETAC CISG/1989/02, CISG-Online 1230 (Pace) (where the tribunal stated,
without reference to any legal basis, that because ‘the buyer had not made the down payment pursuant to
the contract, the seller was consequently freed from its obligations to deliver the goods within the time
stipulated in the contract’).
86 See Supreme Court of British Columbia (Canada) 21 August 2003, Mansonville v Kurtz, CISG-Online
1017 (Pace); Federal District Court, New York (U.S.), Doolim Corp v R Doll, LLC, CISG-Online 1892
(Pace); Arbitral Award, CIETAC CISG/1996/11, CISG-Online 1033 (Pace); Arbitral Award, Tribunal of
27 July 1999 (Pace) (it is unclear whether the tribunal did not treat the buyer’s failure to issue letter of
credit as justifying the seller’s suspension because it did not regard such a failure as a sufficient ground for
suspension or because the seller failed to give a notice of suspension under Art. 71(3)); Arbitral Award,
CIETAC CISG/1996/56 (Pace) (the buyer failed to extend the duration of the letter of credit, as required
by the contract, and the seller was held entitled to suspend its obligations as soon as the original letter of
credit had expired).
87 See Hungarian Chamber of Commerce and Industry Court of Arbitration (Hungary) 17 November
1995, Vb 94 124 (Unilex).

88 See Landgericht Kassel (Germany) 21 September 1995, CISG-Online 192 (Pace).
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performed at the due date. However, it is important not to consider the buyer’s conduct
in relation to its payment obligations in isolation from other relevant circumstances. In
one case,89 the buyer’s stoppage of the payment of its check was not considered to be a
ground for the seller’s right of suspension because there was a practice, established
between the parties, whereby the seller would not usually credit the buyer’s check until
it delivered the goods; there was no other possible indication of the problems in the
buyer’s financial standing and; the buyer’s conduct did not constitute a breach of
contract. A rather typical situation is where the buyer fails to pay (or makes only a
partial payment) for the previous deliveries the seller made under the contract and, on a
number of occasions, it has been held that such conduct of the buyer entitles the seller
to suspend its performance.90 The treatment of such situations has not, unfortunately,
been uniform and in one case,91 it was held that the buyer’s failure to pay for previous
deliveries, coupled with the subsequent cancellation of the payment order (presented to
the seller after the latter’s demand for payment), did not constitute a circumstance
which would, in the words of the court, be ‘a serious lack of creditworthiness on the
part of the buyer with high probability’. According to the decision, ‘[s]ingular delayed
payments or a sluggish mode of payment are normally not sufficient to show a serious
loss of creditworthiness’.92 It is submitted, with respect, that Art. 71 was interpreted too
strictly in this case.93 While the right of suspension should not be invoked too lightly,94
it is equally important that the standard of ‘becoming apparent’ be interpreted in light
of the nature and purpose of the right of suspension (i. e., its not being a drastic remedy
and its purpose of maintaining a fair balance between the parties and establishing a
dialogue and inducing cooperation). It seems reasonable to argue that, in the ordinary
course of things, the circumstances, such as those which occurred in this case, would
raise legitimate doubts in the mind of a reasonable person in the seller’s position about
the buyer’s ability and/or willingness to perform. It is more sensible and, arguably, more
in line with the expectations of business persons, to allow the seller in such situations to
suspend its performance in order to clarify the buyer’s position.
21 Where the buyer proposes to modify the terms of the contract, for example, where the
buyer offers to open a letter of credit for the remaining part of the price, as opposed to
providing a bank guarantee as required by the contract, such a conduct may make it
apparent that a substantial part of obligations would not be performed and the seller can
be justified in suspending its obligations.95 This should not, however, mean that every
89Landgericht München (Germany) 6 April 2000, CISG-Online 665 (Pace).

90See Rechtbank van Koophandel Hasselt (Belgium) 1 March 1995, JPS BVBA v Kabri Mode BV,
CISG-Online 373 (Pace) (the buyer’s seven month delay in making a full payment for the first order leads
to a ‘reasonable suspicion’ that the buyer would not pay for the future orders and justifies the seller’s
suspension of delivery relating to the second order); Arbitration Court of the Chamber of Commerce and
Industry of Budapest (Hungary) 5 December 1995, Vb 94 131 (Pace) (the buyer’s failure to pay for
previous deliveries under a framework contract led the seller ‘to believe that the buyer would not
voluntarily pay’); Tribunal Commercial de Bruxelles (Belgium) 13 November 1992, Maglificio Dalmine
Srl v S C Covires, CISG-Online 458 (Pace); Belarusian Chamber of Commerce and Industry International
Court of Arbitration (Belarus) 5 October 1995, ATT v Armco, CISG-Online 861 (Pace).
91 See Supreme Court (Austria) 12 February 1998, CISG-Online 349 (Pace).
92 Ibid.
93 For a similar view, see Karollus referred to in Posch/Petz, Austrian Cases on the UN Convention on
Contracts for the International Sale of Goods, 6 Vindobona Journal of International Commercial Law
Arbitration (2002) 20 note 102. Cf. Fountoulakis, in: Schlechtriem/Schwenzer, Commentary (2016),
Art. 71 para. 22 note 62; Huber/Mullis, The CISG (2007), p. 342.
94 See above.
95 See Arbitral Award, Tribunal of International Commercial Arbitration at the Russian Federation
Chamber of Commerce and Industry, 25 May 1998 (Pace) where, however, the seller’s right of suspension
was based not on the CISG but on the contract.
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proposal to modify the terms of the contract will inevitably meet the requirement of
‘being apparent’ as, ultimately, it is the particular circumstances which are decisive. For
example, if the buyer’s proposal to modify the terms of the contract is accompanied by
the statement that if the seller is unwilling to accept the proposal, the buyer would still be
able and willing to perform as initially agreed, then it seems clear that the seller should
not be able to suspend its obligations merely on the ground of the buyer’s offer.
When it comes to the question of whether it is apparent to a reasonable person in the 22
buyer’s position that the seller will not perform a substantial part of its obligations, the
answer to it may be quite straightforward where the seller itself makes an express
statement that it will not be able to perform. Thus, in several cases the seller told the
buyer that it would not be able to deliver on time and in such cases it has been rightly
held that the buyer was entitled to exercise the right of suspension.96 However, in most
cases the seller will not make such unequivocal statements and the buyer will have to
engage in a sometimes difficult and risky97 task of making a judgment on whether the
standard of ‘being apparent’ is met in the circumstances. The existing body of cases may
nevertheless alleviate this difficulty to some extent by providing a background against
which the buyer is to evaluate its situation.
The seller’s failure to deliver conforming goods may make it apparent that future 23
deliveries will also be non-conforming. This is likely to be so where the seller denies that
its past deliveries were defective, thereby indicating that no improvements can be
expected,98 or where all the goods (those already delivered and those to be delivered)
come from the very same source which is incapable of producing the goods in
accordance with the contract (e. g., in case of an oil well from which an oil condensate
with higher levels of mercury than those required by the contract and the Convention
was derived).99
However, the situations involving non-conformity in the goods raise a difficulty 24
where the contract is silent on the technical specifications and detailed qualities of the
goods and the parties and their experts genuinely disagree about whether or not the
goods can be deemed non-conforming.100 It could be argued that, in the absence of
clarity regarding the standard of conformity at the time of suspension, it is not
justifiable for the buyer to suspend its performance where it is highly debatable where
the delivered goods were indeed non-conforming and that the tribunal’s subsequent
decision holding that the goods to be non-conforming cannot retrospectively justify the
buyer’s suspension. While it is easy to state that the ‘innocent party must be deemed to
be aware of information and matters with which the relevant trade sector is generally
familiar’,101 ‘the relevant trade sector’ may not always have an answer to a particular
question.102 Where this is the case, it could be argued that even the reasonable person in
96 See Kantonsgericht Appenzell Ausserrhoden (Switzerland) 10 March 2003, CISG-Online 852 (Pace);
Arbitral Award, ICC 8786, CISG-Online 749 (Pace).

97 For if the buyer suspends its performance on the basis of an incorrect prognosis, it itself will be in
breach.
98 See Landgericht Berlin (Germany) 15 September 1994, CISG-Online 399 (Pace).
99 See Netherlands Arbitration Institute (Netherlands) 15 October 2002, Case 2319 (Pace).
100 See Arbitral Award, CIETAC CISG/1994/04, CISG-Online 1030 (Pace) (involving a dispute on
whether storing cow’s liver fungus in refrigeration at ‘-14\hoC’ will damage the goods; although the
parties referred to Art. 71, the seller’s alleged breach should have been analysed from the standpoint of a
possible ‘actual’, rather than ‘anticipatory’, breach); Netherlands Arbitration Institute (Netherlands)
15 October 2002, Case 2319 (Pace) (involving a dispute on the acceptable level of mercury in oil
condensate).
101 Hornung, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 71 para. 15.
102 ‘From the evidence, it is unclear whether there is a common understanding in the refining industry
what average quality for blended condensates…should have been and what levels of mercury are
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the buyer’s position would not be able to know whether the delivered goods are
conforming. If the court/tribunal later decides that the goods were non-conforming,
the seller would argue that the buyer’s prognosis could only be made prospectively,103
which would mean that the buyer did not have the right to suspend because of the
absence of clarity regarding the standard of conformity, and it is unfair for the buyer’s
suspension to be justified retrospectively.
25 It is, of course, true that the correctness of almost every exercise of the right of
suspension will be judged by the court/tribunal after the suspension had taken place.104
However, there is a difference between whether it will be so judged by reference to
knowledge available at the time of the exercise and knowledge acquired after that time.
Can it be said then, in response to the seller’s arguments, that the tribunal’s later
decision was not subsequently acquired knowledge but was knowledge which was
available to a reasonable person in the buyer’s position at the time of suspension? The
answer, it is submitted, should be ‘yes’. It is inevitable that legal questions with no
immediately available answers will arise and it is only a subsequent tribunal’s decision
which will have a final say on such questions. The courts/tribunals in such cases will
still rely on the facts known during the period prior to or at time of suspension105 and,
for that reason, cannot be said to refer to knowledge acquired after suspension. It
would also be unfair to the buyer, who alleges the non-conformity, to be denied the
right of suspension where there is no evidence of a clear standard of conformity at the
time, considering that the buyer’s position may prove right in the future. If not, the
buyer will have to take the risk of being found to be in breach. To put it differently, the
possibility of justifying the buyer’s suspension by reference to a later tribunal’s decision
can be said to be, in a sense, the Convention’s symmetrical response to the buyer
taking the risk of making an incorrect assessment about the conformity of the delivered
goods.
26 Relying on other existing cases the following guidelines can be given. In light of the
seller’s obligation to deliver the goods free from rights and claims of third parties,106 the
seller’s failure to supply the contractually required documents to this effect would, most
likely, meet the standard of ‘being apparent’.107 The same is the case where the goods,
which had been sold to the buyer and kept in a warehouse, disappear from the
warehouse after the warehouse firm was declared bankrupt and the seller is unable to
find them.108 In contrast, a seller’s mere expression of its desire not to perform in the
future may not meet this standard, particularly where afterwards the parties first agree
to continue negotiations and then are involved in a series of talks.109 Finally, it is
tolerable’ (Netherlands Arbitration Institute (Netherlands) 15 October 2002, CISG-Online 740 and 780
(Case 2319) (Pace)). The statement was made when the tribunal considered the possibility of relying on
the ‘average quality’ standard in applying Art. 35.
103 I.e., on the basis of the information available to the buyer prior to the time of suspension.
104 Bundesgericht (Switzerland) 17 July 2007, CISG-Online 1515 (Pace), where suspension of delivery
by the seller, who failed to establish deficiency in the buyer’s creditworthiness, led to the seller’s liability.
105 See, e. g., Netherlands Arbitration Institute (Netherlands) 15 October 2002, Case 2319 (Pace) (the
contract price and the long-term nature of the parties’ relationship were the decisive factors in resolving
the question of conformity of the goods).
106 See Art. 41.
107 See Federal Arbitration Court for the Western Siberia Circuit (Russia) 6 August 2002, O. I. L. Otto
International Leasing Aktiengesellschaft v Zernopererabatyvayuschiy kombinat Barnaulskaya melnitsa

(Pace).
108 Oberlandesgericht Hamm (Germany) 23 June 1998, CISG-Online 434 (Pace).
109 See Arbitral Award, ICC 8574 of September 1996, CISG-Online 1293 (Pace) (although the decision
primarily addressed the standard of ‘being clear’ in Art. 72, it also noted that the seller’s expression of its
desire to discontinue deliveries did not justify the buyer’s suspension of payment).
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suggested that, in general, a change in the economic environment and market condi-
tions, such as where a market price for the goods rises sharply, does not in itself make it
‘apparent’ that the seller will not deliver at the due date.110 It is only where there are
some additional circumstances indicative of the seller’s unwillingness (for instance,
where the seller makes ambiguous statements to the effect that it might not be able to
perform at an earlier agreed price) or inability to perform (for example, where the buyer
is aware that the seller’s suppliers are only willing to sell at increased prices and where
the seller uses the contract price, received from the buyer, to purchase the goods from
its suppliers) that the buyer may have the right to suspend.
dd) Source of information. Art. 71 does not require that the information regarding a 27
party’s inability or unwillingness to perform at a future date derive from a particular
source.111 Any source which would be regarded by a reasonable person in the position
of a party who wishes to invoke the right of suspension as a trustworthy and reliable
source will suffice.112 It follows that the reliance on an unfounded gossip should not be
allowed.113 In case the information on which a party relies to suspend its obligations
turns out to be untrue, it is the standard of a reasonable person that should, once again,
be decisive: if a reasonable person in a suspending party’s position would regard, at the
time prior to the suspension, the information as reliable, then the risk of the incorrect-
ness of the information should fall on the other party, and vice versa.114
c) Obligations which can be suspended. An unresolved issue is whether there needs 28
to be some kind of connection between the obligations which can be suspended and the
obligations a substantial part of which is expected not to be performed. This issue
manifests itself in at least two inter-related questions.
The first question is whether a party is allowed to suspend only that type of obligations 29
which can be regarded as an ‘agreed return’ for the type of obligations anticipatory non-
performance of which is expected. For example, it is clear that where it is apparent that
the seller will not be able to deliver the goods, i. e. one of its primary obligations, then
clearly the corresponding primary obligation of the buyer, for the purposes of suspension,
is to pay the price. However, where it is apparent that the buyer will not comply with the
contractual duty of confidentiality regarding the expertise and know-how passed by the
seller in the course of performing the contract, what is a corresponding type of obligation
that the seller can suspend?115 It is suggested that while there may not be a precisely
corresponding obligation, it is still the primary duties of delivery, payment and taking
delivery, as the case may be, to which suspension is to be generally applied. After all, most
110Cf. White/Summers, Uniform Commercial Code (2000), p. 198.

111See Carter, Suspending Contract Performance for Breach, in: Beatson/Friedman (eds), Good Faith
and Fault in Contract Law (1995), p. 508.
112 A somewhat similar position to that taken in the main text can be found in comment 3 to § 2–609
UCC. English courts, however, have taken a more restrictive approach. In Universal Cargo Carriers
Corporation v Citati [1957] 2 BQ 401 at 405 Devlin J refused to recognise the sufficiency of a ‘well-
informed opinion on the market’ on the ground that ‘anticipatory breach must be proved in fact and not
in supposition’. However, it seems that because establishing an anticipatory failure to perform involves
inquiry into the future and, therefore, a degree of speculation, rarely will it be possible to prove it ‘in fact’.
For a similar view, see Ze, Anticipatory Breach of Contract – the PRC System and English Comparisons,
Lloyd’s Maritime and Commercial Law Quarterly (1993) 266.
113 See Carter, Suspending Contract Performance for Breach, in: Beatson/Friedman (eds), Good Faith
and Fault in Contract Law (1995), p. 508.

114 See Enderlein/Maskow, International Sales Law (1992), pp. 284 seq. who, while taking a similar view,
incorrectly rely on the suspending party’s actual knowledge, rather than on the standard of a reasonable
person.
115 See Arbitral Award, CIETAC CISG/2002/29 (Pace) and accompanying text.
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obligations in a sales contract are directed towards enabling the parties to provide an
agreed return (delivery of the goods and payment of the price) and creating the necessary
conditions and putting in place the safeguards for this purpose. Thus, in the example
above, the duty of confidentiality is likely to be an essential condition for the seller’s
delivery of the machinery and if there are grounds to expect that this condition will not be
met, it is only natural for the seller to suspend its obligation to deliver the goods.
30 At the same time, instances do arise where a party suspends its ‘ancillary’ duties to
induce the other party to perform its primary duties. For example, the seller may have to
suspend its duty to repair the goods to induce the buyer to perform its obligation to
pay.116 It is also relevant to note that the right to suspend performance will not be
effective in the context of some modern payment instruments. Thus, if the buyer has
opened an irrevocable letter of credit, the right to suspend payment becomes impossible.
The suspension of payment is only possible where the letter of credit is revocable or
where the letter of credit has not yet been opened and the buyer refrains from taking the
necessary steps to open it. Therefore, so far as the remedy of suspension is concerned, the
buyer who has opened an irrevocable letter of credit is left with the option of suspending
either its main obligation to take delivery or some other obligations which are not treated
by the Convention as the buyer’s primary duties. Such obligations can include, for
example, the buyer’s duty to provide information to the seller enabling the latter to
produce the goods117 or, in an FOB contract, to enter into the contract of carriage and to
give the seller notice of the vessel name, port of loading and time of delivery.118
31 Secondly, do the suspended obligations have to correspond in extent to that of the
obligations a non-performance of which is expected? For instance, if, after the buyer has
made an advance payment of thirty percent of the contract price, it is apparent that the
buyer will not be able to pay the remaining contract price at the due date, can the seller
suspend the delivery of all the goods or can the seller suspend the delivery of not more
than seventy percent of the goods? Although the Convention’s silence regarding this
question is sometimes taken as an indication of the absence of any requirement of
‘proportionality’,119 the position in some cases is that the extent of the suspended
obligations must correspond to that of those obligations which are anticipated not to be
performed. Thus, where the buyer anticipated that the seller, who had already delivered
part of the goods, would not be able to deliver the remaining goods, it was held that the
buyer could not suspend the price for the delivered goods and only the performance
which was ‘mutual’ with, or corresponded to, the performance an anticipatory non-
performance of which was expected could be suspended.120
32 Such an approach in this type of cases seems, in general, correct121 since here, the
seller can be said to have ‘earned’ the payment by the buyer of that part of the price
116 Arbitration Court of the Chamber of Commerce and Industry of Budapest (Hungary) 5 December
1995, Vb 94 131 (Pace).

117 See, e. g., Art. 65.
118 See, e. g., Ramberg, ICC Guide to Incoterms 2000: Understanding and Practical Use (2000) pp. 102 seq.
119 See Carter, Suspending Contract Performance for Breach, in: Beatson/Friedman (eds), Good Faith
and Fault in Contract Law (1995), pp. 511 seq.

120 See Oberlandesgericht Düsseldorf (Germany) 24 April 1997, CISG-Online 385 (Pace); Arbitral
Award, ICC 9448 of July 1999, CISG-Online 707 (Pace). See also Oberlandesgericht Karlsruhe (Germany)
20 July 2004, CISG-Online 858 (Pace) (where it is not entirely clear whether a reference to ‘a relationship
of mutuality in terms of [Article] 71(1) CISG’ is intended to indicate proportionality between the
suspended obligations and the obligation which is expected not to be performed); Chamber of National
and International Arbitration of Milan (Italy) 28 September 2001, CISG-Online 1582 (Pace) (in the
context of an instalment contract).
121 See Saidov, Anticipatory Non-Performance and Underlying Values of the UNIDROIT Principles,
Uniform Law Review (2006) 795 (818 seq).
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Section I. Anticipatory breach and instalment contracts 33 Article 71

which corresponds to the value of the delivered goods.122 However, most cases would
present much greater challenges for the advocates of the ‘proportionality’ or ‘mutuality’
requirement.123 For example, because the seller’s delivery is to be made in the future, the
buyer may not be in the position to determine precisely the extent of the expected non-
conformity in the goods and to ascertain that part of its own performance which can be
correspondingly suspended. Imposing the requirement of proportionality in such cases
would hardly make it possible for suspension to be exercised, thus depriving this
remedy of much of its use and value. At the same time, there is something to be said
in favour of requiring proportionality where reasonably possible: not only will it
introduce symmetry but it can also be said to be fair to link the suspended obligations
with those which are expected not to be performed.124 In addition, if proportionality is
regarded as a Convention’s general principle,125 then the said linkage can be said to
necessarily follow from such a general principle.
In light of these conflicting considerations, it is suggested that one solution is to 33
require that suspension be proportionate only where it is reasonable for the suspending
party to do so. One instance where it is clearly unreasonable to impose this requirement
is where the suspending party is simply not in a position to determine the degree of the
expected non-performance.126 Another instance could be where the suspending party
expects that a fundamental breach127 will occur which will entitle it to avoid the contract
122 See, however, Nyer, Withholding Performance for Breach in International Transactions: an Exercise in
Equations, Proportions or Coercion?, 18 Pace International Law Review (2006) 29 (40) arguing, in the
context of a general right to withhold performance that, in general, whether or not a partial performance
has been rendered should be irrelevant since the suspension of the performance of the whole obligation will
promote the coercive and ‘self-help’ nature of the remedy: ‘It is only where A‘s retaining his performance
puts B at risk of forfeiting the full value tied up in his partial performance that an incentive to cure is
created…When suspension is conceived as a coercive measure, A‘s disproportionate reaction is reasonable
and, indeed, necessary’. The author, however, takes the view that this reasoning is not relevant in
anticipatory breach context on the ground that then the party suspected of an anticipatory breach has
not yet performed and therefore ‘does not run the risk of forfeiting the value tied up in his performance’
(ibid. note 41). However, as the cases referred to above demonstrate, the party under suspicion may already
have rendered a partial performance and, relying on the author’s reasoning and view of the coercive nature
of suspension, it can be argued that, similar to what has been said in relation to a general right to withhold
performance, allowing the party to suspend the performance of obligations corresponding not only to the
obligations due in the future but also to those already performed would promote the remedy’s coercive
nature. If this is correct, an argument that a ‘disproportionate’ suspension is more appropriate can, in
principle, be made. Cf. Carter, Suspending Contract Performance for Breach, in: Beatson/Friedman (eds),
Good Faith and Fault in Contract Law (1995), p. 512 for the view that it is ‘proportionate suspension’
which ‘would give effect to the enforcement function of suspension’.
123 Carter, Suspending Contract Performance for Breach, in: Beatson/Friedman (eds), Good Faith and
Fault in Contract Law (1995), pp. 511 seq.; Carter, Adequate Assurance of Due Performance, 10 Journal
of Contract Law (1996) 7.
124 See also Carter, Suspending Contract Performance for Breach, in: Beatson/Friedman (eds), Good
Faith and Fault in Contract Law (1995), pp. 511 seq.; Carter, Adequate Assurance of Due Performance,
10 Journal of Contract Law (1996) 7. For other factors which, albeit mentioned in the context of a
general right to withhold, may prove relevant and point in favour of a proportionate suspension in
the context of Art. 71, see Nyer, Withholding Performance for Breach in International Transactions:
an Exercise in Equations, Proportions or Coercion?, 18 Pace International Law Review (2006) 29 (42
seq.).
125 On the principle of proportionality, see, e. g., Lando, CISG and Its Followers: A Proposal to Adopt
Some International Principles of Contract Law, 53 American Journal of Comparative Law (2005) 379
(397 seq.); Lando, Salient Features of the Principles of European Contract Law: A Comparison with the
UCC, 13 Pace International Law Review (2001) 339 (360 seq.); Hornung, in: Schlechtriem/Schwenzer,
Uniform Law Review (2006) 795 (820).

127 See Art. 25.
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and it may be wasteful and burdensome to require this party to perform one part of its
obligations while suspending the remaining part where it is highly likely that it may
shortly afterwards be able to avoid128 the contract altogether.129
34 A situation where only proportionate suspension may be appropriate could be where
the anticipated non-performance is not of fundamental nature and suspending all of the
obligations by a party is likely to damage the other party’s interests significantly: the
seller’s business may depend on the buyer paying the price in advance, thereby enabling
the seller to run the manufacture or to purchase the goods from its suppliers, or the
buyer’s economic survival may be fully dependent on the seller’s continuous perfor-
mance.130 Thus, it would seem that while the approach suggested here will introduce a
degree of complexity and uncertainty into the remedy of suspension, it will enable
judges and arbitrators, in the spirit of the Convention’s idea and general principle of
reasonableness, to balance the conflicting considerations, set out above, and the interests
of both parties against the circumstances of a particular case.
35 d) Parties’ derogation from the right to suspend. The parties can exclude or
derogate from the right to suspend in Art. 71131 as the contract can contain an express
term to this effect. In one case,132 the contract expressly provided that the buyer’s delay
in providing a bank guarantee would give the seller the right to suspend delivery and
there is little doubt that such a clause is a clear indication of the parties’ intention to
derogate from the right of suspension in Art. 71. The question can arise as to whether
such a clause can be regarded as an intention to exclude the remedy in Art. 71 in all
cases (i. e., including those not involving delay in providing a bank guarantee) or
whether the parties intended to exclude Art. 71 only in cases relating to a bank
guarantee. The answer to this question will depend on the interpretation of the
intentions of the parties in accordance with the requirements of Arts 8 and 9.
36 In some cases, the contract will not contain an express clause and their intention to
derogate can be inferred from the parties’ conduct, statements and other relevant
circumstances. For example, the seller (who expects a failure to pay because of the
buyer’s failure to pay for previous deliveries) may wish to suspend the performance of
128See Art. 72.
129Suppose that on 3 February the buyer becomes aware of the circumstances giving rise to serious
suspicions that the seller will only be able to deliver forty percent of the contract quantity which would be
a fundamental breach of the contract. The buyer may be required to pay the entire contract price in
advance on 4 February or to open a letter of credit by that date. It would seem that that the buyer should
be allowed to suspend the payment in full or not open a letter of credit. Making the buyer pay forty
percent of the price, whilst there is a possibility that the buyer may soon be able to avoid the contract,
may create unnecessary practical inconvenience and expense. If the buyer is only allowed to exercise
proportionate suspension but then justifiably avoids the contract, it may be deprived of some of its money
for the period until the seller returns it and, even worse, in case the seller refuses to do so (e. g., if the seller
disputes the buyer’s actions), the buyer may have to incur additional legal and other costs to be able to
recover that money. Conversely, if the buyer is allowed to withhold the entire contract price, such
inconvenience and expense will be avoided.
130 See, e. g., Nyer, Withholding Performance for Breach in International Transactions: an Exercise in
Equations, Proportions or Coercion?, 18 Pace International Law Review (2006) 29 (note 34), referring to a
case decided in France where the buyer’s business depended on the seller’s continuous maintenance of its
IT system and the suspension of those obligations would have put the buyer’s enterprise at risk.
131 See Art. 6. In some cases, the contract may entitle a party to suspend its performance, but the
grounds and preconditions for suspension may be more limited than those in the Convention. In one
such case, initially the tribunal rightly held that it was the contract, not the Convention, that governed the
grounds and preconditions for the exercise of the right to suspend performance (see Arbitral Award,
Tribunal of International Commercial Arbitration at the Russian Federation Chamber of Commerce,
12 November 2004, CISG-Online 2406 (Pace)). See notes 153 and 154 for a further discussion of this case.
Chamber of Commerce, 25 May 1998 (Pace).
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its obligations by means of not returning the goods to the buyer after taking them back
from the buyer in order to make the necessary adjustments. In a case based on similar
facts,133 the court held that because the seller had assured the buyer that it would return
the goods, the parties could be said to have implicitly agreed to derogate from the right
of suspension under Art. 71, noting, with reference to the consideration of good faith,
that the buyer ‘was entitled…to trust’ that the seller would return the goods.
e) Relationship between Arts 71 and 80. There is a close connection between the right 37
to suspend under Art. 71 and the logic underlying Art. 80.134 It is often the case that
judges and arbitrators rationalise cases from the standpoint of Art. 80, where Art. 71 is
applicable. For example, it has been said that where the buyer fails to pay for previous
deliveries, it is that failure which causes the seller not to deliver the goods,135 or where the
seller refuses to clarify its position regarding the performance of the contract, it is the
seller’s behaviour which makes the buyer withhold the payment.136 In short, the suspen-
sion of performance can, in principle, be rationalised by reference to ‘causation’ con-
siderations. It is suggested, however, that where Art. 71 is applicable there is no need for
courts and tribunals to do so. It is surely easier, and at the same time more convincing, to
analyse a party’s legal position by reference to a remedy available in the specified situation
(such as that stipulated in Art. 71) than to rely on a potentially complex and shaky
‘causation’ analysis. For example, where the seller fails to nominate the port of loading,
there is no need to rely, as has been done in one case,137 on Art. 80, thereby stretching the
notion of causation, to justify the buyer’s non-opening of a letter of credit where a letter
of credit can, in principle, be opened without the seller’s nomination of the port.138 So
long as the seller’s failure to nominate the port of loading is sufficient to meet the
requirements of Art. 71, the latter constitutes a more solid legal basis.139
f) Notice of suspension. A party suspending performance must immediately give a 38
notice of suspension to the other party to enable the latter to provide adequate
assurance of its performance.140 A controversial issue, arising from this provision,
133 Oberlandesgericht Köln (Germany) 8 January 1997, CISG-Online 217 (Pace). Although the court
treated the seller’s attempt to suspend from the standpoint of Art. 71, it is not entirely clear whether the
seller was attempting to induce the buyer to perform its future obligations (in which case Art. 71 would be
applicable) or whether it was attempting to make the buyer to perform its obligations the due date for
which had already passed (in which case Art. 71 would not be applicable).
134 ‘A party may not rely on a failure of the other party to perform, to the extent that such failure was
caused by the first party’s act or omission’ (Art. 80). See Belarusian Chamber of Commerce and Industry
International Court of Arbitration (Belarus) 5 October 1995, ATT v Armco, CISG-Online 861 (Pace)
(‘Article 80 of the CISG closely interconnects with Article 71’).
135 Belarusian Chamber of Commerce and Industry International Court of Arbitration (Belarus)
5 October 1995, ATT v Armco, CISG-Online 861 (Pace).

136 See Zürich Chamber of Commerce (Switzerland) 31 May 1996, Soinco v NKAP (Pace).
137 See, e. g., Oberster Gerichtshof (Austria) 6 February 1996, CISG-Online 224 (Pace).
138 Although the court treated the nomination as a precondition for the opening of a letter of credit, it
is not apparent from the facts of the case whether there was clear and strong evidence of the parties’
intention to this effect. For a more detailed discussion of this case, see Saidov, The Law of Damages in
International Sales – The CISG and other International Instruments (2008), pp. 97 seq.
139 The court of lower instance did in fact rely on Art. 71 to justify the buyer’s non-opening of the letter
of credit on the basis that the seller failed, in breach of contract, to get approval from its supplier to
export the goods to Benelux countries (i. e., where the buyer intended to resell the goods). See also
Arbitral Award, CIETAC CISG/1989/02, CISG-Online 1230 (Pace) where the tribunal held that because
the buyer had failed to make a down payment, the seller was exempt from its obligation to deliver the
goods by the due date. It is not entirely clear whether it is Art. 71 or Art. 80 that was the basis for the
decision. If it were the latter, then it seems evident that a more extensive analysis would be called for.
140 See Art. 71(3). See also Arbitral Award, ICC 8574 of September 1996, CISG-Online 1293 (Pace)
(stating that Art. 71(3) is based on the “concern that the other Party is made clear of the position of its
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relates to the consequences of a suspending party’s failure to give this notice. According
to a majority of the reported decisions, giving this notice is a necessary precondition for
the exercise of the right of suspension and, therefore, a failure to inform of suspension
prevents a legally justifiable exercise of this right.141 However, there is also some support
for the view that the notice under Art. 71(3) is not necessary for the exercise of the
remedy of suspension and a party’s failure to give it will only provide the basis for a
possible claim for damages by the other party.142
39 On balance, a better approach seems to be to regard the notification of suspension as
a necessary precondition for the right of suspension. Such a position would be more in
line with the purpose of the remedy of suspension of establishing a dialogue and
cooperation between the parties and its function of inducing the party under suspicion
to restate its commitment to the contract. More specifically, the operation of the right to
suspend is inextricably linked with the demand for adequate assurance and a party
under suspicion is more likely to be induced to explain and provide assurances
regarding its position in response to a notice of suspension than in the absence of such
a notice.143 While there is some force in the criticism of linking the consequences of an
anticipated non-performance with the provision of notice, the Convention already
employs a similar structure in relation to the buyer’s ability to rely on a lack of
conformity.144 In any event, in light of the existing controversy, the parties wishing to
invoke their rights under Art. 71 are well advised to provide the notice of suspension to
eliminate the risk of being found not to have met the condition for the exercise of this
remedy, particularly considering that doing so is in their own interests.
40 Like any other notice, a notice of suspension is subject to Art. 27145 and this means
that a notice becomes effective from the moment of its dispatch. It is worth emphasising
the importance of a suspending party actually sending a notice since proof that a notice
has merely been written will not be sufficient to transfer the risk of non-receipt by the
counter party, placing him in a position to provide assurance that he will in fact perform and thereby
defeating the assumption of anticipatory breach and the concomitant threat to the orderly fulfilment of
the contract”).
141 See Oberlandesgericht Karlsruhe (Germany) 20 July 2004, CISG-Online 858 (Pace); Amtsgericht
Frankfurt (Germany) 31 January 1991, CISG-Online 34 (Pace) (in relation to the stoppage in transit);
Landgericht Darmstadt (Germany) 29 May 2001, CISG-Online 686 (Pace); Arbitral Award, ICC 11 849/
2003, CISG-Online 1421 (Pace); Tribunal of International Commercial Arbitration at the Ukraine
Chamber of Commerce and Trade (Ukraine) 48/2005, CISG-Online 1372 (Pace); Arbitral Award, Tribunal
of International Commercial Arbitration at the Russian Federation Chamber of Commerce and Industry,
27 July 1999 (Pace); possibly, Rechtbank Utrecht (Netherlands) 18 July 2007, CISG-Online 1551 (Pace).
142 Hornung, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 71 para. 21 stating “It would not
be understandable to link the habitual consequences of an ordinary breach of contract to a failed or even
merely belated notice of suspension under Article 71(3) by an otherwise innocent party. The relatively
narrow scope of the right to suspend performance in Article 71(1) is in itself an operational corrective for
its misuse, and thus, posing the notice foreseen by Article 71(3) as an additional precondition for the
remedy would amount to breaking a butterfly on a wheel”. For a similar position, see Huber/Mullis, The
CISG (2007), p. 343; Enderlein/Maskow, International Sales Law (1992), p. 288 (with further reference).
This view has also been supported by the fact that the notice is not required to be given prior to
suspension; see Vanwijck-Alexandre, Anticipatory Breach and Instalment Contracts in the CISG, 3–4
143 For similar views, see Leser, in: Schlechtriem (ed.), Commentary on the UN Convention on the
International Sale of Goods (CISG) (1998), Art. 71 para. 21 stating “Breach of a duty to give notice
cannot sensibly be separated from the remedy of suspension itself and compensated for with a separate
award of damages. The duty to give notice is an integral part of the way in which the right is
constructed”; Liu, Suspension or Avoidance Due to Anticipatory Breach: Perspectives from Arts. 71/72
CISG, the UNIDROIT Principles, PECL and Case Law (Pace).
144 See Art. 39.
145 See Landgericht Stendal (Germany) 12 October 2000, CISG-Online 592 (Pace).
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other party.146 It can also be safely stated that no particular form is required by the
Convention. As long as the notice is appropriate in the circumstances, it is irrelevant
whether it has been given orally or in writing, unless the parties have agreed other-
wise.147 It follows that any means of communication, provided that it is appropriate and
adequate in the circumstances, will suffice.148
Art. 71 is silent on the issue of content of the notice of suspension. Since the purpose 41
of this notice is to enable the party under suspicion to provide adequate assurance, it is
most desirable that a suspending party indicate the grounds for suspension.149 In fact,
one decision formulated the position in stricter terms by stating that ‘[i]f the seller
wanted to exercise his right of suspension, the seller was obligated to inform the buyer
about any existing or arisen doubts with regards to her creditworthiness or ability to
perform…’.150 In some cases, however, the parties’ conduct and statements will not be
clear-cut and the possibility of an implied notice should be recognised.151 In one
case,152 the seller’s request for a copy of bank documentation coupled with the
statement that such documentation would enable it to confirm the shipping arrange-
ments and the timely shipment of the goods, was regarded as a sufficient notice of
suspension. In another case,153 the seller’s rejecting the supply orders by the buyer, who
had delayed making payments, and instead offering the supply of the goods subject to
the buyer’s prepayment or provision of a bank guarantee were deemed to constitute a
notice under Art. 71(3), containing a request for adequate assurance.154 In another
146 See, e. g., Tribunal of International Commercial Arbitration at the Ukraine Chamber of Commerce
and Trade (Ukraine) 48/2005, CISG-Online 1372 (Pace) stating that “the Seller has not proved that the
messages in fact were sent to the Buyer even though they were indeed written by the Seller”; see von
Ziegler, The Right of Suspension and Stoppage in Transit (and Notification thereof), 25 Journal of Law
and Commerce (2005–2006) 353 (372) (Pace) for a more extensive discussion and further references.
147 See Art. 6.
148 For specific examples of what may or may not be adequate, see von Ziegler, The Right of Suspension
and Stoppage in Transit (and Notification thereof), 25 Journal of Law and Commerce (2005–2006) 353
(371 seq.) (Pace). For the case, where the seller’s notice of suspension was given in a ‘pre-arbitration
warning’, see Arbitral Award, Tribunal of International Commercial Arbitration at the Russian Federa-
tion Chamber of Commerce and Industry, 29 February 2000, in; Rozenberg (ed.), Praktika Mezhdunar-
odnogo Kommercheskogo Arbitrazhnogo Suda pri TPP RF za 1999–2000gg. (2002), pp. 233 seq. See also
CISG-AC Opinion no 1, para. 71. (a notice of suspension “includes electronic communications, provided
that the addressee expressly or impliedly has consented to receiving electronic communications of that
type, in that format, and to that address”).
149 In fact, this is what the parties sometimes do. See Oberlandesgericht Hamm (Germany) 23 June
1998, CISG-Online 434 (Pace), and Belarusian Chamber of Commerce and Industry International Court of
Arbitration (Belarus) 5 October 1995, ATT v Armco, CISG-Online 861 (Pace). See also Bennett, in:
Bianca/Bonell, Commentary (1987), Art. 71 para. 2.10 and Enderlein/Maskow, International Sales Law
(1992), p. 288 (also emphasising the consideration of good faith).
150 Amtsgericht Frankfurt (Germany) 31 January 1991, CISG-Online 34 (Pace).
151 See Arts 8 and 9.
152 Supreme Court of British Columbia (Canada) 21 August 2003, Mansonville v Kurtz, CISG-Online
1017, paras 31 and 78 (Pace).

Chamber of Commerce, 12 November 2004, CISG-Online 2406 (Pace).

154 The applicability of Art. 71(3) in this case is questionable given that the contract contained a special
regime for the right to suspend. This contractual regime provided for more limited grounds and
preconditions for the right to suspend and, initially, the tribunal rightly held that the preconditions for
the right to suspend under Art. 71 were not applicable (see also n 131 above). However, the tribunal went
on to apply Art. 71(3) seemingly on the basis that the contract did not provide for the consequences of
the seller’s exercise of its right to suspend. This proposition seems at odds with the earlier finding that the
contract expressly stated that the delay in payment did not ‘require immediate notification’ and that the
seller’s refusal to perform did not require any notification. Even in the absence of such provisions, the
applicability of Art. 71(3) would, on balance, be questionable in the face of the parties’ intention to create
their own suspension regime that was different from that in the CISG: arguably, had the parties wanted
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case,155 the buyer’s letter in which it refused to accept defective goods (which,
presumably, were indicative of the seller’s inability to perform in the future) and
offered their return was also viewed as a notice of suspension.156 However, a simple
failure to perform cannot in itself be regarded as a notice of suspension,157 unless there
are some additional circumstances (such as previous talks between the parties in which
the innocent party has expressed its concerns or referred to the possibility of suspen-
sion)158 in combination with which a failure to perform sufficiently communicates the
party’s suspension and reasons for it. At the same time, the suspending party cannot be
expected to be too strenuous in its efforts to inform the other party. If the suspending
party has given, albeit once, a clear notice containing a demand for assurance, it
cannot, contrary to what has been held in one case,159 be required to continue to urge
the other party to respond to its notice and to make attempts to negotiate.
42 The question of whether a suspending party can be regarded as having given a valid
notice can give rise to additional difficulties where the suspending party communicates
its intentions not to the other party itself but to some other person who is in some ways
associated with it. In such cases, whether that other person is an agent of the party
under suspicion has been said to be relevant160 and, if this is correct, recourse may have
to be had to the rules of domestic law to determine whether there is an agency
relationship. In one case,161 involving twelve sales contracts with thirteen sellers, all
engaged in oil upstream activities under joint operating agreements (JOAs), the problem
of the buyer’s communication to a third party arose in an acute form. The buyer gave
notice to a party who acted as the operator under the said JOAs and the decisive
question was whether that notice could be regarded as a notice to all other sellers.162
Having found that the JOAs were concerned with upstream activities (i. e. exploration
for, development and production of oil) and not sales contracts, and that it was the
latter that governed the relationship between the sellers and the buyer, the tribunal held
the Art. 71(3) notice requirement to apply, they would have expressly provided for its equivalent or for
the applicability of Art. 71(3) in their contract.
155 Landgericht Berlin (Germany) 15 September 1994, CISG-Online 399 (Pace).
156 Relying solely on the decision, this notice may be more reminiscent of a notice of avoidance rather
than suspension. However, in the absence of a clear intention to avoid such a statement by the buyer can,
in principle, be interpreted as a sufficient notice of suspension. In addition, the text of the buyer’s letter
which is not reproduced in the decision may have contained some other indications of the buyer’s
intention to suspend. See also Arbitral Award, Tribunal of International Commercial Arbitration at the
Russian Federation Chamber of Commerce and Industry, 29 February 2000, in: Rozenberg (ed.), Praktika
Mezhdunarodnogo Kommercheskogo Arbitrazhnogo Suda pri TPP RF za 1999–2000gg. (2002), p. 233.
157 See Landgericht Stendal (Germany) 12 October 2000, CISG-Online 592 (Pace) (‘[s]imply failing to
pay the purchase price does not replace the notification that payment of the purchase price is being
suspended’).
158 Arbitral Award, ICC 8611/HV/JK, 23 January 1997, CISG-Online 236 (Pace) may be relevant in this
regard.
159 Arbitral Award, CIETAC CISG/1996/16 (Pace).
160 “the question arises whether the notification to K. … BV and the subsequent discussions and
negotiations with K. … BV amounted to a notification to [the sellers]. This may be so under any agency
theory if it were established that K. … BV acted in a capacity of express, implied or apparent agent of
[the sellers] regarding the increased mercury level problem and its possible solutions” (Netherlands
Arbitration Institute (Netherlands) 15 October 2002, CISG-Online 740 and 780 (Case 2319) (Pace)).
161 Ibid.
162 “The question of K. … BV’s capacity, thus, boils down to the question whether [the buyer] could
rely upon the fact that when the operational problems regarding the increased levels of mercury could
not be solved when the source of these levels became known, it was up to K. … as the operator under the
Terminalling, Off take and two of the three exploration Joint Operating Agreements to inform [the
sellers] at some point in time about the problems. If so, [the sellers] would have reasonably led [the
buyer] to believe that they had been so informed and [the buyer] could have relied on that” (ibid).
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that the sellers did not receive the notification.163 Therefore, it is advisable that in this
type of case, suspending parties give notice, where possible, directly to the party(ies)
under suspicion in order to ensure that the requirement of Art. 71(3) are met.164
The notice must be given ‘immediately’ after suspension. This requirement seems to 43
be driven by the concern that due to the need for a prompt action a suspending party
may not have time to give a prior notice.165 It would follow from this rationale that a
party is allowed to give a notice prior to suspension.166 The ‘immediacy’ requirement
means that a notice needs to be given without any avoidable delay:167 giving a notice
thirteen days,168 several months,169 or three years170 after suspension would not meet
this requirement.
2. Stoppage in transit
a) General. If the seller had dispatched the goods before the grounds in Art. 71(1) 44
became evident, it may, under Art. 71(2), prevent the handing over of the goods to the
buyer. This right, commonly known as ‘stoppage in transit’, is a manifestation of the
seller’s right of suspension in a specific set of circumstances. A corresponding right of
the buyer was not introduced into the Convention as it was feared that it would disrupt
international payment transactions and because in some countries the non-payment of
a cheque constitutes a criminal offence.171 In those legal systems in which a similar
remedy is available,172 it has been primarily justified from the standpoint of commercial
morality173 and justice:174 the seller cannot be expected to deliver the goods where the
buyer is in a financial difficulty and is entitled to treat its goods as security for payment.175
It is now widely recognised, however, that the practical significance of this remedy has
163 “On the basis of the sales contracts, no operator alone could bind any seller and both operational
and commercial issues regarding the Rijn Blend contracts were to be handled respectively also by the
seller or only by the seller involved” (Ibid.).
164 See also Oberlandesgericht Karlsruhe (Germany) 20 July 2004, CISG-Online 858 (Pace) where the
buyer gave a notice to a fashion agency but where the relationship between the agency and the seller was
not clearly explained.
165 See Bennett, in: Bianca/Bonell, Commentary (1987), Art. 71 para. 2.5; see also Vanwijck-Alexandre,
Anticipatory Breach and Instalment Contracts in the CISG, 3–4 International Business Law Journal
(2001) 360 (362) referring to the argument that prior notice is not justified because of the temporary
nature of suspension.
166 For a similar view, see Fountoulakis, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 71
para. 34.
167 See ibid.
168 Landgericht Darmstadt (Germany) 29 May 2001, CISG-Online 686 (Pace).
169 Hof van Beroep Gent (Belgium) 26 April 2000, BV BA JP v S Ltd, CISG-Online 1316 (Pace).
170 Landgericht Stendal (Germany) 12 October 2000, CISG-Online 592 (Pace).
171 See Bennett, in: Bianca/Bonell, Commentary (1987), Art. 71, para. 1.12; Enderlein/Maskow, Interna-
tional Sales Law (1992), p. 286. For the discussion of other possible reasons in the context of the ULIS, see
Cohn, The Defence of Uncertainty: A Study in the Interpretation of the Uniform Law on International
Sales Act 1967, 23 International Comparative Law Quarterly (1974) 520 (533). For the view that the
equality between the buyer and the seller is thereby abandoned, see ibid.
172 The origin of this remedy can be traced back to mercantile customs in the 17th century. See, e. g.,
Booth Steamship Co Ltd v Cargo Fleet Iron Co Ltd [1916] 2 KB 570 at 589, 597; Bridge, The Sale of Goods
(2009) p. 689. For a comparative work covering nineteen jurisdictions, see von Ziegler/Ronoe/Debattista/
Plegat-Kerrault, Transfer of Ownership in International Trade (1999). The remedy was also provided for
in Art. 73 ULIS.
173 See Atiyah/Adams/MacQueen, The Sale of Goods (2010), p. 457.
174 See, e. g., In re The National Sugar Refining Company v C Czarnikow, 27 B. R. 565 at 568 stating that
the right of stoppage in para. 2–705 UCC “is premised on the inequity of permitting the buyer to obtain
possession of goods when there has been a prospective failure of the buyer’s performance”.
175 For more extensive discussions and criticisms of various justifications put forward in the common
law, see Bridge (ed.), Benjamin’s Sale of Goods (2014) p. 940; Bridge, The Sale of Goods (2014) pp. 594 seq.
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considerably diminished mainly due to the development of other means of providing

security to the seller, such as the payment against documents (most commonly, letter of
credit) and retention of title clauses,176 and, to some extent perhaps, to the rapidity of
transit in modern times which decreases the time available for its exercise.177 The remedy
can nevertheless still be invoked where goods are sold on credit.178
45 The right of stoppage is available regardless of whether the property or risk has
passed to the buyer179 or whether the buyer holds the documents entitling him to
require the delivery of the goods.180 The notice requirement in Art. 71(3) is similarly
applicable to the exercise of this right.181
46 b) The exercise of the right of stoppage. The remedy of stoppage in transit ‘relates
only to the rights in the goods as between the buyer and the seller’182 and this provision
brings about the situation where the actual exercise of this remedy and the question of
when the goods can be said to be in transit will often depend on the laws outside the
Convention. This is so because the exercise of stoppage in transit impacts on and collides
with the rights and interests of third parties (e. g., carriers, buyer’s creditors, sub-buyers,
state authorities) thereby having to intersect with other legal regimes (e. g., those relating
to transportation, insolvency, property).183 The likely dependence of the seller’s ability to
exercise a remedy, provided for by the CISG, on other legal regimes potentially gives rise
to much uncertainty in this area, arguably diminishing the effectiveness of this remedy,184
and no doubt undermines the Convention’s aspiration to uniformity.185
47 The right of stoppage, if successfully exercised, will enable the seller to gain access to
the goods in transit.186 The remedy is available where the seller has dispatched the goods
176 See, e. g., see Bridge (ed.) Benjamin’s Sale of Goods (2014), pp. 940 seq.; Bridge, The Sale of Goods
(2014) pp. 594 seq.; Atiyah/Adams/MacQueen, The Sale of Goods (2010), pp. 457 seq.; Debattista,
England, in: von Ziegler/Ronoe/Debattista/Plegat-Kerrault, Transfer of Ownership in International Trade
(1999), p. 147 referring to this remedy as “somewhat archaic”.
177 See Bridge, The Sale of Goods (2010) pp. 689 seq.
178 See Atiyah/Adams/MacQueen, The Sale of Goods (2010), pp. 457 seq.
179 See Honnold/Flechtner, Uniform Law (2009), Art. 71 para. 390; Schlechtriem, Uniform Sales Law:
The UN-Convention on Contracts for the International Sale of Goods (1986), p. 93; Fountoulakis, in:
180 See Art. 71(2).
181 See Amtsgericht Frankfurt (Germany) 31 January 1991, CISG-Online 34 (Pace). For the discussion
of whether the notice of suspension is a necessary precondition for the exercise of the right of suspension,
see above.
182 See Art. 71(2). See, generally, Pejovic, Stoppage in Transit and Right of Control: “Conflict of Rules”?
20 Pace International Law Review (2008) 129.

183 The issue of the passage of property is outside the Convention’s scope (see Art. 4). See von Ziegler,
The Right of Suspension and Stoppage in Transit (and Notification thereof), 25 Journal of Law and
Commerce (2005–2006) 353 (366) (Pace).
184 See Bennett, in: Bianca/Bonell, Commentary (1987), Art. 71 para. 2.8; Flechtner, Remedies under the
New International Sales Convention: The Perspective from Article 2 of the U. C. C., 8 Journal of Law and
Commerce (1988) 53 (n 203) (Pace).
185 See Albors, Spain, in: von Ziegler/Ronoe/Debattista/Plegat-Kerrault, Transfer of Ownership in
International Trade (1999), p. 352; Berman, The Uniform Law on International Sale of Goods: A
Constructive Critique, 30 Law and Contemporary Problems (1965) 354 (358) stating, in the context of
the ULIS, that ‘it is surely unsound when the rights of seller and buyer vis-à-vis each other depend
entirely on their rights vis-à-vis third parties – as in the case of stoppages in transit…’.
186 See Fountoulakis, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 71 para. 42. There are only
several cases under the CISG in which the right of stoppage was referred to: see Amtsgericht Frankfurt
(Germany) 31 January 1991, CISG-Online 34 (Pace) where the notice under Art. 71(3) was regarded as a
precondition for the right of stoppage; Bundesgericht (Switzerland) 17 July 2007, CISG-Online 1515
(Pace) where it was held that there were no grounds for the seller to exercise the right of stoppage;
Arbitral Award, CIETAC CISG/1996/11, CISG-Online 1033 (Pace) where the right of stoppage appears to
have been exercised.
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while the buyer has not yet acquired the possession of them. Numerous situations,
which make it difficult to answer the question of whether the seller will be able to
exercise the right of stoppage, can arise. One type of case relates to the legal position
and interests of a carrier. Because the carrier often has lien over the goods as security for
the payment of freight as well as for costs arising from complying with the demand for
stoppage, it may refuse to redeliver the goods to the seller unless the latter is prepared to
pay the freight and other costs.187 How such cases are to be resolved and whether the
carrier has to follow the seller’s instructions are matters for the carriage contract and its
governing law.188 It has been suggested that where the carrier does follow the seller’s
instructions and where the buyer holds a negotiable bill of lading (or another document
controlling delivery), “the seller by an appropriate proceeding should require the buyer
to deliver the document to the seller or to the carrier”.189 Where the goods have been
handed over to a third party, such as a carrier or a warehouse person, the relevant
question, for some legal systems, would be whether that third party can be regarded as
an agent of the buyer.190 If so, the right of stoppage would end from the moment of such
handing over.191 In cases where the documents transferring ownership have been passed
to a party, to whom the buyer had resold the goods, such a transfer of documents
would, in many legal systems, end the seller’s right of stoppage.192 Finally, in case of the
buyer’s insolvency, a conflict may arise between the right of stoppage and the claims to
the goods by the buyer’s creditors. Different insolvency laws may take different
positions in relation to the seller’s right of stoppage and it may well be the case that
such a right would not be recognised by particular domestic insolvency legislation,
leaving the seller to merely assume its place in the queue of creditors.193
3. Suspension and burden of proof

In case there is a dispute between the parties regarding the questions of whether the 48
innocent party was entitled to suspend performance or whether the other party
provided adequate assurance,194 the issue of burden of proof is likely to be of
considerable practical importance. Assuming that it is an issue governed by the
187 For examples in English law, see Booth Steamship Co Ltd v Cargo Fleet Iron Co Ltd [1916] 2 KB 570
at 599: “to get [the goods] from the carrier, [the seller] must discharge any lien the carrier has for
particular charges or freight on the goods in question, but not any general lien by contract or usage for
other sums due from the consignee but not due in respect of the particular goods”; United States Steel
Products Co v Great Western Railway Co [1916] 1 A. C. 689.
188 See, e. g., Schlechtriem, Uniform Sales Law: The UN-Convention on Contracts for the International
Sale of Goods (1986), p. 93.

190 See, e. g., s. 45 of the Sale of Goods Act 1979; Cohn, The Defence of Uncertainty: A Study in the
Interpretation of the Uniform Law on International Sales Act 1967, 23 International Comparative Law
Quarterly (1974) 520. For examples in the U.S. case law, where this was not the case see In re Bearns 2
F. Cas. 1190; Maremont Corp. v Hoesch America, Inc. 663 F. Supp. 876. See also the U.S. case In re Talbot
& Poggi 185 F. 986 involving two classes of goods in relation to one of which the right of stoppage could
be exercised while in relation to the other it could not.
191 For examples in some domestic legal systems, see Johann Plischke & Sohne GMBH v Allison
Brothers Ltd (1936) 55 Ll L Rep 262 in the context of English law; In Re Charles T Stork & Co 271 F. 279
in the context of the U.S. law.
192 See, e. g., s. 47(2) of the Sale of Goods Act 1979; Albors, Spain, in: von Ziegler/Ronoe/Debattista/
Plegat-Kerrault, Transfer of Ownership in International Trade (1999), pp. 353 seq.; Johnsson, Sweden, in:
von Ziegler/Ronoe/Debattista/Plegat-Kerrault, Transfer of Ownership in International Trade (1999), p. 385.
193 See von Ziegler, The Right of Suspension and Stoppage in Transit (and Notification thereof), 25
Journal of Law and Commerce (2005–2006) 353 (366 seq.) (Pace); Hornung, in: Schlechtriem/Schwenzer,
194 On the issue of burden of proof in connection with the provision of adequate assurance, see para. 56
below.
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Convention, it is suggested that it is up to the party relying on Art. 71 to prove the

preconditions for the exercise of the right of suspension. More specifically, this party
must prove the existence of the grounds specified in Art. 71(1) and the required level of
prognosis.
49 In case the question of what obligations could be suspended arises, it is not entirely
clear who is to bear the burden of proof. It is suggested that because the Convention
does not expressly impose the requirement relating to the connection between the
suspended obligations and those which are expected not to be performed and because it
is in the interests of the party under suspicion to raise this issue, the burden of proving
that there was no such connection should initially lie with the latter.
4. Adequate assurance
50 a) General. A suspending party must continue with performing the contract if the
other party provides adequate assurance of its performance.195 The much praised196
mechanism of adequate assurance implements, to a significant extent, the policies and
purposes underlying the anticipatory breach doctrine.197 First, it is widely recognised that
it contributes to promoting economic efficiency.198 It reduces the likelihood that ineffi-
cient allocation of resources will be taking place by providing a suspending party with
relative guarantees that performance will be forthcoming. By receiving an adequate
assurance the party regains a sense of security and continues to perform what, in many
cases, will be a beneficial and efficient transaction. Further, because the reliance on
remedies for an anticipated failure to perform involves a risk of error, a party, in the
absence of the adequate assurance mechanism, would be less confident in invoking such
remedies. The availability of this device contributes to a sense of security in commercial
transactions and to the promotion of voluntary exchange which, in turn, is often thought
to lead to an efficient allocation of resources.199 If no adequate assurance is provided, the
party, by having suspended the contract, may well have avoided an unnecessary cost of
performance (or further performance) and may be in the position to channel its resources
in another direction. Secondly, it is through this mechanism that the purpose of
promoting communication200 and cooperation201 between the parties is implemented.202
51 The provision of adequate assurance has been criticised on the ground that it extends
the parties’ rights and obligations under the contract. While this criticism has not
prevented the introduction of this mechanism, it is nevertheless important to bear it in
195Art. 71(3).
196See, e. g., Robertson, The Right to Demand Adequate Assurance of Due Performance: Uniform
Commercial Code Section 2–609 and Restatement (Second) of Contracts Section 251, 38 Drake Law
Review (1988–1989) 353 (referring to this mechanism as “the most innovative and commercially sensible
development in contract law in the [twentieth] century”).
Uniform Law Review (2006) 795 (813 seq.).

198 See, e. g., in the context of U.S. law, Crespi, The Adequate Assurance Doctrine after U. C. C. 2–609:
A Test of the Efficiency of the Common Law, Villanova University Law Review (1993) 179 (183 seq.);
Taylor, Self-Help in Contract Law: An Exploration and Proposal, 33 Wake Forest Law Review (1998) 883.
199 See, e. g., Kronman/Posner, The Economics of Contract Law (1979), pp. 1 seq.
200 For similar statements in the context of U.S. law, see Campbell, The Right to Assurance of
Performance under UCC para. 2–609 and Restatement (Second) of Contracts para. 251: Toward a
Uniform Rule of Contract Law, 50 Fordham Law Review (1982) 1292 (1308).
201 Cf. Garvin, Adequate Assurance of Performance: Of Risk, Duress and Cognition, 69 University
Colorado Law Review (1998) 128 stating that an erroneous demand for assurance may taken badly by the
promisor as it may suggest a lack of trust.
202 For the suggestion that the adequate assurance mechanism implements the ideas of good faith and
fair dealing, see Crespi, The Adequate Assurance Doctrine after U. C. C. 2–609: A Test of the Efficiency of
the Common Law, Villanova University Law Review (1993) 179 (184). Cf. Garvin, ibid., p. 123.
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mind in deciding what constitutes an adequate assurance; more specifically, it should
serve as a reminder that excessive demands should not be imposed on the party
providing assurances.
b) Meaning of ‘adequate assurance’. Whether an assurance is adequate depends on 52
the circumstances. In dealing with this question, two conflicting considerations need to
be taken into account. On the one hand, assurances must be able to alleviate
considerably the suspending party’s doubts about the other party’s ability and will-
ingness to perform. On the other hand, the demands for assurances cannot be excessive
and unreasonable. It follows that assurances are to provide the suspending party with
reasonable security regarding the other party’s future performance203 and this means
that the latter will not necessarily be required to give assurances of perfect perfor-
mance.204 If, therefore, assurances indicate that only an insubstantial part of obligations
(e. g., a slight delay in performance) will not be performed, this will not prevent such
assurances from being adequate.205 In assessing the adequacy of assurances regard
should be had to a number of factors including the purpose of the contract, the
reputation of a party giving assurances,206 the nature of the obligation which is
expected not to be performed, the nature of grounds giving rise to suspicions,207 the
contractual framework, a relevant trade usage and the history of dealings between the
parties.
Considering that the issue of adequacy is to be decided on a case-by-case basis, a 53
categorical suggestion that reassuring words can never constitute an adequate assurance
is probably not entirely correct since there must be room for, admittedly, rare cases
where mere words restating a party’s commitment to the contract will suffice.208 In
general, however, the party’s assurances209 need to be based on evidence such as: the
and Developing Countries, 38 International Comparative Law Quarterly (1989) 457 (495) (Pace).
204 See ibid., p. 496; Honnold/Flechtner, Uniform Law (2009), Art. 71 para. 391; Bennett, in: Bianca/
Bonell, Commentary (1987), Art. 71 para. 3.4.

and Developing Countries, 38 International Comparative Law Quarterly (1989) 457 (495) (Pace);
Honnold/Flechtner, Uniform Law (2009), Art. 71 para. 391; Bennett, in: Bianca/Bonell, Commentary
(1987), Art. 71 para. 3.4.
206 See, e. g., a U.S. case By-Lo Oil Co Inc v Partech Inc 11 Fed.Appx. 538 where the promisor’s
reputation was an important factor in holding that its assurance was adequate despite it being less than
requested. See also Vanwijck-Alexandre, Anticipatory Breach and Instalment Contracts in the CISG, 3–4
208 This may be the case where it follows, from a party’s reputation and previous dealings with the
suspending party, that it had always kept its promises and acted in accordance with its statements. For a
similar view, see Carter, Suspending Contract Performance for Breach, in: Beatson/Friedman (eds), Good
Faith and Fault in Contract Law (1995), p. 515; comment D on Art. 8:105 PECL.
209 The cases under the CISG are yet to deal with the issue of ‘adequacy’ of assurances. See Landgericht
München (Germany) 6 April 2000, CISG-Online 665 (Pace), where, following the buyer’s suspension of
its performance due to non-conforming delivery by the seller, the parties agreed to reduce the purchase
price. The court stated that ‘as a result [of this agreement], [the] buyer proceeded to perform her duty to
pay the purchase price pursuant to Art. 71(3) second clause’. The court appears to have treated the seller’s
agreeing to reduce the purchase price as adequate assurance. If so, such an interpretation of Art. 71(3) is
arguably incorrect. Although the parties’ agreement performed a function similar to that of the adequate
assurance device (i. e., establishing communication and cooperation with a view to resolve a problem),
adequate assurance relates to the performance, as it was originally agreed by the parties. What happened
in this case was an agreement to modify the terms of the contract and the parties’ performance in
accordance with such terms. For the discussion of the question whether an innocent party’s offer to settle
is a demand for assurance in the US law see Robertson, The Right to Demand Adequate Assurance of Due
Performance: Uniform Commercial Code Section 2–609 and Restatement (Second) of Contracts Sec-
tion 251, 38 Drake Law Review (1988–1989) 337.
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insolvent buyer’s opening an irrevocable letter of credit;210 the proof of the existence of
another source of supply by a seller who has been facing difficulties with its previous
supplier; the proof that the goods have been or will be manufactured from ingredients
or materials that enable the goods to comply with the contractual requirements, as
opposed to those from which non-conforming goods in previous deliveries had been
manufactured;211 the provision of a bank guarantee by a party under suspicion212 or of
security that the losses flowing from the breach will be compensated.213
54 There may be a fine line between a genuine request for adequate assurance and an
attempt to change the terms of and the balance created by the bargain.214 The
interpretation of the parties’ intentions and particularly those of the suspending party,
in light of the facts of the case is critical. Thus, the demand by a seller, who doubts the
buyer’s ability to pay, that money be held in escrow and that the buyer’s management
provide a personal guarantee of payment may be regarded as a seller’s attempt to
rewrite the contract where during the contractual negotiations the parties specifically
agreed not to include additional means of securing payments.215 The demands may also
be found to be excessive where the circumstances indicate that the buyer by invoking
the adequate assurance device is effectively trying to find a way to escape from the
contract on a falling market.216 The conduct of the party under suspicion can also be
relevant for dealing with the question of whether demands are excessive. If the seller’s
conduct in the course of performing the contract showed signs of dishonesty and
stalling, it may well be justifiable for the buyer to demand the extension of a contractual
warranty and the opening of an irrevocable letter of credit for the price of the goods.217
55 c) Failure to provide adequate assurance. There is no agreement on what the
suspending party’s legal position is if no adequate assurance is provided.218 In contrast
with some other legal regimes,219 the Convention does not state that a failure to provide
adequate assurance is in itself a ground for the avoidance of the contract. While it has
been suggested that such a failure will make it clear that a fundamental breach will
occur,220 it has also been argued that this will not necessarily be the case.221 It is
and Developing Countries, 38 International Comparative Law Quarterly (1989) 457 (495 seq.) (Pace);
211 See Helsinki Court of Appeal (Finland) 30 June 1998, CISG-Online 1304 (Pace).
212 For some other examples, see Fountoulakis, in: Schlechtriem/Schwenzer, Commentary (2016),
Art. 71 para. 51 and the discussion below.

213 For further examples, see Secretariat Commentary on 1978 Draft, Art. 62.
214 It is, of course, possible to argue that it is in the very nature of the adequate assurance device to
make the parties go beyond the terms of the contract. See White/Summers, Uniform Commercial Code
(2000), pp. 199 seq.
215 The example is based on a U.S. case Pittsburgh-Desmoines Steel Co v Brookhaven Manor Water Co.
532 F.2 d 572.

216 See, e. g., in the context of the U.S. law, United States v Great Plains Gasification 819 F.2 d 831, 834:
‘Natural’s demand for assurance was merely a subterfuge to escape its obligations under the Gas Purchase
Agreement’.
217 This example is based on a U.S. case Creusot-Loire International Inc v Coppus Engineering
Corporation 585 F. Supp. 45.

218 For cases where the buyer failed to provide adequate assurance, see Arbitral Award, Tribunal of
102/1997, 22 January 1998 (Pace); Belarusian Chamber of Commerce and Industry International Court of
Arbitration (Belarus) 5 October 1995, ATT v Armco, CISG-Online 861 (Pace).
219 See § 2–609(4) UCC; Art. 7.3.4 second sentence PICC; Art. 8:105(2) PECL.
221 Ziegel, The Remedial Provisions in the Vienna Sales Convention: Some Common Law Perspectives,
in: Galston/Smit (eds), International Sales: The United Nations Convention on Contracts for the
International Sale of Goods (1984), pp. 9 seq.; Hornung, in: Schlechtriem/Schwenzer, Commentary
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submitted that the latter position is correct. The preconditions for the right to avoid the
contract for anticipatory breach are set out in Art. 72 and the question of whether the
suspending party has a right to avoid the contract is to be resolved solely by reference to
those conditions. Where, however, a party suspects that a fundamental breach will
occur, a failure to provide adequate assurance will often confirm the party’s suspicion,
thereby justifying the avoidance of the contract under Art. 72.222
d) Burden of proof. The suspending party must prove that it gave the notice as 56
required by Art. 71(3). If there is a question of whether an adequate assurance has been
given, burden of proof would, in principle, seem to depend on who relies on the
provision in Art. 71(3). However, because it is in the interests of the party under
suspicion to demonstrate that adequate assurances were provided, it will usually be
this party who will bear the burden of proof.223
5. Cessation of suspension
The right of suspension terminates where the grounds which triggered that right 57
cease to exist,224 an adequate assurance of performance is provided,225 or the contract is
properly avoided under Art. 72.226 A party under suspicion may also perform the
obligations which were anticipated not to be performed and this may be the case either
prior to, at or even after the due date if suspension continued up to that time.227 If the
performance is tendered at the due date, this clearly ends the other party’s right of
suspension and the latter must perform its part of the contract. In principle, the tender
of performance prior to the due date should also end the right of suspension as it
evidences the party’s ability and willingness to perform except that it is not the
performance at the due date. If the suspending party accepts the early performance,
then clearly the grounds for suspension cease to exist and the party must perform the
suspended obligations. The suspending buyer, however, has the right to refuse an early
delivery228 and the question can arise whether an early delivery by the seller can be
regarded as either an indication that the grounds for an anticipated failure to perform
were unfounded or ceased to exist or as adequate assurance of the seller’s ability or
willingness to perform.229 The answer, it is submitted, depends on the circumstances of
the case. If the buyer’s doubts regarding the seller’s ability to deliver stemmed from the
difficulties the seller has faced with its own sources of supply, the seller’s early delivery
can put those doubts to rest as it evidences that the seller does in fact have the goods to
(2005), Art. 71 para. 40 (however, expressing regret, Art. 71 para. 23, that the approach of the UCC was
not adopted by the Convention); Bennett, in: Bianca/Bonell, Commentary (1987), Art. 71 para. 3.7.
222 See also this author’s commentary on Art. 72.
223 See also this author’s commentary on Art. 72.
224 See, e. g., Fountoulakis, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 71 para. 47.
225 See Art. 71(3). See also Landgericht Stendal (Germany) 12 October 2000, CISG-Online 592 (Pace).
226 Huber/Mullis, The CISG (2007), p. 343.
227 See Supreme Court of British Columbia (Canada) 21 August 2003, Mansonville v Kurtz, CISG-
Online 1017 (Pace).

228 See Art. 52.
229 Presumably, the concerns underlying the buyer’s right to refuse an early delivery (e. g., causing the
buyer additional inconvenience or expenses of storage) will rarely be relevant in cases where it is the
buyer who tenders an early payment or takes steps to enable the payment to be made earlier than
required by the contract (e. g., opening a letter of credit at an earlier date than that stipulated by the
contract). One example where the buyer’s early performance can cause difficulties to the seller is where
the seller had to ship the goods within a specified period from the moment of payment or opening of
letter of credit. If the seller’s delivery obligations are interpreted as still dependent on the moment of that
early performance by the buyer, the seller’s ability to ship within the period which is now moved closer in
time can be affected.
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meet its obligations. If, however, the buyer’s doubts have arisen due to the information
about an imminent closure of the port from which the seller intended to ship the goods
or the introduction of the government restrictions on export, then an early delivery may
not necessarily alleviate the buyer’s doubts since the anticipated risks may still
materialise at the due date.230
58 In its notice of suspension, the suspending party may fix an additional period for
performance to the other party.231 The question is whether in such a case, the right of
suspension ceases to exist as soon as this additional period expires. On the one hand, it
can be argued that a key purpose of both suspension and the fixation of an additional
time is to encourage performance. By giving an additional time, the suspending party is
taking and signalling its stance as to the time period during which it is prepared to wait
for and encourage (through both the pressure of suspension and additional time) the
other party’s performance. Therefore, the expiration of this period should mark the end
of the ‘encouragement of performance’ function of suspension and the right to suspend
must cease to exist.232 Any suspension beyond that time will depend on whether a
general right of suspension of performance (that is, after the due date for performance)
exists under the Convention and if so, what its preconditions are and whether they are
met.233 If there is no such general right, suspension after the additional period is a
breach of contract and the Convention.
59 On the other hand, it can be contended that because the Convention does not limit the
period of suspension, the party invoking Art. 71 should be allowed to suspend indefi-
nitely.234 The suspending party is already disadvantaged by the uncertainties of the Art. 71
suspension regime,235 of whether the other party will perform and of whether the right to
avoid is available once the due date for the other party’s performance has passed. As a
matter of policy, therefore, the suspending party should not be disadvantaged by being
put at risk of liability if its notice of suspension is accompanied by an additional time.
60 It is submitted that the issue is that of the parties’ intentions. Given that the right of
suspension is not subjected by the Convention to any time limit, the suspending party
should, in principle, be able to suspend indefinitely. This, it is suggested, is the
Convention’s position. The parties, however, can derogate from it236 and the setting of
an additional time can be seen as an expression of such an intention by the suspending
party, to which the other party would normally have no objections since it weakens the
remedy of suspension applied against it. Therefore, a common intention of the parties237
to limit the duration of suspension to that of the expiration of additional time can often
be inferred in such cases.
230 In such circumstances the question of whether the Convention allows the buyer to exercise its right
to refuse delivery only where it is reasonable for it to do so is of particular significance (for the discussion
of this issue, see, e. g., Enderlein/Maskow, International Sales Law (1992), p. 199; Will, in: Bianca/Bonell,
Commentary (1987), Art. 71 paras 2.1.2 seq.; Ying, Comparison between Provisions of the CISG
(Articles 33 and 52(1)) and the Counterpart Provisions of the PECL (Articles 7:102 and 7:103) (Pace).
231 It is debated whether such a notice can be given under Arts 47 and 63 (see, e.g., EP Kimbel,
‘Nachfrist Notice and Avoidance under the CISG’ (1999) 18 J L Commerce 301, 325–329; Enderlein/
Maskow, International Sales Law (1992) pp. 236–237; also Müller-Chen, in: Schlechtriem/Schwenzer,
Commentary (2016), Art. 47 para. 11 (and further references)).
233 See Fountoulakis, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 71 paras 10–11 (with
further references).
234 See, e.g., Fountoulakis, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 71 para. 48.
235 ‘Under Article 71, the creditor is paralyzed as long as a breach of contract by the debtor is
impending and no adequate assurance has been provided’ (ibid, para. 49).
236 Art 6.
237 Art 8.
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The uncertainty as to the duration of suspension raises a further question of whether 61
a mechanism should be developed within the Convention to inject greater certainty for
the suspending party. It has been argued that a ‘reasonable period’ for giving adequate
assurances should be implied in the Convention, with the consequence that if no such
assurance is provided within a reasonable time, the suspending party should be allowed
to avoid the contract.238 It is submitted that this proposal would extend the innocent
party’s rights beyond what the Convention’s regime provides for. As noted,239 the
preconditions for avoiding the contract before the due date for performance are
governed solely by Art. 72, which requires a case-by-case analysis. There is no basis in
the Convention for a general assumption that a failure to give adequate assurance
amounts to a fundamental breach, entitling the innocent party to avoid the contract.240
With the right to avoid not automatically arising if no adequate assurance is provided,
there is otherwise little value for implying the requirement that an adequate assurance
must be given within a reasonable time.
Where the right of suspension terminates and the suspending party is now under an 62
obligation to perform, the contractual timetable for its performance needs to be read-
justed. Although the Convention does not state so expressly, it is clear that the innocent
party cannot be penalised for the exercise of the right which the Convention itself
confers.241 While a ‘reasonable adjustment’242 may be appropriate in some cases, particu-
larly those where the time that the suspending party needs to tender its performance is
less than the period of suspension,243 a precise approach linking the period of suspension
with that of extension244 may be more appropriate where the question of whether the
suspending party is in breach by tendering its performance late is at stake.245
6. Damages
The question may arise as to whether a suspending party can claim damages on the 63
ground of the other party’s anticipated failure to perform a substantial part of obliga-
tions. For example, if it is apparent that the seller will only deliver eighty five percent of
the contract quantity, should the buyer be allowed to claim damages for an anticipated
non-delivery of fifteen percent of the quantity? It is submitted that an anticipated failure
to perform a ‘substantial part of obligations’, provided for in Art. 71, should not be
regarded as the basis for the right to claim damages, unless it amounts to an anticipated
fundamental breach on the basis of which the innocent party avoided the contract
238Fountoulakis, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 71 para. 50.

239See para. 55 above.
240 The same would apply if, under the above proposal, a reasonable time was to expire after the due
date. The evaluation of whether a breach is fundamental would still require a case-by-case analysis.
241 For the rationale based on ‘common sense’, see Carter, Suspending Contract Performance for
Breach, in: Beatson/Friedman (eds), Good Faith and Fault in Contract Law (1995), p. 512 note 101.
242 Bennett, in: Bianca/Bonell, Commentary (1987), Art. 71 para. 3.6; Honnold/Flechtner, Uniform Law
(2009), Art. 71 para. 393.

243 ‘The seller may not always need an extension of time that is equivalent to the period of suspension’:

244 See Schlechtriem, Uniform Sales Law: The UN-Convention on Contracts for the International Sale of
Goods (1986), p. 92; Strub, The Convention on the International Sale of Goods: Anticipatory Repudiation
Provisions and Developing Countries, 38 International Comparative Law Quarterly (1989) 457 (495) (Pace).
245 Suppose that the seller, who has an obligation to deliver the goods on 1 September, correctly
suspended its manufacturing activity on 1 August until 15 August when the buyer provided adequate
assurance. If the seller then delivers the goods on 18 September while the buyer had to pay penalties to its
sub-buyer for every day of delay, a precise approach suggested here will matter to this buyer, since it will
be able to claim damages from the seller for penalties paid to the sub-buyer for the period between 16 and
18 September, provided that the requirements in Arts 74 and 77 are satisfied.
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under Art. 72. It will often be the case that the innocent party will not be absolutely
certain that a substantial part of obligations will not be performed and it is the very
purpose of suspension to induce the other party to perform and to clarify, by means of
the adequate assurance device, the other party’s position.246 Because the parties’ legal
positions are not yet finalised at this stage, it would generally be unjustified to allow the
innocent party to claim damages where the full performance may still be provided. The
avoidance of the contract, in contrast, crystallises the parties’ legal positions, as neither
of them can change its mind, and the claim for damages for anticipatory breach in such
a case is certainly justifiable.247 The only situation not covered by these arguments is a
rare case where it may be absolutely clear to the innocent party that the other party will
not perform a part of its obligations which does not amount to a fundamental breach.
Since such breaches are not likely to be serious (otherwise they would have been
fundamental) and will not therefore inflict a considerable damage on the innocent
party, it is suggested that a claim for damages should not be allowed in such cases, given
that the remedy of suspension already provides sufficient security to the innocent
party.248
64 If, however, the party suffers losses as a result of its exercising the right of suspen-
sion,249 then damages for such losses should in principle be available. It has been
correctly suggested that the legal basis in such cases cannot be Arts 45 and 61 CISG, but
should be formulated by reference to Art. 7(2)250 and/or by drawing an analogy with
other provisions of the Convention.251
III. Comparable Rules252

65 Other international contract law instruments, such as the PICC and PECL also
contain provisions on the suspension of performance in the case of an anticipated
failure to perform. One difference is that both the PICC and PECL allow a party to
suspend its performance only where that party reasonably believes that there will be a
‘fundamental non-performance’, as opposed to a non-performance of a ‘substantial part
246 An anticipated failure to perform a substantial part of obligations under Art. 71, not amounting to a
fundamental breach, is often not regarded as an anticipatory breach, which would be equated with an
actual breach unquestionably giving rise to a claim for damages. See, e. g., Hornung, in: Schlechtriem/
Schwenzer, Commentary (2005), Art. 71 para. 5, where Art. 71 is said to cover ‘threatened disturbances
prior to performance’ while Art. 72 is said to cover an anticipatory breach of contract; Eiselen, Remarks
on the manner in which the UNIDROIT Principles of International Commercial Contracts may be used
to interpret or supplement Articles 71 and 72 of the CISG (Pace): ‘Whereas Art 72 is aimed at the
phenomenon of anticipatory breach of contract, i. e. a breach of contract that takes place before the
performance is due by the party in breach, Article 71 has a wider scope in that it deals with anticipatory
breach as well as incomplete performance.’
247 See further Saidov, The Law of Damages in International Sales – The CISG and other International
Instruments (2008) pp. 23 seq.

248 In the light of the criticisms advanced against the anticipatory breach doctrine (see above), it can
also be argued that the innocent party has already been given extensive rights and allowing a claim for
damages in such cases is a step too far.
249 If, e. g., on a rising market the seller refrained from purchasing the goods from its supplier and after
ending suspension had to purchase them at a higher price than it would have paid had there been no
suspension. See Huber/Mullis, The CISG (2007), p. 344.
250 See ibid. with further reference.
251 See Arts 34, 37, 47, 48.
252 See, generally, Eiselen, Remarks on the manner in which the UNIDROIT Principles of International
Commercial Contracts may be used to interpret or supplement Articles 71 and 72 of the CISG (Pace);
Saidov, Anticipatory Non-Performance and Underlying Values of the UNIDROIT Principles, Uniform
Law Review (2006) 795.
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of obligations’ in Art. 71 CISG. Considering that an anticipated non-performance of a
‘substantial part of obligations’ will not necessarily amount to a ‘fundamental’ non-
performance, the difference between the Convention and the two sets of Principles is
potentially significant: since under the CISG the remedy of suspension will be available
in a broader range of circumstances, the Convention appears to provide a more
favourable regime to the party who is unsure about the other party’s performance at
the due date. However, this difference may turn out to be less significant because, in
practice, it will often be difficult to draw a clear line between the two, rather vague,
standards of ‘substantial’ and ‘fundamental’ non-performance.
Similar to the CISG, the PICC and PECL contain a less strict/more lenient standard of 66
prognosis for the purposes of the right to withhold performance. While their provisions
on the right to terminate the contract contain the standard of ‘being clear’,253 a party is
allowed to suspend where it ‘reasonably believes’ that a fundamental non-performance
will occur.254 Considering that the standard of ‘becoming apparent’ in Art. 71 CISG is to
be interpreted from the standpoint of a reasonable person, it is likely that the level of
prognosis required by the Convention is very similar to that in the PICC and PECL.
Under the two sets of Principles, while it is withholding performance the party ‘may 67
demand adequate assurance of due performance’.255 It is clear that, in contrast with the
CISG which imposes a duty on a suspending party to give a notice of suspension often
accompanied by a request for assurances, the PICC and PECL only provide for a party’s
right to demand assurances. This is perhaps unfortunate,256 considering that the remedy
of withholding performance aims to promote communication and cooperation and that,
in international transactions, parties “have a much greater propensity for misunder-
standing – of culture, language, and business ethics”.257 It is clear that, as is the case
under the CISG, what constitutes an adequate assurance under the PICC and PECL will
depend upon the circumstances of the case258 and to be adequate, an assurance need not
necessarily provide security of perfect performance.259 The Principles introduced greater
clarity than the CISG regarding the consequences of a failure to provide an adequate
assurance by stating that if such an assurance is not provided within a reasonable time,
the party demanding it has the right to terminate the contract.260 The PECL add,
however, that such a termination is allowed if the party demanding assurance “still
reasonably believes that there will be a fundamental non-performance by the other
party and gives notice of termination without delay”.261 Although in its provisions on
253See Art. 7.3.3 PICC and Art. 9:304 PECL.

254See Art. 7.3.4 first sentence PICC and Art. 8:105 PECL.
255 See Art. 7.3.4 first sentence PICC and Art. 8:105 PECL.
256 For a more extensive discussion, see Saidov, Anticipatory Non-Performance and Underlying Values
of the UNIDROIT Principles, Uniform Law Review (2006) 795 (810 seq.).
257 Strub, The Convention on the International Sale of Goods: Anticipatory Repudiation Provisions and
Developing Countries, 38 International Comparative Law Quarterly (1989) 457 (499) (Pace).
258 See Comment 2 on Art. 7.3.4 PICC and Comment D on Art. 8:105 PECL.
Uniform Law Review (2006) 795 (815).

260 See Art. 7.3.4 second sentence PICC and Art. 8:105(2) PECL. Cf. § 2–609(4) UCC introducing even
greater certainty by imposing a thirty day time limit for the provision of adequate assurance and treating
the failure to do so as a repudiation of the contract. For a cautious suggestion that the provisions of the
PECL might be helpful in resolving the question of whether a failure to give an adequate assurance entitles a
party to avoid the contract under the CISG, see Eiselen, Remarks on the manner in which the Principles of
European Contract Law may be used to interpret or supplement Articles 71 and 72 of the CISG (Pace).
261 Art. 8:105(2) PECL. The comments on this provision further explain that a failure to give the
requested assurance ‘is itself treated as a fundamental non-performance, giving the aggrieved party the
right to terminate the contract and also a right to damages where the deemed non-performance is not
excused under Article 8:108’ (Comment C on Art. 8:105 PECL).
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the termination for anticipatory non-performance the PICC do not expressly refer to
the necessity of the notice of termination, there is no doubt that such a notice must be
given.262
262 Art. 7.3.2 PICC and Comment 1 on Art. 7.3.4 PICC.
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Article 72
(1) If prior to the date for performance of the contract it is clear that one of the
parties will commit a fundamental breach of contract, the other party may declare the
contract avoided.
(2) If time allows, the party intending to declare the contract avoided must give
reasonable notice to the other party in order to permit him to provide adequate
assurance of his performance.
(3) The requirements of the preceding paragraph do not apply if the other party
has declared that he will not perform his obligations.
Bibliography: Bridge, Issues Arising Under Articles 64, 72 and 73 of the United Nations Convention on
Contracts for the International Sale of Goods, 25 Journal of Law and Commerce (2005–2006) 405; Strub,
The Convention on the International Sale of Goods: Anticipatory Repudiation Provisions and Developing
Countries, 38 International Comparative Law Quarterly (1989) 457; Vanwijck-Alexandre, Anticipatory
Breach and Instalment Contracts in the CISG, 3–4 International Business Law Journal (2001) 353.
Outline
1. General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2. The relationship between Art. 72 paras 1 and 3. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
3. The standard of prognosis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
4. The nature of events giving rise to the right to avoid . . . . . . . . . . . . . . . . . . . . . . 8
a) General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
b) Parties’ disagreement on the content of the contract. . . . . . . . . . . . . . . . . . . . 11
c) Other cases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
5. Burden of proof . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
6. Notice under Art. 72(2); burden of proof . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
7. Adequate assurance; burden of proof . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
8. Refusal to perform (Art. 72(3)); burden of proof . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
9. Damages and mitigation of loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33

According to Art. 72, a contract can be avoided if there are grounds to expect that a 1
fundamental breach will occur. This provision complements the remedy of suspension
in Art. 711 and reflects a policy decision to provide further protection to the innocent
party.2 While the roots of the remedy of avoidance for anticipatory breach lie in the
English common law,3 the direct predecessor of this provision of the Convention was
1See Bennett, in: Bianca/Bonell, Commentary (1987), Art. 72 para. 1.1 (Pace).
2See Hornung, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 72 para. 4. For the view that Art. 72
is a logical continuation of Art. 71, see Vilus, Provisions Common to the Obligations of the Seller and the
Buyer, in: Sarcevic/Volken (eds), International Sale of Goods: Dubrovnik Lectures (1986), p. 244 (Pace).
3 For similar statements, see, e. g., Vanwijck-Alexandre, Anticipatory Breach and Instalment Contracts
in the CISG, 3–4 International Business Law Journal (2001) 353 (355). The origin of the doctrine is
usually associated with the English case Hochster v De La Tour (1853) 2 El. & Bl. 678. For the history of
the development of the doctrine in the common law, see Mustill, Anticipatory Breach of Contract: The
Common Law at Work (1989–1990); Rowley, A Brief History of Anticipatory Repudiation in American
Contract Law, 69 University Cincinnati Law Review 565 (2001) (Pace).
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Art. 76 ULIS.4 Art. 72 CISG is more elaborate than its counterpart in the ULIS as it
contains provisions, introduced at the Vienna Diplomatic Conference, regarding the notice
of the intention to avoid in order to allow the party under suspicion to provide adequate
assurance5 and the specific case of a party’s declaration that it will not perform its
obligations.6 Paragraph 2 of Art. 72 was introduced to deal with the concern expressed by
some of the developing countries, led by the Egyptian delegation, that the exercise of such a
drastic remedy as avoidance should be preceded by a notice which would give an
opportunity to the party under suspicion to provide adequate assurances.7 At the same
time, the provision which confines the notification requirement only to cases where ‘times
allows’ was retained, despite the objections of some developing countries, to take account of
the situations where the party wishing to avoid the contract needs to do so promptly and
has no time to notify the other party.8 Art. 72(2) is therefore the product of a compromise.

1. General
2 The right to avoid the contract under Art. 72 will only arise where a fundamental
breach is anticipated.9 A fundamental breach is defined by the Convention as a breach
which “results in such detriment to the other party as substantially to deprive him of what
he is entitled to expect under the contract, unless the party in breach did not foresee and a
reasonable person of the same kind in the same circumstances would not have foreseen
such a result”.10 In contrast with Art. 71, Art. 72 does not specify the nature of events
which can give rise to the right to avoid the contract. Nevertheless, because the grounds in
Art. 71 most probably cover any type of disturbance, they can, in principle, be invoked to
help interpret Art. 72.11 In any event, there is no doubt that any circumstance giving rise
to an expectation that a fundamental breach will occur is within the scope of Art. 72.12
This suggestion finds support not only in the text of Art. 72, which does not restrict the
grounds to any particular circumstance, but also in its legislative history: the proposal to
tailor the provision on anticipatory breach by reference to the common law doctrine of
anticipatory breach, which is confined to the innocent party’s express renunciation and
conduct,13 or to circumscribe other types of grounds,14 was rejected.15
3 In the context of Art. 71, it has been argued that to minimise the risk of the innocent
party abusing its position and to maintain a balance between the two parties, it is
4 “Where prior to the date fixed for performance of the contract it is clear that one of the parties will
commit a fundamental breach of the contract, the other party shall have the right to declare the contract
avoided.”
5 Art. 72(2).
6 Art. 72(3).
7 See the statement by Mr. Shafik (Egypt) at the Vienna Diplomatic conference, A/CONF.97/C.1/L.
249, L.250 (Pace). See, further, Bennett, in: Bianca/Bonell, Commentary (1987), Art. 72 paras 1.7 seq.;
Hornung, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 72 para. 3.
8 See, e. g., the statement by Mr. Kruse (Denmark) at the Vienna Diplomatic conference A/CONF.97/
C.1/L.252, L.253 (Pace). See, also, Bennett, in: Bianca/Bonell, Commentary (1987), Art. 72 para. 1.9.
9 Art. 72(1).
10 Art. 25.
11 See Fountoulakis, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 72 para. 12. However, such
an exercise is likely to be of limited practical value.

12 See ibid.; Bennett, in: Bianca/Bonell, Commentary (1987), Art. 72 para. 2.2.
13 See, e. g., Bennett, in: Bianca/Bonell, Commentary (1987), Art. 72 para. 1.4; Fountoulakis, in:

15 For specific examples, see below.
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important that the provision referring to ‘a substantial part’ of the obligations be
interpreted from the standpoint of a reasonable person.16 This issue of objective
interpretation of ‘fundamentality’ of a breach is unlikely to arise in case of Art. 72 since
the definition of a fundamental breach already contains in-built mechanisms to this
effect such as the reference to the parties’ expectations under the contract17 and, most
importantly, to the foreseeability test which is to be applied from the standpoint of not
only the party in breach but also a reasonable person.18
2. The relationship between Art. 72 paras 1 and 3

The grounds for expecting an anticipatory breach can arise from one party’s 4
statements, conduct or some other external circumstances. At this point, it is worth
mentioning para. 3 of Art. 72 which allows the innocent party to dispense with the
notification requirement in para. 2, “if the other party has declared that he will not
perform his obligations”. This provision was intended to ease and simplify the applica-
tion of Art. 72 by dispensing with the need to apply the criteria of ‘being clear’ and
‘fundamental breach’ and to comply with the notification procedure where the highest
level of certainty (that the innocent party can possibly have before the due date) is
present.19 However, the provision appears to have caused some uncertainty regarding its
function and place in the structure of the remedy in Art. 72.
Thus, para. 3 refers to the party’s ‘declaration’ that it will not perform its obligations. 5
Where such a declaration takes the form of an express and unambiguous statement, it
will undoubtedly fall within the scope of this paragraph. The uncertainty stems from the
question of whether implicit declarations are also intended to be covered.20 On the one
hand, because such declarations are by definition not explicit they may not provide the
innocent party with the highest level of certainty regarding the other party’s position.21
Such cases would run contrary to the rationale underlying Art. 72(3) and should not
therefore fall within its scope. On the other hand, implicit declarations can, in principle,
be tantamount to a refusal to perform where, for example, a party denies the very
existence of the contract in definite and unequivocal terms, and such cases seem to have
been intended to fall within Art. 72(3). This bifurcation of the category of ‘implicit
declarations’ raises the question about how the functions and scope of paras 1 and 3
were intended to be delimited.
One solution could be to simply exclude all implicit declarations from the scope of 6
para. 3.22 Another, more refined, solution is only to draw a presumption based on the
statement in the previous sentence and to allow the party wishing to invoke Art. 72(3)
16See this author’s comments on Art. 71 in the commentary.

17“To determine the degree of a given detriment, to draw the line between substantial and insubstan-
tial, is no longer left to the judge’s sole and sovereign appreciation, but tied to the expectations of the
injured party, while those expectations, in turn, are not left to a party’s inner feelings but instead tied to
the terms of the existing contract.”: Will, in: Bianca/Bonell, Commentary (1987), Art. 25 para. 2.1 (Pace).
18 See Art. 25.
19 Since the information comes from the other party itself; in a sense, however, no declaration of an
inability or unwillingness to perform is ever absolutely certain, since the party can change its mind. For
the possibility of retracting declaration under Art. 72(3), see below.
20 For an affirmative answer to this question, see Fountoulakis, in: Schlechtriem/Schwenzer, Commen-
tary (2016), Art. 72 para. 36; and also Schlechtriem, Uniform Sales Law: The UN-Convention on
Contracts for the International Sale of Goods (1986), p. 94 (Pace).
21 These can be cases where, e. g., on a rising market the seller states that it is extremely unlikely that it
will be able to deliver the goods unless the price is increased. For more examples, see below.
22 For a seemingly similar view, see Strub, The Convention on the International Sale of Goods:
Anticipatory Repudiation Provisions and Developing Countries, 38 International Comparative Law

Quarterly (1989) 457 (499) (Pace). See also Honnold/Flechtner, Uniform Law (2009), Art. 72 para. 396.
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to prove that the implicit declaration in question constitutes a clear refusal to perform.
The relevant standard would then be, as is usually the case under the Convention, that
of a reasonable person. Yet another solution is neither to exclude implicit declarations
from para. 3 nor to draw any presumptions, but rather to leave it to a court or tribunal
to decide whether the declaration falls within paras 1 or 3 in the light of the particular
facts. In practice, however, this solution is not too different from the second solution
since the party invoking Art. 72(3) will, in any event, have to prove that the conditions
of its applicability have been met. The key feature distinguishing the two paragraphs is
whether or not there are any doubts regarding the party’s intentions or, in other words,
the question of whether or not there is any room for the interpretation. If there is a need
for the interpretation, the situation is thus not the one contemplated by para. 3.23 In
case there is any reasonable doubt as to whether there is any room for the interpreta-
tion, the case, it is submitted, should be considered in the context of para. 1. The third
solution appears to provide the best balance of all considerations: by not drawing a
presumption that all implicit declarations are excluded from para. 3, it recognises that
there may be cases where implicit declarations constitute clear refusals to perform; at
the same time, if the suggestion that cases where there is doubt about whether a
particular declaration is a refusal to perform should fall within para. 1 is followed, this
will ensure that the line between the two paragraphs is appropriately drawn.24 The
relevant standard for dealing with these questions will inevitably be the standard of a
‘reasonable person’.25
3. The standard of prognosis

7 Art. 72 states that it must be ‘clear’ that a fundamental breach will occur. While the
precise meaning of this standard will depend on the circumstances of the case, a few
general guidelines can be given. First, it is intended to demand a higher degree of
certainty than its counterpart (‘becoming apparent’) in Art. 71. It is, however, doubtful
whether drawing such a fine distinction is possible.26 Secondly, what is ‘clear’ is to be
judged from the point of view of a reasonable person in the innocent party’s position in
order to maintain the balance between the two parties and minimise the risk of abuse.
Finally, it is a probability standard and therefore absolute certainty in prognosis is not
required.27 At the same time, the probability needs to be very high and, in the words of
one court, ‘obvious to everybody’.28 This probably means that even a well-founded
suspicion is unlikely to be sufficient.29
23If the signals are absolutely clear, there is no need for the interpretation.
24This line does not seem to have been appropriately drawn in Oberlandesgericht Düsseldorf (Ger-
many) 22 July 2004, CISG-Online 916 (Pace) where no distinction between the two paragraphs was made:
“[the Buyer] cannot be accused of a general denial to perform its obligations under Arts 72(1) and (3)
CISG. This requires that a debtor both seriously and expressly or unambiguously deny its obligations
under the contract.”
26 For the position in some cases that the standard of ‘being clear’ requires a higher degree of likelihood
than the standard of ‘good grounds’ in Art. 73(2), see Arbitral Award, Schiedsgericht der Börse für
landwirtschaftliche Produkte in Wien (Austria) 10 December 1997, CISG-Online 351 (Pace) with
reference to scholarly writings.
27 Landgericht Berlin (Germany) 30 September 1992, CISG-Online 70 (Pace). See Fountoulakis, in:
Schlechtriem/Schwenzer, Commentary (2016), Art. 72 paras 14 seq.; Eiselen, Remarks on the manner in
supplement Arts 71 and 72 of the CISG (Pace).
28 Landgericht Berlin (Germany) 30 September 1992, CISG-Online 70 (Pace).
29 See the Official Comments on Art. 7.3.3 PICC where a similar standard has been interpreted in this
way.
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4. The nature of events giving rise to the right to avoid

a) General. The meaning of both the standard of ‘being clear’ and that of ‘funda- 8
mental breach’ depend on the interpretation of the parties’ intentions in the light of the
circumstances. Determining a ‘fundamental breach’ will also require the application of
the criteria in Art. 25. To develop an understanding of how Art. 72(1) has thus far been
applied, it is necessary to examine those cases where parties have attempted to invoke
this provision.30
In some cases the buyer had failed to pay for previous deliveries and this was held to 9
make it clear that a future delivery would also not be paid for.31 Similarly, where the
buyer refuses to make the next payment due under the contractual payment schedule by
putting forward complaints which are ‘opportunistic and not genuine in character’,
such conduct can make it clear that a fundamental breach (i. e., future non-payments)
will occur.32 In one case,33 the buyer failed to provide a bank confirmation that a letter
of credit would be open after the examination of the goods. Having relied on its
interpretation of the parties’ intentions, the court found that while such a failure gave
rise to the right to suspend, it could not be regarded as indicative of a future
fundamental breach by the buyer.34 In addition, the court noted that the seller could
not invoke Art. 72(1) because after the buyer had received the notice, in which the seller
had expressed its expectation that the bank confirmation would be provided, the buyer
attempted to reach ‘a reasonable settlement of the problems’.35 The buyer’s failure to
open a letter of credit, despite several requests by the seller to do so, followed by the
buyer’s decision to attempt to renegotiate the contract on a falling market was held to
evince the buyer’s clear intention not to perform its obligations.36 In the same vein, the
opening of a letter of credit on terms many of which37 do not correspond to those
stipulated in the contract, together with the buyer’s failure to revise it notwithstanding
several requests by the seller, can, besides being an actual breach, also be indicative of
the buyer’s anticipatory breach (i. e., non-payment when the contractually stipulated
30 The cases where a party under suspicion makes a definite and unambiguous statement that it will not
perform its obligations will not be mentioned here since they fall within the scope of Art. 72(3) and will
be addressed below.
31 See Oberlandesgericht Düsseldorf (Germany) 14 January 1994, CISG-Online 119 (Pace). For a case
involving the buyer’s failure to pay for previously delivered instalments, see, e. g., Arbitral Award,
Schiedsgericht der Börse für landwirtschaftliche Produkte in Wien (Austria) 10 December 1997, CISG-
Online 351 (Pace).
32 U. S. District Court, W. D. of Michigan, Southern Division (U.S.) 17 December 2001, Shuttle
Packaging Systems v Tsonakis et al., CISG-Online 773 (Pace) where it was not entirely clear whether
the court treated the buyer’s conduct as anticipatory or actual fundamental breach.
33 Landgericht Kassel (Germany) 21 September 1995, CISG-Online 192 (Pace).
34 “The bank confirmation could only – and then quite imperfectly – serve as a security of some
advance performances made by [the Seller], which however were not at all aimed at a transfer of assets to
[the Buyer]. These advance performances were rather connected to the internal procurement of the goods
which naturally forms part of a seller’s obligations. [The Seller]’s only risk in that respect was that it
might not have succeeded in reselling the procured goods. However, this risk was comparably small even
according to its own statements… [The Seller]…demonstrated that it was generally willing to perform its
obligation to deliver…[I]t cannot be assumed that the intention of both parties was such as to attach
fundamental relevance to the bank confirmation of future opening of letters of credit in terms of Art. 25
CISG” (ibid.).
35 Ibid.
36 Supreme Court of Queensland, Court of Appeal (Australia) 12 October 2001, Downs Investments v
Perwaja Steel, CISG-Online 955 (Pace), approving the decision of the court of the lower instance on this
matter.
37 Contract number, shipping period, the duration of the letter of credit, the period for the seller’s
notification of loading.
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documents are presented).38 The buyer’s insolvency may not necessarily make it clear
that it will not fulfil its obligation to pay39 and the circumstances need to be evaluated as
a whole in order to determine whether the right in Art. 72(1) can be exercised. If, for
example, in addition to its insolvency, the buyer informs the seller that it is extremely
likely that it will not perform its contract, the seller can arguably rely on Art. 72(1).
10 It can become clear as a result of the seller’s previous delivery of non-conforming
goods40 that it will not be able to deliver conforming goods in the future.41 This is
particularly so where, for instance, the goods come from the same source,42 or the
circumstances indicate that the seller would need more time, than the contract would
allow, to develop expertise or the ability to supply conforming goods.43 The require-
ments of Art. 72(1) have also been met where the manufacturer delivered non-con-
forming drawings, thereby indicating its inability to produce conforming goods.44 The
same would be the case where the seller delivers the samples late, leaving insufficient
time to the buyer to inspect and return them within the period which would make it
possible for the seller to deliver the goods by the due date.45
11 b) Parties’ disagreement on the content of the contract. More difficult cases are
those where the parties disagree on what the contract’s position is on a particular matter
and one party invokes Art. 72(1) by treating the other party’s arguments as an
expression of its intention to commit an anticipatory breach. Should the exercise of
the right to avoid Art. 72(1) be allowed in such cases? In some legal systems, it has, on
occasions, been suggested that it would be too harsh to hold a party as having
committed an anticipatory breach where its interpretation of the contract stems from
a good faith but erroneous position.46 Such cases will undoubtedly arise from time to
time, particularly where the contract as well as practices and trade usages have nothing
to say on the issue in question: the contract may be silent on the mode of transportation
and the parties may disagree on whether there was an implicit agreement that the goods
be transported only by a particular means of transportation;47 the parties may disagree
on whether the specified loading date was intended to mean that the goods could only
be loaded on that date or whether it was merely intended to indicate the latest date by
which loading could be carried out;48 where the contract provides that the buyer is
entitled to an ‘exclusive’ use of the vessel, the parties may take different positions on
whether such a provision means that the vessel can contain no goods other than the
38Arbitral Award, CIETAC CISG/1997/35, CISG-Online 1662 (Pace).
39See, generally, in the context of the common law, Wee, Insolvency and the Survival of Contracts,
Journal of Business Law (2005) 494 (501 seq.).
40 Whether non-conformity amounts to a fundamental breach, is, of course, to be decided by reference
to the criteria in Art. 25.

41 Helsinki Court of Appeal (Finland) 30 June 1998, CISG-Online 1304 (Pace).
42 For an example where this was the case, see Netherlands Arbitration Institute (Netherlands)
15 October 2002, CISG-Online 740 (Pace).

43 Helsinki Court of Appeal (Finland) 30 June 1998, CISG-Online 1304 (Pace). See the finding by the
court of first instance: “M’s statement does not support the view that with the time the [seller] had in his
hands he would have been able to manufacture new goods or change the old goods so that the
preservation of vitamin A would have been guaranteed.”
Chamber of Commerce, 161/1994, 25 April 1995 (Pace).

45 See Arbitral Award, ICC 8786/1997, CISG-Online 749 (Pace).
46 See, e. g., Ross T. Smyth & Co. Ltd. v T. D. Bailey Son & Co. (1940) 67 Ll. L. Rep. 147 (159): “a mere
honest misapprehension, especially if open to correction, will justify a charge of repudiation”. Cf. Federal
Commerce and Navigation Co. Ltd. v Molena Alpha Inc. [1979] A. C. 757. For further discussion, see
Farnsworth, Contracts (2004) pp. 587 seq.
47 See Bezirksgericht der Saane (Switzerland) 20 February 1997, CISG-Online 426 (Pace).
48 See Arbitral Award, CIETAC CISG/1996/07, CISG-Online 1122 (Pace).
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contract goods or whether the agreement was intended to exclude the possibility of
using the vessel for transporting the goods of the type different from the contract
goods.49 The sense of possible injustice to the party, against whom Art. 72(1) is invoked,
can be exacerbated here because the decision as to which interpretation is correct is
made retrospectively by a court or tribunal.
It is argued, however, that neither the point made in the previous sentence nor the 12
subjective intention of the party against whom the right in Art. 72 is exercised should be
relevant. First, it is a trite statement that the realities of commercial life and the
workings of the law are such that a final say on the dispute regarding the parties’ legal
positions will have to be had by a court or tribunal after the dispute has arisen and the
self-help remedies have been exercised. Therefore, it is inevitable that either party who
relies on a certain interpretation and/or asserts a particular right takes a risk that its
position may be subsequently found to be incorrect. Secondly, in practice it will be
difficult to distinguish between situations where the party genuinely misinterprets the
contract and those where it wants to appear to misinterpret the contract in good faith in
the hope of possibly changing the original agreement or minimising the adverse
consequences of its anticipated failure to perform.50 Furthermore, if a signal is sent
that the application of Art. 72(1) depends on whether a party appears to act in good
faith, it may induce potential non-performing parties to abuse their position by
attempting to create an appearance of a good faith misinterpretation of contract. Finally,
if a party’s right to avoid for anticipatory breach were to depend on the other party’s
subjective state of mind, certainty and security that this remedy was intended to provide
would be undermined since the parties would be much more cautious in invoking it.
Perhaps, one solution which could alleviate the positions of the parties who genuinely 13
disagree on the interpretation of the contract is to seek a construction summons from
the court in which the court would express its view regarding the contract interpreta-
tion.51 Once the parties have been given the court’s interpretation, the party who
erroneously interpreted the contract but was committed to it may still be willing to
perform. This suggestion may not be workable, however, where time does not permit
for the parties to seek a construction summons (e. g., where the party intending to avoid
needs to do so within a short period of time).52 The solution may also be of limited use
since such a procedure may not be available in some jurisdictions.
c) Other cases. Another situation, not too dissimilar to the one just discussed, is 14
where a party proposes or insists on modifying the contract. Whether such a position
makes it clear that a fundamental breach will occur depends, once again, on the
interpretation of this party’s intentions in light of the facts of the case. In general, a
mere proposal to renegotiate the contract in itself will not be sufficient to meet the
requirements of Art. 72(1).53 The same can be said about a mere expression of a desire
to change the terms of the contract. In one case,54 the seller expressed a wish to
discontinue deliveries and it was held that such a statement, coupled with the fact that
Chamber of Commerce, 238/1998, 7 June 1999 (Pace).

50 See the decisions in the cases considered supra notes 321–323, and the accompanying main text,
from which it is not at all clear whether the parties who relied on an erroneous interpretation did so in
good faith or in an attempt to modify the contract, get into an advantageous position, or minimise the
adverse consequences flowing from their conduct.
51 For a discussion of this solution in the context of the common law, see Carter, Breach of Contract
(1984) pp. 284 seq.

52 See ibid.
54 Arbitral Award, ICC 8574/1996, CISG-Online 1293 (Pace).
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the parties were involved in on-going negotiations on this matter “hardly constituted
any alarming development in the Parties’ relationship tantamount to any ‘clear’
indication of anticipatory breach”.55 Where, however, on a sharply rising market the
seller states, for example, that it is highly unlikely that it would be able to deliver unless
the price is raised, that would probably be sufficient to trigger Art. 72(1). Those cases
where a party makes an unambiguous and definite statement that it will not perform
unless the terms are changed should fall under Art. 72(3) as this is the case of a
declaration of refusal to perform.
15 Some of the remaining types of case include those where a party, against whom Art. 72
is invoked, denies the very existence of the contract, claims that it has the right to avoid
the contract, or enters into what appears to be a substitute transaction. If such a conduct
is based on an erroneous interpretation, the considerations and proposals set out above
will be applicable here.56 These cases may also give rise to the question of whether the
party’s statement should be analysed by reference to para. 1 or para. 3 of Art. 72. As
suggested earlier, in such cases if there is room for interpreting the party’s statement or
conduct, the relevant provision should be that in para. 1. Thus, if on a falling market the
buyer that ‘it believes that there is no contract’ between the parties, adding that ‘although
it will still need some time to consider its position, there is very little chance that it will
change its mind’, such a statement should not be regarded as falling within para. 3.
Similarly, where the buyer complains about the earlier deliveries, stating that because of
the non-conformities therein it is very likely to avoid the contract, whereas the seller is
certain that the goods were conforming and suspects that the buyer attempts to reduce
the price,57 such a case should also be considered by reference to para. 1.
16 In general, the seller’s apparent resale of the contract goods to another buyer should
not in itself be regarded as an implicit refusal to perform (because, for example, it may
have other goods in stock) and should again fall within para. 1; in such cases, it is
generally better to provide the seller with an opportunity to provide adequate assurance.
It is only in cases where a reasonable person in the innocent party’s position would have
no doubt that the other party’s sale or purchase of the goods prevents it from
performing the contract that para. 3 may be invoked.
5. Burden of proof
17 A party who wishes to exercise the right to avoid the contract under Art. 72(1) must
prove that the necessary preconditions for doing so have been met. Therefore, this party
must establish that there are grounds which would make it clear to a reasonable person
in its position that a fundamental breach58 will occur.59
6. Notice under Art. 72(2); burden of proof

18 It is in the interests of the party intending to rely on Art. 72 to make sure that it is indeed
clear that a fundamental breach will occur. Otherwise, if it has made an incorrect judgment
55 Ibid. The arbitrator also took into account the fact that at no time was there a mention of the
avoidance of the contract.

56 See, in the context of English law, Woodar Investment Development Ltd. v Wimpey Construction
U. K. Ltd. [1980] 1 W. L. R. 277.

57 See, e. g., Arbitral Award, Schiedsgericht der Börse für landwirtschaftliche Produkte in Wien
(Austria) 10 December 1997, CISG-Online 351 (Pace), where the seller argued that the buyer’s complaints
about the quality of previous deliveries were an attempt to reduce the price.
58 This obviously requires that that the preconditions set out in Art. 25 must also be demonstrated.
59 See Arbitral Award, Tribunal of International Commercial Arbitration, 161/1994, 25 April 1995
(Pace), and accompanying text, where the issue of burden of proving the grounds for invoking Art. 72(1)
was dealt with by reference to the applicable arbitration rules.
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and invoked Art. 72, it will itself be in breach. Para. 2 of Art. 72, which requires that the
innocent party give notice to the other party to give the latter an opportunity to provide
adequate assurance of performance, is helpful to the innocent party: if adequate assurance is
provided, the innocent party regains the sense of security and the expectation that the
contract will be honoured and can continue to perform; if the other party fails to respond to
the notice, the innocent party is likely to be in the position to avoid the contract. Because
giving a notice may help save the contract, the notice requirement is in line with the
Convention’s policy of the preservation of contract. This requirement can also promote
communication and, possibly, cooperation between the parties and for this reason is said to
meet the expectations and needs of business persons. In addition, it may be able to
minimise the risk of the innocent party abusing its right of avoiding the contract.
The notice under Art. 72(2) must be distinguished from the declaration a party is 19
required, by Art. 26, to make to exercise its right of avoidance. By giving the former
notice a party expresses its suspicions that the other party will commit a fundamental
breach and expresses its intention to avoid,60 while by giving the latter notice the party
invoking Art. 72 avoids the contract.61 Because the purpose of the notice under
Art. 72(2) is to give a chance to the other party to provide adequate assurances, the
grounds for fearing an anticipatory breach, which are at the same time grounds for the
intention to avoid, need to be specified.62 It is also often the case that parties expressly
demand and specify the types of assurances and set the time limits for giving such
assurances.63 Provided that such time limitations are reasonable, the party giving a
notice should be able to do so since there may often be a need for it to act promptly
which, in turn, demands a speedy crystallisation of the parties’ legal positions.
It has been further suggested that, by analogy with Art. 48(2), the innocent party 20
should be allowed to seek a declaration from the other party regarding its commitment
to the contract.64 More specifically, it has been argued that in this declaration the
innocent party can request the other party to state whether it intends to provide
assurances and that a failure to do so within a reasonable time justifies an assumption
that no assurances will be given.65 This suggestion is driven by the concern that the
innocent party may be much disadvantaged by its duty to give a notice where it is under
pressure of both the need for a prompt action and lack of certainty regarding the future
of the contract while the provision of adequate assurance may take some time. Whether
this suggestion will be followed remains to be seen. It would seem, however, that by
seeking to introduce an additional level of protection to the innocent party, not
60 See, e. g., Helsinki Court of Appeal (Finland) 30 June 1998, CISG-Online 1304 (Pace); Landgericht
Berlin (Germany) 30 September 1992, CISG-Online 70 (Pace).

61 For examples where the innocent party gave notice avoidance in the context of Art. 72, see, Supreme
Court of Queensland, Court of Appeal (Australia) 12 October 2001, Downs Investments v Perwaja Steel,
CISG-Online 955 (Pace) using the common law terminology of ‘accepting repudiation’; Arbitral Award,
Tribunal of International Commercial Arbitration, 238/1998, 7 June 1999 (Pace).
62 See Fountoulakis, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 72 para. 22 with further
references. This would seem to mean that, despite Art. 26 not expressly requiring that the grounds for
avoidance be specified in the declaration of avoidance, the party invoking Art. 72 will not be able to later
rely, as it generally would be under the common law, on some other ground for avoiding the contract
(which existed at that time but of which the party was unaware) if the initial reason for avoidance turned
out to be unjustified. For a cautious view to the contrary, see Bridge, Issues Arising Under Articles 64, 72
and 73 of the United Nations Convention on Contracts for the International Sale of Goods, Journal of
Law and Commerce (2005–2006) 405 (415) (Pace).
63 See Supreme Court of Queensland, Court of Appeal (Australia) 12 October 2001, Downs Investments
v Perwaja Steel, CISG-Online 955 (Pace); Landgericht Berlin (Germany) 30 September 1992, CISG-Online
70 (Pace); Oberlandesgericht Düsseldorf (Germany) 14 January 1994, CISG-Online 119 (Pace).
65 See ibid., p. 724, note 53.
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expressly provided for, this proposal can disturb the balance between the parties created
by Art. 72(2). Its underlying concern should be adequately addressed by the provisions,
discussed in the next paragraph, referring to whether ‘time allows’ for a notice to be
given and to the reasonableness of this notice.
21 The duty to give notice is subject to two requirements. First, the notice must be
‘reasonable’ in the circumstances.66 The reasonableness of the notice relates not only to
its form and content but also to the procedure of giving it. What is reasonable also
needs to be interpreted taking into account the rights and interests of both parties.
Thus, reasonableness would require that the party under suspicion be given sufficient
time to provide adequate assurances. At the same time, the party should be required to
give notice only where doing so would not seriously jeopardise its position and damage
the utility of Art. 72 (i. e., in cases where there is a need for prompt action). It would
also not seem reasonable to require the party to give notice where it is evident from the
circumstances that it will not be possible for the other party to perform67 (for example,
where the destruction of a factory or the imposition of an export ban prevent the seller
from delivering the goods, or where currency exchange regulations make it impossible
for the buyer to pay the price).68 Similarly, where the parties were involved in a number
of communications regarding one party’s ability to perform and it was clear from such
contacts that that party would not perform, it would be unnecessary for the innocent
party to give a notice (even if such communications are not treated as a notice and
failure to provide assurance under Art. 72(2)). In one such case,69 the tribunal stretched
the duty to give notice too far where despite the seller having urged the buyer to
perform its obligation to open a letter of credit on several occasions,70 the tribunal still
held that the seller did not comply with the notification requirement.71
22 At the point where reasonableness means that the innocent party should not be
required to give notice where there is a need for it to act promptly, it becomes very
similar to the second requirement relating to the duty to give notice: the party is required
to give notice only ‘if time allows’.72 Although, in the light of the modern means of
66Art. 72(2).
67See Schlechtriem, Uniform Sales Law: The UN-Convention on Contracts for the International Sale of
Goods (1986), p. 94 (Pace); Eiselen, Remarks on the manner in which the UNIDROIT Principles of
International Commercial Contracts may be used to interpret or supplement Arts 71 and 72 of the CISG
(Pace); Enderlein/Maskow, International Sales Law (1992), p. 292 (Pace).
68 See Secretariat Commentary on 1978 Draft, Art. 63 note 1.
70 “The Buyer did not open the L/C after having been urged to [do so] several times by the Seller” (ibid.).
The tribunal also noted that the seller requested the establishment of the letter of credit even after it had
resold the contract goods but failed to explain the relevance of this fact to the question of whether the seller
complied with its duty to give notice under Art. 72(2). It is suggested, in this regard, that the said fact can
only be relevant for the question, widely discussed in the common law, of whether the innocent party itself
was able and willing to perform. It is suggested that the innocent party’s readiness and willingness to
perform is not relevant for the exercise of its right to avoid under Art. 72 Convention but is certainly
relevant for calculating damages on a ‘concrete’ basis. See, further, Saidov, Anticipatory Non-Performance
and Underlying Values of the UNIDROIT Principles, Uniform Law Review (2006) 795 (808 et seq.).
71 The decision also reflects a degree of confusion regarding what notices the Convention requires the
seller to give. Besides referring to Art. 72(2), the decision also implies that the seller ought to have given a
notification of its resale of the goods. The legal basis for such a requirement is unclear since the
Convention does not contain any requirements to this effect. See Arts 74–76; for a further discussion
see Saidov, The Law of Damages in International Sales – The CISG and other International Instruments
(2008), Ch 8. In contrast with this overly demanding approach, see an example of an overly cautious
approach by the innocent buyer who gave notice under Art. 72(2) despite the seller’s refusal to perform in
Oberlandesgericht Hamburg (Germany) 4 July 1997, CISG-Online 1299 (Pace).
72 The representatives of several developing countries at the Vienna Diplomatic Conference proposed
the deletion of this provision on the ground that it might provide a party with an excuse to escape from
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communications, situations where time will not allow for a notice to be given are likely to
be very rare,73 they may still arise in some cases. Some of the typical scenarios where this
might be the case include those where: there is an urgent need, on a highly fluctuating
market, to enter into a substitute transaction at once; in the case of seasonal goods, the
seller needs to quickly find another buyer as the season is drawing to a close; or the buyer
needs to find another supplier of complex machinery, which the seller was to manufac-
ture, in order to deliver it to its customer on time (coinciding with or following shortly
after the date when the seller was to deliver). To ensure that this provision is not invoked
by a party simply looking for a convenient means of escaping from the contract and that a
fair balance between the two parties is maintained,74 the question of whether or not ‘time
allows’ needs to be decided by reference to the ‘reasonable person’ standard.75
Burden of proof: Because giving a notice under Art. 72(2) is a prerequisite for 23
invoking the rights under Art. 72(1), the innocent party bears the burden of proving
that this notice has been given. If no notice has been given, it will further have to
demonstrate that ‘time did not allow’ it to do so.
7. Adequate assurance; burden of proof

The meaning of adequate assurance is a matter of the circumstances of the case.76 In 24
general, adequate assurances are those which provide the innocent party with reason-
able security regarding the future performance by the other party.77 In assessing the
adequacy, regard should be had to a number of factors including the purpose of the
contract, the nature of events giving rise to an expectation that an anticipatory breach
will occur, reputation and previous conduct of a party giving assurances, the relevant
practices between the parties and trade usages. The discussion relating to adequate
assurances provided under Art. 71(3) should, generally, be relevant here as well.78 There
are, however, some points of difference. First, an anticipated failure to perform under
Art. 71 will not necessarily be fundamental and where this is the case, a similar
anticipatory breach but that which is fundamental will, by comparison with the former,
require assurances of an arguably greater extent. Second, the effect of the remedy of
avoidance under Art. 72 is much more severe and this can, in some cases, justify a
the contract without giving a notice and therefore an opportunity for the other party to save the contract
by providing adequate assurances (see, e. g., the statements made by Mr. Sami (Iraq) A/CONF.97/C.1/
L.252; and Mr. Tian (China) A/CONF.97/C.1/L.253 (Pace)). This proposal was rejected (see e. g., Bennett,
in: Bianca/Bonell, Commentary (1987), Art. 72 paras 1.7 seq. (Pace)) to take account of cases where there
is a need for a prompt action by the innocent party.
73 See Bennett, in: Bianca/Bonell, Commentary (1987), Art. 72 para. 3.3 (Pace); Honnold/Flechtner,
Uniform Law (2009), Art. 72 para. 398.

74 See, e. g., Strub, The Convention on the International Sale of Goods: Anticipatory Repudiation
Provisions and Developing Countries, 38 International Comparative Law Quarterly (1989) 457 (499)
(Pace) (“parties will always be able to put forth some plausible reason for the particular circumstances
demanding quick action: the party is unable to reach the other party, it is necessary to procure another
source of supply to meet other contractual obligations, mitigate losses, meet a crucial deadline, etc.”).
75 See ibid.
76 For a detailed discussion of the underlying considerations and meaning of adequate assurance, see
the above commentary on Art. 71.

77 See ibid.; also Koch, The Concept of Fundamental Breach of Contract under the United Nations
Convention on Contracts for the International Sale of Goods (CISG), Review of the Convention on
Contracts for the International Sale of Goods (CISG) (1998), p. 305 (Pace).
78 This should be so for two reasons: one is that many cases of the suspension of performance will be
based on suspicions of an anticipatory fundamental breach; the other relates to the fact that both Arts
71(3) and 72(2) refer to very same device based on the same considerations and policies.
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stricter approach to the notion of adequacy under Art. 72.79 Whether these general
points can translate themselves into fine and consistently drawn distinctions between
different types of assurances remains to be seen.
25 A party’s refusal or mere failure to provide adequate assurance will usually confirm
the innocent party’s prognosis that a fundamental breach will occur and will, as rule,
justify the avoidance of the contract.80 It is not entirely clear how cases where the
innocent party does not regard the provided assurances as adequate are to be dealt with.
Much depends on the circumstances and the key question is what can be inferred, so far
as the party’s willingness and ability to perform is concerned, from its attempt to
provide an assurance. If a buyer, who failed to pay for previous deliveries and to
perform its contractual obligation to provide a bank guarantee to secure payment,
supplies an expired guarantee which is no longer valid after the seller’s request to
provide one, it would seem that there is no need for this seller to ask for yet another
assurance and the contract can be avoided at once.81 In some other cases where an
assurance contains real signs of an intention and/or ability to perform, such as where
the buyer provides a ‘comfort letter’ from its parent company stating that the buyer will
perform the contract, it may be sensible for the seller who does not regard this letter as
adequate assurance to give the buyer, if time allows, another chance to provide security
of its performance. The innocent party should be able to set strict but reasonable82 time-
limits and doing so would ensure that if adequate assurances are, once again, not
provided within the time-limit the innocent party can safely avoid the contract.83 In any
event, it would seem that in most cases of this type the innocent party should be allowed
to avoid the contract. First of all, the duty to give notice only arises when it has already
become clear that a fundamental breach will occur and giving a notice is often merely a
device for the innocent party to reassure itself of the correctness of its prognosis.
Secondly, the notification requirement under Art. 72(2) is by no means absolute and
does not need to be met if time does not permit the innocent party to engage in any
further communications.
26 Burden of proof: The parties may dispute whether the given assurances were
adequate and it is not entirely clear who should bear the initial burden of proof in this
regard. It seems that because it is in the interests of the party against whom Art. 72 is
invoked to prove that adequate assurances were provided, the burden of presenting
evidence to this effect should generally lie on this party.84
8. Refusal to perform (Art. 72(3)); burden of proof

27 Where a party makes a declaration that it will not perform its obligations, the
innocent party does not have a duty to give notice under Art. 72(2). The underlying
79 For a similar view, see Bridge, Issues Arising Under Articles 64, 72 and 73 of the United Nations
Convention on Contracts for the International Sale of Goods, Journal of Law and Commerce (2005–2006)
405 (417) (Pace).
80 See Secretariat Commentary on 1978 Draft, Art. 63; Bennett, in: Bianca/Bonell, Commentary (1987),
Art. 72 para. 2.3 (Pace); Koch, The Concept of Fundamental Breach of Contract under the United Nations
Convention on Contracts for the International Sale of Goods (CISG), Review of the Convention on
Contracts for the International Sale of Goods (CISG) (1998), pp. 304, 308.
81 See Arbitral Award, Hungarian Chamber of Commerce and Industry Court of Arbitration, CISG-
Online 250 (Pace) where the seller, in similar circumstances, was allowed to avoid an instalment contract
under Art. 73(2).
82 I.e., sufficient time that would enable the other party to provide the requested assurance.
83 Some commentators advocate such solutions by emphasising a general duty to cooperate, inferred
from the Convention (see Hornung, in: Schlechtriem/Schwenzer, Commentary (2005), Art. 72 para. 22).
84 For a similar position, see Fountoulakis, in: Schlechtriem/Schwenzer, Commentary (2016), Art. 72
para. 43, with further references.
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presumption that where such a declaration is made a fundamental breach will occur85
can be explained by the view that the party’s statement provides the other party with the
highest level of certainty regarding the occurrence of an anticipatory breach and, for this
reason, there is no need to engage in any kind of prognosis and further communications
confirming it. It can also be explained by the idea that an unambiguous and definite
renunciation of its commitment to the contract should in itself be regarded as an actual
breach of contract and the Convention.86 Although, as discussed above, para. 3 was no
doubt intended to ease the exercise of the right to avoid for anticipatory breach in a
specific type of case, it has created some uncertainty regarding its relationship with
para. 1. It has been argued here that para. 3 should be confined to those cases, including
those where an implicit declaration has been made, which leave no room for the
interpretation of whether a party has refused to perform its obligations. In other words,
a declaration needs be definite and unambiguous. If there is any reasonable doubt as to
whether this is the case, the situation should be considered by reference to para. 1.
The clearest examples of where Art. 72(3) will be applicable are those where a party 28
refuses to perform in express and definite terms: the seller may state that it will simply not
deliver,87 or that it is impossible for it to deliver the goods,88 or that it is neither able to
ship the goods within the shipment period, nor to specify the date when the shipment will
be possible at all, urging the buyer to enter into substitute transactions.89 Similarly, where
the buyer has not committed any breach90 or there are no grounds to expect that the
buyer will commit a fundamental breach,91 the seller’s statement that it will “no longer
feel obligated” to deliver the goods and will “sell the material elsewhere” if the buyer does
not agree to modify the terms of the contract will fulfil the requirements of Art. 72(3).92
However, some cases of a clear statement of the inability to perform may not fall 29
within para. 3 if the contract provides a special procedure for such cases. The contract
may, for example, give the seller a right to an additional period of time in case of its
inability to deliver on time, provided that it makes the specified payments to the
buyer.93 It may be that, in such a case, the seller’s statement that there will be a delay
in delivery will not be regarded as a sufficient basis for invoking Art. 72(3)94 as long as
85For a similar view, see ibid., Art. 72 para. 34.

86See the discussion of the rationale underlying the anticipatory breach doctrine in the section
‘Introduction to Articles 71–73’ above. For a similar view, see Fountoulakis, in: Schlechtriem/Schwenzer,
Commentary (2016), Art. 72 para. 34 (“Refusal to perform is arguably the purest form of contractual
breach”).
87 See Handelskammer Zürich (Germany) 31 May 1996, Soinco v NKAP, CISG-Online 1291 (Pace).
89 See Arbitral Award, CIETAC 29 March 1996 (Pace).
90 Where the buyer has committed a fundamental breach, the seller will have the right to avoid the
contract and the seller’s statements referred to in the main text will most probably constitute the seller’s
threat to exercise its legal right of avoidance unless the buyer agrees to the modification of the contract.
91 Where there are such grounds and the buyer fails to provide adequate assurance after the seller has
given notice under Art. 72(2), the statements in the main text are, once again, likely to constitute the
seller’s threat to exercise its right to avoid under Art. 72 if the buyer does not agree to the proposed
modification (e. g., provision of additional security). For the discussion of the problem of requests for
adequate assurance being used as a party’s attempt to change the terms of the contract, see this
commentary on Art. 71 paras 50 et seq.
92 See U. S. District Court, N. D. of Illinois, Eastern Division (U.S.) 7 December 1999, Magellan
International v Salzgitter Handel, CISG-Online 439 (Pace) (“It would be difficult to imagine an allegation
that more clearly fulfills the notice function of pleading”).
93 See Arbitral Award, CIETAC CISG/1997/36, CISG-Online 1418 (Pace) where the contract provided
a ten week grace period to the seller in case of delay in delivery. Although the clause seems to have
referred to the seller’s actual failure to deliver on time, the tribunal relied on it to deal with an
anticipatory breach claim made by the buyer.
94 Only those delays which would have amounted to a fundamental breach of contract are meant here.
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the period of delay is not expected to exceed the additional period fixed by the contract
and the seller is able and willing to make the said payments.95
30 The Convention is silent on the question of whether the party which made a
declaration under Art. 72(3) is entitled to retract it. Clearly, if the innocent party has
avoided the contract, retraction is no longer possible since the contract is no longer in
existence. Where, however, the contract has not been avoided, retraction is, in principle,
possible and arguably desirable in light of the Convention’s policy of the preservation of
contracts. At the same time, it may well be the case that although the innocent party has
not yet avoided the contract it has already relied on the other party’s refusal to perform.96
If so, it can be argued that no retraction should be allowed in cases where such reliance
was reasonable: the doctrine of anticipatory breach was intended to provide the innocent
party with security and certainty regarding its legal position before the due date and it
follows that the innocent party should be able to rely on the other party’s refusal to
perform without fearing that it may still be required to perform. The UCC in this regard
strikes a good balance of these conflicting considerations by ruling out the possibility of
retracting repudiation where the innocent party has materially changed its position or
otherwise indicated it considers the repudiation as final.97 According to this position, the
right to retract depends on the actions taken by the innocent party.98 It is submitted that
the policies and considerations underlying Art. 72 will be well served if the Convention is
interpreted in a similar way: the general principles of good faith (assuming there is such a
general principle), with the protection of reliance being its specific manifestation, and
reasonableness could be the starting point for the development of these rules within the
Convention. It is further argued that a mere retraction of a declaration of the refusal to
perform is not sufficient for such retraction to be effective. The party must also provide
adequate assurances of its performance and the considerations set out above in relation to
the notion of adequacy also become relevant here.99
31 It is often the case that the innocent party’s response to the other party’s refusal to
perform is to urge the latter to perform.100 If then the other party does retract its refusal,
the contract remains alive and only some adjustments to the contractual timetable may
have to be made, if, for example, the innocent party has suspended its performance or
some other delay has been caused by the refusal to perform. If no retraction follows, the
innocent party should not be penalised for its earlier attempt to save the contract and
should be allowed to avoid the contract subsequently.101
32 Burden of proof: If the innocent party relies on Art. 72(3) it must show that the other
party’s declaration constituted a refusal to perform the contract. As argued above, in
case of doubt as to whether a declaration in question falls within the scope of Art. 72(3)
or if the party fails to meet this burden, the innocent party will have to revert to
establishing the preconditions for the invocation of Art. 72(1).
95 See ibid. For the discussion of, and disagreement on, whether the so-called ‘Nachfrist’ procedure is
relevant in anticipatory breach cases, see, e. g., Kimbel, Nachfrist Notice and Avoidance under the CISG,
18 Journal of Law and Commerce (1999) 301 (326 seq.) (Pace); cf. Enderlein/Maskow, International Sales
Law (1992), pp. 236 seq.
96 For example, the seller may well have begun modifying the goods for the needs of other buyers while
the buyer may have already entered into arrangements with other sellers.
97 See para. 2–611 UCC. See also Farnsworth, Contracts (2004), pp. 591 seq.
98 See Comment 1 on para. 2–611 UCC.
99 For a similar position, see para. 2–611(2) UCC.
100 See, e. g., Supreme Court of Queensland, Court of Appeal (Australia) 12 October 2001, Downs
Investments v Perwaja Steel, CISG-Online 955 (Pace).

101 For a similar view in the common law context, see Farnsworth, Contracts (2004), p. 592.
932 Saidov
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9. Damages102 and mitigation of loss

Because an anticipatory breach is equated with an actual breach, it constitutes the 33
basis for the right to claim damages. It is submitted, however, that such a right should
arise only after the contract has been avoided103 since it is the avoidance which
crystallises the parties’ legal positions. In contrast, when the contract remains in
existence there is still a possibility that it will be performed: for example, there is, as
explained, the possibility of retracting a refusal to perform; or in some cases the
innocent party’s choice not to avoid the contract will reflect its hope that the contract
may still be saved and, if so, the party cannot, on the one hand, contemplate the
possibility of the contract being performed and, on the other hand, claim damages on
the assumption that the contract will not be performed.
Once the contract has been avoided, damages can be claimed and they will usually be 34
calculated by reference to Arts 75 and 76. Thus, where the innocent party has made a
replacement contract within a reasonable time and in a reasonable manner, damages can
be calculated under the ‘concrete’ formula in Art. 75 as the difference between the
contract price and the price in the replacement transaction. What needs to be borne in
mind here is that the requirement of reasonableness in Art. 75 is linked integrally to the
mitigation rule. This means that, as a general matter, the contract needs to be avoided and
a replacement transaction needs to be made at the time leading to the lowest amount of
damages.104 To implement this guideline, the innocent party, who is effectively required to
predict the market movements, will often need to think carefully about the appropriate
time for avoiding the contract and entering into a substitute contract. This is a difficult
position to be in and, therefore, in cases where it is unreasonable to expect the innocent
party to be able to predict market movements (for example, because the market is a highly
fluctuating one or because the due date of delivery is too far in the future), avoiding the
contract shortly after anticipatory breach and making a replacement soon afterwards
should be regarded as the conduct which is in line with the mitigation rule. Where,
however, the party is in the position to make market predictions with a reasonable degree
of likelihood, the mitigation rule will dictate the time when the contract is to be avoided
and the replacement transaction is to be entered into: therefore on a falling market the
buyer may have to wait before buying a replacement while the seller may have to resell
the goods as soon as possible. One way of partially overcoming the difficulty of
determining whether it was reasonable for the innocent party to make market predictions
is to do so by means of the allocation of the burden of proof: it will usually be the
breaching party who bears the burden of proving the innocent party’s failure to
mitigate105 and where it fails to meet this burden, damages can then be assessed on the
presumption that the innocent party has acted reasonably.
Where the ‘abstract’ formula in Art. 76 is relied upon, the current price should generally 35
be the price for future delivery, as fixed by the original contract, current at the time of
avoidance.106 This should be so because the hypothetical replacement transaction, just like
102 The discussion in this section of the issue of calculating damages is substantially based on Saidov,
The Law of Damages in International Sales – The CISG and other International Instruments (2008),
Chapters 2 and 9. See this source for a much more extensive treatment and further references.
103 A similar position seems implicit in Comment D on Art. 9:304 PECL.
104 The buyer needs to re-purchase at the lowest price reasonably possible and the seller needs to sell at
the highest price reasonably possible.

105 See Saidov, The Law of Damages in International Sales – The CISG and other International
Instruments (2008), pp. 147 seq.

106 See Schlechtriem, Calculation of Damages in the Event of Anticipatory Breach under the CISG,
<http://www.cisg-online.ch/cisg/FS%20Hellner.pdf>.
Saidov 933
3B2 9.1.580; Page size: 160.00mm 240.00mm
an actual replacement, needs, as a rule, to be concluded on similar terms to the original

contract where this is reasonably possible. This approach is also based on the view (which,
as has been seen, also underlies the existence of the anticipatory breach doctrine) that the
contract itself represents an asset or an effective commercial resource, which although to
be performed in the future, has a present value.107 The price for future delivery as fixed by
the original contract current at the time of avoidance can sometimes be determined at the
relevant forward or futures markets.108 Where no such prices are available, there is a
danger that the ‘abstract’ formula may either over- or under-compensate the innocent
party since the current price at the time of avoidance may be higher or lower than the
current price at the due date of delivery. The decision as to whether the innocent party has
been over- or under-compensated can, however, only be reached if the legal proceedings
take place after the due date. Therefore, if the proceedings take place before that date, there
is generally no other choice but to award damages by reference to the current price at the
time of avoidance (for immediate delivery or delivery at some time before the due date).
Where the proceedings take place after the due date, the subsequently acquired knowledge
of the price at the due date cannot be ignored and over- or under-compensation must be
prevented. One way of doing so is to require the innocent party to make a replacement
transaction as soon as possible and to calculate damages ‘concretely’ by reference to that
transaction. If a replacement transaction is not possible,109 damages will have to be
assessed ‘concretely’ by reference to the party’s actual loss on the basis of Art. 74.110
36 As shown, the mitigation rule can dictate where the innocent party is to avoid the
contract under Art. 72 in order to prevent the prospect of its damages claim being
reduced on the grounds of a failure to mitigate. It is further argued that the idea of the
mitigation of loss should extend beyond the confines of the remedy of damages and be
able to restrict the exercise of other remedies. For instance, where after a party’s clear
refusal to perform before the due date the other party insists on (specific) performance
despite not having a legitimate interest in doing so, its later claim for the performance of
the contract should be denied if the latter could have easily reduced its losses by
avoiding the contract after the refusal to perform and channelling its resources in
another direction.111 For example, the seller of goods designed exclusively for the needs
of the buyer, who at the time of the buyer’s refusal to perform has not yet begun the
manufacture, should not be able to claim the contract price if it knew that the buyer no
longer needed the goods and could have easily accepted an order from another
customer instead, later claiming damages for the difference, if any, between the prices
in two contracts. This approach, based on the need to prevent the economic efficiency,
waste of resources,112 reasonableness and the need to maintain a fair balance between
107For a similar view, see ibid.

108Such prices usually represent the market’s best guess regarding the prices for the goods in question at
the date fixed by the original contract and will therefore approximate, as much as possible, a hypothetical
transaction at the time of avoidance to a hypothetical transaction had it been concluded at a future due date.
109 It may, e. g., not be possible to find another supplier because the goods are highly specialised or
unique or because the goods need to be ordered a long period in advance and the buyer is not left with
sufficient time to do so to enable itself to resell to its sub-buyer at the agreed date (see Arbitral Award,
ICC 8786/1997, CISG-Online 749 (Pace).
110 For a detailed discussion of this problem, see Saidov, The Law of Damages in International Sales –
The CISG and other International Instruments (2008), Chapter 9.

111 For a well-known and controversial Scottish case touching upon these issues, see White and Carter
(Councils) Ltd. v McGregor 2 A. C. 428 (H.L 1961). See further Saidov, Methods of Limiting Damages
under the Vienna Convention on Contracts for the International Sale of Goods, 14 Pace International
Law Review (2002) 307 (356 seq.) (Pace).
112 Allowing the seller in this example would clearly run counter to the interrelated ideas of efficiency
and avoiding waste. For instance, efficiency is often understood to dictate that resources need to move in
934 Saidov
3B2 9.1.580; Page size: 160.00mm 240.00mm

the interests of the two parties, arguably follows from the spirit,113 policies114 and
principles115 underlying the Convention.

Similar to the Convention, the PICC and PECL allow a party to avoid the contract if 37
it is clear that the other party will commit a fundamental breach.116 The two sets of
Principles also contain a provision giving the innocent party the right to withhold
performance and request adequate assurance if it ‘reasonably believes’ that a funda-
mental breach will occur.117 This standard seems to require a lower degree of prognosis
than that flowing from the standard of ‘being clear’ because it gives rise to a less drastic
remedy of withholding performance. The Principles take a more certain position than
the Convention in respect of the consequences of a failure to provide adequate
assurance within a reasonable time (provided, in case of the PECL, that the party still
reasonably believes that a fundamental breach will occur) by stipulating that such a
failure will entitle the innocent party to avoid the contract.118 In contrast with the
Convention, the two sets of Principles do not treat a party’s declaration of refusal to
perform as a separate category of anticipatory breach which entitles the innocent party
to avoid the contract at once (i. e., without a need to make a prognosis). In light of some
uncertainty created by Art. 72(3) CISG, the Principles’ position seems, on balance, a
better one. At the same time, referring back to the criticisms and concerns surrounding
the availability of remedies for anticipatory breach, it can be argued that the Principles’
lack of the notification requirement similar to the one in Art. 72(2) CISG is regretta-
ble;119 not only would it reduce the risk of the innocent party’s abuse of its right to avoid
and establish a fairer balance between the parties, but it would also be a better way of
promoting the ideas of cooperation,120 communication and the preservation of con-
the direction where they are valued most: clearly, manufacturing the goods which are no longer wanted
does not seat easily with the said notion of efficiency. Other criteria of efficiency will also appear to be
met: no one will be worse off as and at least the buyer will be better off by having to pay a lower amount
(Pareto efficiency) also meaning that, at least in theory, there are no losers and a winner (Kaldor-Hicks)
(for the discussion of the limitations of these criteria, see Saidov, The Law of Damages in International
Sales – The CISG and other International Instruments (2008), pp. 125 seq. with further references). Waste
also can be said to occur since the buyer would have to pay a higher amount as a purchase price if the
seller were allowed to claim specific performance, than it would be if the seller were required to take the
least costly measures. In other words, the buyer lost an opportunity to use its money elsewhere
(opportunity cost).
113 The Convention’s spirit is very much that revolving around a fair balance between the two parties,
promoting good faith conduct and cooperation. These are some of the central considerations underlying
the idea of mitigation (see Saidov, The Law of Damages in International Sales – The CISG and other
International Instruments (2008), pp. 125 seq.), i. e., taking account of the interest of the breaching party.
114 One of the main policies of the Convention is to promote free trade (see the Preamble) which, in
turn is very based on the idea of the effective allocation of resources. This means that efficiency is by no
means an alien consideration to the Convention.
115 A number of general principles are relevant here including, reasonableness and good faith (assum-
ing it is a general principle) with its emphasis on the need to take account of the other party’s interests.
For an extensive discussion of a multi-layered rationale of the mitigation rule, see Saidov, The Law of
Damages in International Sales – The CISG and other International Instruments (2008), pp. 125 seq.
116 See Art. 7.3.3 PICC and Art. 9:304 PECL.
117 See Art. 7.3.4 PICC and Art. 8:105(1) PECL.
118 Art. 7.3.4 PICC and Art. 8:105(2) PECL.
119 For a more extensive discussion, see Saidov, Anticipatory Non-Performance and Underlying Values
of the UNIDROIT Principles, Uniform Law Review (2006) 795 (810 seq., 822).
120 See Art. 5.1.3 PICC and Art. 1:202 PECL.
Saidov 935
3B2 9.1.580; Page size: 160.00mm 240.00mm
tracts.121 Finally, just like the Convention, the Principles require that to avoid the
contract, the innocent party must give a notice of avoidance.122
121 See, e. g., Bonell, Restatement (2005), pp. 117 seq.

122 See 7.3.2 PICC and 9:303 PECL.
936 Saidov
3B2 9.1.580; Page size: 160.00mm 240.00mm
Article 73
(1) In the case of a contract for delivery of goods by instalments, if the failure of
one party to perform any of his obligations in respect of any instalment constitutes a
fundamental breach of contract with respect to that instalment, the other party may
declare the contract avoided with respect to that instalment.
(2) If one party’s failure to perform any of his obligations in respect of any
instalment gives the other party good grounds to conclude that a fundamental breach
of contract will occur with respect to future instalments, he may declare the contract
avoided for the future, provided that he does so within a reasonable time.
(3) A buyer who declares the contract avoided in respect of any delivery may, at the
same time, declare it avoided i

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o:/Beck/978-3-406-71455-9/3d/A1 - Foreword.3d from 20.02.2018 17:59:21

Stefan Kröll, Loukas Mistelis, Pilar Perales Viscasillas

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AAA ....................................... American Arbitration Association

Audit, Vente Internationale

Status of the CISG1

State Signature Ratification, Acces- Entry into force

Albania 13 May 2009 (b) 1 June 2010

Argentina (a) 19 July 1983 (b) 1 January 1988

Armenia (a) 2 December 2008 (b) 1 January 2010

Australia 17 March 1988 (b) 1 April 1989

Austria 11 April 1980 29 December 1987 1 January 1989

Azerbaijan 3 May 2016 (b) 1 June 2017

Bahrain 25 September 2013 (b) 1 October 2014

Belarus (a) 9 October 1989 (b) 1 November 1990

Belgium 31 October 1996 (b) 1 November 1997

Benin 29 July 2011 (b) 1 August 2012

Bosnia and Herzegovina 12 January 1994 (c) 6 March 1992

Brazil 4 March 2013 (b) 1 April 2014

Bulgaria 9 July 1990 (b) 1 August 1991

Burundi 4 September 1998 (b) 1 October 1999

Cameroon 11 October 2017 (b) 1 November 2018

Canada (d) 23 April 1991 (b) 1 May 1992

Chile (a) 11 April 1980 7 February 1990 1 March 1991

China (e) 30 September 1981 11 December 1986 (f) 1 January 1988

Colombia 10 July 2001 (b) 1 August 2002

Congo 11 June 2014 (b) 1 July 2015

Costa Rica 12 July 2017 (b) 1 August 2018

Croatia (g) 8 June 1998 (c) 8 October 1991

Cuba 2 November 1994 (b) 1 December 1995

Cyprus 7 March 2005 (b) 1 April 2006

Czech Republic (h), (i) 30 September 1993 (c) 1 January 1993

Denmark (j) 26 May 1981 14 February 1989 1 March 1990

Dominican Republic 7 June 2010 (b) 1 July 2011

1 As stated on the UNCITRAL website (http://www.uncitral.org/uncitral/en/uncitral_texts/sale_goods/

1980CISG_status.html) on 15 February 2018.

Status of the CISG

Ecuador 27 January 1992 (b) 1 February 1993

Egypt 6 December 1982 (b) 1 January 1988

El Salvador 27 November 2006 (b) 1 December 2007

Estonia (k) 20 September 1993 (b) 1 October 1994

Fiji 26 May 1981 7 June 2017 1 July 2018

Finland (j) 15 December 1987 1 January 1989

France 27 August 1981 6 August 1982 (f) 1 January 1988

Gabon 15 December 2004 (b) 1 January 2006

Georgia 16 August 1994 (b) 1 September 1995

Germany (l), (m) 26 May 1981 21 December 1989 1 January 1991

Ghana 11 April 1980

Greece 12 January 1998 (b) 1 February 1999

Guinea 23 January 1991 (b) 1 February 1992

Guyana 25 September 2014 (b) 1 October 2015

Honduras 10 October 2002 (b) 1 November 2003

Hungary (a), (n) 11 April 1980 16 June 1983 1 January 1988

Iceland (j) 10 May 2001 (b) 1 June 2002

Iraq 5 March 1990 (b) 1 April 1991

Israel 22 January 2002 (b) 1 February 2003

Italy 30 September 1981 11 December 1986 1 January 1988

Japan 1 July 2008 (b) 1 August 2009

Kyrgyzstan 11 May 1999 (b) 1 June 2000

Latvia (a) 31 July 1997 (b) 1 August 1998

Lebanon 21 November 2008 (b) 1 December 2009