Uniform Sales Law - The UN-Convention on Contracts for the International Sale of Goods

Univ. Prof. Dr. Peter Schlechtriem [*]

Preface Abbreviations Bibliographic Notes

page number of Manz text .............. . 5 .............. . 9 .............. 11 . .... 17 .... 17 .... 18 .... 20 ......... ......... ......... .........

. . A. Early History . . B. The UNCITRAL Drafts and the Vienna Conference on the . International Sales . C. Background Materials and Documents . . I. Preliminary Remarks

II. The Structure and the Main Features of the 1980 Convention . . . . . . . . . . . . . . . 22 (CISG) III. Sphere of Application (Articles 1-6) A. Initial Questions (Article 1(1)) B. Sufficiency of Foreign Contacts .............. 24 . .............. . 24 .............. . 27

C. Application of the Convention Independent of the Parties' Commercial Character or Nationality (Article 1(3)) . . D. Exceptions (Article 2) . . 1. Consumer Contracts . . 2. Auctions; Stocks, Securities. Negotiable Instruments and Money; Ships and Aircraft; Electricity .

............. 27 ............. 28 ............. 28


. E. Contracts for the Sale of Made-to-Order Goods and for the Sale . of Services . F. Contract Validity and the Transfer of Title (Article 4) . . G. Products Liability (Article 5) . . H. Party Autonomy (Article 6) . . . IV. General Rules . A. Interpretation and Gap-Filling (Article 7) . . B. Interpretation of Statements and Conduct (Article 8) . . C. Usages (Article 9) . . D. Place of Business (Article 10) . . E. Form (Articles 11, 12, 13, 29 (2) and 96) . . . V. Formation of the Contract . A. Basic Principles and General Provisions . . B. The Offer (Articles 14-17) . . C. Acceptance of an Offer (Articles 18-22) . . D. Open Questions . . 1. Battle of the Forms . . 2. Letters of Confirmation . . 3. Requirements of Official Permits . . 4. Culpa in contrahendo . . . VI. Substantive Sales Law . A. General Provisions . . 1. Fundamental Breach (Article 25) . .

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29 ... 31 ... 32 ... 34 ... 35 ... 37 ... 37 ... 39 ... 40 ... 43 ... 44 ... 48 ... 48 ... 50 ... 54 ... 56 ... 56 ... 56 ... 57 ... 57 ... 58 ... 58 ... 58

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. . 3. "Dispatch" Principle (Article 27) . . 4. Specific Performance (Article 28) . . 5. Modification and Termination of the Contract (Article 29) . . B. Obligation and Responsibilities of the Seller . . 1. Place of Delivery (Article 31) . . 2. Obligations in Connection with Carriage (Article 32) . . 3. Delivery Date (Article 33) . . 4. The Transfer of Documents (Articles 34) . . 5. Conformity of the Goods and the Absence of Third-Party . Claims (Articles 35-44) . a) Defects in Quality and Quantity (Articles 35-37) . .

2. Avoidance of the Contract (Article 26)

.... 61 .... 61 .... 62 .... 63 .... 63 .... 64 .... 65 .... 66 .... 66 .... 66 .... 67

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b) Examination and Notice by the Buyer (Articles 38-40, 44) . . . . . . . . . . . . . . . 69 c) Third-Party Claims to the Goods and Intellectual Property Rights of Third Persons .............. . 72 (1) Third-Party Claims .............. . 72

(2) Industrial and Other Intellectual Property Rights of . . . . . . . . . . . . . . Third Persons . 73 6. Buyer's Remedies for the Breach of Contract by the Seller . . (Articles 45-52) . a) Claims for Performance (Articles 46 and 47) .. . ............ 75 ............ 76

b) The Seller's Right to Cure (Article 48) ("Second . . . . . . . . . . . . . . Tendering") . 77

.. 97 . . 79 d) Reduction of the Price (Article 50) e) Remedies for Partial Non-Performance or Partial Lack of . .... 92 . 79 f) Early Delivery or the Delivery of Excess Goods (Article . Other Places of Delivery (Article 69(2)) .. . . . 80 C. 1. F........ ...... 3. . 1... ....... Sales Involving Carriage (Article 67) . 80 ... ...... ......... . ... .. ... The Buyer's Obligations (Articles 53-65) . .. . 83 ....... ... .......... 2.. 1. Extent and Measure of Damages (Articles 74-76) ..... The Passing of Risk (Articles 66-70) ... . 90 . Instalment Contracts (Article 73) ... Suspension of Performance Due to Deterioration in the Other Party's Situation (Article 71) . .... 2. 86 .. 95 .... 80 ...... 87 . Conformity (Article 51) ..... 3. 4......... . . D. .. .. 52) . .... ... 3. . .. . 96 ........ .. . .... Damages (Articles 74-77) .. 2. E.... . Buyer's Obligation to Take Delivery (Article 60) .... .... ...... . . 92 . The Seller's Remedies for Breach by the Buyer (Articles 61.... 78 . 97 . Provisions Common to Both the Seller's and the Buyer's .... .... .c) Avoidance of the Contract (Article 49) ...... ..... ... ... Local Purchase (Article 69(1)) . .. ... ... Obligations (Chapter V) .. The Obligation to Pay the Price (Articles 54-59) .. .. 1... ..... 65) ....... 91 ..... 89 .. 84 .... The Sale of Goods During Transit (Article 68) .. ..... .. .. . Avoidance Based on Anticipatory Breach (Article 72) . . .. . .. . ...

...... 106 ...... Reservations VIII. Effects of Avoidance (Articles 81-84) 1............ . .. ....... . Final-Provisions (Articles 89-101) A. 111 ... . Obligations After Avoidance 3... In General B.... . ... 115 .. 111 .. Limitation Period Final Remarks Index .. 107 ....... . . Exemptions (Article 79) I........ ... ....... ... The Obligation to Preserve the Goods (Articles 85 and 86) . 107 . 99 . .. 108 . 114 . ........ .2. Prerequisites 2. 101 . The Self-Help Sale . .. ....... . .. .... 108 2........ Restitution of the Benefits Received 4..... ... ..... The Obligation to Preserve the Goods and the Right to a SelfHelp Sale (Articles 85-88) ................. 1..... . 117 VII..... .... ...... 105 .. 109 . ................ 99 .... 111 ...... ..... Interest (Article 78) H..................... The Duty to Mitigate Damages (Article 77) G. ........... .. . 108 . 106 ...... Gaps ... . K.......... ...... .. .. Failure of Performance Caused by the Other Party (Article 80) J...

and to the law firm Covington & Burling in Washington.[page 5] Peter Schlechtriem Freiburg. but frequently they forced me to reconsider statements I made in the book. D. C. but certainly not least. material and working hours for the completion of this work. discuss. B. Denzlinger patiently typed and retyped the various drafts. Wien. Gerhard Dannemann. Often I have found that the comments of my colleagues reassured me as to my own views. Mrs. and Kommerzialrat Dr. Lührs and Mr. The experiences of the German courts with the predecessor of the Convention. Last. I owe special thanks to Ms. Ms. for checking the footnotes. It was originally intended as a source of information for German jurists. Joelen Gates. In the translation I have tried to take into consideration the enormous amount of literature on the 1980 Convention that has appeared since the first publication of the book. are included in the footnotes whenever this appeared to me to be of some benefit to the reader. scholars may wish to have access to an interpretation of the Convention from the perspective of German law. and for reading the proofs. I am aware that a scholarly contribution in a language that is foreign to the author can never be formulated quite as convincingly as it can be in his native language. and -.C. In agreeing to have the book translated. Mr. Bond for translating. But I am particularly indebted to my dear friend and colleague. In this process of forming an international consensus. West Germany. I decided to follow their advice because I believe that uniformity in the interpretation of the Convention can be promoted if legal scholars throughout the world recognize. for their understanding and generous assistance in providing him with secretaries. Wirtschaft und Außenhandel" and the patient care of the publishing house of Manz. for his invaluable advice and the tremendous sacrifices he made in a thorough revision of the text.if possible -clarify the potential problems before the Convention is applied by the courts.. 1986 . Richard Hyland. I have examined everything to which I had access and have listed what I consulted in the bibliography. the 1964 Hague ULIS and ULF. Mr. I did not strive for completeness. Professor Dr. Helmut Haschek for editing this little book in their "Schriftenreihe Recht. word-processors. I have to thank my esteemed colleague. I can only hope that the efforts that went into the translation are merited by the contents of this book. Peter Doralt of the Wirtschaftsuniversität Wien. a law which has influenced the development of the Convention.Preface The short report presented here is a translation of my book Einheitliches UN-Kaufrecht. Mohr (Paul Siebeck) Publishing House in Tübingen. This book would not have been possible without the dedication and help of my assistants. nevertheless. I am greatly indebted to those authors for the insights which enabled me to correct my interpretation. Stegemann. Mr. Fischer organized the administrative side of the translating and editing of this book. but foreign colleagues and friends suggested that I have it translated into English in order to make it accessible to jurists of all nations interested in uniform sales law. but. published in 1981 by J.

) BGB Bürgerliches Gesetzbuch (German Civil Code) BGBl Bundesgesetzblatt (F.R. ch.9. American Journal of Comparative Law (U.J Connecticut Bar Journal (U. of International Encyclopedia of Comparative Law Comp.) ed.B. 1980) Conn.R. BB Betriebs-Berater (Periodical. chambre commerciale (F) (confer) compare cf.German standard contract terms act.R. J. Comp. German Democratic Republic id.) Rev. Int'l Fin. J.) . F. Int'l Law. Ariz.N.) BGH Bundesgerichtshof (German Federal Court) BGHZ Entscheidungen des Bundesgerichtshofs in Zivilsachen (German Federal Court Reporter) cass. Law.A.) Am.com. (et sequentes) and the following EuGVÜ Europäisches Übereinkommen über die gerichtliche Zuständigkeit und die Vollstreckung gerichtlicher Entscheidungen in Zivil.G. International Financial Law Review (U.S.1968) (EEG-Convention on Jurisdiction and the Enforcement of Judgements in Civil and Commercial Matters) Eur.und Handelssachen (27.S.) Int'l Tax & International Tax & Business Lawyer (U.S. L. (idem) the same (id est) that is i.K. European Transport Law (Bel) L. F. IPRax Praxis des Internationalen Privat. L.Abbreviations AGBG Gesetz zur Regelung des Rechts der Allgemeinen Geschäftsbedingungen (9 December 1976) .G.A. Int'l & Arizona Journal of International and Comparative Law (U. Convention for the International Sale of Goods (11. F. Cour de cassation.und Verfahrensrechts (Periodical.S.A) Comp.S.D. editors (exempli gratia) for example e. editor eds.e. Federal Republic of Germany G. L.R.G.A. F.R.4.R. infra below Int. The International Lawyer (U.) Bus.G.g. Enc. Chapter CISG U.A. Transp. AcP Archiv für die civilistische Praxis (Periodical. et seq.G.) L.

Uniform Commerdal Code Law Journal (U. World Tr.K.S/U. in Scandinavian Studies in Law (Swe) Law sent.G. F. int'l dr. Yearbook Y.S.) RG Reichsgericht (German Empire Court) Scan. paragraphs RabelsZ Rabels Zeitschrift für ausländisches und internationales Privatrecht (Periodical. F.) Contract & Fin.) U. U. Juris-Classeur Periodique (Semaine Juridique) J. paragraph paras. L.) J.S. RIW/AWD Recht der internationalen Wirtschaft/Außenwirtschaftsdienst des Betriebsberaters (Periodical.C.11 April 1980) [page 9] p.Rev UCC Uniform Commercial Code (U. F.) . The Journal of Business Law (U.S. page para.A. U. Studs. volume vols.A. J.S. L. Review of Ghana Law (Ghana) Rev.S. volumes WM WM Wertpapier Mitteilungen (Periodical.B. Revue Internationale de Droit Comparé comp. Ghana L. United Nations UNCITRAL United Nations Commission on International Trade Law UNCITRAL United Nations Commission on International Trade Law.A.S. Journal of World Trade Law (U.R.S.R. Vienna 10 March .J.S.N.A. Official Records (of the United Nations Conference on Contracts for the International Sale of Goods.G.R.) Rev.A.R. United Kingdom of Great Britain and Northern Ireland ULF Uniform Law on the Formation of Contracts for the International Sale of Goods (1964) ULIS Uniform Law on the International Sale of Goods (1964) U. sentence supra above The Int'l The International Contract Law and Financial Review (U.N.) L.G.A. Ohio State Law Journal (U. Note NJW Neue Juristische Wochenschrift (Periodical.G. L.) OPEC Organization of the Petroleum Exporting Countries O. F.) UCC. Union of the Socialist Soviet Republic vol. N.A United States of America U. J.S.) Ohio St.R.P.R. Bus.

) [page 10] Bibliographic Notes The authors have been basically cited by name and page or other reference such as a section (§) number. in: Wiener Übereinkommen von 1980 über den internationalen Warenkauf. La nouvelle convention des Nations-Unies sur les contrats de vente internationale de marchandise. American Bar Association Commitee on Continuing Professional Education (1977-1980) Bonell. 1 Ariz. Das UNCITRAL-Kaufrecht im Vergleich zum österreichischen Recht. Wien: Manz (1985). The Vienna Convention: Posing a New International Law of Sales. 11 Rev.. The Law of International Commercial Transactions (Lex Mercatoria) 42-49. Comp. Prepared by the Secretariat. 17 Eur. J. Ghana L. 1980: Overview and Selective Commentary. Die Haager Konferenz über die internationale Vereinheitlichung des Kaufrechts vom 2.). (1980) 39-52 [page 11] De Vries. Wesentliche Vertragsverletzung und Rücktritt. reprinted in O. 207-218 (cited as Lausanner Kolloquium) Bydlinzki. Works frequently cited and their short titles appear below followed by complete references. 2d ed. 57-90 Cain. 327340 (1983) von Caemmerer. L. J.). 1979-II Revue de Droit Uniforme/Uniform L. p. Part 3. 7 Droit et pratique du commerce international 7-35 (1981) Bonell. Rome. J. A/Conf. 50-67 (1979) Date-Rah. 2-12 Bonell. Folio III.). 97/5 (14 March 1979).). 178 AcP 121-149 (1978) Commentary on the Draft Convention on Contracts for the International Sale of Goods. Basic Concepts of the UN Convention on the International Sale of Goods. When there is more than one publication by the same author either a short title is also given or the full citation.ZfBR Zeitschrift für deutsches und internationales Baurecht (Periodical. in: A Lawyer's Guide to International Business Transactions (Surrey and Wallace. Int'l & Comp. in: Problems of Unification of International Sales Law. Rev. The Vienna Convention on International Sales Contracts and Mexican Law: A Comparative Study. cited as Secretariat's Commentary Date-Bah. Probleme des Haager Einheitlichen Kaufrechts.G. L. 14-66. B. Inc. Das UNCITRAL-Kaufrecht im Vergleich zum österreichischen Recht. Gefahrenübergang. Transp. in: Doralt (ed.. Die Bedeutung der Handelsbräuche im Wiener Kaufrechtsübereinkommen. 57 Conn. The Passing of Risk in International Sales under the Vienna Sales Convention 1980 as compared with Traditional Trade Terms. Problems of the Unification of International Sales Law from the Standpoint of Developing Countries. Wien: Manz (1985). April 1964: 29 RabelsZ 101-145 (1965) von Caemmerer. 122-156 (1982) Beinert. in: Doralt (ed. London. Schweizerisches Institut für Rechtsvergleichung (ed. eds. 107 östJBl 385-395 (1985) Bucher. 15-27 Berman. Das allgemeine Vertragsrecht. 27 (1979) 255-277 Bergsten. L. The United Nations Convention on Contracts for the International Sale of Goods. New York: Oceana Publication. Am. The Remedy of Reduction of Price.R. Some Critical Reflections on the New UNCITRAL Draft Convention on International Sale. Philadelphia: American Law Institute. bis 25. Bielefeld: Gieseking (1979) Bergsten/Miller. F.R. Barrera Graf. 495-528 (1982) .

London. Formation of Contract. J. F. New York: Matthew-Bender (1984). eds.). 77 Am. Convention for the International Sale of Goods. Das UN-Übereinkommen über internationale Kaufverträge: RIW/AWD 1980. 2 Int'l Tax & Bus. Bus. cited as "General Provisions" Eörsi. 311-323 (1979). 601608 Herber. International Sales: The United Nations Convention on Contracts for the International Sale of Goods. New York: Matthew-Bender (1984).S. Problems of the Unification of Sales Law from the Standpoint of the Common Law Countries. Law 79-100 (1984) Hearing. London. see: U. 346-361 (1981) Gonzales. A Propos the 1980 Vienna Convention on Contracts for the International Sale of Goods. in: Problems of Unification of International Sales Law. cited as "Formation" Farnsworth. London. The Rules of the Convention Relating to the Buyer's Remedies in Cases of Breach of Contract. cited as "Problems" Eörsi. L. New York: Oceana Publications. Inc. The Vienna Convention: History and Scope. Kaufrechtskonvention der UNO (mit Verjährungskonvention). Choice of Law under the International Sales Convention: A U. Inc. Wien: Manz (1985) Enderlein. (1980) 26-38 Enderlein/Maskow/Stargardt. The UN Convention on International Sale of Goods. L. .N. Schweizerisches Institut für Rechtsvergleichung (ed. in: Problems of Unification of International Sales Law. L. 17-20 (1984).). Müller (1983) 72-102.). Anwendungsbereich des UNCITRAL-Kaufrechtsä bereinkommens. in: Parker School of Foreign & Comparative Law (Galston & Smit. Riesenfeld. International Sales: The United Nations Convention on Contracts for the International Sale of Goods. Remedies Under the U.). Comp. 27 Am. München: Beck (1976) Dore. Inc. in: Festgabe Weitnauer. Problems of the Unification of Sales Law from the Standpoint of the Socialist Countries. in: Wiener Übereinkommen von 1980 über den internationalen Warenkauf.). J. Rome. 521-540 (1983) Doralt (ed. 18 Int'l Law. p. in: Parker School of Foreign & Comparative Law (Galston & Smit. Perspective.S. Das Zustandekommen von Kaufvertragen im Aussenhandel nach internationalem Einheitsrecht und nationalem Sonderrecht: 45 RabelsZ 169-195 (1981) Dölle (ed. Comp. (1980) 104-129 [page 12] Herber. cited as "Ipso facto Avoidance" Hellner. Problems of Unifying Laws on the Formation of Contracts for the International Sale of Goods. Kommentar zum Einheitlichen Kaufrecht. (1980) 3-25 Farnsworth. in: Doralt (ed. J. in: Problems of Unification of International Sales Law. New York: Oceana Publications. Formation of Contract. New York: Oceana Publications. Rome.Dilger. Das UNCITRAL-Kaufrecht im Vergleich zum österreichischen Recht. General Provisions. J. Berlin: Duncker & Humblot (1980) 85-99. cited as "History" Feltham. Ipso facto Avoidance. in: Festschrift für Stefan A. 353-356 (1983) Eörsi. eds. Int'l L. cited as "An Outsider's View" Herber. Senate Hellner. Heidelberg: C. Berlin 1985 Eörsi.). 31 Am. 43-54 (cited as Lausanner Kolloquium) Farnsworth. Rome. The United Nations Convention on Contracts for the International Sale of Goods.

La Convention de Vienne du 11 avril 1980 sur les contrats de vente internationale de marchandises. Antwerpen. J. 951-986 (1981) Khoo. 27 Am. J. Comp. Studs. The Draft Convention on Contracts for the International Sales of Goods: An Overview. J. World Tr. London. 21-28 (1984) Honnold. 27 Am. La convenzione di Vienna dell' 11 aprile 1980. in: Wiener Übereinkommen von 1980 über den internationalen Warenkauf. Frankfurt: Kluwer (1982). The Int'l Contract-L. & Fin. Convention on Contracts for the International Sale of Goods. int'l dr. cited as "Force Majeure" Nicholas. in: La Vendita Internazionale. in Law 107-138 (1983) Magnus.).). Uniform Law for International Sales Under the 1980 United Nations Convention. The Reception of the 1980 United Nations Sales Convention. L. 27 Am. Convention on Contracts for the International Sale of Goods. Impracticability and Impossibility in the U. Boston.).Das UNCITRAL-Kaufrecht im Vergleich zum österreichischen Recht. p. eds. 7 Digest of Commercial Laws 13143 (March 1980) Loewe. London. 577-584 (1980) . Boston.N. London. The U. New York: Matthew-Bender (1984) Honnold. 18 Int'l Law. 27 Scan. 265-267 (1981) Honnold. International Sales: The United Nations Convention on Contracts for the International Sale of Goods. Uniform Law and Uniform Trade Terms . International Sales: The United Nations Convention on Contracts for the International Sale of Goods. Auslegung.11-20 (cited as Lausanner Kolloquium) Lookofsky. Europäische Kaufrechtsvereinheitlichung: 45 RabelsZ 144-168 (1981) Maskow. Boston. Risk of Loss. 231-245 (1979). Der UNCITRAL-Entwurf eines Übereinkommens für internationale Warenkaufverträge: 43 RabelsZ 431-526 (1979) Kahn. Lücken. L. American and International Sales Law. Rev. Comp. cited as: "Honnold. L. 223-230 (1979) Honnold. UN Convention on Contracts for the International Sale of Goods 1980. Anwendungsgebiet.). L. 15 J. Wien: Manz 1985. Giuffré Editoré (1981) Michida. New York: Matthew-Bender (1984) [page 13] Perrott. in: Parker School of Foreign & Comparative Law (Galston & Smit. Commentary" Honnold.Two Approaches to a Common Goal. in: The Transnational Law of International Commercial Transactions 161-171 (Horn & Schmitthoff. 33 Rev. Formation of International Sales Contracts. Antwerpen. The Convention on the International Sale of Goods from the Perspective of the Socialist Countries. 279-289 (1979) Naón. eds. comp.). Force Majeure and Frustration. in: Parker School of Foreign & Comparative Law (Galston & Smit eds. 2845 Honnold.N. Cancellation of Contracts. Frankfurt: Kluwer (1982). The New Uniform Law for International Sales and the UCC: A Comparison. Handelsbräuche. in: The Transnational Law of International Commercial Transactions 89-124 (Horn & Schmitthoff. cited as "Two Approaches" Huber. The Vienna Convention 1980 on Contracts for the International Sale of Goods. Comp. eds. Fault and No-Fault in Danish. Antwerpen. Frankfurt: Kluwer (1982) Nicholas. Schweizerisches Institut für Rechtsvergleichung (ed.

London. The International Sales Convention: A Dissenting View. Mohr (1981) Schlechtriem. The Seller's Obligations under the United Nations Convention on Contracts for the International Sale of Goods.Progress in Unification of the Law of International Sales Contracts. Pflichten des Verkäufers. in: Wiener Übereinkommen von 1980 über den internationalen Warenkauf. 513522 (1981) Réczei.). in: Doralt (ed. From the Hague to Vienna .). 149-172 (cited as Lausanner Kolloquium) Schweizerisches Institut für Rechtsvergleichung (ed. bis 25. 265-305 (1984) Rosett. Wiener &Uml. 22 RabelsZ 16-116 (1957) Riese. Berlin. Das UNCITRAL-Kaufrecht im Vergleich zum österreichischen Recht.). UN Convention on International Sales Law. Schweizerisches Institut für Rechtsvergleichung (ed. L. Zehn Jahre deutsche Rechtsprechung zum Einheitlichen Kaufrecht: IPRax 1985. Gefahrenübergang und Schadenersatz. International Sales: The United Nations Convention on Contracts for the International Sale of Goods. Köln. J. L. Passing of Risk. B. 24 Acta Juridica Acad. Rev. Bonn. 45 Ohio St. Der Entwurf zur internationalen Vereinheitlichung des Kaufrechts. p. 44-49 (1984) Roth.). Am. Wien: Manz (1985). eds. The Field of Application and the Rules of Interpretation of ULIS and UNCITRAL Conventions. 153-183 Réczei. eds. in: The Transnational Law of International Commercial Transactions. Heymann (1985) Sevón.). L. p. New York: Matthew.Pfund. Einheitliches UN-Kaufrecht.191-266 (cited as Lausanner Kolloquium) Schlechtriem.Bender (1984) Plantard. Area of Operation of the International Sales Conventions. Sci. 111-117 (cited as Lausanner Kolloquium) Posch. 29 RabelsZ 1-100 (1965) Rosett. Rechtsbehelfe des Verkäufers. C. in: Wiener Ubercinkommen von 1980 über den internationalen Warenkauf. Hungaricae 157-188 (1982).). Schweizerisches Institut für Rechtsvergleichung (ed. (1980) 53-103 Reinhart. Tübingen: J.). April 1964. Rome. New York: Matthew-Bender (1984) [page 14] Schlechtriem. Boston. Zur vertraglichen Haftung des Warenverkäufers für seine Lieferquelle unter Betrachtung insbesondere des deutschen und amerikanischen Rechts als Beitrag zum UN-Kaufrecht. in: Wiener Übereinkommen von 1980 über den internationalen Warenkauf. Droits et obligations de l'acheteur. Prospects for Adoption in the United States. Problems of Unification of International Sales Law. in: Parker School of Foreign & Comparative Law (Galston & Smit. 15 Riese. Frankfurt: Kluwer (1982) Schlechtriem. 20 (July 1983) Salger. New York: Oceana Publications. 29 Am. London. Gemeinsame Bestimmungen über Verpflichtungen des Verkaufers und des Kaufers. in. L. Die Haager Konferenz über die internationale Vereinheitlichung des Kaufrechts vom 2. International Sales: The United Nations Convention on Contracts for the International Sale of Goods. München: C. 27 291-310 (1979) Rowe. Comp. Critical Reflections on the United Nations Convention on Contracts for the International Sale of Goods. Schweizerisches Institut für Rechtsvergleichung (ed. Beschaffung und Beschaffenheit. The Passing of Risk. Comp. p. Antwerpen.bereinkommen von . Inc. The Rules of the Convention Relating to its Field of Application and to its Interpretation. J. 125135 (Horn & Schmitthoff) (eds. Int'l Fin. cited as "Acta Juridica" Réczei. 18 Int'l Law. in: Parker School of Foreign & Comparative Law (Galston & Smit. J.).

München: C. 5571 (1984) Winship. 753-764 (Luke. Zürich 1985 Secretariat's Commentary. The Role of UNCITRAL. 17 Int'l Law. The Buyer's Obigations under the Convention on Contracts for the International Sale of Goods. November 1984. cited as "Scope" [page 15] Witz. lacunes. bis 20. New York: Matthew-Bender (1984) Tallon. International Sales: The United Nations Convention on Contracts for the International Sale of Goods. see: Commentary on the Draft Convention Sono. p. in: Wiener Übereinkommen von 1980 über den internationalen Warenkauf. Köln. Schweizerisches Institut für Rechtsvergleichung (ed. 7-15 (1984) Stoffel.). in: Wiener Übereinkommen von 1980 über den internationalen Warenkauf. eds. Droits et obligations de l'acheteur. 1-18 (1983) Winship. New York: Matthew-Bender (1984) Sono. Droits et obligations du vendeur. UNCITRAL and the Vienna Convention. Formation of International Sales Contracts under the 1980 Vienna Convention. International Sales: The United Nations Convention on Contracts for the International Sale of Goods.21-23 (cited as Lausanner Kolloquium) Welser. p. 105-132 Widmer. Second Session on Treaty Document 98-9 (1984) (cited as "Hearing") Vischer. usages. p.).).55-80 (cited as Lausanner Kolloquium) Tallon. Lausanner Kolloquium vom 19. Berlin. 17 UCC. eds. in: Parker School of Foreign & Comparative Law (Galston & Smit.).). 91-104 (cited as Lausanner Kolloquium) Winship. Ress & Will. Europarecht und Staatenintegration.) Das UNCITRAL-Übereinkommen im Vergleich zum österreichischen Recht. in: Wiener Übereinkommen von 1980 über den internationalen Warenkauf. The Scope of the Vienna Convention on International Sales Contracts.).J. p.1980 über den internationalen Warenkauf. Heymann (1983) Tercier. p. Schweizerisches Institut für Rechtsvergleichung (ed. eds.). in: Parker School of Foreign and Comparative Law (Gaiston & Smit. Schweizerisches Institut für Rechtsvergleichung (ed.). 119-142 (cited as Lausanner Kolloquium) US Senate. L. eds. International Sales Contracts Under the 1980 Vienna Convention. Der unbestimmte Kaufpreis. Formation du contrat. Ninety-Eight Congress. Wien: Manz (1985). International Sales: The United Nations Convention on Contracts for the International Sale of Goods. La consecration de la notion de conformité aprés la Convention des Nations-Unies sur les contrats de vente internationale de marchandises. Hearing before the Committee on Foreign Relations. Schweizerisches Institut für Rechtsvergleichung (ed. Champ d'application. New York: Matthew-Bender (1984). Gemeinsame Bestimmungen über Verpflichtungen des Verkäufers und des Käufers. interprétation. in: Rechtsvergleichung. in: Wiener Übereinkommen von 1980 über den internationalen Warenkauf.). 18 Int'l Law. 173-184 (cited as Lausanner Kolloquium) Volken. to be published in 1986 . in: Wiener Übereinkommen von 1980 über den internationalen Warenkauf. Bonn. Schweizerisches Institut für Rechtsvergleichung (ed. in: Parker School of Foreign & Comparative Law (Galston & Smit. Die Vertragsverletzung des Verkäufers und ihre Sanktion. in: Doralt (ed.

[page 17] Indeed. and published in two volumes as Recht des Warenkaufs (Law on the Sale of Goods). The efforts to achieve a uniform law for international sales .[5a] even though the number of nations which have ratified the Hague Conventions has remained small.[5] They have been important in daily practice as evidenced by the considerable number of judicial decisions applying their provisions. in each case. New York: Matthew-Bender (1984). 1978.[9] In any case.thereby came to something of a conclusion.[7] Presumably each individual state had its own reasons for not ratifying and. eds. in: Parker School of Foreign & Comparative Law (Galston & Smit. 1980 by the Secretary-General of the United Nations. without the participation of the developing and socialist countries. acting upon a resolution of the UN General Assembly from December 16.[1] but also laid the foundations for the ensuing process in his comprehensive comparative study on sales law. Early History Ernst Rabel not only initiated the drafting of an international uniform sales law. more than one aspect determined the rejection of the uniform sales law.[2] It is not necessary here to trace the details of the progression from the International Institute for the Unification of Private Law (UNIDROIT) in Rome under the auspices of the League of Nations to the first successful intermediate stage. A.Ziegel. cited as "Remedial Provisions" [page 16] I.did not fulfill the high expectations which accompanied the signing of the 1964 Hague Convention on Sales. Preliminary Remarks The United Nations Uniform Law for International Sales discussed in the following pages is the product of a diplomatic conference which was convened in Vienna from March 10 to April 11.[8] Frequently mentioned is the negative evaluation of the sales law by developing countries . 1974.[3] The Hague Conventions .a pursuit with a history extending back to the year 1929 and which is closely connected with the name of Ernst Rabel .together with the fact that these countries were not represented in the drafting process at the Hague Conference. written together with his collaborators at the former Kaiser Wilhelm Institute in Berlin. the Hague Conference on Uniform Law for International Sales. The participants at the Vienna Conference were constantly aware of Rabel's initial contribution. . and its use is generally restricted to transactions between parties from these member states. The Remedial Provisions in the Vienna Sales Convention: Some Common Law Perspectives. Various reasons have been given for this failure.). the hope that the Hague Conventions would become the lex mercatoria of world trade could not be fulfilled.the Uniform Law for the International Sale of Goods (ULIS) and the Uniform Law on the Formation of Contracts for the International Sale of Goods (ULF) [4] .the belief that it favored the sellers of manufactured goods in the industrialized nations .such as France and the United States .which had exercised considerable influence on the formulation of their rules.[6] It was especially disappointing that the Hague Conventions were not ratified by some of the signatory states . International Sales: The United Nations Convention on Contracts for the International Sale of Goods. both ULIS and ULF have been in effect in the Federal Republic of Germany since April 4.

In the final vote. 42 countries voted for the Convention. had passed. Prof. Mathanjuke of Kenya. Prof. the Final Act of the Conference was signed in a festive ceremony. parallel with the working committees and the Plenary. Warren Khoo Leang Huat from Singapore. 30. Chinese. The actual deliberations took place in the sessions of the above-mentioned First (Sales Law) and Second Committees (Final Provisions and Protocol Amending the Convention on the Limitation Period) from March 10 to April 5.the drafts from the First and Second Committees were discussed in Plenary and. proposed by the Working Group. Roberto Luis Mantilla-Molino (Mexico) was elected chairman of the Second Committee.[17] On April 11.[15] The Secretary-General then circulated this 1978 Draft Convention among the governments of UN member states for their opinions and comments. Sept. In the last week of the Conference .[11] It can be said that the efforts represented a continuation because the working group did not begin with a clean slate. The first sign of continuity was that UNCITRAL [10] took up the cause of drafting a uniform [page 18] international law of sales and that a working group was appointed for this purpose. opened the Conference on March 10 at 11 a. in which the substantive provisions of the international law of sales were deliberated and worked out. In accordance with the rules of procedure adopted in the first plenary session. The Chairman of the Hungarian delegation. 1980. Mr. The UNCITRAL Drafts and the Vienna Conference on International Sales The efforts to achieve a worldwide unification of international sales law did not stop. in accordance with the Conference procedure. passed by a two-thirds majority.April 7 to 11 .[16] It took place at the Neue Hofburg. A representative of the UN Secretary-General.[18] It was written and certified in the following official languages: Arabic. the chairmen of the First and Second Committees. and the Credentials Committee was chaired by Mr. while 10 abstained. German was not an official language of the Conference. and the 22 vice presidents of the Conference. English. Peter K. and the Austrian Foreign Minister Pahr gave an opening address. 3 countries have to date acceded after the last day for signatures. Eörsi.m.[12] The UNCITRAL Working Group finished the first draft (the Draft Convention on Sales) [13] in January 1976. The Drafting Committee was headed by Mr.B. The delegates chose Prof. was elected president of the Conference. decisions were reached in these working committees by a simple majority vote. which was ratified after a few changes at the tenth UNCITRAL Conference in Vienna in May and June of 1977 (the 1977 Draft Convention). The Drafting Committee began its work on March 21 and continued until the end of the Conference. Sixty-two nations participated in the Vienna Conference. 1981. Erik Suy. Russian and Spanish. was deliberated at the eleventh session of UNCITRAL in 1978 in New York and incorporated in the substantive sales law (1978 Draft Convention). rather it worked from the basis of the Hague Conventions and the research of Ernst Rabel with the intention of creating an international sales law acceptable to as many countries as possible. French. The Steering Committee of the Conference was composed of the president. Roland Loewe (Austria) to be the chairman of the First Committee. The discussions were all conducted in one of these languages and then translated simultaneously into the other five. however. The Federal . which was responsible for the Final Provisions and the Protocol [page 19] Amending the Convention on the Limitations Period. It formed the basis for the work of the Vienna Conference. The Convention has been signed by 20 countries. with the failure of the Hague Conventions.[14] The Draft Convention on Formation.

during the deliberations. for which the UN Secretariat had prepared a commentary (hereinafter the Secretariat Commentary)[20] which.Republic of Germany. Czechoslovakia. the United Kingdom.[page 21] II. [21] Australia. The Structure and the Main Features of the 1980 Convention (CISG) Annex I to the Final Act contains in its first three Parts (Articles 1-88) the Sales law. the German Democratic Republic. although. the Federal Republic of Germany. Finally.[28] the Asian African Legal Consultative Committee. The main concern behind the proposals and amendments was almost always to achieve the best objective solution and not simply to perpetuate the regulations of one country's domestic law. Byelorussian SSR. There was also rarely a firm block position on individual issues. C. Due to a request made by the Scandinavian countries.[30] along with an analysis of these comments and suggestions by the UN Secretariat. a state need not adopt all three parts but rather may adopt either Part II or Part III in conjunction with Part I. for their internal discussions. while the western industrialized nations and Japan deliberately tried to avoid acting as a group and. Portugal. the comparative studies on the Hague Convention and the UNCITRAL Draft made by Kahn [35] and Hartley [36] at the request of the EC Commission were also taken into consideration. [26] the WIPO (World Intellectual Property Organization). by comparative references. Background Materials and Documents The basis for discussions of the substantive sales law was the above-mentioned 1970 Draft Convention. .[32] and a draft of the Final Provisions (the public international law provisions). the German delegation made profitable use of Huber's commentary on the 1978 Draft Convention. kept their coordinating contacts to a minimum. therefore.[33] In addition to the above.[29] and the Council for Mutual Economic Assistance (COMECON).[23] the Netherlands. Sweden.[25] the Central Office for International Railroad Transport in Bern. The Conference also relied on the comments and proposals of the following governments and international organizations: Canada.[24] Austria.[22] Finland. France. As already reported by Herber. Austria and Switzerland formulated an official German version in 1983. the developing countries did seek to protect the interests of buyers of manufactured goods and coordinated their position in the "Group of 77". and Part III contains the substantive rules for the sales contract itself.[34] as well as the (unpublished) minutes of the German Council on Private International Law which had examined the UNCITRAL Draft in several of its sessions. Switzerland. This possibility is reflected in Article 92 as well as in the text of the substantive sales provisions themselves. Norway. Israel. Ireland.[31] These comments concerning the substantive sales provisions were supplemented by reports by the Secretary-General on the relationship between the Draft Convention and the Limitations Convention.[page 20] clarified the extent to which the Hague Convention had served as a source for the Draft Convention. Part II governs the formation of the contract. The socialist states also held joint sessions. while Part IV (Articles 89-101) contains in the Final Provisions the obligations of the Contracting States.[37] Part I outlines the Convention's sphere of application and its general provisions. Yugoslavia.[27] the International Chamber of Commerce. the United States.[19] the Conference's deliberations were for the most part free from political influence.

[39] The Convention distinguishes only between claims based on breach by the seller (Articles 45-52) and those based on breach by the buyer (Articles 6l-65). Second. for example. above all. according to Article 6.[page 22] Several points in the UNCITRAL Draft which had been criticized in the legal literature were improved in Vienna. It would then be sufficient that the forum's conflict-of-law rules point to the law of a Contracting State. barter contracts are not governed by the Convention. as supplemented by provisions . It is clear that the Convention applies in those cases where both parties have their places of business in different Contracting States but find themselves in a court of a non-Contracting State whose rules of private international law point to the law of a Contracting State. and the interpretation and gap-filling provisions of Article 7. damages and exemptions (Articles 74-77. such as in the requirement that a measure or waiting period be "reasonable" . even though the parties have their places of business in different states.on suspension of performance and anticipatory breach (Articles 71-72). when the parties to the contract have their places of business . since. parties may opt out of the Convention completely. however. the description of a "fundamental breach of contract". The tendency to avoid inflexible and irrevocable legal remedies. Initial Questions (Article 1(1)) As Article 1 indicates. private international law may direct the application of the Convention when.Huber [38] has already pointed out that the the reduction in the number of provisions contained in the UNCITRAL Draft compared to the Hague Convention was achieved not only by combining the law of contract formation with the sales law but. the Uniform Law for International Sales is applicable. to some extent. some suggestions were not adopted. does not eliminate party autonomy. In general. either by choosing a particular domestic law or by allowing the forum's rules of private international law to determine the appropriate law.[41b] The Convention combines applicability on the basis of "autonomous" requirements [42] with the lex fori's rules of private international law.[page 23] III.equally applicable to both parties . under Article 1(1)(a). see Articles 2-5). which was already visible in the 1978 Draft Convention. the Convention applies to contracts of sale (for the exceptions. The need for greater judicial discretion in particular cases also became clear. The Sphere of Application (Articles 1-6) A. 79 and 80) and avoidance of the contract (Articles 81-84). The Convention. [40] influenced the formulation of the remedy provisions in the 1980 Convention. their habitual residence (Article 10(b)) . the formulations of the UNCITRAL Draft survived in the final text. under the "autonomous" requirements. the apportionment of the risk for sending legally relevant communications. First.[43] Article 1(1)(b) also leads to the application of the Convention in cases when the private international law rules of the forum state.[41] The new provisions on time limitations for giving notice of non-conformity and the consequences of failing to give the notice in a timely manner (Articles 39 and 44) show especially clearly the strongly felt need for flexible rules to accommodate the buyer's difficulties.in different Contracting States. the remedies are no longer differentiated according to the various forms of breach.[41a] but it should be regarded as a success that. and additional and special remedies are available only as exceptions to the rule. the content and.[44] whether or not it is a .or alternatively. in many cases. by greatly simplifying the rules for breach of contract. the requirement that these are Contracting States is not met. Of course.

then it is a matter of interpretation whether they meant the Convention or that state's local sales law. as long as the basic requirement of Article 1(1) is met. at least. the forum must apply the domestic law of the reservation state and not the Convention. Numerous German court decisions have had to decide the meaning of standard references to "German" law in cases where the requirements for the application of ULIS are met. only parts of the uniform sales law would be applicable. Then. If the forum's conflicts law invokes the law of a Contracting State that has made the reservation. First. In such a case. not only Article 1(1)(b) gives rise to this question. even in relation to nonContracting States which are not bound to do the same.[50] However. It would certainly be easier for the courts of non-Contracting States to understand and apply the Convention than it would be for them to apply the domestic sales law of a foreign country.[46] Views on the solution differ. is compatible with domestic formation-of-contract provisions. Sufficiency of Foreign Contacts . Article 1(1)(b) considerably enlarges [page 24] the sphere of application of the Convention. If the parties have chosen the law of a Contracting State. since decisions based on the modern law of the Convention.[56a] B. The rule was very controversial in Vienna [47]. that the parties' places of business are in different states. the majority of delegations voted for the version of Article 1(1)(b) [54] as formulated.[51] The uncertainty which may arise from the parties' choice of law should also not be overestimated. would apply the law of a Contracting State. a partial application. limited to the rights and obligations arising from the contract already formed.[45] Of course.the option for Contracting States not to enact Article 1(1)(b).[49] The fact that Contracting States give more than they take cannot give rise to serious apprehensions that this will dissuade states from signing the Convention.Article 95 .[56] A reservation under Article 95 restricts the meaning of "Contracting" in [page 26] the phrase "Contracting State" (Article 1(l)(b)). Moreover.[53] Despite this serious concern. should not present insurmountable obstacles because the Convention was drafted in such a way that Part III (the substantive sales provisions). in effect. namely. More understandable are the fears that Article 1(1)(b) could make the Convention more difficult to apply. developed under the auspices of the United Nations and tailored to the intricacies of international sales transactions.Contracting State. it is advantageous for Contracting States to apply the Uniform Law for International Sales in international transactions not only when their own law is applicable by virtue of Article 1(1)(a).[48a] Finally. the court would refer to the Convention rather than to domestic law.[52] Some delegations indicated that laws in their countries already make special provision for the regulation of foreign trade. domestic rules of private [page 25] international law could apply one law to the formation of the contract and a different law to the substantive sales law. and the opposition to it finally led to the reservation clause in Article 95.[48] Application of the Convention is even more desirable when the private international law of a non-Contracting State invokes the law of a Contracting State. the fact that Contracting States are bound to apply the Convention. often will be far more acceptable to both parties than one party's domestic law that often is entirely alien to the other. should not influence the appraisal of these provisions. but also when it applies by virtue of private international law.[49a] For example. but the Plenary accepted the Czechoslovakian proposal [55] to include as a reservation clause . The pros and cons of this provision must be judged from several standpoints.

which further specifies that the fact that the parties have their places of business in different states must be apparent either on the face of the contract. either in the formation or in the execution of the contract. a party who has his place of business in a Contracting State may buy in that state and the goods may be delivered and payment made there. Consumer Contracts The extension of the Uniform Law for International Sales to non-commercial purchases is restricted by Article 2(a).would be invoked in a case where the transaction's foreign contacts are not recognizable to one of the parties.[62] The exception to the exclusion . in certain circumstances. the Hague Sales Law.instead of domestic sales law . if they are recognizable as such. For example. Application of the Convention Independent of the Parties' Commercial Character or Nationality (Article 1(3)) Like Article 7 of ULIS.[59] [page 27] D. overlapping areas remain in which the Uniform Law for International Sales as well as domestic consumer-protection regulations will apply. family or household use. Article 2(a) bears the same inadequacy as Article 5(2) of ULIS. the nationality of the parties is insignificant. This rule takes into account the fact that "international" consumer purchases are infrequent. alternatively. or that formation and execution each take place in different countries. The Convention does not apply to transactions concerning goods bought for personal. This is reflected in Article 1(2).[57] C. Thus.in France and this fact was known to the other party. and even though that state is not a Contracting State.or. and concern mostly tourists and mail-order businesses. a contract between two Germans would be controlled by the Convention. his habitual residence . The exception for sellers who "neither knew nor ought to have known" that the goods were for private use is deliberately formulated in the negative in order to place the burden of proof firmly on those who claim the exception to the consumer-contracts exclusion and assert that the Convention should apply. Exceptions (Article 2) 1.[60] Article 2(a) thereby fulfills the same function as Article 5(2) of ULIS. such as if one of the parties has his place of business . even when formation and execution both take place in a single state. this exclusion intends to ensure that domestic consumer-protection laws are not affected by the Uniform Law for International Sales. The Convention thereby avoids the intricate problem of defining a "commercial party". there is some risk that the Convention . The application of the Uniform Law for International Sales requires only that the parties' places or business be located in different states. For the Convention to apply. These requirements were not retained in the 1980 Convention. the fact that the other party's place of business is in a different state must be recognizable no later than the time of the formation of the contract. Article 1(3) of the 1980 Convention also provides that the application of the Convention does not depend on whether the parties are considered "civil" or "commercial". to apply. It is also irrelevant whether the sales contract is commercial or private in character. Moreover. namely that the attempt to delimit the sphere reserved for domestic consumer-protection laws did not fully succeed and.[61] The claim will succeed when the contents of the order or the company address of the buyer suggests that the sale is of a commercial character. Since the sole criterion for the Convention's applicability is that the parties' places of business be in different states. from the dealings between them. it is necessary that borders be crossed. therefore. or from the information disclosed by them.[58] Finally.In order for ULIS.

and who makes a purchase abroad without any express agreement. 2.[63] Above all.[68] The exception for auction sales can also be justified by the fact that most jurisdictions accept the domestic law of the auction site as controlling. on the one hand.of Article 2(a) .[70] Sales contracts which name a document as the subject of sale. this must be accepted. the purpose of Article 2(a) is to allow a broad description. according to Article 4(a). Ships and Aircraft. even if it means that the state thereby violates one of the obligations it made by ratifying the Convention. Since auction sales customarily are concluded immediately at the auction location.[65] The law of the [page 28] Contracting State must decide the priority between the Uniform Law for International Sales. On the other hand. Auctions. the question is more difficult where certain forms are required or special legal remedies are available under domestic consumer-protection laws that favor the buyer. which the state has left in force unchanged beside CISG. Securities. the Uniform Law for International Sales would take precedence in the Federal Republic of Germany because it is the more recently ratified and enacted law. and takes into consideration that international securities and currency transactions are governed by their own rules and laws which are often compulsory.[69] The [page 29] exception for forced or judicial sales in Article 2(c) corresponds to Article 6(1)(d) of ULIS. if the latter two are not registered commercial parties. negotiable instruments.[64] or building materials by a contractor. Electricity The exclusion in Article 2(b) and (c) shows consideration for the special domestic laws governing these transactions. an exception in deference to any easily determined domestic law does not significantly impair the unification of law. cannot be certain that the German instalment-purchase law will protect him. For example.can lead to overlapping when domestic consumer-protection law does not use such a criterion.where the seller cannot recognize the character of the purchase . a purchase made for a godchild or the acquisition of a car for the housekeeper would be covered. or a beer delivery to a restaurant owner. However. because the document controls the delivery of goods. Where domestic consumerprotection laws void certain contract provisions. since. of those persons who are regarded as included in the family or household. the application of the two laws can be reconciled. The preconditions for the exclusion concerning "personal. based on sociological evidence. and it is more specialized than the domestic consumer-protection law. and money (Article 2(d)) can also be found in ULIS Article 5(1)(a). investment securities. and its domestic consumer-protection law. which the state has adopted. this does not necessitate recourse to domestic law. Thus. the German "Abzahlungsgesetz" (instalment-purchase law) can apply to the purchase of an office machine by a lawyer. since an instalment purchaser whose place of business is in Germany. The exception for shares. domestic consumer-protection laws sometimes intervene when the goods purchased are intended for occupational or even commercial use. In my opinion. This conclusion can be justified.[67] A domestic law's definitional provisions on family membership should not apply.[66] If domestic law allows the conflicting consumer-protection provisions to remain in force and take precedence over the application of the Uniform Law for International Sales. family and household use" are not defined. Negotiable Instruments and Money. are considered to be within the sphere of application . the Convention is not concerned with the validity of the contract or with that of any of its provisions. Interpretation according to Article 7 of the Convention is both mandatory and possible. Stocks.

which should be the only ones affected by it. In sum. sales contracts concerning the supply of electricity are excluded from the Convention's sphere of application in Article 2(f) and of that ULIS in Article 5(1)(c). uncertainty about the application of the uniform sales law can also arise. but that restriction was dropped in the Convention because domestic registration requirements differ greatly from country to country. with small fishing boats or high sea yachts. dinghies and yachts . Attempts to exclude other goods from the Convention's sphere of application were averted by the use of the argument that the parties always have the right to exclude the goods if they wish by choosing a different applicable law. the rule is probably only acceptable because it increases the willingness of states to join the Convention. although forceful arguments for its elimination were again raised in Vienna. As a whole.[74a] Delimiting the application of this exception will of course be difficult. that there is seldom any need to consult the applicable law. for example. hovercraft were included in the list of exceptions. the duty to register will therefore remain an important criterion. The function and reason for the exception .suggest that the exception should not be extended to boats (although no distinction is feasible in regard to aircraft). such as. it has. when it has not been determined which domestic law controls the duty to register. elaborate their transnational agreements in such detail. In many cases. At the request of India. the exceptions listed in ULIS were maintained in the Convention. Contracts for the Sale of Made-to-Order Goods and for the Sale of Services Contracts "for the supply of goods to be manufactured or produced" fall within the sphere of application of the Convention (Article 3(1)). The exclusion seems to conflict with the need for consistency.[75] On the basis of the argument advanced by the Indian delegation that such craft are treated in Indian law the same as ships or aircraft. by tradition. As with ULIS Article 6. canoes. even though some domestic regulations would characterize these as negotiable instrument transactions. however. one may conclude that this [page 30] exception includes only hovercraft that can be used as boats and not other kinds of vehicles or vessels that operate on the principle of the pneumatic cushion. Finally. However. the electricity-producing industries.belong to the subject matter excluded from the application of the Convention. Insignificant amounts of materials supplied by the manufacturer . In the ULIS version. contracts in which the party who orders the goods also supplies a substantial part of the materials are excluded from the scope of the Convention.recognition of special rules for transactions involving ships .[73] Some legal systems characterize the sale of a ship as a real-estate transaction and establish special rules not only for the transfer of title but also for the effective formation of the contract (formal requirement).row boats. the sense and purpose of Article 2(e) is that the exception should then apply.of the Uniform Law for International Sales. If they do. In such cases.[72] In ULIS the exception is restricted to registered ships or to ships that are required by law to be registered. for example.[74] With the elimination of the registration criterion.[71] The exception for ships and aircraft in Article 2(e) of the Convention and Article 5(1)(b) in ULIS was retained. one will consult domestic law to learn whether such boats come under the special rules applicable to ships. become uncertain whether and to what extent smaller boats .[76] E.

This presumably would be the case under the Convention as well.the examples are expressly stated . to decide whether there are. This proposal failed because the characterization of such sales contracts was perceived as uncertain. Contract Validity and the Transfer of Title (Article 4) Article 4.[77] Article 3(2) further excludes contracts which may require the delivery of goods. the parties should attempt to reach a clear agreement in their contract.[78] This section attempts to regulate a question that proved to be difficult in ULIS. a substantial amount of the materials. but which are primarily contracts for labor or services. though the obligation to install is the "preponderant part. but the United States's countervailing example of a painter who is commissioned to cover a ceiling with gold paint will hardly have any practical impact. and contracts for labor or services. such as construction contracts.are not sufficient to bring the contract under the Convention. so long as the Convention's rules on the formation of the contract do not expressly apply. Article 6 also permits the parties to modify Article 3(2) in such a way that. This provision is likely to prove difficult to interpret and to apply. The United Kingdom's proposal aimed at excluding contracts for goods to be manufactured or produced if the party ordering the goods provides the information or expertise necessary for such manufacture or production. A United Kingdom proposal [79] to use the term "major part in value" was withdrawn for lack of support. Domestic law should decide whether these two contracts can and must be distinguished. He must prove that the party who placed the order supplied. for example. even if domestic law generally regards such combinations as a single contract. gross unfairness. and. the distinction between contracts for the supply of goods to be manufactured or produced. which are subject to the Convention.[page 32] . though. in such cases. and because quite a number of contracts would thereby be removed from the sphere of the Convention. which are governed by domestic law. depends on whether the materials supplied by the party ordering the goods are "substantial" or not. The term "preponderant part" should in most cases be understandable and practicable if considered in terms of relative values.[83] F." the whole contract is subject to the Uniform Law for International Sales. "Preponderant" in this sense should be considerably more than 50% of the price.[78a] The sale price of the goods to be delivered must be [page 31] compared with the fee for labor and services.both the effect of the contract on the transfer of title to the goods sold (Article 4(b) [83a]) and the validity of the contract and any of its provisions (Article 4(a)). that the intent of the parties [81] to treat the delivery contract separately must be respected. a United Kingdom proposal [82] addressed the problem of whether the transfer of know-how should be covered and regulated by the Convention. During the deliberations on Article 3. As under ULIS. unconscionability and fraud. limits the Convention's sphere of application to the rules on formation of contract and the rights and obligations of the seller and the buyer arising from it (Article 4 sentence 1). because it is probably without parallel in domestic laws. Therefore. Under ULIS. Furthermore. the party asserting the exception has the burden of proof. like ULIS Article 8. as if two separate contracts have been made. or was supposed to supply.[80] It must be remembered. This leaves to domestic law . It is more difficult. whether the delivery is subject to the Uniform Law for International Sales while the installation contract is governed by domestic law. Therefore. in fact. domestic law still regulates such matters as the capacity to contract and the consequences of mistake. two separate contracts. namely whether a contract for both the delivery and the installation of goods is covered by the Uniform Law for International Sales.

Article 5 expressly states this principle for products liability questions concerning personal injuries from defective goods. To the extent products liability is characterized as non-contractual under domestic law. such as BGB § 306. France. The basic idea is simple: the Convention does not govern products liability.[87] It also follows from Article 4 sentence 1. or by an act of a party. The courts can also adjust the content of a contract where domestic law voids only part of the contract and the court is permitted to fill the gap. as long as the Convention does not include express provisions to the contrary. such as by judicial decision or government intervention.[83b] Economic regulations such as export or import controls or consumer-protection laws which prohibit certain formulations may void contracts falling under the Convention. since some legal systems resolve problems of product liability in contract. the general view was that if the subject of the sale was nonexistent at the time the contract was formed. despite the similar formulation in ULIS Article 8. provided German law otherwise applies.[85] Finally. Article 5 merely states the obvious. This deference to domestic provisions regarding validity is only binding.[84] In my view.[90] this Article was needed to ensure that these domestic rules would still apply when the Convention is enacted. domestic law still controls the validity of usages. and not domestic provisions which would nullify the contract. however. domestic laws which accord legal recourse in situations where a party errs about the goods to be delivered [84a] or the solvency of the other party would not apply under the Convention because these problems are specifically and conclusively regulated by the Convention's provisions on conformity of goods and anticipatory breach. Thus.are to be judged strictly according to domestic law. the breach-of-contract provisions of the Uniform Law for International Sales would apply. such as a declaration of avoidance. therefore. The controversy over the binding effect of usages [86] loses much of its practical importance by virtue of Article 4(a) which permits states to prohibit the recognition of international usages which conflict with domestic law. the buyer's right to revoke an instalment contract under German law can probably be "saved" where the Convention covers an instalment sale. The applicability of domestic law does not depend upon whether the invalidity occurs by operation of law. even though there is no provision corresponding to ULIS Article 89. that duties and liabilities which arise outside of the contract are not covered by the Convention. remains in force. Products Liability (Article 5) A proposal sponsored by Finland. even though it was never written as a rule. "Expressly provided in Article 4" should not be taken to mean only those of the Convention's provisions that expressly indicate a deviation from domestic law or the validity of an obligation despite the domestic prohibition. As in ULIS. For example. However. that claims for damages caused intentionally or by fraud . from [page 33] the limitation by Article 4 sentence 1.[88] But one may also assume. Therefore the contractual remedies of "positive Vertragsverletzung" or § 463 BGB under . G. a state and its courts can also refuse to recognize a usage on the grounds that the usage is contrary to its public policy. Domestic law. and the United States [89] to exclude from the Convention claims based on death or personal injury caused by the goods was accepted in Vienna and embodied in Article 5.Contracts are also considered invalid if the underlying sale is immoral or illegal and therefore void according to domestic law. therefore.regardless of whether they sound in contract or tort . This was understood to be the interpretation in ULIS as well.

as was the demand to include a reservation clause in the Final Provisions. Party Autonomy (Article 6) Article 6 guarantees party autonomy over both the conflict rules and the substantive law. any rule of the Convention can be altered or rejected by the parties. such as "claims based on product liability. but also include the buyer's own liability for damages due to the death or personal injuries of his customers. but no agreement could be reached as to the extent to which the Convention should apply to property damage caused by defective goods which are used as foreseen by the contract. This result is required by the fact that Article 5 leaves untouched liability claims which sound in contract.[94] In the end.[96] The Convention can be excluded by choice of law if the parties choose to apply a different local domestic law. On the basis of proposals from Anglo-Saxon countries. unless the parties agreed to apply a different law (the "opting-out" solution). Substantively. as had been done in ULIS.[95] Also rejected was a Canadian proposal to exclude certain principles.[91] Liability for death or personal injury is only one . namely whether the parties must affirmatively choose CISG in order for it to apply (the so-called "opting-in" solution) or whether the Convention would automatically apply. The intent of deleting the word "implied" was to prevent the courts from being too quick to impute exclusion of the Convention. Liability for damage caused to property is not excluded by Article 5.[92a] The question of whether a concurrent action in tort would lie must be decided by domestic law. A buyer's claims based on death or personal injury are not limited to the injuries suffered by the buyer himself. H. the fact that the parties have agreed on an arbitral tribunal in a specified country or on standard contract terms enacted before the Convention takes effect and based on the background of a particular domestic substantive law does not by itself imply that the parties wished to exclude the application of the Convention. which would have turned the Convention into a set of standard contract terms. Semi-finished products ruined by a defective machine and raw materials wasted because they were combined with unsuitable materials are typical cases where the buyer's contract expectations are frustrated and which therefore belong [page 34] to the core of the matter to be regulated by sales law. was rejected. but this does not mean that a tacit exclusion is impossible. including the typical claims which permit recovery against the original producer by following the chain of sale back to its origin. The Conference considered whether a broader term. from the domain of the party autonomy.[93] a fundamental issue much debated in UNCITRAL reappeared.[97] as long as the requirements for their validity in domestic law are fulfilled. the "opting-in" proposal. even by standard contract terms.German law or the responsibility of the "vendeur professionel" under Articles 1645 and 1646 of the French Civil Code are applicable in case of death or personal injury.[98] Therefore.although probably the most important field of products liability."[92] could be used. such as the standard of good faith. In contrast to Article 3 sentence 2 of ULIS. In my opinion. the Convention does not mention the possibility of an "implied" exclusion.[99] [page 35] . It is also possible simply to reject CISG without choosing an applicable law. damages in those circumstances should be governed by the Convention and compensated in conformity to the provisions set forth in Article 74.

CISG does not incorporate in the principle of party autonomy the parties' ability to bypass the limits on party autonomy in domestic law. A proposal by the German Democratic Republic to this effect. Above all.g. and therefore. that this provision has been extraordinarily controversial.[102] Not only can the parties agree to reject the application of the Convention. many critics were not optimistic that jurists would be able to develop and apply general principles of a uniform sales law.the only remaining legal source was the substantive rules of the 1978 Draft Convention as interpreted. in case of doubt.[103a] For example. the parties' choice of a national law means that the Convention applies if that state has adopted the Convention. Therefore. of course. It is well known. the limitations of that law must be observed. in the case of the sale of a ship.[104] In other words.[105] but this would simply have restated the obvious. such remarks increased the opposition and resistance of those delegations which considered the interpretation and extension of CISG by reference to domestic rules to be a less serious alternative and. It is domestic law that grants the parties the autonomy to choose the Convention.upon special rules by way of extension or of analogy. Interpretation and Gap-Filling (Article 7) ULIS Article 17 attempts to base interpretation and gap-filling on the general principles underlying the rules of ULIS. Interpretation and gap-filling would therefore draw upon the basic underlying principles of the uniform law.[101] The French delegate argued that. the requirements of good faith in international trade could also prevent an all too hasty resort to domestic regulations and legal custom. an agreement to apply the Convention in an instalment purchase of goods for personal use cannot override the mandatory regulations of German instalment-purchase law where German law is applicable.[103] however. but they can also agree to apply the Convention when the preconditions for application have not been met.Just because the parties choose a domestic law does not necessarily mean that country's local sales law applies. within the area of sales law . a decisive preliminary question .. of course.[106] During the discussion of Article 7 at the Vienna Conference. because recourse to domestic law was believed to be more or less inappropriate for interpretation and gap-filling. The remark that Article 6 of the 1978 Draft Convention did not change the substance of the rules in Article 17 of ULIS is therefore probably accurate. General Rules A. This corresponds to the interpretation generally accepted in Germany with regard to ULIS. as well as . UNCITRAL. which otherwise would have resulted from interpretation and gap-filling. The delegates rejected proposals by Canada and Belgium [100] which would have mandated the application of a state's domestic sales law whenever a national law was chosen. encountered resistance partly because it was thought to be superfluous and partly because it was considered dangerous. .in certain cases . however. had accepted the goal of preserving and furthering uniformity and used the indication about the international character of the Convention as a floodgate against an all too broad recourse to domestic law. unless. The only alternative would have been an article that corresponds to ULIS Article 4. on the other hand. [page 36] IV. This provision is designed to safeguard unification of the law and to avoid a mixture of uniform law with domestic sales law. developed and supplemented on its own terms.the definition of which is. the parties have explicitly chosen the local sales law of that country. e. Furthermore.

that such broadly formulated principles could be interpreted and applied in different ways. such as avoidance based on mistake about the quality of the goods. In interpretation and gap-filling.therefore. there was corresponding sentiment in connection with the treatment of Article 7. the compromise formulated in Article 7(2) was passed. the function of such a general clause can probably be fulfilled by the rule that the parties must conduct themselves according to the standard of the "reasonable person. Because the seller's responsibility to provide goods of the quality agreed upon in the contract is a matter within the realm of the Convention. even those who had previously opposed them indicated again and again that it would be desirable to observe the good faith principle. of using a survey of comparative law to develop general principles that cannot be derived from the law itself and to use them to interpret the Convention. Whether or not effective international standards of good faith can actually be determined must be left to studies in comparative law. However. domestic remedies. [115] Certain concerns which had already been expressed in the UNCITRAL Working Group. perceived the possibility of recourse [page 37] to domestic law in such cases as undesirable. in the application of a uniform sales law. finally led to the withdrawal of these proposals.[114] The UNCITRAL Working Group had discussed whether the principle should be generalized to include the conduct of the parties . namely whether a certain matter falls within the scope of the Convention. The German jurist may regret this rejection of a "good faith rule" corresponding to § 242 of the German Civil Code in its present day meaning. fundamental principles on the basis of comparative analysis. closes off the path. and that sanctions were lacking. The reference to the observance "of good faith in international trade" in Article 7(1) indicates one of the general principles that must be regarded in interpreting and extending the uniform law. on the other hand.must also apply to the important preliminary question to paragraph (2). this limitation serves only as a clarification. The principle has affected the formulation of a number of [page 38] provisions in CISG [113] and the leading commentary on CISG cites Articles 21(2) and 19(2) as likely "candidates" for an interpretation based on the principles of good faith. concerns only the interpretation of the Convention and not the conduct of the parties in the formation and performance of the contract or the interpretation of their intentions. Nevertheless. that domestic views about their content varied.[109] Thanks to the German Democratic Republic's mediating proposal. whether it be the law of the seller's place of business [107] or the law applicable by virtue of the rules of private international law.[110a] The authoritative principles can be inferred from the individual rules themselves and their systematic context. should not be available to the buyer.[111] The last part of Article 7(2). as embodied in the Convention.[108] The great majority of the delegates. wanted to provide for recourse to domestic law in all cases of doubt.to promote uniformity in the application [110] of the Convention when interpreting it ." which is expressly described in a .an area where the principle has gained concrete recognition in ULIS Article 5(2). even though mistake is not expressly mentioned in the Convention. In Vienna. The maxim laid down in this provision . because. Some even proposed a return to (and an extension of) the formulation in Article 17 of ULIS. Article 7 should thereby allow about the same possibilities as ULIS Article 17.[113a] There is naturally some cause for uncertainty when the principle of good faith.[112] Practically. though. it is rarely possible to determine autonomous. though. which was sometimes considered for ULIS.

C. The regulation of such discrepancies is a question for domestic law.[117] A usage is binding only where the parties knew or ought to have known of the particular . Of course. must be regarded as a general principle of the Convention. According to the German understanding. The usages to be considered when discovering the intended and/or objective meaning of a statement presumably include. or followed by a particular group of business people. usages which are only local. It appears. therefore. according to Article 7(2). the German jurist is here on the familiar ground of §§ 133 and 157 of the German Civil Code. on the other. The intent of a party or the understanding of a reasonable person depends on all of the facts and circumstances including those specially listed in the Convention. established practices between the parties. according to Article 8(3).[116a] As far as these deficiencies in intent are concerned.[115a] B. regardless of whether Article 9(2) includes the German customs pertaining to letters of confirmation. For the latter. For example. recognizable to the addressee. The so-called "normative" usages were extremely controversial.number of provisions and. in any case. If this intent is neither known nor recognizable.that a usage is binding due to an implied silent agreement between the parties.[116b] This provision corresponds to ULIS Article 9(1) and confirms the parties' autonomy over the contents and formation of the contract.either through their negotiations or by their course of dealing. that Article 8(1) and (2) prevents a party's purely subjective intent from being decisive (secret reservations!) and prescribes the solution found in § 117 of the German Civil Code for a sham statement. in contrast to those mentioned in Article 9(2). and. then the understanding of a reasonable person in the situation of the addressee is the controlling standard (Article 8(2)). but rather the interpretation of a party's statements. Article 4(a) still mandates respect for domestic laws that prohibit certain trade practices and void contracts concluded by such means. their validity is not based on the parties' agreement. Of course. a German who remains silent after having received a letter of confirmation can be understood to have expressed approval. It is important to note that the function of Article 8(3) is different from that of Article 9(2): It does not address gap-filling of the contract.[116] The Convention does not regulate the consequences of a discrepancy between the actual but unrecognizable intent of a party on the one hand. Interpretation of Statements and Conduct (Article 8)[115b] As already established in the 1978 Draft Convention. domestic law is replaced by the Convention. however. usages. the particular circumstances are important. namely. including usages that are possibly significant only to a party making the statements or to a reasonable person in the rule of the addressee. either the objective meaning of that party's statement in the sense of Article 8(2) or the other party's response to the first statement where the intent of the parties does not coincide.which in certain cases may be accurate . as in Article [page 40] 8(2) of the 1978 Draft Convention. Usages (Article 9) Article 9(1) binds the parties to any usages to which they have agreed . this intent must have been known by or. and any subsequent conduct of [page 39] the parties (Article 8(3)). the meaning of the statements or other legally relevant conduct of the parties is to be determined by their actual intent (Article 8(1)). As Huber has already pointed out. national. The Convention adopts in Article 9(2). negotiations. the legal construction .

in principle.[121] factors which are basic in other legal systems as well. However. in presenting arguments for its proposal to include as usages those concerning contract formation. due consideration had to be given to whether the other side was informed or could have been informed. It is irrelevant.[122] In comparison to ULIS Article 9(2) and ULF Article 13(1). According to the version formulated in Vienna. for example. i.[120] The requirement that the usage must be widely known in international trade. if taken literally. These [page 41] usages cannot be "internationalized" simply because a foreign party knew or should have known of the custom." This means respect for usages existing. Nevertheless. that silence may be . The fact that the legal relevance of usages is based on a tacit agreement made it easier to accept them as a consequence of the priority of party autonomy over the Convention's rules. The United States delegation.[126] The Conference also rejected a Pakistani proposal that would have permitted one party's conduct to prevent a finding that the parties had agreed on a usage. This provision probably produces the same results as the restrictions of ULIS Article 9(2) sentence 1 and ULF Article 13(1). in the international grain trade and followed by the parties who buy and sell grain on the international market. Article 9(2) restricts the recognition of national. if they meet the requirements of Article 9(2).. There was no support for the view expressed by the Czechoslovakian delegation that the rules of the Convention should have priority over trade usages. however." "widely known" and "regularly observed.e. was rejected.[123] The Chinese proposal that only reasonable usages should be recognized. it seems possible. and a certain duration. domestic prohibitions of certain trade customs which have the effect of voiding the contract remain operative (Article 4(a)).[124] which would have given domestic courts control over the contents of usages. But Article 9(2) specifies that usages are defined with reference to the particular branch of the trade involved and to the parties who form contracts like the one concerned in a particular case. regional or local usages which were developed for domestic sales and are not regularly followed in international transactions. on the other hand. whether the practice is known "internationally" outside graintrade circles.usage. The substantive requirements for an effective letter of confirmation. mentioned cases in which silence operates as the acceptance of an offer. which itself permits the "internationalization" of German usages.[119] The formulation reflects the concerns that some delegations had regarding respect for trade usages. Basically. it can be assumed that a party can show that a usage does not apply only by proving that it rejected it. usages explicitly apply to the formation of the contract as well.[118] The last part of Article 9(2) restricts the kind of usages which must be observed. it remains unclear whether usages such as those developed in Germany concerning the "commercial letter of confirmation" will be respected.[125] however. Article 9(2) is an "internationalized" version of the requirements in German law for development and recognition of a binding trade usage: actual use. the consent of those who deal in the relevant trade transactions. This is especially important when defining "international. the requirements for according legal consequence to the silence of a party receiving a letter of confirmation would be considerably narrower in international commercial transactions than for internal dealings. to recognize usages in which silence means approval. But even according to the wording of ULFIS Article 13(1).[128] Therefore.[127] Accordingly. would mean that trade usages would generally have little effect.

it is not always easy to attach the contract to one of several places of business solely on the basis of the criterion of the "closest relationship to the contract and its performance". The provision that the circumstances as known to or contemplated by the parties must be taken into account defies further normative description.[131] the Convention does not define the term. in practice. since the Convention does not require the place of business to be the main office.[130a] D. Finally.[135] This solution was maintained at the Vienna Conference.[132] As in German law. A good example is when the contract is negotiated and is to be performed by one place of business. The use of the "habitual residence" of a party as an alternative to "place of business" will rarely be applied to legal transactions governed by the Convention.[130] As a result. Form (Articles 11. such as in a multinational's headquarters in a different country. by application of the domestic law invoked by conflict rules. [page 43] E. On the other hand. states.[134] Therefore.[133] The difficulties that. which corresponds to the rules recognized in Germany. etc. . would not be met if the foreign party were uninformed. be able to fulfill the function of ULIS Article 9(3) in these cases. 29(2) and 96) From the very beginning. for example. in general. the form issue for contracts concluded by parties with a place of business in one of these states. but a reservation clause would enable states preferring a formal writing to decide. that the party would be the governmental authority that is dealing with the business involved. It certainly does not apply merely because a party does some act outside of its place of business. it can be assumed that a "place of business" is an establishment of some duration and with certain authorized powers.regarded as consent. 12. Article 10(a) should provide an appropriate solution. are lacking. Article 8(2) should. the Draft Convention already offered a compromise whereby freedom of form was the basic rule. For the problems that can arise when a major enterprise has multiple places of business. Place of Business (Article 10) Even though the concept of "place of business" plays a central role in the Convention. one of the most controversial issues of UNCITRAL's work was whether or not ULIS Article 15 concerning freedom of form should be followed. On the other hand. but the formation of the contract is concluded in another place. there was no support for the Egyptian proposal to include in the Convention ULIS Article 9(3).[132a] Granted. It was pointed out even by countries not in favour of form requirements that the bureaucratic needs especially of large-scale entities (business enterprises.[129] The wording of Article 9(2). permits a letter of confirmation to be effective only if it is used in that particular branch of business in several countries and if the practice is acknowledged to have the legal consequence that silence means consent.) to control their transactions require written evidence and the respect of form requirements. commercial management of the enterprise is not necessary. 13. or governmental organizations. arise with the term "party" when a state is a contracting party should be clarified with the help of the interpretation proposed by the Finnish delegation. guidelines for a uniform interpretation [page 42] of Incoterms. in connection with the determination of the place of business.

both because it could have made it more difficult to decide whether a formal writing is required. Even when Contracting States make use of the reservation in Article 96.[141] When the reservation is made and one party's place of business is in a reservation state. the contract. on the basis of the Article 96 reservation. freedom of form according to Articles 1(l)(b) and 11 prevails. Similar proposals had previously been rejected by UNCITRAL because a list of the contract types with form requirements would have had to accompany the reservation and would have made application of the Convention very difficult. The Conference also passed a proposal by the Federal Republic of Germany.[139] Sentence 2 also overrides domestic rules of procedure which exclude parole evidence and thereby indirectly pressure the parties into using a written form. therefore.[144] The German proposal was not meant only as a definition of the term "writing" as used in Articles 21(2) and 29(2). in principle. its modification or termination. it is not clear whether there are any applicable domestic requirements on form. On the other hand. the fixing of time limits. Later withdrawal of that reservation is possible (Article 97(4) sentence 1). notification of defects.A Dutch proposal to limit this possibility to certain types of contracts [136] was not accepted.[138] [page 44] According to Article 11 sentence 1. not subject to form requirements. the Convention can be signed even if. then the domestic regulations of that state control.[140] nor does a declaration to reduce the price according to Article 50 sentence 1. even when. as far as they relate to the formation of the contract. and other communications are. domestic requirements on form are only to be regarded. as in construction contracts. at the time of the signing. above all. If the law of a Contracting State which did not invoke the reservation provision is applicable. it means rather that domestic form requirements are always satisfied by the use of telegrams and telexes. the court must determine the law applicable to form according to its private international law. Thus. "its modification or termination by agreement" makes it clear that a one-sided declaration to terminate a contract does not fall within the scope of the reservation and the corresponding domestic regulations on form. In particular. is subject to domestic form regulations which require that such communications adhere to formal writing requirements. so that parties need not comply with domestic form requirements which perhaps impose higher standards and about which it may be difficult to obtain . Otherwise there could be difficulties in contract modifications which favour one side. because it might have encouraged the use of the reservation clause. especially for contract modifications which often necessitate quick decision. although the formulation of Article 13 might lead to that conclusion. the lack of form requirements means that "consideration" is not required. In my opinion. whereby the Article 96 reservation may also be invoked after signing the Convention. its modification or consensual termination. the more precise formulation. despite the broad wording in Articles 12 and 96 ("or other indication of intention").[142] [page 45] Compliance with writing requirements. This does not mean merely that the Article 96 reservation in connection with Article 12 permits the use of telegram or telex when that use is permitted by domestic law. Article 13 was meant to achieve a uniform objective standard for form requirements. was made easier by the acceptance of the Federal Republic of Germany's proposal [143] that a "writing" include communication by telegram or telex (Article 13). This rule applies to all legally relevant statements and communications which are or will be required for the formation of a sales contract.[137] and. if the conflict rules point to a reservation state.

at the request of the Scandinavian countries.[147] On the other hand. without doubt.[149a] It uses two consecutive constitutive manifestations of assent . particularly since the integration helps to avoid parallel rules [148] and solves the problem. . On the other hand. the result obtained in the Federal Republic of Germany by means of "oral modifications of the writing requirement". in matters of interpretation and gap-filling. Basic Principles and General Provisions The rules for the formation of the contract [147a] which were already successfully incorporated into the 1978 Draft Convention were retained at the Vienna Conference. the 1980 Convention follows ULF. Article 29(2) sentence 2 deals with the case where a party has relied on an oral agreement abandoning the writing requirement by [page 46] precluding the other party from asserting the requirement in such as case. [page 47] V.[145] However. or bind themselves to adopt. Formation of the Contract A.[149] of determining to what extent one law refers to the other. to be regarded as an improvement. the Hague Uniform Law on the Formation of Contracts for the International Sale of Goods. including telex or telegram (Article 13).information. the Convention either without Part II or without Part III (Article 92). the parties cannot effectively agree to dispense with the form requirement if the Soviet Union claims the Article 96 reservation.seems not to be recognized in the sphere of application of CISG. subject to one limitation. In the end. The formula occasionally used by the West German courts . This latter provision further makes it clear that a formal writing requirement agreed upon by the parties can only be changed or suspended by a written agreement. because of the awkward wording of Article 13. of course. The premise is that these manifestation of assent can be identified in the long process of negotiations in which the parties approach each other. In comparison to the Hague Conventions. In its outlines. The principle of freedom of form does not prevent the parties from agreeing to a writing requirement. for example.as building blocks for the formation of the contract. this interpretation is open to to criticism. The parties' freedom of contract with regard to the form of their statements is. for which the form requirements of Soviet law are applicable.offer and acceptance . This follows from the basic principle of party autonomy. In a contract with a party whose place of business is in the Soviet Union. will therefore be satisfactorily resolvable under CISG as well. and states have the option to adopt.that a formal writing requirement agreed upon by the parties can be removed without a writing [146] . which applies as well to the prerequisites for the existence or termination of the obligation and is also reaffirmed in Article 29(2) sentence 1. step by step. namely the form requirements imposed by the domestic law invoked by conflicts rules whenever the Article 96 reservation clause is applicable (Article 12 sentence 2). such as when the buyer has relied on the oral promise of an authorized sales agent and is later confronted with the objection that the agreement was not in writing. until they have reached an agreement. the combination of the rules on formation of the contract with those concerning the contents of the contract into one body of law is. Parts II and III were written so that they may function independently.

a question which is determined by domestic law. Article 18(1)).[152] By using the acceptance to determine the moment when a contract is formed (Article 23). But. when it is delivered to him.[150] The main criticism is that reliance on the external process of establishing a consensus cannot adequately cover situations where there is no doubt about the parties' agreement. Delivery should occur preferably in person. that the proposal is truly a public offer.[153] it may be assumed that the parties can agree to prolong the formation of the contract even after the moment fixed in Article 23. the "offer" and the "acceptance" as well as the withdrawal of such declarations and the rejection of an offer are only effective if they reach the other party.. the requirement presumably applies to the Convention as well. by a condition precedent.[154] As in the Hague Convention.[151] However. particularly since it is possible to "cure" uncertainties or incongruities in the parties' oral expression by taking into account their conduct and its objective meaning (see Article 8(1) and (2) and. it should be possible to identify an offer and an acceptance. alternatively to the place of business or mailing address. which deliberately does not fix the time when a contract is formed. Articles 14 and following are not merely "fragmentary" regulations to be supplemented by applicable domestic laws that recognize other forms of consensus. Even though the Convention.e. since the issues obviously belong within the sphere regulated by the Convention. in more concrete terms. The Convention also provides conclusive standards as far as the consensus that constitutes a contract is concerned.[156] and finally to the habitual residence. in any case. Whether or not an intent expressed orally or in writing to an intermediary may constitute effective delivery depends on that person's authority. however. the meaning of a condition precedent. i. does not specify that the declaration must have been "intelligible" for the delivery to be effective. like ULF Article 12(1) and the German Civil Code.. The Offer (Articles 14-17) Under Article 14(1) sentence 1 (which corresponds to ULF Article 4(1)) an offer is a proposal that is "sufficiently definite" and indicates the "intention of the offeror to be bound in case of acceptance".There has been no lack of criticism of this traditional concept of contract formation and its retention in the Uniform Law for International Sales. for those provisions which make the determination of the moment of the contract's perfection legally relevant. preference should.or.e. the declaration must have been perceived by the addressee. unlike ULF Article 12(2). for example. the theory of cognizance should apply under Article 24.[155] Article 24. Article 14(2) is more precise than ULF in that it generally considers proposals to indefinite groups of people to be mere invitations to make offers. and the circumstances of the postponement. unless the offeror has made it clear that the contrary is intended. even though the agreement did not result from an identifiable offer followed by a concurring acceptance. be given to the gap-filling rules in Article 7 rather than to an all too hasty retreat to domestic law and its rules on mistake. In my opinion.[159] . provides that a "materialized" expression of intent has reached the addressee when it reaches his sphere of control . in the majority of contracts [page 48] involving international transactions. the Convention has increased its importance in the process of contract formation.[158] B. as in ULF. i. for the acceptance.[157] [page 49] For oral declarations. In questions of external consensus. the choice between the time set forth in Article 23 or a later time must be made by evaluating the respective provision and its legal purpose.

Also. Large organizations can be so limited by the comprehensive planning that the price they have agreed upon is an indispensable factor for the planning of the entire organization. Above all. permits . the offer must indicate the goods to be sold. the developing countries are also understandably concerned about using the shorthand of the seller's standard price or even allowing the seller discretion to set the price within the bounds of equity. there are likely to be divergent results. In particular. determine or make provision for determining the quantity..[163a] It can only be explained by the desire of the Scandinavian countries to introduce the Uniform Law for International Sales without Part III. The wording of the law. a number of developing countries. an order that does not name a price must frequently be understood as an implied reference to these sales prices (list prices. The more flexible system can be practicable or at least tolerable in countries or economic systems with comparatively homogeneous and well-known market structures.[163] The Article also poses an unsatisfactory contradiction to Article 55. France and other states.a broader application. but not for the industrial goods imported by these countries.). since the beginning of the 1970's. which. the definite price requirement can endanger the validity of a contract and provide a pretext for escaping a disadvantageous agreement.indeed encourages . A price can also be determined expressly or implicitly by reference to a particular market at delivery or at some . But in world trade.[165] Finally.[162] The retention of the definite price requirement for a valid offer and. price transparency is a given at most for raw materials. in German law it is essential for a sales contract that the goods be specified. Unfortunately. sufficient certainty is not assured by means of supplemental reference to the preliminary negotiations. the Convention establishes concrete requirements.[164] On the other hand. has experienced a renaissance as an instrument of control for contracts that exploit the weaker party. in many [page 50] cases.[161] Both in the UNCITRAL deliberations and the Vienna Conference. which presupposes the possibility of forming a contract without a fixed or determinable price. however. the position of those who wished to require a definite price is also understandable. one of the parties or a third person is granted the authority to determine them. as in §§ 316 and 315(1) of the German Civil Code. catalogue prices. i. Proposals to eliminate the requirement of a fixed or determinable price failed as a result of the opposition by the Soviet Union. Where the "price generally charged" exists at [page 51] the time the contract is concluded and can be determined by the other party. According to Article 14(1) sentence 2. when the parties have waived price negotiations. and the applicable legal rules for sales contracts. usages.e. for contract formation is regrettable. established practices between the parties. the further requirement that the price be determined or determinable was hotly debated. for the products of the developing countries.[162a] In special circumstances. and to have a provision in Part II in case the price has not been determined.[160] Rather. the French position can perhaps be explained on the basis of the French experience with Article 1591 of the French Civil Code.In contrast to ULF Article 4(2). The goods might be considered "determinable" where. They may even employ Article 14(1) sentence 2 as an additional instrument to control validity in pursuing certain legal-political purposes. such as urgency or trust in the seller's sincerity. etc. it is possible that domestic courts will make only limited use of the tacit price agreement or an implied reference to circumstances which make a determination of price possible.[166] The practicality of Article 14(1) sentence 2 probably cannot be determined until there is experience with its application. as in German law. and fix the price or provide a means for its determination. such as contracts between a gas-station owner and his supplier.

but the discussions made it clear that the various viewpoints will be reflected in divergent interpretations of the offeror's intent to be bound. cf. Article 16(1). In particular. or in any case simultaneously with. such as when calculations or cover transactions had to be and actually were made. the withdrawal of an offer that has not yet reached the addressee (Article 15(2)). the addressee's conduct. The provision is designed to cover those cases in which not just the offer itself but rather other conduct by the offeror or the special circumstances and exigencies of the proposed transaction enable and necessitate the offeree's presumption that the offer would be valid for a certain length of time. the offer is binding if the offeree could reasonably rely on the irrevocability of the offer and has in fact relied on it (Article 16(2)(b)).other time. a fixed time. such as the acceptance of delivered goods. and usages. as well as to the parties' later conduct. its arrival coincides with ULF Article 5(1) and § 130(1) sentence 2 of the German Civil Code. the parties may generally exclude the application of Article 14(1) sentence 2 [168] and agree to allow one side to set the price . the negotiations. This rule essentially covers those situations for which ULF Article 5(2) is applicable. in practice. He does not need to do this expressly. and.as long as there are no domestic prohibitions applicable under Article 4(a). whenever a tacit agreement on price. like ULF Article 5(4). In my opinion. on the other hand. makes the offer irrevocably binding from the moment the acceptance is sent. the . The offeror can also declare the offer to be irrevocable. In any case. but rather his intent to be bound can be deduced from the circumstances relevant to the interpretation of the offer and particularly from his setting a fixed period during which the offer is open (Article 16(2)(a)).[167] Reference to price lists or catalogues which reserve the right to change prices can also be understood as a reference to the price valid at the time of delivery. the Germans will.[173] Finally. while the addressee's reply may contain sufficient indication of the price or of its determination to be an offer. In addition. It is regrettable that no regulation corresponding to ULF Article 11 (death or incapacity of a party after dispatching a communication) was adopted. the Convention distinguishes.[169] Articles 9 and 8(3) indicate that due consideration must be given to trade usages. As for the revocation of an offer. on the one hand.[171] The result was the same as the compromise already worked out by UNCITRAL. and above all to the intent of the parties. a statement which is intended as an offer but lacks a definite price will be treated as an invitation to make an offer. or even the implicit exclusion of Article 14(1) sentence 2 is in question. between the revocation of an offer that already has reached the addressee and is therefore fully effective (Article 16). On the whole. although it is advisable that offers and acceptances indicate as definitely as possible a price or a mechanism for fixing the price. which was understood by some delegates to be an irrebuttable presumption of an intent to be bound.[172] may be subject to different interpretations depending on the legal system in which the offeror lives. an agreement on price determinability. The possibility of withdrawing an offer until.[174] Rejection of an offer terminates it (Article 17. § 146 sentence 1 of the German Civil Code). established practices between the parties. Finally.[172a] Of course an offer can no longer be revoked once the contract has been concluded by an effective acceptance. It erupted once again in Vienna.[170] The antagonism between legal systems that permit the revocation of offers for a fixed period or that have been declared irrevocable and those legal systems that prefer to bind the offeror to his offer already dominated the Hague [page 52] Conference. be able to live with Article 14(1) sentence 2. can then be considered as an indication of assent in the sense of Article 18(1) sentence 1.

Examples of such acts which are considered equivalent to acceptance and thus mean that a contract is concluded are the shipment of goods or payment of the price. Legal holidays or non-business days generally have no influence on the calculation of the deadline (Article 20(2) sentence 1).[177] This provision essentially conforms to the German Civil Code (§151) and ULF (Article 6). which depends on the means of communication. CISG thereby corresponds to the Hague Convention (ULF Article 8(1)) and presumably the definition of an oral expression of acceptance should be interpreted in the same way: Communications by telephone as well as by other technical and electronic means which make oral messages immediately intelligible and allow a direct reply by the same means are governed [page 54] by the same rule. regional. If a time limit neither is set by the offeror nor is apparent from the circumstances. on the one hand.e. such as after an acceptance has been sent. including the offeror's chosen means of communication.[176] Ordinarily an acceptance is not effective until it reaches the offeror (Article 18(2) sentence 2). Whether conduct should be interpreted as acceptance is determined by Article 8. however. occurs after the offer has expired. i. Article 20 gives more precise rules than ULF Article 8(2) for the beginning of the period of time available for acceptance.[175] is intended to prevent the offeree from being taken by surprise (such as when a shipment of unordered goods is sent with an offer stating that by not returning the goods the offeree accepts the offer).[175a] In addition. a contract is generally not formed if the notice of acceptance or conduct equivalent to acceptance is late. particularly on the basis of Article 8(3). At most. It can be withdrawn if the withdrawal reaches the offeror before or at least at the same time as the notice of acceptance (Article 22).[178] on the other hand. cannot be affected by the death or contractual incapacity of the offeror. a fundamental rule can be derived from the Uniform Law for International Sales that offers which have become irrevocable. have the effect of acceptance on the basis of usages which are legally relevant under Article 9. when the . silence can. or local holidays. an extension of the idea behind ULF Article 2 sentence 2.question of capacity to contract cannot be removed from domestic law. telex or taperecorded messages sent by mail.[174a] [page 53] C.[179] For the offeree's reply. Acceptance of an Offer (Articles 18-22) The acceptance of an offer can be communicated verbally or by conduct indicating assent (Article 18(1) sentence 1). for example. silence or inactivity as a reaction to the offer does not indicate acceptance. even though parallels are frequently drawn here between termination by death and contractual incapacity. whereas other offers must be accepted within a reasonable time (Article 18(2) sentence 2). conduct by the offeree may indicate assent and thereby be considered an effective acceptance (Article 18(3)) if the offer himself waives a verbal statement or if his conduct is assumed to have this meaning by practices established between the parties or usages. however. an oral offer must be accepted immediately (Article 18(2) sentence 3). are not considered oral. As an exception to the rule. The length of this reasonable time depends on the circumstances of the transaction. This rule. According to Article 18(2) sentence 2 and (3). and revocability on the other.. Notification to the offeror is then not necessary. as an exception to the rule. that silence in connection with other circumstances can be considered as acceptance. The wording "in itself" makes it clear. Parties in international trade cannot be expected to adjust to the various national. According to Article 18(1) sentence 2.

This Article simply clarifies that the offeror's notice of protest must merely be dispatched (Article 19(2) sentence 1).[184] which would have allowed the offeree to save the contract by withdrawing any of the modifications objected to by the offeror.[183] The Dutch also withdrew their proposal. like 150(2) of the German Civil Code and Article 7(1) of ULF. the proposals to strike paragraphs (2) and (3) entirely. Article 19(3).[181] [page 55] The questions discussed in connection with ULF Article 7(2) are not resolved by Article 19. Belgium suggested that the issues involved in the battle of the forms also be resolved. the date of the contract depends on when the acceptance was received. sentence 2 allows an extension of the deadline for acceptance until the first following business day. and the assertion that the problem could not be resolved because of the uncertainties in domestic law is not convincing. namely that one could not force the parties to accept the provisions of a law which both had rejected in their standard contract terms. 149) and ULF (Article 9(1) and (2)). unless the offeror protests these additions orally or immediately dispatches a notice to that effect (Article 19(2) sentence 2). This should not make the offeror uncertain because he must reasonably take into account the possibility that the other party would not know of a holiday which prevents delivery and. a contract can be formed despite a late acceptance. there is a difference between an acceptance sent late and one sent on time but which arrives late because of an unforeseen delay in the transmission.[186] Unfortunately. However. were not passed. Article 19(3) attempts to alleviate the difficulties in distinguishing between material and immaterial modifications by listing the contractual provisions to which any modifications are presumed to be material. the acceptance becomes effective on arrival and thus concludes the contract. Article 19. sentence 1. According to Article 21. unless the offeror protests orally or in writing (Article 21(2) = ULF Article 9(2)). In the first case (late dispatch). both because UNCITRAL had not discussed the problem and because there was still uncertainty about the proper solution in domestic law. This notice. however. like ULF Article 7(2). the reluctance is regrettable. would take advantage of the entire period.[182] Unfortunately. provides that an acceptance with additions. As in the German Civil Code (§§ 150(1). Open Questions 1. therefore. Battle of the Forms At the Vienna Conference. the proposal did not arouse much interest.[180] In the second case (late arrival). facilitates the formation of a contract if there are modifications which do not materially alter the conditions of the offer. the regulation concerning a discrepancy between the offer and the acceptance.acceptance could not be delivered to the offeror because of a holiday. also caused problems in Vienna.[185] D. the offeror can conclude the contract by so informing the offeree. limitations or other modifications is considered a rejection of the offer and serves as a counter-offer. The contract is then effective on the terms stated in the offer. does not constitute the acceptance of a counter-offer. First of all. even though it was received late. In my opinion. which would have led to the solution of § 150(2) of the German Civil Code. Since the Convention does not address . modified by the immaterial changes in the acceptance (Article 19(2) sentence 2).[187] An argument from the German discussions was raised. Even those who recognized the importance of the practical problem believed that the issue was not ripe for resolution.

under Article 18(3). For some individual matters governed by the Convention. The fact that certain provisions are proposed only in standard contract terms or fine print is not enough to characterize them in every case as immaterial. etc. from the wording of Article 9. the liability of an agent without authority and damages in case of avoidance for mistake. e. On the other hand. relying on the belief that a contract would materialize. during the discussions on the recognition of trade usages. This also applies to the time the contract takes effect. by limiting the formation of contracts to those created by an offer followed by an acceptance. to the discretion of domestic laws applicable by virtue of conflict rules.e. which corresponds to the proposals submitted in connection with Article 7 of ULF.[191] Otherwise other domestic formation provisions. 3. it cannot be assumed [190] that the Uniform Law for International Sales.it is a question governed by domestic law on the basis of Article 4(a). for lack of . an export license. In my opinion. however. they must be considered material modifications. has left other possibilities. in the event that the required approval is not retroactive. Since standard contract terms normally (also) affect the points mentioned in Article 19(3).[189] but unlike the Hague Conference. Because of its general wording. has made considerable expenditures. First. for example the liability for the invalidity of the contract caused by neglect of form requirements.[194] The proposal was especially intended to cover those cases in which contract negotiations have already progressed so far that one side. Requirements of Official Permits A Belgian proposal [192] concerning requirements of official permits did not win the necessary support.[193] 4. The issue was addressed several times. to reach an agreement on whether [page 56] the German rules on commercial letters of confirmation were applicable as usages. . As far as governmental or judicial approval is required for the validity of a contract or of particular obligations . such as the German laws on letters of confirmation. the solution will depend on whether the deviations in the terms are material or immaterial. it would have raised the difficult question of the relation between this liability and the remedies and rules of CISG.g. Article 7(1) forbids such a "fragmentation" of the law governing the formation of the contract. Culpa in Contrahendo Finally.or is supposed to . On the contrary. Letters of Confirmation It is not certain. the Conference rejected a proposal by the German Democratic Republic which would have introduced a general culpa in contrahendo (= precontractual) liability. and the desired unification and legal certainty would be endangered. it must be assumed that the letter of confirmation will be effective only if the relevant business customs exist between the parties of that particular branch of trade in international transactions. unrelated to offer and acceptance would also be applicable. it was not possible.. Most of the time the party who last made reference to his conditions will prevail if the other party indicates assent . where they do.g. whether and to what extent commercial letters of confirmation will have effect under the Convention. it would have affected a number of problems which arise outside the Uniform Law for International Sales.the problem of conflicting standard contract terms. according to Article 19(2). the proposed rule could not have been limited to such cases..[188] 2. The entire process of contract formation is governed by CISG.

Chapter V contains the general provisions for the obligations of the seller and buyer (Articles 71-88). independent of objectively measurable (and provable) damages. grounds for exemption (Articles 79 and 80). Chapter IV controls the transfer of risk (Articles 66-70). rights of the parties after avoidance of the contract (Articles 81-84).[200] Thus. Damages caused by one party to the other in the course of contract negotiations. The Federal Republic of Germany also advocated that the criterion should be the injured party's expectations as reflected in the circumstances of the particular contract in question.[196] and also for the right to demand substitute goods if the goods delivered do not conform to the contract.[199] From the very beginning.[198a] ULIS Article 10 was heavily criticized in UNCITRAL publications and working committees. as it did in ULIS. In this field. particularly for damages (Articles 74-77). Chapter III regulates the buyer's obligations and the consequences of his breach (Articles 53-65). the preservation of the goods and "self-help" sales (Articles 85-88). Chapter I contains the general provisions (Arts. The breaching party was to be protected from unforeseeable consequences by the second part of the provision. One group of states wanted the extent of objective detriment to the injured party to be the determining factor. Substantive Sales Law Part III of the Convention sets forth (optional) provisions for the contents of the sales contract. therefore.conformity and for revocation of an offer.[202] Leaving aside the comments based on a misunderstanding of the provision's function. General Provisions 1. Fundamental Breach (Article 25) The concept of a "fundamental breach" plays a central role in the CISG.[204] A working group [205] finally arrived at a compromise. and therefore wished to keep the UNCITRAL formulation in order to establish an unmistakable criterion. This proposal was adopted as Article 23 of the 1978 Draft Convention and formed the basis for the discussions at the Vienna Conference. the UNCITRAL Working Group proposed [page 58] as early as 1975 [201] an "objective" test based on substantial detriment suffered by the injured party. the importance of a "fundamental breach" is greater than in ULIS.. Its definition caused substantial difficulties. the "test" in ULIS Article 10 was considered too "subjective". Hence. domestic laws offer quite different legal bases [194a] for liability. Chapter II governs the obligations of the seller (Articles 30-44) and the buyer's remedies when the seller fails to perform his obligations (Articles 45-52). which incorporates the German proposal: It provides that a breach of contract is fundamental if it leads to a detriment that . 25-29). the differences can be traced to two basic viewpoints. A.[197] "Fundamental breach" is also important for the transfer of risk. the rights and obligations of the parties and the consequences of disturbances in the performance of the contract. the motion by the German Democratic Republic failed. i.[198] Because the 1980 Convention considerably limits avoidance of contract by fixing an additional period of time (thereby clarifying whether or not a violation of the contract is fundamental). where it remained controversial until the plenary deliberations at the end of the conference. It is the prerequisite for the avoidance of a contract in certain cases. because the substantial detriment would have to be foreseeable. remain subject to regulation by the domestic law applicable according to conflict rules.e.[195] [page 57] VI.[203] A second group of states wanted to place more emphasis on the injured party's interest in the fulfillment of the obligation in question.

can be a fundamental breach of contract even if the goods were not damaged. The formulation that the detrimental result must have been foreseeable by a reasonable person of the same kind and in the same circumstances as the party in the breach was supposed to avoid the problem of proof which arises from the formulation of ULIS Article 10.[206] This proposal was accepted.[207] As a result.[210] The foreseeability mentioned in the second part of the provision was also the subject of lengthy debates. the present version. The question of whether damages caused by a delay in delivery amount to a breach of contract does not depend on the amount of the damages. In my opinion. and his possibilities of knowledge are taken into account. if the injured party has no further interest in the performance of the contract after the particular breach.or if the terms of the contract make this clear. in which the extent of the detriment was the only determining factor.[209] The question of whether goods which were not packaged according to the agreement presents a fundamental breach depends not only on whether the goods were damaged or at least endangered because of the packaging..substantially deprives the other party of what it is entitled to expect under the contract. it might be claimed that information received by the breaching party about the other party's special expectations must be taken into consideration whether it is received before or after the conclusion of the contract. However. The Drafting Committee drafted the final version as Article 25. if the seller was obligated to do so by contract. his knowledge. Neglecting to insure the goods during transport.[211] that would have made the conclusion of the contract the determining point in time. i.[213] [page 60] 2. which justifies avoidance or the demand for substitute goods. the determination of this interest depends entirely on the individual terms of the contract. if the lack of insurance deprives the buyer of the possibility of reselling the goods in transit. under the actual individual obligations of the seller or buyer.[208] The late delivery of goods with a quoted market price is normally considered a fundamental breach.e. in which only the party in breach. the Convention adopts a solution similar to the one laid down in the German law in § 286(2) and § 326(2) of the German Civil Code (for the special case of delay) and in § 325(1) sentence 2.such as in the case of an express warranty . in which the decisive factor is the interest of the party concerned as fixed by the terms of the contract also fixes the conclusion of the contract as the relevant time for knowledge or foreseeability: a contract in which the delivery time is not binding cannot be turned into a transaction where time is of the essence merely because the seller later learns that the buyer has obligated himself to sell the goods at a particular time. but also on whether the packaging explicitly demanded by the buyer was necessary for further shipment or resale. Avoidance of the Contract (Article 26) . Article 25 does not expressly state the time when the party in breach had to foresee or should have foreseen the detrimental consequences to the other side. the opposing viewpoints in the discussion were still based on the objective version of the 1978 Draft Convention.[212] However. Nonconforming goods only give rise to a right of avoidance if the contract expressly states that non-conformity is of special [page 59] interest to the buyer . Because of the withdrawal of a United Kingdom proposal. but rather on the terms in the contract concerning the time of delivery. and has further been developed by courts for other cases of breach of contract: There is a fundamental breach of contract.

"Dispatch" Principle (Article 27) All that is required to make effective any notice.[217] The (second) provision that dispatch is generally sufficient. In such cases the basic idea behind Article 27 cannot convincingly support apportioning the risk of transmission to the addressee. Specific Performance (Article 28) Similar to ULIS Article 16 (in conjunction with Article VII of the Hague Convention).[218] Since Article 27 is optional. On the basis of Article 7. Receipt is not necessary unless the law expressly provides otherwise. Unfortunately. The idea underlying the principle and the exceptions in Article 27 is that the risk for transmitting a message should be carried by the one who.[221] Article 28 provides a procedural exception primarily tailored to suit the peculiarities of Anglo-American law. for example.makes it clear. the notice must be sent by a means of communication appropriate to the circumstances (Article 27).[219] This is persuasive. though. in conjunction with Article 27)[215]. request or other communication mentioned in Part II is for the notice to be sent by a means appropriate to the circumstances. the draft proposed by the Working Group contained for the first time a general provision with the same formula for all cases of avoidance. in contrast to German law. However. since the [page 61] seller is responsible for ensuring that the quality of goods conforms to the contract. as a result of his deviation from normal performance. The fact that a party can avoid a contract by a declaration of avoidance that has immediate effect is familiar to the German jurist. One advantage of the rule is that at least a clear and unequivocal solution has been found for the question which was generally left open by ULF and ULIS. that the Article refers only to messages transmitted by means similar to correspondence. On the other hand. a statement that is not intelligible or not perceptible to the addressee has not been communicated by appropriate means. Even absent explicit agreement. First is the appropriateness of the means of communication. usages or practices established between the parties can modify the principle stated in Article 27. The provision corresponds to Article 14 of ULIS and to Article 12(2) of ULF.[220] 4. which cannot be attributed to either party. however. In order to be effective. caused the statement to be sent. the formulation that a declaration of avoidance must be communicated by a "notice to the other party" was increasingly used in the individual provisions on avoidance. it can be assumed that an oral declaration must be intelligible to those present or on the telephone.[214] The same provision from the 1978 Draft Convention was adopted in Vienna without further discussion. this declaration does not have to reach the other party in order to be effective (Article 26. in the case of a notice of defects. It can also be caused by force majeure. such as receipt for communications to be effective. the parties are also at liberty to set other requirements.[216] The provision therefore contains two qualifications for the operative effect of communications. an avoidance does not always have to be motivated by a disruption in performance for which the other side is responsible.After the UNCITRAL Working Group had decided to abandon the concept of ipso facto avoidance. but the substitution of "appropriate" for "usual" allows the communicator greater flexibility in the choice of the means of communication. 3. and that the burden for the delay or loss of the notice during its transmission falls upon the addressee comes as a surprise to the German jurist who is used to the principle of receipt. Article 27 does not include a rule for oral declarations. In 1976. which does not generally provide the remedy of specific performance . The wording "transmission of the communication" and "failure to arrive" .

are valid.[224] Article 28 thereby corresponds more closely to ULIS Article 16 in conjunction with Article VIII of the respective Convention.[228] Recourse to Article 4(a) is unavailable. even though consideration has been neither agreed upon nor given. does not refer to the conflict rules of the forum. If the writing requirement is based on agreement. the concept of delivery. thus restricting the possibilities of a judgment compelling specific performance. was abandoned. however. Article 28 may also have significance for German courts: Even where absolute obstacles in performance would release a party from [page 62] its obligations under domestic law. such as the waiver of payment of an outstanding debt. which would invoke perhaps a foreign law allowing enforcement of specific performance. The issues which the Hague Conventions tended to determine in terms of "delivery" are governed both in the 1978 Draft Convention and in the 1980 Draft Convention. Obligations and Responsibilities of the Seller The 1978 Draft Convention had already departed decisively from ULIS on two points concerning contractual obligations and the remedies for their breach: First. the remedy of specific performance should be enforceable in Anglo-American courts as well. For contracts where one or more of the parties has its place of business in a state with formal writing requirements under Article 96. required for any modification or termination by agreement (Article 12 sentence 1). this regulation will not have much impact in actual practice. therefore. which was central to the discussion of performance and the transfer of risk in the Hague Conventions. Conduct. promptly liquidate their unsuccessful transactions.[225] In my opinion. 5. such as the claim for repair in Article 46(3). Modification and Termination of the Contract (Article 29) Article 29(1) concerns the parties' ability to modify or terminate a contract by agreement. ULIS' distinction between several types of breach and its corresponding division of remedies was relinquished in favor of two basic contractual violations with largely uniform remedies: breach of contract by the seller and breach of contract by the buyer. of course. even after the elimination of ULIS Article 25. Article 28 allows consideration to be given to the more extensive release that domestic law provides. where the goods are unique. which underlies Article 29.[226] Nevertheless. however. can preclude reliance on this form requirement.[223] In Vienna. B. since parties in international trade normally shun such time-consuming procedures as judicial enforcement of specific performance and. a court may not compel an impossible performance. the remedy of specific performance remains intact under the Convention. the word "could" was replaced by "would" at the request of the United Kingdom. means that even changes which favor only one side. a writing is. such as art objects or specially made machines and installations. it can be modified only through a formal writing. But this interpretation should not open the road to domestic law whenever CISG gives a remedy unknown to the local law of the forum.[222] Although legal systems differ in the enforcement of claims for specific performance. by a descriptive definition of the seller's obligations for performance and the prerequisites for the transfer of risk.[230] [page 63] .[222a] On the other hand.in the context of most sales contracts. "Its own law".[227] The decision to facilitate modifications.[226a] A contrary interpretation would be contrary to the purpose of Article 28.[229] Second.

which would have necessitated a special UNCITRAL project. Goods afloat are also generally governed by Article 31(b). .[234] In other cases. however. the place where the goods are located when the contract is formed and. Article 69 is the corresponding provision on the passing of risk. Part III Chapter II Section I of the Convention regulates the details of the time and place of delivery (Articles 31-34). This includes specification or at least precise identification of the goods.unless otherwise agreed . Place of Delivery (Article 31) The provision concerning the place of delivery differentiates between sales involving carriage and other sales. a special order of release from the seller may be necessary. ULIS Article 19(1) requires for "delivery" the "handing over of goods which conform with the contract. such as packaging and notification to the buyer. Placing the goods "at the buyer's disposal" means to make the goods available so that the buyer need do no more than take possession.is fulfilled when the seller places the goods "at the buyer's disposal. the place where they are manufactured or produced (Article 31(b)). was perceived in Vienna as too difficult a task. after an introductory provision concerning the seller's obligations (Article 30). and. the goods must conform to the contract. in the case of manufactured goods. if the seller has more than one place of business. The transfer of title is governed by the domestic law chosen by conflictof-law rules (Article 4(b)). Section II concerns the duty to deliver conforming goods which are free from rights or claims of third parties. For goods in warehouses. preparation of the goods as required. the goods must be available to the buyer at the seller's place of business when the contract is concluded.[232] The delivery obligation for all other sales contracts . that the seller must deliver and transfer title to the goods and deliver the pertinent documents. for contracts concerning specific goods or those drawn from a specific stock. reference must be made to Article 10. for the delivery to be effective. furthermore. Section III prescribes the buyer's remedies in the event that the seller fails to perform the obligations described in the preceding sections (Articles 45-52). Article 30 states. can be settled on the basis of Article 8." [233] which is. the sale involving carriage is performed by handing the goods over to the first carrier for transmission to the buyer [231] (Article 31). The seller's duties are determined primarily from the terms of the contract. Finally. 1. It is implicit in Article 31 that. In addition.[236] Proposals to provide directives for interpretation for these clauses found insufficient support at the Conference because the unification of these clauses. Chapter V Section VI deals with the obligations of the parties concerning the preservation of goods. for example.where.[235] Alternative provisions about the place of performance are found mostly in Incoterms and similar standard clauses.In particular. in some circumstances.[237] Any [page 64] difficulties in interpretation in any particular case. and Chapter V Section 1 with remedies available to both parties in the event of a "deterioration" of the other party's position: anticipatory breach or interruptions in an instalment contract. if the claim or directive for delivery is not already embodied in documents." Deviations from the contract description . Article 67(1) sentence 1 is the corresponding provision for the transfer of risk in such sales. Unless the contract states otherwise.

the goods are inferior or different - are "cured," however, if the buyer fails to notify the seller of defects.[238] This conclusion should apply to CISG as well. The Secretariat's Commentary concerning Article 31 (= Article 29 of the 1978 Draft Convention) [239] differentiates between the delivery of inferior and the delivery of different goods. This interpretation would produce unfortunate consequences for the passing of risk and the failure to notify of defects known in German law and should therefore be rejected.[240] Independent of the extent and kind of non-conformity, a delivery is valid under Article 31 if the buyer does not make timely objection. 2. Obligations in Connection with Carriage (Article 32) In a sale involving carriage, the seller must make arrangements for carriage of the goods and conclude transportation contracts appropriate to the circumstances and in accord with the usual terms of such transportation (Article 32(2)). Whether the seller must insure the goods depends on the sales contract; in any case, he must, at the buyer's request,[241] provide all available information so that the buyer may insure the goods himself (Article 32(3)). In the event that, when handed over to the carrier,[242] the goods are not clearly identified and allocated to the contract by the shipping documents, stamps, or other markings on the goods or the packing material or otherwise, the seller must notify the buyer of the allocation by a precise description of the goods (Article 32(1)). A breach of this obligation prevents the passing of risk (Article 67(2)) and may also trigger all remedies for breach of contract.[243] [page 65] 3. Delivery Date (Article 33) This provision, adopted in Vienna without further discussion, distinguishes the following three situations: first, there is an agreement on a fixed or determinable date for delivery; second, there is an agreement on a period of time during which delivery can be made, including contracts where the buyer can choose the date for delivery,[244] and third, there is no express provision regarding the date for delivery, in which case delivery must be made within a reasonable time after the conclusion of the contract. The buyer need not accept delivery before it is scheduled (Article 52), but if he accepts, the seller has fulfilled his obligation to deliver. 4. The Transfer of Documents (Article 34) Article 34 sentence 1 provides that documents relating to the purchased goods must be handed over at the time and place and in the form required by the contract. Usages are to be respected.[245] If the documents are handed over before they are due, the seller may cure non-conformities in the documents until the due date, unless he would thereby cause the buyer unreasonable inconvenience or expense (Article 34 sentence 2). Nevertheless, the buyer retains his right to damages resulting from the seller's exercise of the right to cure nonconformities in the documents (Article 34 sentence 3).[246] The right to correct documents whose contents do not conform to legal standards or to the contract can also be derived from Article 48. Since a breach of the duty to transfer suitable documents is treated exactly the same as the delivery of non-conforming goods, the seller must be given the opportunity to cure the defects at least until the date agreed for delivery.[247] 5. Conformity of the Goods and the Absence of Third-Party Claims (Articles 35-44)

Section II details the requirements for conformity of the goods and the liability of the seller in the event these requirements are not met. As reflected in the heading of the next section of this book, not only defects but also deficiencies in quantity are normally considered nonconforming characteristics (see Article 35(1)). The obligation to deliver goods free from third-party claims of competing [page 66] title or other rights to the goods (Article 41) or from industrial or other intellectual property rights (Article 42) is specially defined. The distinction in German law - which is of historical origin and found in most legal systems between defects in the quality and legal defects, is, therefore, also not fully eliminated in the Convention.[248] a) Defects in Quality and Quantity (Articles 35-37) The decisive factor for determining whether the goods conform to the contract is the contractual description of the goods. The characteristics are therefore not based on objective standards of quality but rather on the denomination and description of the required quality in the contract.[249] The same applies to packaging (Article 35(1)). ULIS Article 33(l)(b) expressly treated alike the delivery of different goods and the delivery of defective goods. Through Article 35 of CISG unfortunately does not, the delivery of different goods must be considered a lack of conformity no matter how extreme the deviation.[250] This change was not intended to exclude the delivery of different goods from the rules on lack of conformity.[251] Rather, it is clear that the case of delivery of entirely different goods should still be considered as a deviation from the "description" of the goods in the contract. In subparagraphs (a) through (d), Article 35(2) defines conformity to the extent the parties do not expressly specify the qualities and packaging of the goods.[251a] First, the goods must be fit for the usual purpose for which goods of the same description would be used (subparagraph (a)). They must also be fit for the buyer's particular purpose, if the buyer expressly or impliedly informed the seller of the particular purpose when the contract was concluded. An exception is made for the case that the buyer did not, or it would have been unreasonable for him to, rely on the seller's skill and judgment concerning the qualities required for the particular use (Article 35(2)(b)).[252] As a result, a buyer generally can expect the quality necessary for a particular purpose only if it is expressly described in the [page 67] contract (Article 35(1)) or he relied on a specialist or expert for the production or supply of goods of this quality.[253] Finally, the quality of goods may be determined by the samples or models provided to the buyer by the seller (subparagraph (c)). The packaging must be in the manner usual for such goods, or, subsidiarily, [254] in a manner adequate to preserve and protect the goods (subparagraph (d)). The Conference rejected an Australian proposal corresponding to ULIS Article 33(2), to treat minor irregularities in quality and quantity as irrelevant.[255] The buyer's remedies are not available if the buyer knew or could not have been unaware of the lack of conformity.[256] The determination of whether the goods conform with the contract in the sense of Article 35 is made at the moment the risk passes to the buyer (Article 36(1)).[257]) There was a vigorous dispute concerning whether the seller should be responsible for the duration of a quality for a certain period of time. While the 1978 Draft Convention required "express guarantees" for a "specific" time, a Pakistani proposal [258] suggested that the Conference adopt "implied warranties" of suitability for ordinary purposes for a "reasonable period as the

case may be."[259] Even though the Pakistani proposal failed, the word "express" (guarantees) was, in the end, deleted. Thus, the possibility remains that an implied warranty concerning the suitability for ordinary purposes will extend beyond the time the goods are accepted. Whether the replacement of "specific period" by "a period of time" should mean that the court determines the life of the warranty (naturally with due consideration to all of the circumstances), or whether some provision must be made in the contract - whereby, of course, Article 8 may be consulted - has not been clearly decided. Hence, Article 36(2) may be applied in different fashions. But presumably the majority opinion was that "a period of time" meant a time fixed by the contract.[260] [page 68] For any delivery made prior to the delivery date, Article 37 gives the seller the right to cure any non-conformity in the goods until the due date. This right to make supplementary shipments or improvements affects neither the buyer's right to claim damages or reimbursement for expenses that result from the early delivery nor his remedies for damages that may have been caused by the curing of the non-conformity. (Only) if the remedying of the defect causes the buyer unreasonable inconvenience or expense may the buyer instead refuse to accept the cure and assert his remedies for breach of contract caused by the lack of conformity.[261] After the due date for delivery, however, the seller can only cure nonconformities as permitted by Article 48. b) Examination and Notice by the Buyer (Articles 38-40, 44) As a prefatory [262] provision, Article 38 controls the time when the goods must be examined.[262a] It is uncertain whether, in cases of early delivery, the "short period" in paragraph (1) begins from actual delivery or from the date when performance was due under the contract.[263] If the goods must be transported, Article 38(2) postpones the time for examination until the goods have arrived at their destination. Difficulties arose - even in Vienna - concerning goods which are redirected in transit or redispatched by the buyer after resale. The version finally adopted in Article 38(3) should make clear that, in the case of reshipment due to resale, examination may be deferred until the goods arrive at their new destination. Thus the packaging, for example, need not be opened beforehand.[264] In order to postpone the examination, it is also necessary that the seller knew or ought to have known that a redirection or redispatch was possible, so that the seller does not assume prematurely - in regard to the time of arrival at the buyer's - that the examination took place and produced no objections. Unfortunately, unlike under ULIS Article 38(4), the law and usages of the place of examination are irrelevant with regard to the procedures for examination.[265] Yet the international usages mentioned in the Secretariat's Commentary are often of little help. On the other hand, it may frequently be possible to find an implied agreement under Article 9(1), or habitual practices between the parties, in order to allow for application of local examination customs.[page 69] If the buyer discovers or ought to have discovered a lack of conformity, then he must notify the seller of defects within a "reasonable" time. Notification must also be given if entirely different goods are delivered.[266] As in ULIS and the German Commercial Code, the notice is effective upon dispatch (Article 27), but it must be sent by a means of communication appropriate to the circumstances and generally designed to reach the addressee. The notice

It is irrelevant whether the non-conformity is discovered or ought to have been discovered during the required examination or does not appear until later as a "hidden" defect. One of the Conference's most difficult problems concerned the consequences of failing to give timely notice of non-conformity. could maintain that timely examination and notice would have permitted him to cure the defects completely. more general rules can override this provision. Finally. able to uphold the two-year limitation. in the end.[271] . Two elements of the 1978 Draft Convention's provision were controversial in Vienna: the buyer's loss of all rights for his failure to notify and the absolute exclusion of all claims after two years. on [page 70] the basis of Article 44. CISG does not retain the provision of ULIS Article 39(2) that the seller is obligated to invite examination by the buyer. on the basis of Article 80. For example. The seller cannot object to the failure to examine and notify of defects if the defects are based on circumstances of which he knew or ought to have known and which he did not disclose to the buyer (Article 40). it must still be determined whether his claim for damages may be reduced under Article 77 or whether his demand for a price reduction could be countered on the basis of Article 80. Though notice cannot be regarded as a measure "reasonable in the circumstances" under Article 77. This inroad into the protection of the seller's interest in regarding the transaction as fully completed may put a considerable burden on the seller. the failure to examine the goods (which is not excusable on the basis of Article 44) might be the cause of increased damages. particularly because "reasonable excuse for his failure to give the required notice" is indefinite and open to an interpretation favorable to the buyer. the seller might claim damages for the buyer's violation of his obligations of inspection and timely notification.[267] the developing countries were successful in maintaining the remedies of price reduction and compensatory damages (except for lost profits)[268] for the buyer who can offer a reasonable excuse for his failure to give timely notice (Article 44). that he would have had an opportunity to cure the lack of conformity if he had been notified in a timely manner. On the other hand. The circumstances which must be disclosed include not only the qualities of the goods themselves but also facts which could influence or alter the goods once they have left the seller's control.[270] And the seller. The preliminary drafts had already adopted a more flexible formulation of the notice requirement by substituting "a reasonable time" for the "short period" of ULIS Article 39(1) sentence 1. whether or not the defects were discoverable during that time. The seller might argue. While the industrialized countries were. even if the buyer has a "reasonable excuse" for not sending timely notice. The provision concerns not only the seller's deceit (as in § 377(5) of the German Commercial Code) but also his gross negligence. the improvement in the position of the buyer who has failed to inspect the goods and to send notice of objections was for quite a number of countries an absolute precondition for approving CISG. even in cases where the buyer has a "reasonable excuse" in the sense of Article 44. withhold remaining payments or take recourse against securities (suretyships or guarantees).[269] It is not certain whether Article 44 is the final word or whether other.must specify the nature of the lack of conformity in the delivered goods (Article 39(1)). for example. In any case. notice must be given when the defect becomes known or recognizable.[268a] Certainly there is some danger that buyers may assert nonconformity for two years and.

[276] As under ULIS Article 52. such as domestic laws protecting workers.[278] The applicable domestic law determines whether claims by third persons exist.[279] Seizure by act of state before delivery is to be regarded as a breach of the obligation to deliver under Article 30. when the contract provides for a test run in the presence of the seller or when both sides sign a report concerning the machine's conformity to the contract. but also contractual claims can fall under Article 41. The sale of goods belonging to another is also governed by Article 41. unlike ULIS Article 53. the claims and remedies available in domestic legal systems are not applicable under the Convention in such a case. Following the basic idea behind the seller's [page 72] obligation. at the Vienna Conference. which is attached as Annex II to the Convention.[277] The defense against such claims and the necessary expenses of litigation are the seller's responsibility. The contract is valid. Article 39(2) permits prolongation of the two-year time limit by virtue of a contractual guarantee period. The rule is uncertain in the case of resale and direct shipment to the ultimate purchaser. not only claims based on better title to the goods.It would be contrary to the sense and purpose of a uniform law to apply remedies for defects under domestic law which are either more extensive than those provided in the Convention or unaffected by the failure to notify.[272] The time limit for the notification of defects is determined by the actual handing-over of goods to the buyer. consumers. the time limit would begin to run from the moment the goods are handed over to the third person. cannot be applied by virtue of Article 4(a). Although. the seller breaches his duty whenever a third person makes a claim. public law restrictions on the use of the goods. Ratification and application of the Limitation Convention would complete the unification of international sales law. be it express or implied.[273] The provisions of Articles 38. As for non-conformity of the goods.[280] In particular. such as Article 1599 of the French Civil Code. in such a [page 71] case. the UNCITRAL Convention on the Limitation Period in the International Sale of Goods [275] was adjusted to the sphere of application of CISG by a Protocol Amending the Convention on the Limitation Period. the buyer's mere knowledge of the third-party claim does not relieve the seller of his obligation. Consent is needed. In contrast to the laws governing lack of conformity. unless the buyer agreed to take such goods (Article 41). .[274] However. the Convention does not explicitly so provide. On the other hand. c) Third-Party Claims to the Goods and Intellectual Property Rights of Third Persons (Articles 41-43) (1) Third-Party Claims The delivery of goods that are subject to any right or claim by a third party is a breach of the seller's obligation. the decisive factor is whether the buyer's use of the goods is infringed or disrupted by the third-party claims. are governed not by Article 41 but by Article 35. The legal nature of the claim is irrelevant. domestic rules on nullity. Domestic law remains applicable. But the contract may also contain special provisions for the examination and notice of defects as. or the environment. 39 and 44 are optional. for example. The Convention does not contain a statute of limitations. such as avoidance for mistake or claims in tort for the decrease in value of the goods. It was generally assumed that.

but rather only in those countries where. in the alternative. the seller must. In other words.[280a] In addition. the seller's liability extends only to industrial or other intellectual property rights existing in those countries where the goods are to be employed according to the terms of the contract.[281] Finally. the seller's obligation in this case depends on where and how the goods are to be used according to the contract. The seller is not obligated to assure freedom from claims of industrial or other intellectual property rights everywhere in the world. the exception in Article 44 applies here as it would for notice of non-conformity. he cannot defend himself on the basis of the buyer's failure to notify. this would mean the country in which the buyer has his place of business (Article 42(1)(b)). if the seller had knowledge of the right or claim of the third party and the nature of it (Article 43(2)). Therefore.[284] but only for particular countries. consider the country where the buyer has his place of business.provided this use in one or more other states was contemplated by the parties at the time the contract was concluded . because there patent claims. when the buyer has a "reasonable excuse" for not notifying the seller. (i.the buyer must notify the seller of any right or claim of a third party within a reasonable period after these defects are discovered or ought to have been discovered and specify the nature of those rights or claims (Article 43(1)). .e.are also similar. it is apparent that this case is [page 73] regarded as a special category of breach of contract. The seller is not subject to the obligation described above if the buyer knew or ought to have known of the right or the claim in question (Article 42(2)(a)).[283] Similar to the seller's obligation with regard to the quality of the goods sold.[282] (2) Industrial and Other Intellectual Property Rights of Third Persons Article 42 specially regulates industrial and other intellectual property rights of third persons. and which were contemplated by the parties in concluding the contract. resold or used). for example.. The exceptions . Nevertheless. he must inform himself about the possible industrial or other intellectual property rights of third persons with regard to the goods sold. according to the contract. designs. In the absence of a special intended use. the seller is only liable if he knew or could not have been unaware of these rights at the time the contract was concluded. a subject which is treated by the German Civil Code and ULIS simply as defects in title infringing upon the use of purchased goods. or other specifications supplied by the buyer himself (Article 42(2)(b)). Furthermore. However. or if the seller followed technical drawings. formulae. closer to a lack of conformity than to a defect in title. so that the seller must take into account that claims based on defective legal title may be asserted for the duration of the applicable statute of limitations. There is no time-limit for notifying the seller of any defects in title. it only assures compensation for damages.the seller's knowledge (Article 43(2)) and the "reasonable excuse" for the lack of notice (Article 44) . though in this case. can just as effectively hinder the use of a machine as can a functional defect. If such use in a third country was not considered.the seller breaches his obligation where claims are raised based on the laws of these states (Article 42(l)(a)). With regard to notice requirements and the buyer's loss of rights for failure to notify. as there is for lack of physical conformity of the goods prescribed in Article 39(2). in the event the goods are to be resold and used in a state other than the one where the buyer has his place of business . this provision is similar to the one on liability for defects in title (Article 43(1)). the goods are to be used.

[291] Others approached the question from exactly the opposite direction. such as avoidance for mistake. both because such grace periods are inappropriate for international trade and because judicial discretion in their application could favor the party at home in the forum. In addition. Specific performance is inconsistent with the buyer's avoidance of the contract and also with his reduction of the price where he could have demanded the repair of nonconforming goods or additional deliveries. However. are also excluded. should not be understood to mean that domestic laws permitting a contract to be voided on the basis of lack of conformity or rescinded for mistake are still generally applicable through Article 4(a).[285] Again. If they were.[289] Domestic rules favorable to the buyer. compensatory damages. A Dutch proposal [290] was rejected which would have excluded domestic remedies. only one of the opposing votes was based on the belief that. the remedies do not follow the provision for each individual type of breach. the buyer can require that the seller cure (by repairs or additional deliveries) as long as such a request is not "unreasonable" . avoidance.[page 75] a) Claims for Performance (Articles 46 and 47) The buyer can request specific performance as long as he has not chosen a remedy which is inconsistent with it (Article 46(1)) or forfeited his right to it by his failure to give the required notice. when the required notice of defects is not given. as in the case of [page 74] defective title. namely that domestic law is not applicable at all in these cases. such as additional remedies. however. because questions of contract validity are excluded from its sphere of application.in light of all the circumstances (Article 46(3) sentence 1). Article 45 offers an overview of the remedies available to the buyer in the event of a breach specific performance. the buyer loses his right to assert a claim based on such infringements if he does not notify the seller within a reasonable time after he learns or should have learned of the thirdparty rights or claims. therefore. The seller is not entitled to rely on the lack of notice from the buyer if he knew of the property right in question and its nature (Article 43(2)). the buyer retains his right to assert a damage claim (except for lost profits) if he has a "reasonable excuse" for his failure to give the required notice (Article 44). there is no timelimit for asserting a claim. the goal of uniformity in the prerequisites and consequences of breach of contract involving the delivery of nonconforming goods would be greatly endangered. as they do in ULIS.Finally.[292] The rejection of the Dutch proposal. and price reduction. the remedy of specific performance may be unenforceable due to Article 28. Domestic laws that permit the courts or arbitral tribunals to grant a seller in breach extra time to perform are expressly excluded by Article 45(3). However.[294] When repairs in a particular case would be "unreasonable" presumably .[287] These relate to all of the seller's obligations and include particularly those regarding documents. the Convention should avoid them. 6. because some remedies apply only to particular kinds of breach by the seller.[288] The cumulation of damage claims with other remedies is explicitly contemplated in Article 45(2). The Buyer's Remedies for Breach of Contract by the Seller (Articles 45-52) The Convention provides a section on remedies for each of the parties.[293] Where the goods are deficient in quality or quantity. The consolidation of remedies based on the uniform concept of "breach" did not fully succeed.[286] Lastly. the remedies for breach of instalment contracts in Chapter V Article 73 belong in this section.

The Federal Republic of Germany's proposal to facilitate claims for substitute goods was unsuccessful. or if the seller has already refused to perform. under Article 35. The only right available to the buyer in any case is his right to claim damages caused by the delay of performance (Article 47(2) sentence 2). above all. even if the buyer can otherwise use the non-conforming transistors without great loss. For example. then the breach is fundamental and the buyer retains the right to demand substitute goods. but this is the result of the passing of time and not of the fixing of an additional period. is as serious to the seller as an avoidance of the contract. or replace parts or goods.[300] Of course.where it would be disproportionately expensive for the seller . The right to require delivery of substitute goods when the delivered goods do not conform to the contract is subject to the condition that the non-conformity must represent a "fundamental breach of contract" (Article 46(2)). The decisive factor is not only the objective damages which the buyer suffers or could suffer as a result of the nonconformity. usually means only that the buyer's remedies are restricted during the additional time period. the buyer's expectations as fixed in the contract control not only the general question. Where the non-conformity does not amount to a fundamental breach and where repairs are not feasible under Article 46(3) . Such an extension. His difficulty is that he cannot.[301] b) The Seller's Right to Cure (Article 48) ("Second Tendering") Until the buyer has effectively avoided the contract .[299] On the basis of Article 25. but not received.[295] The demand for repairs also requires notice.which is frequently the case with raw materials and other fungible commodities .[296] This contrasts both with § 480 of the German Civil Code and ULIS Article 42(1) (c). therefore.[297] The decisive consideration was probably that the delivery of substitute goods practically always requires the return of the defective goods and. however. of whether a lack of conformity exists at all. the extension of time for performance is of additional consequence only if the seller does not deliver at all. As in § 326(1) sentence 1 of the German Civil Code. but. After the additional (and reasonable) period of time has expired. The buyer can always fix an additional period of time for performance.even after the deadline for delivery has passed . unless the seller has already declared that he will not (correctly) perform his obligations by the new deadline (Article 47(2)). he may not take an "unreasonable" (disproportionately . whether the risk of this particular non-conformity was considered so serious by the parties that its existence would eliminate the buyer's interest in the performance of the contract concerning these goods. make repairs. chips suitable for the tropics. the buyer can avoid the contract (Article 49(l)(b))." that is. if the buyer has unmistakably insisted on.the buyer is left only with a claim for damages or price reduction. clarify whether the defective performance is actually a fundamental breach. [298] The difference between a "fundamental" and a "non-fundamental" breach in connection with the delivery of non-conforming goods will thus be the decisive factor in the remedies available to the buyer.the buyer must keep the nonconforming goods and recoup his losses through a damage action or a reduction in price. by [page 76] fixing an additional period of time for performance. delay by the seller during the additional time period can turn his default into a fundamental breach.the seller can generally still "cure. but also the issue of how much weight should be accorded to it. deliver the goods. which must be given either in conjunction with the notice of defects or within a reasonable time thereafter (Article 46(3) sentence 2). and thereby offer the seller an opportunity to cure any lack of conformity (Article 47(1)). However.

[309] Thus the Norwegian proposal [310] to calculate the reduction with reference to the (lower) value of the goods at the time delivery was favorably received.[307] The basis for this provision was both the general tendency to curtail the remedy of avoidance of contracts. The Federal Republic of Germany criticized the provision above all because the buyer's right to avoid the contract endangers the seller's right to cure.long) time to do so or cause the buyer unreasonable inconvenience or uncertainty about the reimbursement of expenses advanced by the buyer (Article 48(1)).[306] By analogy. when time is not of the essence . the provision also applies to the failure to transfer documents of title. The West German delegation believed that the seller's right to a "second tender" should be ensured under the Convention. if the buyer waits too long after delivery to declare his intent to avoid. and. In order to invoke the reduction. It became clear in the discussions that many representatives believed that price reduction constitutes a kind of damages but is merely based on a lesser showing. he may not resort to any remedies inconsistent with performance by the seller before this deadline (Article 48(2) and (3)). the contract may be avoided only when the failure to perform amounts to a "fundamental breach of contract" under Article 25.the seller's cure within a reasonable time after the due date will normally prevent the delay from constituting a "fundamental breach of contract" such as to permit the buyer to avoid the contract. In addition to the right to cure under Article 48(1) sentence 1. even if.[305a] (Article 49(l)). If the buyer does not respond to this request. Article 50. where the rule is set forth in detail. a price reduction is unavailable if the seller completely performs his obligation by curing or if the buyer unjustifiably declines to accept the cure (Article 50 sentence 2). Where the failure to meet a deadline in itself does not constitute a fundamental breach .[page 78] d) Reduction of the Price (Article 50) Where the goods do not conform with the contract. the fear that the procedure of extending the deadline for performance could be used to "upgrade" an unimportant violation of the contract into a fundamental breach. grants the buyer the right to reduce the price. Of course.in other words.[301a] The buyer retains his right to claim damages caused by the delay. which theoretically could be cancelled by the buyer's avoidance of the contract. the buyer loses the .[302] As a rule. Article 48(2) permits the seller. according to Article 49(2). as a result of his cure.[303] c) Avoidance of the Contract (Article 49) [304] As a rule. to ask for clarification as to whether he the buyer will accept the cure. however. the present version will not affect the seller's right to a "second tender". like ULIS Article 46. above all. the buyer need only dispatch notice thereof. The option provided by ULIS to the buyer to extend the date for performance and thereby to clarify whether a breach is fundamental [305] has been retained only for the case where there is no delivery at all. Consequently. Article 48 was the subject of controversy in Vienna. by sending a request (which is effective upon receipt) together with an indication of the date by which he intends to fulfill [page 77] his obligations.[311] Article 50 thereby differs both from the German Civil Code and from ULIS Article 46. the seller fully performs his obligations (Article 48(1) sentence 2).[308] Further. the buyer's right to avoid the contract is also lost.

it also provides that the buyer may incur other obligations typical of sales transactions (compare Articles 61(1) and 62). the seller's remedies. he must pay for it at the contract rate (Article 52(2)). Nevertheless. the rules for anticipatory breach (Article 72) and the special obligations concerning the preservation of goods (Articles 86-88). like the buyer's. such as to provide .[316] Expense or loss incurred by the buyer on account of the early delivery or the delivery of excess goods give rise to a damage action as long as the buyer's acceptance of the goods is not considered to be an acceptance of an offer to modify the contract. the buyer may not be required to assume a more onerous burden. No decision was reached as to whether the price may be reduced for defects in title or third-party claims based on industrial or other intellectual property rights.[312] According to Article 50. Section III (Articles 61-65) governs the seller's remedies for the buyer's breach. But the formula for calculating the decrease in value due to such defects surely would have required thorough deliberations for which no time remained at the Conference. the price of the delivered but non-conforming goods increases more than the price of conforming goods. Articles 54-60. in some circumstances.[315] The buyer may accept or reject any excess goods. constitute a fundamental breach and entitle the buyer to avoid the contract and return the entire delivery. Even though the Convention explicitly lists as the buyer's obligations only payment and taking delivery (see Articles 53. a reduction in price is available only when the goods do not conform to the contract. If he accepts the excess. between the conclusion of the contract and the date of delivery. An example is the case where the seller tenders a bill of lading covering all of the goods (including the excess goods) and specifies that the goods can be delivered only if payment is made for the excess goods as well. he may be obligated to take possession of the good for the seller (Article 86(2)). such as inspecting goods before the contractual date for delivery.[313] The general similarity of the prejudice caused by these defects with that caused by other defects justifies the availability of price reduction in these cases as well. The buyer can demand avoidance of the entire contract only when the partial non-performance or partial non-conformity represents a fundamental breach of the entire contract (Article 51(2)). The delivery of excess goods can. are available only with regard to that part (Article 51(1)). However. the buyer's remedies. The Buyer's Obligations (Articles 53-65) Article 53 and Sections I and II. e) Remedies for Partial Non-Performance or Partial Lack of Conformity (Article 51) In the case of partial non-performance or of a delayed or incorrect partial performance. 54-60). In addition. are augmented by the special remedy available to both parties for cases in which the other party's situation has deteriorated (Article 71).advantages of a profitable purchase if. of Chapter III govern the buyer's duty to pay the price and take delivery of the goods.[314] [page 79] f) Early Delivery or the Delivery of Excess Goods (Article 52) The buyer may refuse to accept an early delivery (Article 52(1)). as a rule. C.

[322] In a sale involving carriage. the buyer's obligation to pay includes all of the measures agreed upon in the contract to enable payment to be made. the parties implicitly 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. Because a restrictive interpretation and application of the provisions on contract formation would require a definite or determinable price.[326] . a contradiction remains between the requirement of a determinate price at the conclusion of the contract on the one hand and the possibility of fixing the price after the contract is concluded on the other.[317] 1. Buyers are thus well advised to seek a more favorable choice-of-forum clause in the contract. the net weight should be used. The parties may specify the currency in which the payment is to be made. the grounds for exemption listed in Article 79(1) and (2) also apply to damage claims based on lost or delayed payment. which applies only in the case that a valid contract is formed.[321] Where there is an agreement for immediate payment . voiced by some states. is reflected in the text of Article 55. The provision on determination of the price renewed the argument concerning the need for a definite price term. with the result . The version finally adopted is based on a compromise proposed by a working group. such as the duties to provide a letter of credit [319a] and to comply with relevant (domestic) laws.[325] As a rule.[324] Unfortunately. and heed export and re-import prohibitions etc. Article 56 provides that. in the absence of a fixed price. a discussion which had already arisen in conjunction with Article 14(1) sentence 2. if [page 81] immediate payment has not been agreed upon.[323] Under domestic rules of procedure. jurisdiction and venue for an action for the purchase price are often at the place of payment. the seller's place of business remains the place of payment.that the place of business or habitual residence of the seller. payment must be made at the seller's place of business (Article 57(1)(a)). furnish information. deliver materials or components. and technical drawings. that a definite price term was needed. in particular currency-exchange regulations. Article 57(2) provides one exception to this rule: the seller must bear the increased cost that is caused by a subsequent change of his place of business.[320] If the price is to be determined on the basis of the weight of the goods.security interests. the CISG may produce the same result. The Obligation to Pay the Price (Articles 54-59) The buyer must pay the price either as fixed in the contract or as determined according to contractual terms. in case of doubt. being the place of payment." The concern. plans. In the absence of agreement. that. a reference to Article 14.much regretted in regard to ULIS Article 59(1) . the risk and costs of a delayed or lost payment are carried by the buyer. Articles 57 and 58 govern the place and time of payment. automatically fixes the forum for an action for payment of the purchase price."cash against documents" . Furthermore. recorded in Article 55.payment is to be made at the place where the goods or the documents are transferred (Article 57(1)(b)).[318] [page 80] The argument in favor of wide-ranging judicial authority to fix a price where the price term is left open was accommodated by the assumption. in turn. follow distribution directives.[319] Under Article 54. which represents.

then actual non-performance must also give the seller the right to withhold delivery. the question of whether the buyer is allowed a "reasonable time" [333] to pick up the goods is to be resolved on the basis of Article 7(1).[327] [page 82] The payment-in-exchange-for-goods principle also operates to the advantage of the buyer. If a party may suspend performance under Article 71 because of the danger of the non-performance of a substantial duty. such as in cases where payment is to be made against documents. The seller must accept partial payment or payment made before the due date only if he is required to do so by contract. Although the convention is not explicit.[328] For inspection to be excluded. [331] such as obtaining the necessary import [page 83] documents. or when the goods must be "placed at the disposal" of the buyer at another location. Thus.According to Article 58. the buyer is normally responsible for removing the goods. Acceptance of a bill of exchange or provision of a letter of credit can. either by placing them at the buyer's disposal (Article 58(1). Article 58 regulates the due date and the other requirements of the obligation to pay the price as well as the reciprocal relationship between delivery and payment. In principle.[330] In addition. as long as these duties are substantial. the seller can make payment a condition precedent to a transfer of the goods or documents controlling their disposition (Article 58(1) sentence 2 and 58(2)). the time for payment is primarily determined by the contract. Article 31 concerning where goods must be placed at the buyer's disposal) or by dispatching them (Article 58(2). 2.[332a] The seller should not be required to request the buyer to take delivery. the parties must agree on a means of performance which does not permit inspection. as long as the contract does not obligate the seller to perform first. be considered part of the contractual obligation to pay under Article 54 as qualified by the contract. cf. and specifying and requesting delivery of the goods ordered. The second element is that the buyer must take charge of the goods. In the case of goods to be picked up at the seller's address. If there is no such agreement. Article 59 would become obsolete in many cases. unless inspection has been excluded by agreement. There is then no need to resort to domestic law to decide the question. and the seller need not send any advance reminder or other formal request for payment (Article 59). before he has had an opportunity to inspect the goods (Article 58(3)). cf. Buyer's Obligation to Take Delivery (Article 60) There are two elements to the buyer's obligation to take delivery. It is consequently covered by the rule in Article 58. he must undertake all acts which could reasonably be expected of him in order to enable the seller to make delivery. making the necessary preparations for any installation to be done by the seller. however. The seller's right to retain the goods or documents until payment has been made is not inconsistent with the buyer's right to inspect. Otherwise. The buyer is not obligated to pay the price. The buyer is not obligated to pay until the seller has delivered goods or documents in conformity with the contract.[329] There is no express provision for the seller to withhold delivery where the buyer has failed to fulfill obligations other than payment. First. . however. he may return the payment without breaching the contract. it follows from Article 71 that even the buyer's failure to perform duties which do not fall directly under Article 54 must give the seller the right to withhold delivery. the particulars of the obligation to take delivery depend on the mode of delivery agreed upon. the seller may demand immediate payment upon delivery. Article 31(a)).[332] Of course.

The right to resell the goods. For breaches other than delay. as such. unless the buyer has refused to perform altogether (Article 63(2) sentence 1). domestic courts and arbitral tribunals may not grant a grace period to the buyer . Article 61(1)).[337] The provision's opponents argued that the seller . the buyer's fundamental breach of contract permits the seller to avoid the contract. once the price has been paid. the transfer to the seller of the right to specify the goods. Article [64(2)] considerably restricts avoidance when the buyer has in fact paid. is a remedy which becomes important to the seller when the buyer fails to take delivery of the goods. the seller's remedies are not categorized according to the kind of breach (cf. however. the seller may not avoid the contract if he does not exercise the right within a reasonable time after the seller learns or ought to have learned of the breach (Article 64(2)(b)(i)).for example. The seller's primary claim is for specific performance by the buyer (Article 62).the seller cannot wait and watch market developments before making his decision to avoid the contract. Article 28 may limit the action. a ground for avoidance . In addition.one of the obligations in Chapter V which are common to both seller and buyer . contains special rules for the seller who wishes to avoid the contract when the buyer breaches his obligations to pay or to take delivery. In other words. However. Article 64. it was maintained. The buyer's obligation to pay interest. the seller may avoid the contract if the buyer's failure to perform his obligations constitutes a fundamental breach of contract. in principle. however. described in Article 88.the seller loses the right to avoid the contract once he learns of the late payment. for obligations of the buyer other than those named in this provision.3.any more than they may grant one to the seller (Article 61(3)). even if the buyer has committed a fundamental breach of the contract . late payment is covered by Article 64(2)(a) as well.[334] The seller can resolve any doubt as to whether the buyer's delay in making payment or taking [page 84] delivery constitutes a fundamental breach by fixing an additional period of time for performance (Article 64(1)(b)). The Seller's Remedies for Breach by the Buyer (Articles 61-65) As with the buyer's remedies. after any additional time period allowed for performance was expired.is a special remedy for the seller when the buyer delays payment. Even if domestic law permits it. In principle.[336] In my opinion.which. for sales subject to the buyer's specifications. The seller's option to specify the goods under Article 65 met with considerable misgivings in Vienna. The 1978 Draft Convention's text of Article 64(2) (Article 60(2) of the 1978 Draft Convention) was disputed in Vienna by those who wished to clarify that in the case of late payment . already may constitute a fundamental breach and. First. except for damages caused by the delay in performance (Article 63(2)). as a special remedy. hence. the buyer's delayed performance permits the seller to avoid the contract only if the seller was unaware that performance had been rendered. the additional period of time for taking delivery has expired . provided for in Article 78 . or after the buyer has declared that he will not perform his obligations (Article 64(2)(b)(ii)).[335] Although. In addition. the right to repudiate the contract is lost as soon as the seller discovers that the payment was made. fixing an additional period of time for performance has only the consequences provided in Article 63(2) sentence 1. the seller can claim damages together with specific performance or other remedies for the buyer's breach (Article 61(2)). In the end. Article 65 provides.[333a] A notice extending the time to perform operates initially only as a bar to the seller's resort to other remedies for the duration of the extended time period. consequently.

There is an exception for the case where the loss or damage was "due to an act or omission of the seller. The seller may also avoid the contract where the buyer fails to specify within an additional period of time fixed by the seller under Article 63(1) and the failure to specify in effect constitutes a failure to take delivery. even if the goods have been damaged or destroyed.[338] insisted that the buyer was sufficiently protected and that the provision achieved an overall balance between the interests of the seller and those of the buyer. and.such as where a defect caused further deterioration .[345] Whether the seller has thereby breached the contract is. are damaged by the seller as he recovers his containers. The passing of risk is therefore no longer determined by the legal concept of "delivery" but rather by a description of the prerequisites for the passing of risk. arguing primarily from the restrictive conditions under which the seller must exercise his option. the buyer must pay even if the [goods are] thereafter destroyed or damaged. The exception concerning loss or damage due to the seller's act may apply even where the seller is not responsible in the sense of Article 79(1) and (2).[347] The fact that the buyer cannot return the Articles destroyed as a result of the breach .was sufficiently protected by the remedies of avoidance and damages.[348] If the buyer neglects to notify the seller of non-conformities (including a delivery of entirely different goods) or defects in title. his act not only releases the buyer from his obligation to pay but also may permit the buyer to claim damages for breach of contract (or for non-contractual liability under domestic law). in principle. In general. in case the failure to specify constitutes a fundamental breach. the buyer remains obligated to pay the purchase price.[339] The special rules for [page 85] the sale to the buyer's specifications means not only that the seller has an additional remedy .[342] This "very elegant legal solution" [343] was dropped by UNCITRAL [344] as too conceptual.namely the possibility to specify without prejudice to his other remedies (Article 65(1)) . Nonetheless. In ULIS. such as encumbering industrial property rights. once the seller has performed. the seller's act which leads to the loss of the goods will almost always constitute a breach of contract. That is the case when the goods are not packaged correctly." The Secretariat's Commentary gives the example of goods which. even when the goods cannot be returned (Article 82(2)(a)). Article 66 states the principle: Once the risk has passed to the buyer. However. the concept of "delivery" was used to describe the closely related concepts of the seller's performance of his obligation and the passing of risk to the buyer. The buyer thus carries the risk of having to pay despite the loss of the goods.[341] D. If the seller is "responsible" for the destruction of the goods. after delivery.[340] The reservation of the other remedies makes it clear that the seller can also sue for damages.[346] [page 86] If the seller's breach of contract is fundamental. irrelevant.does not prevent him from avoiding the contract nor does it prevent the "passing back" of the risk: the seller must return the full purchase price to the buyer. even if the . while its proponents. he must pay the full price. The Passing of Risk (Articles 66-70) The buyer's obligation to pay is dependent on the seller's performance of his obligations. the buyer may avoid the contract and is released from his obligation to pay. these problems exceed the scope of the rule on the passing of risk.but also that an offer to contract where the goods have not been specified may be sufficiently definite to form a valid contract. or a defect causes further deterioration and destroys the goods after the risk has passed. which is limited to the distribution of risk for accidental loss. avoid the contract.

The passing of risk is not affected by the fact that the seller retains the transportation documents (or has already handed them over)[350] (Article 67(1) sentence 3).where the goods are handed over to the first carrier (Article 67(1) sentence 1) . for example. if the seller uses a legally independent (incorporated) entity that is a subsidiary of the seller's firm. that the risk passes to the buyer when the goods have been handed over to the first carrier for transmission to the buyer (Article 67(1) sentences 1 and 2) [348b]. the rule was considerably improved in Vienna. let the risk pass to the buyer even when the seller's own personnel is employed.[page 88] In some sales contracts involving the carriage of bulk goods. then Article 69 applies to the passage of risk. namely. It now contains. Sales Involving Carriage (Article 67) For sales involving carriage.[356] The solution may be corrected by denying to the seller the exemptions of Article 79. road or air or by a combination of modes.[357] In addition. retention of the documents for example. he maintains the risk of loss.and not to the first . This rule also makes it clear that the passing of risk is independent of the transfer of title. the law does not distinguish between carriage by sea.goods are lost and the contract would have been avoidable had timely notice of the lack of conformity been given. such as trade terms. the important case of identification to the contract on the basis of freight documents that indicate that the buyer is to receive the goods. On the other hand.[353] As long as Article 69(2) does not apply to the sale. Therefore. due to the difficulties in delimitation in such cases.is frequently modified by special [page 87] contractual provisions. The basic case . Article 67(2) therefore lists the identification of the goods as an additional requirement for the passage of risk.[351] Although the question was not discussed in Vienna. the transfer of the goods to this carrier .[354] it is my opinion that. only the independent carrier was considered a carrier for the purposes of Article 67. even though he is not obligated to do so. Article 67(1) contains the traditional solution for the passing of risk. if the seller transports the goods with his own personnel. Article 67 applies.[357a] In the case of combined shipment of several . because his personnel or the transportation organization run by him is not "beyond [his] control". Accordingly.[352] The passing of risk in sales involving carriage may therefore depend on the legal structure of the seller's business: If the goods are transported by a division of the firm that is not legally independent of the seller's enterprise. the passing of risk in the sense of Article 67(1) presupposes that the goods lost or destroyed had been clearly identified to the contract in question. The Convention distinguishes in particular between sales involving carriage and simple sales for which the seller's obligation to deliver is fulfilled at his place of business or a third place. to insure payment .and the corresponding right to control the disposition of the goods does not hinder the passage of risk to the buyer.[355] which. where the seller sends the goods using his own transportation organization.[348a] 1. and it does not split the risk in cases of multimodal transportation.marks the passage of risk (Article 67(1) sentence 2).[349] whereby a carrier is to be given the goods at a particular place for (further) transmission. Compared to Article 79(2) of the 1978 Draft Convention. it is worth considering the Reichsgericht's solution under § 447 of the German Civil Code. destruction or deterioration of the goods caused by the seller's employees would surely fall within the meaning of "due to an act or omission of the seller" in Article 66.

[359] 2. instead. At any event. the risk that the buyer would have to pay for goods that were already damaged or lost at the time the sales contract was completed is normally covered by insurance. and.[360] the risk passes at the time the goods are handed over to the carrier.[367] the countries that had favored it blocked the adoption of the original proposal which had already been approved in the First Committee. the principle is that the risk generally passes to the buyer when he takes over the goods. though. identification can result from sending the buyer a shipping document so precise in its contents that it enables a particular portion of the shipment to be identified to the specific contract.[371] 3.[368] Of course. the goods may be identified by placing appropriate marks on them (such as the address of the buyer) or by sending notice of dispatch to the buyer. the identification of the lost or damaged goods to the sales contract in question is a prerequisite for the passing of risk.goods. it is irrelevant whether the documents are negotiable instruments. the parties are more concerned with the sale of the documents than with the sale of the goods themselves. The risk passes to the buyer from the moment the goods are delivered to a carrier who issues "the documents embodying the contract of carriage".[369] The Conference did not succeed.[365] The rejection of the original proposal was also motivated by the [page 89] argument that the parties may have been unable to obtain any insurance at all for the goods before the conclusion of the contract.[358] Most importantly. According to the consensus of the delegates.[361] In contracts such as CIF transactions. A number of developing countries noted that the 1978 Draft Convention's solution violated the legitimate interests of the sellers [364] of bulk goods from developing countries.[362] The Pakistani proposal [363] for the risk to pass when the contract is concluded produced a vehement discussion in the First Committee. no documents may be issued at all and that. The Sale of Goods During Transit (Article 68) The rules for the passages of risk with regard to goods sold in transit proved to be unexpectedly difficult. When the goods are to be picked up at the seller's place of business. a notice which would be effective upon dispatch. in providing for the possibility that. the risk passes when the goods are placed at the disposal of a buyer who then fails . in the future. the retroactive effect of the transfer of risk to the date of shipment operates only to the advantage of the good faith seller (Article 68 sentence 3). the compromise embodied in Article 68 was reached. shipping contracts may be electronically recorded and transmitted. the existence of transportation insurance may point to such an agreement. finally. The proponents of this solution repeatedly pointed out that. This definition was changed in Vienna. According to both Article 80 of the 1978 Draft Convention and ULIS Article 99. (Article 27). but an agreement that the buyer will assume the risk from the moment the goods are handed over to the carrier can be implied from the circumstances.[370] As in Article 67(2). in this kind of transaction.[366] After the Pakistani proposal was also rejected by the Plenary. It was then agreed to reopen the debate. whereby the risk generally passes when the contract is concluded (Article 68 sentence 1). Local Purchase (Article 69(1)) Sales involving carriage and sales of goods in transit so predominate the scheme of the Uniform Law for International Sales that all other cases are considered only in the residual provision (Article 69).

at the buyer's place of business.[378] The deliberations concerning the provision were unusually lengthy and controversial. Where delivery is to be made at a place which is not the buyer's place of business. The new formulation. The proposal differed from § 321 of the German Civil Code but corresponded to ULIS Article 73(1).[375] the risk passes to the buyer at the earliest moment when the buyer could have taken delivery. the goods must be clearly identified to the contract in question before placing them at the buyer's disposal passes the risk to the buyer. such as when the buyer has not obtained a required import license in a timely fashion. Whether the buyer is at fault for the delay in taking delivery is irrelevant. but had not become apparent until after the conclusion of the contract. Provisions Common to Both the Seller's and the Buyer's Obligations (Chapter V) 1.that and where the goods are available. The aim of the proposal that led to the present formulation was to permit a suspension of performance even when the circumstances that made the obligor's performance doubtful had existed before. and some delegates wanted the applicability of these domestic provisions to be preserved. Suspension of Performance Due to Deterioration in the Other Party's Situation (Article 71) Compared to Article 62 of the 1978 Draft Convention. risk passes only when delivery is due and the buyer is in a position to pick up the goods [376] and aware that the goods have been placed at his disposal.as in a sale to destination . under the proposed rule. including .where those changes occur after the conclusion of the contract.[372] In the sale of bulk [page 90] commodities. because of their size or other economic factors. the risk does not pass until the buyer has been notified (Article 67(2)).for example.[page 91] E. This solution was resisted on two grounds. certain domestic laws already make provision for cases where performance was endangered before the conclusion of the contract. often operate under strained conditions would rarely be able to require advance performance from contract partners. parties that. . First. they provide a good example of the problems and obstacles that can confront an effort to achieve a uniform law. Article 69(1) expressly concerns only cases in which the buyer has delayed taking delivery. It should also be interpreted to include those situations in which the goods could not be delivered because of other breaches of the contract by the buyer. They argued that changed circumstances should yield corrective measures only . such as in the case of warehoused goods. The Federal Republic of Germany's proposal to have the risk pass in all cases where the buyer's breach prevents normal delivery [373] found no support because it was assumed that the cases covered by the German proposal were already included. from receipt of a warehouse document or a notice of release.[379] should prevent the party experiencing difficulties from insisting on performance by the other side with the argument that his situation did not deteriorate after the conclusion of the contract but was already unsatisfactory before that date since he had previously failed to perform his obligations to third parties. the remedy available in Article 71 was improved in Vienna.to take delivery. etc.[377] Where the buyer does not know . Other Places of Delivery (Article 69(2)) If a seller is not to deliver the goods at his place of business but rather at another place.[374] 4.if at all . .[380] Second. which was proposed only as a clarification.

[385] However. as with Article 25. possible: For one. domestic law on avoidance due to mistake is not applicable except in the case of fraudulent deception. the other party may not suspend performance. the other party's performance of "relatively minor" (cf. 320(2) German Civil Code) obligations may not be forced by suspending one's own performance. it must be assumed that such a differentiation is. for example. the opposition was also nourished by misunderstandings: Suspension of performance and avoidance based on an anticipated breach (Article 72) were perceived as a single remedy that was too severe. in principle.and only the suspension governed by the Uniform Law for International Sales .in the event that a contracting party could establish that he had contracted under a false impression of the other side's ability to perform.[381] [page 92] But the proposal was meant specifically to exclude the thc diverse domestic rules on avoidance based on a mistake about the other party's ability to perform and to allow suspension of performance . An Egyptian proposal combining suspension of performance with anticipatory breach [382] revived the debate and led to the establishment of a working group which produced the present text of Articles 71 and 72. He is therefore not liable for late performance to the extent the delay corresponds to the suspension of preparations.[383a] The expected breach of contract must concern a substantial part of the obligor's duties. the delivery time may also be prolonged: If the buyer unexpectedly offers payment or adequate assurances of performance according to Article 71(3). in practice. Moreover. the importance of the jeopardized obligation to the obligee's contract expectations must be recognizable to the obligor at the conclusion of the contract: Since Article 71(1) releases the obligee from meeting deadlines. the difference between an (expected) violation of a "substantial part of [the] obligations" (Article 71(1)) and a "fundamental breach" (see Articles 72(1) and 73(2)) will hardly be distinguishable.[383] As it now stands. it can be the de facto equivalent of an avoidance. the seller who cannot meet the initial delivery date because of his justified suspension is not in default. Article 71 corresponds to the 1978 Draft Convention as completed by the German proposal. the Egyptian motion [384] to make the expectation of a "fundamental breach" the prerequisite for suspending performance under Article [page 93] 71(1) was rejected. lay outside the reach of the Uniform Law for International Sales. moreover. Finally. it was argued. As described in Article 71(1)(a) and (b). a party may suspend performance even when the deterioration already existed before the conclusion of the contract but was not apparent until afterwards. the right to suspend depends on how important the obligation is to the party relying on them. In my opinion. . As in the context of Article 25. Above all the difference in remedies under Articles 71(1) and 72(2) may justify including less important breaches under Article 71(1). Even though. especially for parties in developing countries. the proposed rule seemed to permit too great a latitude to subjective appreciation of the other party's condition. "Suspension" refers not only to (advance) performance. The decisive factor is when the inability to perform "becomes apparent". he may stop construction of the machine. but also to the preparation of performance: If the seller of a machine still to be constructed learns of the buyer's impending insolvency.Whether one party's ability to perform is recognizable to the other and the extent to which that factor influenced the parties' will to conclude the contract are questions of mistake which. If it was already apparent at the conclusion of the contract that one party would not be able to perform.

he would have produced adequate assurance. hence. where the delivery date is so near that assurances could not . As regards third parties. from that moment. In the event the seller dispatches the goods before the buyer's inability to perform becomes evident.[386] The example discussed in Vienna of a totally insolvent obligor who against all odds. If the other party gives adequate assurance of performance. Adequate assurance includes not only a guarantee of performance (such as a commitment by a third party) but also security for damage claims in case of non-performance. then the right to suspend performance ends (Article 71(3)). from the moment the [page 94] assurance would have barred the right to suspend performance. under Article 72(2) for avoiding the contract on the basis of anticipatory breach are not terribly important since they have been weakened by exceptions. Whether the carrier or warehouse keeper must follow the seller's order depends on the freight or warehouse contract. retained (Article 72(1) = Article 63 of the 1978 Draft Convention). in my opinion. or internal contracting partners of the obligor had or could have had before the conclusion of the contract may not be considered. home banks. even if the buyer is already the owner of the goods or the holder of documents enabling him to obtain them from carriers or warehouses (Article 71(2) sentence 1). At the same time. However. The suspension is no longer justified.Common sense suggests that "becomes apparent" means that the obligor's situation could not remain hidden to an objective participant in the branch of international trade in question. 2. in principle. The party that has suspended performance must immediately notify the other party (the notice is effective upon dispatch (Article 71(3)). immediate avoidance still remains an option in most cases. In my opinion. was.[387] If the party suspending performance neglects to send notice. Notice of the intent to avoid is unnecessary in those situations . Article 72(2) should apply primarily to situations where performance by a willing party is jeopardized by objective circumstances. the apparent inability to perform must not only induce subjective fears with regard to the performance of the contract but must also enable objective observers to foresee non-performance. Since this exception also covers the frequent cases in which a demand for new terms or alleged contract violations by the other side are used as a pretext for not performing one's own obligations. obtains credit or liquid assets. but was restricted in accordance with the tendency to limit avoidance as a remedy of last resort.practically speaking. The restriction took into account the desire expressed by the developing countries to permit the party whose breach is presumed to provide assurances and thereby to prevent the avoidance (Article 72(2)). Yet it must be remembered that the cases in which it can be stated with absolute certainty that a particular "deficit" will lead to an inability to perform are very infrequent. this right operates only as against the buyer.[389] In those cases where there is no time to notify. the other party may have the right to claim damages or avoid the contract if he can show that. and. will. such as the buyer's creditors who have seized the goods. The standard for this prognosis is again the judgement of a reasonable person. the seller may stop the goods in transit. knowledge that family members. Avoidance Based on Anticipatory Breach (Article 72) Anticipatory breach as a basis for avoiding a contract before performance is due. had he been promptly notified. constitutes a breach of contract. not impair the practicability of the solution.[388] The other prerequisites. on domestic law. the most important .in which the other party has already declared that he will not perform the contract (Article 72(3)). Of course. the seller may exercise his right only if domestic rules on secured transactions permit it (Article 71(2) sentence 2).

the contract may be avoided with regard to the future instalments as well. 72(1) and 73(2) . the refusal of the obligor to provide "adequate assurance" following a notice under Article 71(3) should not in itself be regarded as "clear" evidence of an impending breach of contract.[391] In my opinion. Instalment Contracts (Article 73) Where there is a breach of a single delivery of an instalment contract. Article 73(1) requires that the breach constitutes a fundamental breach of contract with regard to the instalment in question. Otherwise. In that case."good grounds to conclude" .was retained for the case where a fundamental breach is anticipated with regard to instalment contracts. this is true only if the purpose of the entire contract was clear to both parties at the conclusion of the contract (Article 73(3)). By analogy. the contract may be avoided only with respect to the instalment that is defective or was not performed and to the obligation of the other party corresponding to that performance.[392] This provision is concerned with successive deliveries. F. The notice requirement must also be "reasonable" in other respects as well. an avoidance of the contract is possible. the suspension applies only to obligations still to be performed and leaves the contract intact. The discussion also suffered from the difficulties of translation. where a delivery cannot be made because of war . Article 73(2) can also apply to missed payments if they coincide with instalment deliveries. On the other hand. If. the different formulations do not require different degrees of certainty . due to the interdependence of the instalments. differences in the standards of certainty were accepted and justified on the grounds that the remedy in Article 71(1) differs in seriousness from the remedy in Article 72(1).[391b] 3.notice will often be unnecessary.[391a] In Article 73(2). those instalments can be avoided as well.is whether a reasonable person would be convinced that a breach of contract is certain to occur. under Article 72(1). however. there is again no need to notify the other party.[390] To some extent. another reason for not requiring a higher degree of certainty under Article 72(1) is that otherwise.be procured in time. therefore. the defective or failed performance makes past or future instalments worthless. According to Article 73(2). A breach of one instalment may also indicate the probability of a breach of instalment obligations not yet due. The debate over whether the formulation "it is clear" ("il est manifeste") means or should mean a higher degree of certainty than the formulation in Article 71(1) "it becomes apparent" ("il apparait") played a major role in the discussion. a serious refusal to perform would never be "certain" enough under Article 72(3) since an obligor can always change his intentions until the time for performance. the same wording originally used in Article 71(1) . The buyer's interest in receiving complete performance must.such a requirement would hardly be practicable anyway. Under Article 71(1). The decisive factor in all three provisions Articles 71(1).for example. Damages (Articles 74-77) . Article 73(2) is also applicable to other breaches by the buyer.[page 95] whereas. have been recognizable to the seller. However. avoidance in regard to future obligations must be declared within a reasonable time so that the other party has sufficient time to consider the matter. Where there is little chance that the other party can still provide security . the entire contract may be avoided under Article 72. As with Article 71. Moreover. not instalment payments. such as not taking delivery of an instalment. great difficulty arose in connection with the question of when a particular act or occurrence justifies the conclusion that a fundamental breach is to be expected.

This was designed to prevent the injured party from speculating at the other's expense. This method of measuring damages . at the conclusion of the contract. domestic provisions for liability in tort should not be displaced. The rule was found to be objectionable in Vienna. damages are always monetary compensation (Article 74 sentence 1).presupposes that a cover transaction has not been undertaken with regard to the contract breached. But a broader formulation . because it was too uncertain and gave too much discretion to the courts.1.which would have excluded product liability even for property damage . they can be awarded under CISG. or because the goods are directly or partly unusable because they are burdened with third-party claims (Article 74 sentence 1). it is enough that the injured party is constantly dealing in "market transactions" and that it is therefore difficult or impossible to determine which particular transaction should be considered the cover for the breached contract. The fundamental rule in Article 74 makes three basic decisions. These objections finally [403] led to choosing the "declaration of avoidance" [404] or the "taking over" of the goods as the reference point for calculating damages. including products liability for injuries caused by defective goods. but exceptions must remain for individual cases where a typically unforeseeable risk of damage has been assumed by the party in breach. In most domestic legal systems. In assessing this forseeability. in the event such damages were foreseeable to the seller. together with any further damages (Article 75). Extent and Measure of Damages (Articles 74-76) The Convention's provisions on the kind and extent of damages correspond in general to Section IV of ULIS.[397] Therefore. the earlier of the two being .could not be agreed upon in Vienna. i.[398] [page 97] When the contract is avoided. the principles established in the 1978 Draft Convention were no longer disputed in Vienna. independently from any cover transaction. whether this was a result of a late or non-conforming performance or of no performance at all.[393] Finally..[398a] the cover transaction must.e.[400] To meet the requirement. Second.[399] This coincides with the duty to mitigate damages in Article 77. however. the 1978 Draft Convention (Article 72(1)) looked to the time when the injured party first could have declared avoidance. such violations belong to the domain of non-contractual liability.the so-called market-price rule . Article 76. Article 5 entirely removes personal injuries from the sphere of application of the Convention. damages generally amount to the difference between the contract price and the costs of a cover transaction.will be especially difficult with respect to consequential damages caused by defective goods to the person or property of the buyer. the injured party can also measure his damages "abstractly".[395] Judicial discretion in the assessment of damages can be reduced by standardizing the damages in question. should be able to calculate the risks and potential liability they assume by their agreement.[394] The underlying idea is that the parties. Where the goods have a market price. The historical roots and development of and the basic idea behind this rule on the limitation of damages have been the subject of many commentaries. the usual or intended use by the buyer should be the decisive factor. of course.[402] especially in cases of anticipatory breach.[401] As the reference point for the measure of damages. the only damages that must be compensated are those which the party in breach foresaw or ought to have foreseen at the time of the conclusion of the contract. First. the loss to the party affected must have been caused by the other party's breach. The assessment of the possible types of damages which makes it possible to describe concretely the risk each party can be said to have assumed [396] . Even in cases where there is contractual liability under the Convention. be undertaken within a reasonable time after avoidance.

Opposition to the use of the official discount rate in the creditor's country.cancellation of the order and then demands full payment from the buyer. the weakness in the interesting proposal was that the courts would have been given exceptional discretionary powers to modify specific performance or avoidance of the contract. In the case of Article 49(2)(b)(i). Interest payments were opposed in part for religious reasons.[407] However. they have to pay the there prevailing interest rates. The 1978 Draft Convention's sole provision concerning the payment of interest related to the seller's duty to refund the price after avoidance of the sales contract in Article 69. Interest (Article 78) The interest question provoked extraordinary difficulties at the Conference. since.[409] The proposals at the Conference [410] reflected differing beliefs and divergent theoretical approaches to the duty to pay interest as well as to the conflicting practical needs. at that time. Article 77 corresponds to domestic provisions such as § 254(2) sentence 1 of the German Civil Code. as adopted in ULIS Article 83. the reference point actually precedes the moment when the buyer could avoid the contract because the buyer. some of the socialist countries. In connection with Article 84(1).[page 98] 2. A violation of this duty leads to a corresponding reduction in damages under Article 77 sentence 2.[412] The goal of the delegations that believed that a special interest provision was necessary was [page 99] precisely to prevent interest from being considered as damages and thereby to maintain the obligation to pay interest in case of exemptions under Article 79.unjustified . It is more difficult to justify the second reference point . he may be held to have violated his duty to mitigate damages. so that the rate of interest in the debtor's country should be determinative. The solution is thus difficult to understand.decisive. Where the "declaration of avoidance" controls. still did not know of the breach. The Duty to Mitigate Damages (Article 77) Article 77 sentence 1 requires a party wishing to assert claims based on breach of contract to take reasonable measures to mitigate damages. In reality. with regard to interest owed to them on outstanding debts. In the event of a delayed or non-conforming performance. the debtor's ability to use capital owed to the creditor was perceived as an unjust enrichment. was based partly on the fact that it is not an internationally valid indicator of the capital costs in individual countries. there will be little change in the result: If a party delays in declaring avoidance and the difference between the market and the contract price increases. were principally interested in basing the interest rate not on their low internal interest rates but rather on interest rates in the countries of their debtors. when asking for credit in these countries. Above all. all attempts to find the "proper" rate of interest proved fruitless. no agreement could be reached on whether the cost of credit should be based on the interest rate prevailing in the debtor's or in the creditor's country.[405] The United States delegation proposed to supplement the duty to mitigate damages by permitting other remedies available to the injured party to be adapted or modified in the event losses were not mitigated.[411] Others believed that a special provision on interest was unnecessary because the lost use of the capital could be recovered as damages.[413] .[408] G.[407a] It did not receive a majority.[406] The suggestion concerned cases where the seller produces the machine ordered despite an . the buyer who can neither undertake nor prove a definite cover transaction under Article 75 uses the reasonable time period permitted by Article 49(2) at his own risk. Likewise. The difficulty of determining the "proper" time to declare an avoidance remains therefore.the "taking over" of the goods (Article 76(1) sentence 2).

The obligor is always responsible for impediments when he could have prevented them but. On the other hand.[417] Instead.[416b] but specifies more clearly the risks which an obligor assumes.[419] For example.in particular. therefore.to claim the lost use of capital as damages in the amount of his own costs of credit according to Article 74 rather than to expose himself to uncertainties as to the applicable law and its interest provision. Article 84(1) contains a provision corresponding to Article 78 for the case of the seller's obligation to refund the purchase price after avoidance of the contract. Although it is not explicitly stated. Where the impediments are foreseeable. is based on the expectations and intentions of reasonable parties.[414] Damage claims under CISG remain unaffected even if they exceed the relevant interest rate. therefore.at least in countries with a free capital market .temporarily relieves the debtor of his duty to pay under Article 79(1) and (3). organization. the amount . The terms of the contract will often describe the extent to which the obligor is expected to prevent impediments to performance which lie outside his own area of control.on the basis of Article 7 in conjunction with Article 78 . Exemptions (Article 79) Despite non-performance. If he wishes to restrict his liability. failed to do so. It was decided early on not to let exemptions turn on the question of fault.be able to claim damages for a violation of the duty to refund the price and measure his damages from the time the refund was due and in the amount of his own credit costs. the creditor should also . the obligor "guarantees" his ability to perform. he must generally accept responsibility if he has not disclaimed liability. as in Article 74(1) of ULIS.[416] [page 100] H.[417a] In this sense. and execution.are governed by the applicable domestic law chosen by conflicts rules. the details of the obligation to pay interest .[418] In the case of unforeseeable impediments whose origins are not within his control . late performance or lack of conformity. the obligor is liable even for impediments beyond his control.for example. unforeseeable currency restrictions in the country of the debtor . according to Article 79(1). a party is not liable in damages when he is not responsible for his failure to perform. whether a party supplying goods has .[415] The Convention's interest provision will probably have practical impact only in the exceptional cases where the debtor can claim an exemption under Article 79 for his default.he must take reasonable measures to avoid or overcome the impediment or its consequences in order to claim an exemption. Furthermore. so that a debtor still remains liable for interest payments even if his default is due to an impediment beyond his control and he is. not liable for damages under Article 79. as long as they were either reasonably foreseeable or known to him at the conclusion of the contract. Guarantees can increase the scope of his liability. In the absence of express terms. means that they should be considered to be unavoidable . it will generally be easier and more promising for the creditor . an exemption is permitted only when the impediment to performance is beyond the obligor's control. the parties' promises to perform are to be interpreted on the basis of Article 8: The standard.which. such as when some impediment . disclaimers and limitation can diminish it. despite his control over preparation.[416a] The Convention's provision corresponds to ULIS Article 74(l). It conceives the obligation to pay interest as a general rule. he must specify the particular impediments for which he will not be liable. Otherwise.The present version of Article 78 is the result of a compromise reached at the Plenary session and based upon a proposal submitted by a working group.

the foremost being the fear that a release from the obligation to perform could also extinguish collateral rights and secondary claims such as interest. the Federal Republic of Germany proposed the clarification that despite Article 79(5) (restriction of the effects of exemption on damage claims) the existence of grounds for exemption should extinguish the obligor's obligation to perform.[427] Finally. provided for the release of the obligor's duty to perform in the event of temporary but lengthy impediments if the circumstances had fundamentally changed in the meantime. since the obligor generally guarantees his financial capability to procure and produce the promised goods.[421][page 101] One of the controversial points in the preliminary UNCITRAL discussions was whether economic difficulties .[425] corresponding to ULIS Article 74(2).assumed the risk of fluctuating markets or risk of war must. There were several reasons for the rejection of these proposals. but under very narrow conditions .[420a] On the other hand. Moreover." Regarding the first. subcontractors and other "third persons.[422a] As a rule.[420] Though the circumstances permitting exemption cannot generally be equated simply with "force majeure". increased procurement and production costs do not constitute exempting impediments.[426] There was [page 102] special apprehension that the Norwegian proposal to Article 79(3) intended to introduce the "theorie de l'imprevision" into the Convention)."unaffordability" . In my opinion.[423] In Vienna.or whether it did not arise until later. it may be hoped that the general belief expressed in Vienna that a judgment for a physically impossible performance would be neither sought nor obtained should lead to a reasonable limitation or Article 79(5). in cases where obligations are physically impossible to fulfill.the "pre-existing impossibility" or "pre-existing inability" of German law .[429a] Especially in the case of incurable defects for which the seller may not be responsible [430] under Article 79(1). the rule on exemption produced primarily two controversial issues: The first involved the scope of the rule. however.impediment also includes "unaffordability". In the end. on the basis of Article 28.[422] In the end. there was the fact that. It cannot be concluded.[424] Comparable Norwegian proposals. be decided with reference to the actual case and the particular contract. 1 of the European Convention on Jurisdiction and the Enforcement of Judgments in Civil and Commercial Matters). a German court could. Above all. therefore. domestic legal doctrine -. recognition of a foreign judgment that ordered specific performance of an impossible act would conflict with German public policy (328(1) No.[428] The rejection of the German and Norwegian proposals [429] can be interpreted to mean that an impossible obligation remains intact and is actionable. 4 Code of Civil Procedure. it is irrelevant whether the impediment existed before the conclusion of the contract . such fines or penalties could be the equivalent of granting damages and could even surpass them in amount. the second the scope of liability for acts of employees. on the basis of the change in terminology from "circumstances" in ULIS Article 74(1) to "impediments" that an impediment in the sense of Article 79(1) of the Convention is only an occurrence that absolutely bars performance. efforts were made to define them narrowly. there is a danger the domestic courts will set fines or penalties based on their rules of procedure for failure to follow an order for specific performance. in the end. Article 27 No. . dismiss a complaint asking for specific performance in such a case. however.constitute a ground for exemption."impossibilium nulla est obligatio" would generally prevent a demand for performance anyway. the general view was probably that both physical and economic impossibility could exempt an obligor. as long as the obligee does not declare an avoidance on the basis of a fundamental breach.

This exemption will apply only in those very few cases when the seller could neither choose nor control his auxiliary suppliers and it was not possible to procure. three situations must be distinguished. that "unaffordability". where a third party does not directly fulfill the obligor's duty to the obligee. In particular. Article 79(2) therefore increases the obligor's liability for third persons who fulfill contractual obligations directly to the obligee. the obligor is always responsible for his own personnel. the seller's responsibility for his suppliers in Article 79(1) appeared sufficient and appropriate. the seller is therefore not liable for secondary suppliers when they are beyond his control and their failure could neither be contemplated nor cured. The delegation from the Federal Republic of Germany did not support such an unconditional guarantee because it believed that exceptions were needed for cases in which the seller did not choose the secondary supplier and could not exert influence on him. produce or repair the goods in any other manner. for the obligor himself.[434] but. unforeseeable and beyond his control (Article 79(2)(a) in conjunction with paragraph (1)) and the third party personally meets the requirements for exemption from Article 79(1) (Article 79(2)(b)). but is presented in a more detailed manner in Article 79(2). i. and. explicit limitations on such liability should probably be written into the contract. Second.the obligor can only be exempted where the failure was. the possibility for exemption [432] remained the same as provided in Article [page 103] 65(2) of the 1978 Draft Convention."performance would be so radically changed as to amount to the performance of an obligation quite different from that contemplated by the contract". Finally. as long as he organizes and controls their work. Deficiencies and poor performance caused by individual workers. First. whether a strike is "beyond his control" or must be regarded as the employer's responsibility depends on the circumstances and the extent of the strike as well as the labor laws of the particular country. constitutes a ground for exemption.[436] . On the other hand.[433] In the application of Article 79. other grounds for exemption can arise during the existence of the original impediment. even where it first appears at a moment when performance is postponed due to another temporary impediment..[431] Practically speaking. the Scandinavian states wanted the seller in such cases to guarantee performance unconditionally. was discussed in Vienna on the basis of a Norwegian proposal [435] and finally rejected. of course. where third persons are involved. Article 79(3) will mainly concern [page 104] damages caused by delay. under Article 79(1). do not exempt the seller from liability. therefore.e. The importance of this provision is reduced by the fact that the obligor's duty to perform remains unchanged in the event of exempting impediments. A temporary impediment constitutes grounds for exemption only for the length of its duration (Article 79(3)).as stated in ULIS Article 74(2) .[431a] The developing countries. that.Article 79(2)'s rule on responsibility for "third persons" was even more controversial. In the end. If he did so -. In other cases. subcontractors who are engaged by the seller to perform directly to the buyer. One can assume. Article 79(1) remains the controlling provision in cases where the third party's performance is a mere precondition for the fulfillment of the obligor's obligations. for example. though. which will then finally discharge the obligor under Article 79(1). also discharges the obligor from his liability for damages. Whether the exemption should require a change in circumstances so that .[433a] Nevertheless.a situation which corresponds to § 278 sentence 1 of the German Civil Code -. even more. the discussion revolved around the liability for secondary suppliers and subcontractors. Practically speaking. such as when the supplier had a monopoly or had been chosen by the buyer. the seller's liability depends on whether he engaged these persons in fulfillment of his contractual obligations to the other party.

Whether an exemption from liability under Article 79 also constitutes an exemption from contractual penalties and liquidated damages provisions depends on the contractual prerequisites for such secondary claims and the applicable domestic law. the buyer is presumably responsible for the acts or omissions of his personnel. therefore. thus leading to its (further) impairment or complete destruction is not attributable to the buyer's behavior as long as he could not have recognized and prevented it.for the impairment he caused. The German Democratic Republic's proposal [438] to exempt from contractual penalties and liquidated damages parties whose liability for damages is exempted under Article 79 was therefore rejected. the buyer is barred from avoiding the contract or demanding substitute goods. In both cases. because he cannot return the goods. Additionally.in the sense of Article 79 -. resembles ULIS Article 74(3). First. Effects of Avoidance (Articles 81-84) 1. under Article 82(2)(a). give notice of the impediment and its effects on his ability to perform. Therefore. he must compensate for damages caused by the lack of notice. These provisions apply both to cases of avoidance and to cases where the buyer demands a substitute delivery and must therefore return the goods received. the buyer must be able to return the goods received in "substantially the condition in which he received them" (Article 82(1)). Loss or damage to the goods does not in all cases eliminate the right to avoid the contract or to demand substitute goods. an obligor will generally be excused from liability on the basis of Article 79(1). Of course. the buyer's right to demand substitute goods or to avoid the contract is not affected. The ability to return the goods is. In such cases. Second. his other remedies under the contract or the Convention (damages.The party who is unable to fulfill his obligations must. the fact that a defect causes further deterioration of an item.[443] In any case. according to Article 79(4). This provision is based on a proposal by the German Democratic Republic [440] which.[444] . insubstantial damage is irrelevant. a buyer may avoid the contract or demand substitute goods if the damage is not due to the buyer's act or omission. a prerequisite for avoiding a contract or demanding substitute goods. But Article 80 reaches much further.[441] Since Article 80 exempts all claims against the obligor. He also may not reduce the price for defects caused by [page 105] mistakes in the drawings he provided. where defects have caused the damage or loss. If. If the buyer frustrated performance. the obligor is excused only to the extent of the hindrance caused by the obligee.[442] J. according to Article 82(1). it gained importance when a proposal was rejected which would have extinguished the right to demand specific performance in a case where Article 79 exempts a party for liability for damages.[439] I. The obligee need not be responsible -. reduction of price) remain unaffected (Article 83). The notice is effective upon receipt (Article 79(4) sentence 2).[437] If a party fails to notify. even if he would otherwise be exempt. Prerequisites The provisions from the 1978 Draft Convention concerning the effects of avoidance were adopted without change in Vienna as Articles 81-84. he can neither demand specific performance nor declare an avoidance. such as by not providing drawings required for production or by not procuring an import permit. in its aim. Failure of Performance Caused by the Other Party (Article 80) Article 80 releases a party from his obligations where the other party has impaired his performance.

These questions do not turn on whether the buyer was at fault.On the other hand.[445] A further exception involves deterioration or consumption of the goods resulting from the mandatory examination of the goods by the buyer as required in [page 106] Article 38 (Article 82(2)(b)). damage claims for breach. destruction caused by an accident or force majeure could be attributed to the buyer -. are not affected by an avoidance (Article 81 sentence 2).especially -. Obligations After Avoidance An effective avoidance of the contract releases both parties from their obligations (Article 81(1) sentence 1) and obligates the parties to make restitution of whatever has been supplied or paid under the contract (Article 81(2) sentence 1). the acts of third persons can only be attributed to the buyer if his act or -. Otherwise.[449] In contrast to the seller who is bound to pay interest on the refundable price. liquidated damages and penalty clauses. or ought to have discovered. An avoidance only "redirects" the main obligations of the contract. Article 84(2) restricts the duty to return benefits in subparagraphs (a) and (b) to those cases in which the buyer either must return part or all of the goods or the buyer derived benefits before the goods were destroyed.g. Gaps . however. Restitution is to be made concurrently (Article 81(2) sentence 2). If the seller is obligated to refund the price. dispute-settlement mechanisms (arbitration clauses). In addition.from the date on which the price was paid. Under Article 81. would have permitted the buyer to keep defective goods until the seller delivers substitute goods. contrary to trade practices.his omission has made it possible for the third persons to affect the goods.. permit the restrictive interpretation that the buyer must not merely have provided the opportunity for third persons or force majeure to affect the goods but also have increased this chance by his act or omission. Finally the buyer retains his right to avoid or demand substitute goods if he sold the goods in the normal course of business or has consumed or transformed the goods in the course of normal use before he discovered. his taking possession unless the goods would have been destroyed while under the seller's control as well. However the rule of concurrent performance does not apply to restitution by the buyer who only demands substitute goods (instead of declaring an avoidance).[447] The question of whether the buyer's restitution obligations to the seller can prevail over claims of his other creditors are matters to be decided by domestic law. Restitution of the Benefits Received Article 84 obligates the parties to return all benefits of possession (profits and advantages of use). The Conference rejected a Norwegian proposal which.[448] Domestic law also governs the details of the transfer in restitution. On the other hand. and (complete) restitution therefore has become impossible.[446] 2.in an amount to be determined by domestic law -. more than mere physical causation is probably required before the buyer's remedies are lost. the buyer is only obligated to return benefits that he actually derived from using the goods..e. in my opinion. Its special restrictions are not displaced by Article 81(2). he must also pay interest -. 3.[page 107] 4. it does not void the contract ab initio. the lack of conformity (Article 82 (2)(c)). The words "due to". etc.

The buyer. The Obligation to Preserve the Goods and the Right to a Self-Help Sale (Articles 8588) 1. One matter left open is the buyer's responsibility when the goods to be returned are destroyed after the effective date of a declaration of avoidance or demand for substitute goods. in cases where the seller is obligated to hand over the goods only in exchange for payment. a damage claim for lost use of capital should be available in addition to or instead of interest payable under Article 84(1). If a refund is delayed. Article 86(1) sentence 1 also requires him to protect the goods from insubstantial deterioration. recourse may not be made to domestic law. In my opinion. if the goods have been sent to the buyer or to another location and placed there at the buyer's disposal.Like ULIS.[457] Article 87 permits the goods to be stored at the cost of the other party. Thus. take them into custody and preserve them (Article 86(2) sentence 2). if the particular prerequisites of Article 86(2) sentence 1 are met. Furthermore. Article 84(2) shows that the Convention does address this subject.[456] Even though the buyer will generally protect the goods because he otherwise loses the right to avoid the contract or to demand substitute goods if he causes the goods to be lost or damaged (cf.such steps as are possible and reasonable -. The seller has the right to retain the goods until he has been reimbursed for his expenses (Article 85 sentence 2). the Convention does not answer the question of whether the buyer who is bound to make restitution is liable for benefits he could have derived from the goods but did not. If the item to be returned is substantially damaged or destroyed. and if neither the seller nor someone authorized on his behalf is present at the destination. the risk of loss has already passed to the buyer (cf. even though the seller still has control over the disposition of the goods.[453] The place of performance for transactions following avoidance of the contract should be determined according to the provisions governing the performance of contract obligations. in making payment. the seller in possession must take appropriate measures -. the buyer must. is entitled to retain the goods until he is reimbursed for the expenses incurred (Article 86(1) sentence 2). claims based on failure to derive benefits should therefore be denied. Article 82(1)). the gap-filling rules of Article 7(2) should be preferred to a hasty retreat to domestic law.[451] Similarly. A comparable situation can arise when the buyer has received the goods but intends to return them.to protect the goods against loss or damage (Article 85 sentence 1). even when he has not taken possession of the goods. The Self-Help Sale . In my opinion. since there is no gap.[454] On the other hand. 2.[450] There is also no provision concerning where restitution must be made. too. Articles 82 and 84(2)(b) make it clear that the impossibility or inability to make restitution are matters governed by the Uniform Law for International Sales. the Convention does not completely regulate the effects of an avoidance or justified demand for substitute goods. K. the seller's remedies should correspond to those available to the buyer when the duty to deliver is not fulfilled. The Obligation to Preserve the Goods (Articles 85 and 86) If the buyer delays in taking delivery or.[452] Damage claims and the right to a reduction in price are of especial practical interest. Article 69(1)).[page 108][455] The seller's duty to preserve the goods applies especially to those cases in which. the Convention contains no provisions that could serve as a basis for the duty to derive benefits from possession of the goods and that would support claims for the failure to do so.

If he stores and sells the goods himself. however. Article 99(1). in the meaning of this provision. notify the other party of his intentions. the party has not only an option of selling the goods but also a duty to take reasonable measures to do so. acceptance. however. The Convention was open for signature until September 30. when a party has a duty to sell perishable goods. he need only inform the other party to the extent notice is possible (Article 88(2) sentence 2).[463] Article 100 provides the necessary transition rule for contracts which are formed during the period when the Convention comes into force in the individual Contracting State. . Article 99(6) provides that their ratification. who is designated as the depositary for the Convention (Article 89).[461] [page 110] VII. .[462] The instruments of ratification. The commitment which results from signing the Convention is. in taking possession of the goods or in taking them back or in paying the price or the cost of preservation"). the party who is entitled to sell the goods is basically free to sell the goods in any way he chooses.Article 88(1) gives the party who is bound to preserve the goods the option of selling them. The party entitled or obligated to sell the goods can retain the reasonable cost of preserving and selling the goods from the proceeds of the sale (Article 88(3)). domestic law may exert an influence. a notice giving a date for the self-help sale can be sent before expiration of the "unreasonable delay" which is a basic prerequisite for such a sale ("an unreasonable delay . which is usual for this kind of convention. acceptance. acceptance or approval by the national legal authorities empowered to do so. so that. The danger of deterioration. After lengthy debates in Vienna. For parties to the Hague Conventions of 1964. approval or accession does not become effective until their denunciation of the Hague Conventions. or approval are to be deposited with the Secretary-General of the United Nations (Article 91(4)). 1981 at the Headquarters of the United Nations in New York (Article 91(1)). acceptance. then. The party who is entitled or bound to sell the goods must.[458] In contrast to § 373(2) of the German Commercial Code. At least ten instruments of ratification. . Final Provisions (Articles 89-101) A. applies only to physical deterioration and not to the threat of a drop in the market price. however. or accession must be deposited in order for the Convention to enter into force. indirectly. approval. The qualification "by any appropriate means" allows. A right to denounce. In General Part IV contains the public international law framework of the Convention in Articles 89-101. by analogy.[459] Presumably. subject to ratification. If the goods spoil easily or if the preservation cost would be unreasonably high. as described in paragraph (2).[460] On the other hand. is contained in Article 101. of course. the word "reasonable" was inserted in paragraph (1) to qualify the notice. he must be allowed to charge an appropriate compensation for these services. for differences in the execution of self-help sales in various countries on the basis of domestic rules or customs. The Convention enters into force on the first day of the month following the expiration of twelve months after the date of the deposit of the tenth instrument. with the goal of making it clear that [page 109] the notice should afford the other side the time and opportunity to avoid the self-help sale. who must denounce the Hague Conventions either before or simultaneously with their acceptance of the Uniform Law for International Sales (Article 99(3)-(5)).

Article 90 establishes the priority of international agreements which have already been or may be entered into and which cover matters regulated by the Convention. acceptance. Article 95 provide the option. comparable to Article V of the Hague Conventions relating to a Uniform Law on the International Sale of Goods.[464] Regarding the experience of the Hague Conventions in the United Kingdom. The reservation permitted by Article 96 making inapplicable the Convention's provisions on the freedom of contractual form to contracts concluded by a party whose place of business is in the reservation state is. as noted above. would violate the state's [page 111] public international law obligation under Article 98 to which a state commits itself by signing the Convention.[465] Under Article 92. accepting. except when the Final Provisions explicitly provide for them. and to limit the effect of the signing. Article 94 makes it possible to exclude the applicability of the Convention to contracts between parties from states which have the same or closely related sales laws. it is fortunate that these proposals were not successful.[467] Article 94(2) and (3) addresses the same problem where the legal system of a Contracting State is the same or closely related to that of a non-Contracting State. of a reservation with regard to the application of Article 1(1)(b).Finally. or acceding to the Convention. Reservations Article 98 states the basic principle that reservations are not permitted when signing. gives regional uniform laws precedence over the Convention. the Convention may be adopted either without Part II or without Part III. the result of a compromise with the states for which the continued validity of their [page 112] domestic statute of frauds was an absolute precondition to their adoption of the Convention. This provision takes into account the request of the Scandinavian countries that do not wish to adopt the provisions in Part II on formation of contract.[466] The provision is designed to enable federal legislatures to request the legislative bodies of the individual member states (or other territorial entities that have authority to regulate matters governed by the Convention) to agree to the terms of the Convention. discussed above in Chapter III A. ratification. where ULIS apparently was never applied in actual practice. several common law countries proposed to include a reservation clause. an important factor for the Benelux countries and apparently for Australia and New Zealand as well.[468] . ratifying. A reservation. which would make the Convention applicable in a reservation state only at the parties' option (the so-called "opting-in" solution). Again at the Vienna Conference. B. This reservation. Article 93 (the so-called "Federal-State Clause") takes into consideration the peculiarities of federal states in which the individual member states have legislative power over the matters covered by the Convention. a reservation state. as well as any other change or restriction of the text of the Convention. which corresponds in its function to Article II of the "Convention Relating to a Uniform Law on the International Sale of Goods" of 1964. approval or accession to those member states or territorial entities that are willing to accept the Uniform Law for International Sales. approving.

jointly produced a semi-official German translation of the Convention in 1983. at least for the exchange of goods within the European Community. While various provisions of the Uniform Law for International Sales may give rise to criticism. it is regrettable that the Hearing before the Committee on Foreign Relations of the United States Senate in the Spring of 1984 yielded no positive results.Reservations are to be made at the time of signature. on the whole.[470] The Protocol containing the adaptation was added to the Convention as Annex II. and many countries that trade with the U. Limitation Period As discussed above. would signify a breakthrough. ratification. even after adoption of the Convention. the fate of the Convention remains uncertain. However. in order to take into account later developments. Ratification by the Federal Republic of Germany is still pending. The heart of the regulation is the uniform limitation period of four years (Article 8). great hopes rest on the United States: Ratification by the U. the Convention should soon enter into force. are expected in 1986. Nevertheless. and Switzerland -.S. would undoubtedly follow. the 1974 Convention on the Limitation Period was re-drafted by the Second Committee in Vienna and adapted to the Uniform Law for International Sales. the reservations available in Articles 94 and 96 can be made at any time.Austria. by introducing the Uniform Law for International Sales. the Federal Republic of Germany. approval or accession.S.[page 114] Final Remarks While this English version is in the making. in particular those of the Scandinavian countries. it is a modern law that will serve its practical purpose. The details of the Convention on the Limitation Period are not within the scope of this book. It is another good sign that the four German-speaking countries -. The Final Provisions of the Convention on the Limitation Period were also altered to fit the corresponding provisions in the Uniform Law for International Sales (see Articles IIIVI of the Protocol). final rejection of the Convention by the U. four years after the publication of the original.[471] In light of this rather generous limitation period. there are grounds for hope: To date. The limitation period also applies to claims based on lack of conformity. Since the responsible EC authorities in Brussels apparently show little interest in motivating the member states to adopt the Convention. On the other hand. acceptance. apparently because rather strong objections were voiced against CISG.[469] The form of the reservation and the time when it becomes effective are governed by Article 97(2) and (3). On the other hand. it is not clear whether all EC member states are willing to lay a uniform legal foundation. the Convention has been ratified by 9 states. Above all. The Convention's sphere of application had to be altered in order to make the prerequisites for applying the 1980 Convention and the Convention on the Limitation Period congruent (see Articles I and II of the Protocol and Articles 3 and 4 of the Convention on the Limitation Period). and since additional ratifications.S. the German Democratic Republic. would mean a severe setback to any unification in the field of international sales law. the exclusion of warranty claims based on a failure to give timely notice under Article 39 becomes much more important. it is based on thorough preliminary work in the field of comparative law and is the result of a serious effort . A reservation may be withdrawn at any time (Article 94(4) and (5)).[page 113] VIII.

With respect to this first initiative. . then. (Complete bibliographic information for works frequently cited appears in the Bibliographic Notes. That would be unfortunate and would justifiably raise the question of whether such a unification of the law is really necessary. In my opinion. Rabel's work was often praised. the experiences gathered during the work of UNCITRAL and the deliberations at the Vienna Conference have shown that the greatest obstacles to unification do not lie between states with different social and economic systems.S. Besides. Its wide dissemination would not only ease the legal requirements for the sale of goods between countries which have ratified the Convention.) 2. delegate. where each holds convictions.G. spoke of Berlin as the "cradle of the unification of the law of sales". it would be a mistake to take consolation from the hope that the failure to achieve a uniform sales law under the auspices of the United Nations would clear the way for a unification of sales law within the European Community. It remains to be hoped that fears of the Convention's failure are unfounded. about the superiority of its own solutions. If the Convention does not come into force.R. the time has probably not yet come to advise exporters and importers to adapt their standard contract terms to the CISG. in the European Community.[472] However. For example. the chance of achieving a world-wide unification of the law in this area would presumably be lost. the U. There is little chance that a uniform sales law for the European Community can be achieved by extending the number of Contracting States to the Hague Conventions. 1. particularly third world and socialist countries. in Vienna. it even suggests that parties should agree on its application to international sales contracts. see Dölle introduction at XXXI. Farnsworth. helped to surmount these barriers. the general difficulties of access to foreign legal materials are surmountable and constantly diminishing.[page 115] rooted in centuries of legal tradition. Even if it is not ratified by all EC member states but is accepted by many others. for the forseeable future. or its delegation. it is to be feared that the profound differences could only be overcome through compromise on the basis of the lowest common denominator. It is hardly to be expected that such a large number of countries with different economic and social structures could once again be brought together for such fruitful and result-oriented collaboration. but rather between the countries of Western Europe. Prof.to find the best practical solution for each problem. it should be considered a success.[page 116] FOOTNOTES * The author of this book participated at the Conference as a member of the delegation from the Federal Republic of Germany. but it would also be suitable as a contractually stipulated law for sales contracts between parties in countries where the Convention has not entered into force. Without the persuasive power of large majorities that. Indeed. The fact that the provisions of the Convention were formulated not only by representatives from the industrialized countries but also by delegations from third-world countries should pave the way for the Convention. particularly since. The views expressed here are personal to the author and do not necessarily represent the position of the F.

the information in 5 RabelsZ 207 (1931). 17 RabelsZ 212 et seq..D. (1968-1970).A. 6.R.. 65 et seq. see also Herber. 1974 BGBI. Italy. Frank A. 8. Acta Juridica at 159.. 1966). Riese. 11. Article V. United Nations Commission on International Trade Law. 9.3. 7. (on the non-participation of the U. Haager Konferenz at 101 et seq. Maskow (G. 148. (19681970).B. Orban and submitted to the Committee on Foreign Relations of the U.S. Herber. For details of the Working Group and the proceedings of UNCITRAL and the appointed working group. Maskow at 45. see Hearing at 44. For the history and reasons behind the division into two conventions. They show the increasing practical importance of this uniform sales law. See Convention Relating to a ULIS. (commenting on the Draft Convention on Sales). cf. Senate. Die Haager Konferenz at 1 et seq. the Netherlands. ignores the existence of about 180 European decisions concerning ULIS. 5. at 317 et seq. See von Caemmerer at id. see von Caemmerer. Probleme at 122. Winship. Herber. Von Caemmerer.B. UN-Übereinkommen at 601.(1952). . cf. 579. at 43-44. (1929). (for German judicial opinions). See Réczei. see 1 UNCITRAL Y. Res.. Luxembourg. Scope. that ULIS is the product of creative work rather than of compromise. Israel. (1968-1970).) criticizes ULIS and ULF on the merits for being "more of a common denominator of different national legal systems than a regulation which first and foremost takes into account the requirements of contracts for the international sale of goods". 5a. 1974 AWD/RIW 577 et seq. 12.. see 1 UNCITRAL Y. 162 et seq. the U. the F.. 10.). criticism of the Hague Conventions. Secretariat's Commentary at 7 et seq. Winship. see also Herber.S. See G. I would agree with Réczei. The last two nations adopted the reservation which makes the law applicable only if chosen by the parties. 1976 RIW/AWD 125-26. The Conventions have been ratified by Belgium. For U. 7 UNCITRAL Y. 339 et seq. supra note 11. Teil II 146. on the other hand. a permanent commission instituted by the UN General Assembly on a motion by Hungary. Farnsworth. History. Scope at 1-13. Herber. von Caemmerer. (1965). the reports by Rabel in 9 RabelsZ 1 et seq. 1974 AWD/RIW 578-79. See Dölle introduction at XXXI et seq.S. See Date-Bah. Riese. Der Entwurf at 16 et seq. (1976). Commentary at 49 et seq. See Reinhart 1 et seq. San Marino.K.B. The telex from the German Federation of Industries (Bundesverband der Deutschen Industrie). Haager Konferenz at 101 et seq. Honnold. which was attached to the written statement of Mr. and Gambia. (1935). see also the information in 3 RabelsZ 405 et seq. 317. 89 et seq.B. 2205 (XXI) (Dec. 1977 RIW/AWD 314 et seq. 13. Die Arbeiten des Ausschusses der Vereinten Nationen für Internationales Handelsrecht (UNCITRAL).. in 1 UNICITRAL Y. 78 et seq. 17. 4...G.R. cf.

Peru. A/Conf. France. 21.2.2. and Zaire.R.14. Hungary. A/Conf. Kenya. 97/8/Add. Colombia. Germany. Australia. A/Conf.B. A/Conf. Luxembourg. 15 et seq. Greece. For the merger of the law of sales and the law on the formation of contracts.G. 8 UNCITRAL Y. Byelo-Russian Soviet Socialist Republic. Iraq. Egypt. German Democratic Republic. Costa Rica. International Institute for the Unification of Private Law (UNIDROIT). 22. (1977). For the reasons for their abstention. Ghana. Turkey. 97/8/Add. Brazil. 25. Federal Republic of. A/Conf. A/Conf. China. Singapore. Finland.D. 28. Accesions (until 1985): Argentina. Lesotho. China. Colombia. 97/8. Venezuela was represented by an observer. Tunesia. Signatures: Austria. Philippines. Italy. 5 et seq.5. 23. . United States of America. Kenya. Belgium. see Eörsi. Lybian Arab Jamahiriya. Denmark. Finland. Pakistan. 97/8/Add. Singapore. as were the following international organizations: The World Bank. Panama. Cyprus. 27. (1979) and discussed in depth in Huber at 413 et seq. Poland.. Printed in 43 RabelsZ 528 et seq. see Herber at 602. China. Nigeria. Portugal. Ghana.). Uruguay. 15. United Kingdom of Great Britain and Northern Ireland. Ireland.R. Syria. Chile. Argentina. Sweden. Panama. F. Norway. 26. 24. 16. Spain. Austria. Israel. Republic of Korea. Egypt. 17. Netherlands. 97/8/Add. Ecuador. 97/8/Add. Czechoslovakia.2. Poland. Sweden. Venezuela. Thailand. Mexico.4. Rumania. Denmark. Herber at 602. India. Iran. Burma. Ukranian Soviet Socialist Republic. Yugoslavia and Zaire. Problems at 311 et seq. Turkey. 97/8/Add. A/Conf. 20. Union of Soviet Socialist Republics. 19. Canada. Hungary..R. Japan. Burma. Bulgaria. Bolivia. Peru. Italy. USA. G. A/Conf. Central Office of International Railway Transport. Norway. 97/8/Add. Chile. The Hague Conference on Private International Law. Netherlands. 97/5 (= O.3. Thailand. European Communities. A/Conf. Bank for International Settlements and the International Chamber of Commerce. Iran.1. 29. A/Conf. 97/8. Jugoslavia. Czechoslovakia. 18. Switzerland. Council of Europe.

36. Article 65 (sale to specifications). (a critical view regarding the details). see Articles 49(1)(b) (fixing an additional period of time only for a failure to deliver). or whether it simply leads to a "hidden application" of private law rules in regard to the application of the uniform law. The question that was much debated in connection with ULIS. 97/9 (= O.). 37. 63(1). 34. namely whether that and the supplementary provision. Articles 46(3) sentences 1 and 2. 97/7. A/Conf. seems to be theoretical and fruitless. 39. infra at IV A. For examples of such special regulations. and "soft" debtor-friendly regulations on the other. Article 50 (reducing the price only for lack of conformity). 79(1).. 49(2). A/Conf. 97/6. e. Scope at 1-24. It should be noted that the term "reasonable" was often a compromise between the need for "hard and fast rules. 38. 88(1). "excluding" the application of private international law. Ipso Factor Avoidance at 85 et seq. Hartley. The positions of the other delegations also showed that they were familiar with this work. cf. P. 85 sentence 1. 87.30. But see Hellner. 41. cf. cf. 71 et seq. 73(2). really displace it. Anwendungsgebiet at 13. A/Conf. 2 vols. Huber at 416. .). 41b. but see Hellner.g. See also Löwe." on the one hand. 97/8/Add. infra note 49a. 86(2) sentence 1. 41a.6. (1978). ULIS Article 2. 1979). 40. 65(2). 88(2) and 88(3). 86(1) sentence 1. Huber at 413 et seq. 35. 33. See Huber at 417 (reasons for abandoning ipso facto avoidance). Articles cited without further designation refer to CISG. UNCITRAL'S interest in barter and barter-like transactions indicates that they are regarded as outside the scope of the Convention. A/Conf. 72(1). Schlechtriem. 32. A Study of the Uniform Law of the International Sale of Goods including the Uniform Law on the Formation of Contracts for the International Sale of Goods (The Hague Conventions 1964) and the Draft Convention on Contracts for the International Sale of Goods prepared by the United Nations Commission on International Trade Law (Oct. 77. 75.R. See Winship. 1979. Etudes Comparées des Conventions de la Haye du 1er Juillet 1964 sur la Vente Internationale des Objets Mobiliers Corporels et la Formation du Contrat de Ventes et Projet du Convention sur les Contrats de Ventes Internationales de Marchandises preparées par la Commission des Nations-Unies pour le Droit Commercial International (Oct. 31. 42. Einheitliches Kaufrecht -Wissenschaftliches Modell oder praxisnahe Regelung? 14 et seq.. Kahn. Outsider's View at 71 et seq.

In cases where both parties do not have their places of business in Contracting States. 1977 RIW/AWD 317. 44. In such a case the Hague Conventions are only invoked on the basis of domestic conflicts rules. See A/Conf.'s motion to reject the proposal. This result was not intended and would have been difficult to include in the Conference's mandate. Winship examines 54 permutations under Article 1(1)(b) but concludes that "there are only two questions which raise difficulties". Article 1(1)(b) modifies internal conflicts rules and would yield the abandonment of special conflicts rules for contract formation. 48. this revives the specters which were raised in conjunction with the Hague Conventions: If two parties with places of business in different non-Contracting States form a contract in a Contracting State.1/SR. This is unlikely. It is not CISG that is the stumbling-block but rather the weakness of the contact which determines the controlling law. 1979/C.2 at 5 §§ 32-33 (= O.and others . even though to a considerably lesser extent. Compare also Volken. The Hague Convention on the Law Applicable to International Sale of Movable Goods of 1955 can thus also lead to application of the Convention. Appendix. 97/8. but cf. contra Winship. But the domestic sales law of the Contracting State would be even more alien. 29 with references to the Secretariat's Commentary. 440) (position of the observer from the Hague Conference for Private International Law). This choice would now include the Convention instead of the domestic law of the Contracting State. Lausanner Kolloquium at 15. Scope. Of course. which is alien both to the court and to the parties. and if disputes then arise in a third non-Contracting State whose conflicts rules make applicable the law of the state where the contract was formed. See Herber at 603.R. Honnold. Naón fears that Article 1(1)(b) will lead to forum shopping. Lausanner Kolloquium at 28. 48a. Presumably the Convention would already be applicable on the basis of article 1(1)(a).motivated the F.43. The same difficulties may arise with the Hague Conventions and on the basis of Article 1(1)(a). See also Herber at 603 ("As a rule it is expedient for a state that has ratified the Convention to apply it to all international sales contracts" (translation).2/SR. This reservation . the court must apply the Convention. 6 and A/Conf. For the details of the discussion. 49a. See A/Conf. provided the private international law of the non-Contracting States makes applicable the sales law of a Contracting State which applies Article 1(1)(b). Scope. 97/C. 237). Compare Huber at 424 (approval) with Herber at 603 ("a regrettable expansion"). Forum shopping is favored by conflict-of-law rules that give the plaintiff the choice between several domestic laws. cf. The "unforeseeability" of the applicable law (and of the applicability of the Convention) results rather from the uncertainty of national conflict-of-law rules.R. 46. Article 1(1)(b) leads to the application of CISG not only by the courts of Contracting States but also by courts of non-Contracting States. at 1-28.1 at 3 (= O. S. also Löwe. Commentary § 47 (some domestic laws are well-suited to international sales transactions). 49. 50. According to Huber at 423. See Winship. see also Herber.R. See supra note 43.G. 47. . 45. see the summary reports of the Conference.

the vote was 25 in favor. so that reference by the conflicts rules only to the Convention's provisions on formation of contract should not raise any insurmountable difficulties. In my view. In an alternative motion (A/Conf. D. Honnold at 227. 28. 97/C. at 1-27. Such states. See also Lausanner Kolloquium at 36 (Farnsworth).)).R. 97/C.R. See 8 UNCITRAL Y. see Winship. A/Conf. Scope.1 at 5 (= O. 53. See A/Conf. In UNCITRAL the question was raised whether nationality should be introduced as an (additional) prerequisite for the application of the Convention. Commentary § 41. Huber at 462 note 30 (further references). 54. Despite the reservations expressed by the F. 1985.1/SR. 237) (statement by Kopác (Czechoslovakia)). not to make this reservation. and 10 abstentions. 26 § 14 et seq. 0 no votes and 1 abstention.7 and L. with regard to Article 1(1)(b). 56. Moreover. the inapplicability of the Convention would follow because only the agent would actually be a party to the contract. See A/Conf.D. 60.D. (1977).R. 4.R.2 at 2 et seq. Löwe.R. Attempts by Czechoslovakia in the Second Committee to restrict the application of the Convention to contracts between parties in Contracting States were unsuccessful.).).6 (= O. I would welcome the decision by the F.1.B. when they become Contracting States.1 at 3 (= O. 7 against. However. 57. 1986 RIW 214.G. this thought was not pursued because of the difficulty in determining the "nationality" of legal persons. . Convincing Winship. do not apply their special foreign trade laws where the parties to a sales contract have their places of business in a Contracting State. 55. But see infra at III. Reinhart at 1-5.G. See Judgment of Dec. 97/C. 97/C.D. The motion was rejected. A/Conf. the F. then it will apply to sales contracts between parties that have their places of business in these states on the basis of Article 1(1)(a).R. the Secretariat's Commentary mentions the case of a party who is an agent of an undisclosed principal whose place of business is in a different state. tried to clarify that Article 1(1)(b) should refer to conflict-of-law norms that concern the rights and obligations arising from an already formed contract. 97/SR.1/SR.2/L. 56a. 439). there is a reservation in favor of international conventions.27 (= O.G. and Czechoslovakia adopt the Convention. A/Conf. Lausanner Kolloquium at 15. (discussion of Article 2(a)). 71 et seq. the Convention's provisions on the formation of contract are probably compatible with the substantive provisions of domestic sales law. See Secretariat's Commentary at 39 § 3. 237 et seq. however.R. 59.2/SR. 97/9) (= O. if the G. Under German law.) (statement by Wagner (G.51. See also Honnold.R. 145 and 152). Scope at 28. In the Plenary there were 42 yes votes. 199 et seq. For a convincing analysis.R. 58.R. As an example of the inapplicability of the Convention when the other party's foreign contacts are not recognizable. 52.'s International Commercial Contracts Act § 1(2). In the G.R. In the first Committee.R. (= O.

1/SR. 1b. 3 E. 97/C.). A/Conf.1/SR.1/SR. As to similar conflicts in the application of ULIS arising when mandatory laws regulating the economy contradict the Convention. Conflict of Laws 53 note 12 (1950) (regarding the application of the lex fori to "sales executed and fulfilled at once in one place"). 240 et seq. 97/C. 62. 239) (Finland's argument). Many opposed the provision on the grounds that special domestic rules concern only the transfer of title. pleasure boats should also be included). 63. 64.R. Dölle (Herber) Article 5 § 9 (on ULIS). See also Huber at 422 ("family" and "household" serve only as examples of personal use. (= O. Commentary § 54 (suggesting that. Article 18 § 6 with Dölle (Stoll) Article 74 § 148 et seq. But see also Löwe. . 97/C. 1977 NJW 1632.). compare Dölle (Herber) Article 5 § 19. cf.R. 65. 70.97/C. Norway withdrew its motion on the basis of an alleged understanding that an instalment contract would be interpreted as an exclusion of the Convention. Cf. cf.B.R. 246 et seq. See also A/Conf.) 68.2 at 2-3 (= O. The opposition to the proposal was based on the fact that parties have the right to exclude the Convention. Contra Honnold. 71. See A/Conf.14 (= O. Id. 44-45.1/SR. Judgment of May 11.R.R.61. The problem was recognized by UNCITRAL. 97/5 at 40 (= O. see also A/Conf. 97/C. It is probably not possible to find criteria for excluding the Convention that fully correspond to various cases where consumer-protection laws apply.1/SR.1/SR. 97/8 at 15 (Norwegian motion and reasoning). See A/Conf. 240 et seq.).1 at 6 et seq. at 40 § 8. 69. 66. 72. Abzahlungsgesetz §§ 1a. Rabel. 73. A/Conf. A/Conf.1 at 8 (= O. 237). 239) (justified criticism expressed by Vischer (Switzerland) in Vienna).2 at 2-3 (= O.R. See Huber at 419. A/Conf. See A/Conf.1 at 8 (= O.) (discussion). 55 (1971).1/L.). 74a. 67. Secretariat's Commentary at 40 § 7.3 at 6 (= O. 1977. 97/C. A Norwegian proposal would have excluded questions of avoidance in instalment sales from the sphere of application of the Convention on the grounds that special domestic laws govern this area. 36 et seq. the problem is still not resolved because the alleged understanding would open the possibility of imputing exclusion of the Convention in all cases in which the parties' agreement is based on types and terms of domestic contracts that are familiar to them. cf. BGH.R. 85). In my opinion. See 2 UNCITRAL Y. 74. 97/C.R. Lausanner Kolloquium at 17. See also Huber at 422 (explaining that auctions are local transactions with no significant foreign contacts. since no distinctions are feasible with respect to different types of aircraft.

See A/Conf. domestic provisions use "indefinite concepts" such as "unconscionable" or "treuwidrig".C. Accord Honnold.1/SR. The Conference thus also avoided the politically sensitive question of rules and guidelines relating to the transfer of technology. Respect for party autonomy belongs to the basic principles of the Convention. a clause limiting recoverable damages to foreseeable losses is in accordance with the principle underlying Articles 74-76 and therefore valid. 83. 127.26 (= O. 83a. 97/C. Discussed infra at III. Remedial Provisions at 9-38.75.1/SR. 241).R.1/L. contra Honnold. see Secretariat's Commentary at 179 § 4 (seller's liability for goods already destroyed at the conclusion of the contract). 97/C. however. Riese.G. 78. 85. Scope at 1-24. even if the standards under domestic law are stricter. As to the 1978 Draft Convention. Dölle (Stoll) ULIS Article 74 §§ 51-52 (with references to comparable domestic rules on validability). 84). Gonzales at 82. 97/C.2 at 3 (= O. Commentary § 59.R. See A/Conf. Honnold. A/Conf. Cf. 84. Secretariat's Commentary at 41 § 2. (= O. See Article 6.5. Secretariat's Commentary at 41-42 § 3. see also Kahn 955 (presumption that CISG is applicable to contracts with a clearly preponderant "service" component as well as to "turn-key" contracts). Vi. See von Caemmerer. If. Probleme at 121 et seq. Commentary § 240. 86.1/L. See A/Conf. See Dölle (Herber) Article 8 § 8 (with additional references). 83b. 84). For example. exclude the application of the Convention to the sales contract.e. Commentary § 60 (arguing that the Convention should apply to the entire agreement).6 (= O. 80. 87. 29 RabelsZ 18 (1965) (on ULIS). 243) (for the positions taken). See infra at VI. 199 et seq. See Winship. cf. 79.26.R. . See A/Conf. 84a. the contractual clause should be measured by CISG and not by domestic law.2 at 9-10 (= O. See infra at IV. 76. 88.97/C.R.B. 78a.). Cf. 77. 81. 82. A reservation of title does not. 97/SR.1. however. See also Ziegel. Iraq had proposed to exclude oil contracts from the sphere of operation of the Convention because OPEC had established special contracts for the sale of oil.R.

3 at 6 et seq. A/Conf. See A/Conf.) (discussion in the First Committee). Huber at 427. 93. (= O.10. 104. 99. Cf.R. See infra at VII. cf.1/SR.). 103a. Australia (A/Conf. Commentary § 73. See Secretariat's Commentary at 44.10 = O.41 (= O. 97/C. 96. 250).4 at 8 et seq. . Cf. 92.) (discussion). to insert the word "implied" at the Vienna Conference was unsuccessful. not arise or be known until the period for making claims against a foreign seller had already passed.3 at 8 (= O. SR. Cf. Honnold. See A/Conf. Judgment of November 11. 101.1/L." The commentators favor implied exclusion. Practically speaking. ").1 at 7 et seq. 247) (discussion). 86). 94. Huber at 426.1/SR.4 at 20.1/SR. 21. Cf. in some cases.R. 4 at 6-7 (reasons for the French proposal). Another attempt by the U. 97/C. 144 et seq. (= O. 95. 90. Commentary § 76 ("normal rules of construction of the contract would apply . A/Conf. See also supra note 90. Schiedsgericht der Hamburger freundschaftlichen Arbitrage. If damages from defective products fall strictly under CISG. See A/Conf. A/Conf.K. 97/8/Add.R.R.2/L. Judgment of Dec. See A/Conf. 97/C.3= O.89. 439) (debates in the Second Committee). based on liability to his customer would.R. A/Conf.R. id. A/Conf. 1978 RIW/AWD 544.1/L.B. 245 et seq.4 at 6 et seq. . Canada (A/Conf. Judgment of April 14.6 at 8.R. id. 51 (= O. .2/SR. 92a. 4 at 6. 1978.32 (= O. BGH. (= O.R. 97/C. 97/C. See Winship. 251 et seq. 103. Accord Honnold. 97/8/Add. 100. Thus was avoided the possibility that an exclusion of the Convention could be "implied by law. See Article 39(2). supra note 52. the concern was not only for the preservation of a doctrinal structure but also for the system that follows the chain of sales back to its origin. L. Cf.1/L. 1985.1/SR. 247). 2 at 2 (= O. 437). 1978 RIW/AWD 337.R. 1975. 97/C. 97/C. 97/C. 86). 91. A/Conf. 97. 102.R. Scope at 1-35 ("an express exclusion should not be required"). 97/C. (= O.R.3 at 3 et seq. OLG Karlsruhe. Magnus at 150 (both with references to the discussion with respect to ULIS).R.1/SR. 98. 85). 86). Naón § 2. 97/C. 9/C. (= O.1/L. A/Conf. then the buyer's or re-seller's claims for damages. 4.

See Eörsi.5= O. See A/Conf. 97/C.1/L. The change was not intended to imply a limitation. 106. General Provisions at 2-72 (discussing the danger of prompt recourse to domestic law when a general principle cannot be found). 109.5 at 2.1/SR. See also Eörsi. 112.1/SR.1/L. 97/C. Honnold.R.22= O." In Vienna. would have represented a violation of the Hague Convention on Private International Law for the Law Applicable to Sales Contracts of 1955.5 at 6 § 30 (= O. General Provisions at 2-9 (arguing that interpretation of the contract and of the Convention cannot be separated "since the Convention is also necessarily interpreted by the parties"). Commentary §§ 100.5 at 8 et seq. 111.1/L. 101 (analogies should be possible).S. Huber at 432. see Farnsworth. refers to the public international law obligations and goals of the signatory states and may not be used for the interpretation and gap-filling of the substantive legal provisions. But see Dölle (Wahl) Article 17 § 51 (concerning ULIS Article 17): "The reference to the general principles is to be understood to include all creative sources. 115. 110a.R." See also id.5 at 4 (= O. 113. but see Bergsten/Miller at 5 ("The change in emphasis . A unification of conflicts law was thereby proposed which. General Provisions at 2-13 for an illuminating analysis. is obvious"). (= O. See A/Conf. See generally Eörsi.R. .105. 87) and then inserted behind "uniformity" as an editorial correction. 255) (statements by Bonell (Italy) in the First Committee). In the 1978 Draft Convention. Field of Application at 185. 97/C. 97/C. . for some states. )" on the basis of proposals by the U. This was argued by Czechoslovakia. See Secretariat's Commentary at 45 § 3 (catalogue). 97/C. contra Réczei.R. § 75: "The judge can seek to fill gaps by examining the legal systems of the most important Contracting States to see if the case has been dealt with and decided" (translation). 113a. A/Conf. Cf. A/Conf. 252) (statement by Bonell (Italy)).R. 87). 115b. 97/C. 87) (Italian proposal). Problems at 18-19.R.16 (= O.R. 108. on the other hand.59 (= O. 97/C. 257) (discussion by the Swedish delegate). Feltham at 349. see also Réczei. the wording was still "to promote uniformity.1/L. 258).1/SR. See A/Conf. 97/C. "in its application" was removed from the phrase "In the interpretation of this Convention (and its application . delegate. Reflections at 5-9.R. The preamble to the Convention.R. but see Bonell. As to this question and the opposition from the U. 87) and France (A/Conf. See A/Conf.1/SR.1/L. (A/Conf. . 97/C. Fields of Application at 182-187. General Provisions 2-7 ("an honourable burial").S. 110. see also Eörsi at 313.4 at 9 (= O. Bulgaria's proposal. 87). But see Naon § 1. See A/Conf. See Eörsi. 115a.15 (= O. . 107. . 114.

1/SR.4 at 58 ("quite happy with the present formula . See also A/Conf. 260) (discussion in the First Committee). See Eörsi. 21.1/L. while Article 9(2) allows an implicit agreement. As to the Hague Convention.7 (= O. such international usages and customs which can rightly be considered as democratic and equitable"). See also Bydlinski at 76 for an important advantage of the contractual approach: There can be no doubt that usages prevail over the rules of the Convention. 1951.6 at 10-11 (= O. as to the Hague Conventions.1/L. . Huber at 429-430. see Date-Bah at 46-47. Sonnenberger. see Dölle (Schlechtriem) Article 13 §§ 7 et seq. 107 östJBL 385 (1985).24 (= O. while the contract really intended by the parties and hidden "under" the sham statement may be valid. 97/C. See Enderlein at 33 ("Unification of law must not sanction customs developed by capitalistic monopolies vis-à-vis weaker parties. In contrast to normative grounds. especially in developing countries.6 at 8-9 (= O. Cf. 263). see Dölle (Schlechtriem) ULF Article 13 § 4. Bydlinski at 75. Eörsi argues that. usages must be made explicitly applicable. General Provisions at 2-23. . (1970).. But see Maskow § 2. 97/C. A/Conf. See Judgment of Oct. contra Bonell. Verkehrssitten im Schuldvertrag 61 et seq. unification of sales law can take into account.1/SR. But. 119.) (discussion). see Bergsten. see also Réczei. On the other hand.R. contractual intent as the ground for the applicability of usages means that capacity to contract and defects of will can gain importance as questions of "validity" under Article 4(a).6 at 4-5 (= O. Fields of Application at 179-182. 9 and will lead to diverging interpretations.R. . while other socialist countries may feel some hesitations"). 123. 118. 116a. 97/C. at 11. 97/C. For ULF Article 13(1).43= O." See A/Conf. 266) at 4 § 19 (remark by the Soviet delegate that the version represents a compromise on one of the most controversial issues debated in UNCITRAL).1/SR.R.R. Eörsi. General Principles at 9. Dölle (Junge) Article 9 § 3.1/SR.R. 97/C. under Article 9(1). See also A/Conf. 126. as its cornerstone.116. 125.6 (= O. 116b. the formulation of Article 8(2) corresponds more than did the Draft to the standpoint of the objective addressee from German law: the person "standing in the shoes of the addressee. seems to be desirable. See A/Conf. 27. but can hardly be based on the history of art.R. 122. 1952 NJW 257.R. A sham agreement is void. Eörsi. As for the reservations of the developing countries. 88). General Provisions. The contrary view of Bonell. Cf. östJBL 385. 97/C. Eörsi is very informative on the reasons behind the Socialist countries' position on usages. 20. at 262 et seq. Réczei. 117. Rules of Application at 82 et seq. 263) at 9 § 71 (position of the Yugoslavian delegate). Appendix. A/Conf. 89). BGH. 121. 97/C. 124. see Dölle (Schlechtriem) ULF Article 13 § 7 at 11-12.1/SR. Basic Concepts of the UN Convention on the International Sale of Goods. 120. Due to the acceptance of a proposal by the Egyptian delegation (A/Conf.

For "unforeseeable" delivery from or to a certain place of business. which only recognize form requirements for certain kinds of contracts.1/SR. O. 97/C.A.8 at 4 et seq. etc. the outcome is unfortunate because it would have made the decision as to whether or not to make the reservation easier for many states. A/Conf. 131. 136. See A/Conf. to make the reservation.1/SR. 76 (= O. 97/C. 97/C. 130a.R. 129. 135. 269) (complaints by Dabin (Belgium)). See A/Conf. (1980).R. 134. 266 et seq. In my opinion. 133. 90. See Farnsworth at 11. 82 WM 846 = 83 IPRax 212.) (discussion). 97/C.R. But in international sales contracts. 91). 132a. 137.6 at 11 § 88 (= O.R.B. See Honnold.1/L. 130. The German Federal Court has used CISG Article 10(a) in the interpretation of "place of business" in ULIS Article 1.R. 89) (motion).) (discussion in the Plenary). 267). 132. Judgment of June 2. see id. it is not necessary for the F.R. 97/C.SR.71.S. 42(1)(b).G. See Article 1(1) (prerequisites for application). First are the exceptional cases of international instalment transactions.) (discussion). (= O. Even if final approval must be given by company headquarters. 8. for which a written form would be required according to the German Instalment Law (Abzahlungsgesetz) § 1(a). 199 et seq.1/. A/Conf. 3 UNCITRAL Y.127. 21 (1971). 138. see also Articles 31(c).S. BGH.R.64 (= O. 75 (1972).R.S. the location of the headquarters is not considered a "place of business" if the other party need not have taken account of it. 1982. 97/C. 94. 57(2). 57(1)(a).R.1.1/L. Sandrock.1/SR.1/SR.1/SR. see supra at III.. 128.7 at §66 (= O. A/Conf.7 at 4-5 (= O.R. 93(3).6 (= O.B. Commentary § 120 (suggesting that contract provisions could be construed in light of the applicable usage).) and Date-Bah (Ghana)). 203) (motion). Acceptance of the proposal would have meant that a party could have invalidated part of a usage by neglecting to follow the behavior prescribed by it.R. See 2 UNCITRAL Y. 271 et seq. See A/Conf.7 at 5-6 (= O.) (statements by Farnsworth (U. Dölle (Schlechtriem) ULF Article 13 § 10. See also A/Conf.3 (= O. 97/C. See Secretariat's Commentary at 50 §§ 6. 273 et seq. 97/C. Handbuch der Internationalen Vertragsgestaltung 263 et seq.G. the German buyer cannot count on the protection of the German instalment law anyway. since only a few types of business transactions are affected. Cf. 97/SR. It is clear that the right to declare a reservation was granted as a concession to the U. Cf. 97/L. See A/Conf. See Baden-Württembergische Gemeindeordnung . such as the F.D. A/Conf. A second group are the form requirements prescribed in state laws governing municipalities. Nevertheless. 96.8 at 7-8 §§ 43 and 47 (= O.R. Cf. 264). See A/Conf.R.

S.) (discussion). mandates application of U. it can be assumed that Russian courts. CISG does not cover such agreements anyway. which are subject to form requirements under anti-trust laws such as German Gesetz gegen Wettbewerbsbeschränkungen (GWB) § 34. 97/C. note 145.1/L. Nevertheless. of sales contracts with marketing commitments and similar agreements.R.R.17 (= O.1/L.S. infra. See A/Conf. law on form requirements in all foreign trade transactions. Since Article 565 of the Civil Code of the U. 97/C.R. but the municipal authority responsible for forming the contract would still be subject to internal sanctions for violating official duties since these sanctions cannot be disturbed by the Convention. If those rules indicate that the sales part of an integrated contract is void as well. form requirements would be agreed upon and. See Huber at 434. Of course. In German law.S.R. (= O. and 38 (= O. The compromise found in Articles 12 and 96 considers form requirements based on domestic law to be exceptions. 272 et seq. followed. the basis for the judgment is. 140. 145.G. especially §§ 26. Eörsi believes that Article 13 does not require comment.S.R.S. See A/Conf. See Eörsi at 316. mandates application of U.R. The Convention on the Limitation Period itself contains requirements on form. 139. A/Conf.S.1/SR. In my opinion. Commentary § 130. however.1/SR. A proposal by the U.R. Secretariat's Commentary at 51.S. then it is void under Article 4(a). in Article 20(1) (the interruption of the limitations period by a written acknowledgment) so that the provision on written form contained in the Limitations . 91) (motion). Honnold's interpretation would make Article 13 almost meaningless. 83). Whether an unwritten sales contract containing marketing or licensing commitments is totally void depends on the domestic rules governing partial nullity.S.8 at 7 § 43 (= O. Accord Stoffel in Lausanner Kolloquium at 60. mentioned by Huber.R.R.) (discussion). law on form requirements in all foreign-trade transactions. to include the avoidance of contract by one party in the reservation was unsuccessful. 32. 97/C. Since Article 565 of the Civil Code of the U. 36. The reasons for ensuring that these requirements are upheld are probably along the same lines as those the Soviet Union uses to defend its form requirements.8 at 5 et seq. See Eörsi. The practical effect would probably be that in such cases.S.R. 272 et seq.§ 54. See Honnold..G. 142. law. Cf.R. 141.S. See A/Conf.S.1/SR. as far as the domestic law contains form requirements for sales contracts. Finally there remain the cases. 273). so that domestic provisions on form requirements remain undisturbed. will always require contracts to be written. this would mean that municipalities could contravene local law by entering into valid but unwritten international sales contracts. 143. The reservation clause is only available.). on the basis of U. therefore. 144.R.8 at 5 et seq. The motion to allow the telegram or telex to fulfill the writing requirement was probably accepted in Vienna without further debate because it was drafted on the model of a provision with the same wording in the UNCITRAL Convention on the Limitation Period of 1974 (Article 1(3)(g)). 97/C.97/C.35 (= O. should commit itself to adopting the Convention without the reservation.S. in any case. it can be assumed that Russian courts will always require contracts to be in writing. See A/Conf.R. the F. German Civil Code § 139. 97/8 at 7 (position of the government of the F. A/Conf. for example. General Provisions at 2-34.

42(1). CISG itself only mentions "writing" in two provisions and only requires it in Article 29(2) for modifications. But see Huber at 447. 35(2)(b). 16(1) (rejection of the offer). See von Caemmerere. 97/C. . agreement evidenced by the parties' conduct but which leaves the price term open does not form a contract under CISG. in which an agreement is eventually reached. 148. 151. For example. An Italian proposal.R. Examples include the negotiations. 150. 155. 3-4 (for the histocial development). because of the lack of coincident declarations of intent. The representatives from the Soviet Union agreed to the West German motion presumably because. also Dölle (Schlechtriem) ULF Article 6 §§ 1822 (concerning the Hague Conventions). 97/C. 269).R. would have permitted an oral suspension of such an agreement on form.1/SR." to deal with problems involving standard contract terms. 1976. which became apparent in connection with the "battle of the forms. but where it is not possible to determine afterwards at what point both parties legally agreed to be bound and the cases where offer and acceptance cross in the mail. See also Dilger at 190 et seq. See Eörsi in Lausanner Kolloquium at 44. 146. See UCC § 2-207(3). This conclusively eliminates the option of saving a contract by recourse to domestic [law] where its formation does not conform to an explicit general principle of the Convention. See A/Conf. Commentary § 178. and 74 sentence 2. Judgment of June 2.1/SR. See generally Farnsworth. Examples with regard to the Hague Conventions were the applicability of ULIS Article 17 to ULF and the question of whether notices under ULIS are effective only upon receipt. 154. 305). Examples of provisions for which the time of contract formation is important are: Articles 33(c). See A/Conf. BGH. 18(2) sentence 1 (acceptance). 153. 101). 147. it was never effectively formed. It was not adopted primarily because a reference to written-form clauses in standard contract terms conflicted with the unwillingness. Dölle (Schlechtriem) ULF Article 4 § 2 (for ULF).7 at 10 § 73 (= O.68 (= O. 22 (withdrawal of the acceptance). See Huber at 445. Accord Honnold. 68 sentences 1 and 3. corresponding to West German judicial practice. 147a. One has also to consider the contract which is performed even though.1/L. 73(3). (1965). cf.. 71(1). 29 RabelsZ 136 et seq. In that case. with respect to the sphere of application and usages. 66 BGHZ 378. 35(3). Formation §§ 3-3. See Articles 15(1) (offer). Cf. 97/C. 57(2).R. 149. 42(2).g. 15(2) (withdrawal of the offer). the existence of a clear general principle demonstrates that there is no gap in the Convention which might be filled by a domestic law. discussed above. 152.Convention only had an internal effect. telegrams and telexes fulfill the requirement. according to an applicable Soviet law which makes a writing mandatory for foreign trade transactions. 149a. E. A/Conf.13 at 8 § 56 (= O.

158. 167. 1971 Cass. See also infra note 319. see Huber at 438-439. Judgment of June 21. when a party has the right to determine the quantity. or other characteristics of the goods. 160.205 (= O.R. 290) (discussion). Dölle (Schlechtriem) ULF Article 4 §§ 24-25. (= O. 166. 165. Cf. 163a. Offers for requirement and output contracts whereby the quantity to be delivered is based on the future demand of the buyer or the quantity which the seller can produce. 97/C.C. 1976. com. 264. 162. the offer lacks a definite term and no contract can be concluded by its acceptance. see id. For additional critical views. the mere fact that Article 65(1) presupposes that. 159.such as by a move . size. 97/C. 157. the buyer has the right to determine the form. They can also be applicable by virtue of the supplementary and optional provisions of the Convention on the contents of sales contracts. See Secretariat's Commentary at 57 § 14 et seq.R. therefore. In the deliberations on Article 55. at note 6.1/L. 163. With regard to the motions and the discussion. See Date-Bah at 51. see id. Secretariat's Commentary at 72 § 6.1/L. Although the Convention contains no provision corresponding to ULF Article 4(2). D.11 at 6 et seq.97/C. see A/Conf. also be covered. see also Tallon. 16975.and not yet corrected. 164. See infra at VI.R. Cass. see Huber at 437-438. 121) (French compromise proposal).P. Dölle (von Caemmerer) (regarding ULIS Article 57) (includes a comprehensive analysis of comparative law). The means of communication which must be "appropriate in the circumstances" must also be intelligible. See A/Conf.1/SR. 270). 161. com.C.R.156.1/L. For examples. in a sale subject to the buyer's specifications. 92) (an even more restrictive Soviet proposal which also was not passed). § 87. did not progress any further. See Judgment of April 27. See A/Conf. Even the proposals by a working group. but Article 27 concerns only the declarations under Part III that are effective upon dispatch. but not an address that has been changed . Farnsworth. J.R. In my opinion. does not justify the contrary conclusion that. the French position was more flexible.. 92).8 at 10 et seq. (= O. 97/C. 97/C. 162a. See Huber at 437. which attempted to find a compromise between the irreconcilable differences (A/Conf.37 (= O. A/Conf.1. As to the controversy in German law and a critical comparison to the 1978 Draft Convention. Formation at 3-9. . 1976 I. See Secretariat's Commentary at 56 § 9. But cf. "Mailing address" means the place where mail is received.103) (= O. a contract can be supplemented by usages if they are directly applicable under Article 9 or made applicable by virtue of the parties' intent on the basis of Article 8(3). As to the firmness of the Soviet position. Buyer's Obligations at 7-11. such as a mail box.R. would.1/SR.

1/L. 281).9 at 3 (= O. Farnsworth confirms the danger of divergent interpretations. § 35 (The Netherlands) and id.. In contrast to ULF Article 5(2).1/L. Contrary to the necessity of written form in the reservation states. proposal (A/Conf. 97/C. 278) (Japan). 170. 173. see Dölle (Schlechtriem) ULF Articles 5 § 3 19 (revocation is effective if made in the same manner in which the offer was made. 97/C. A corresponding U.48 (= O.. which may provide various remedies (e.R.1/SR.56) (= O. a British proposal (A/Conf. the fixed period serves merely as one indication of the offeror's intention.R. see also Secretariat's Commentary at 62 § 4.R.R.1/SR. 97/C. 172. See supra at IV. In the end. under consumer-protection laws . 174a. 97/C. See Stoffel in Lausanner Kolloquium at 63.): Where the offeree has justifiably incurred expenses in reliance on an offer. an offer open for a fixed period of time is not always irrevocable during that period. 64.R. For a less restrictive view. 176.9 at 3 § 14 (= O.C.e. 171.1/L. Other cases of damage caused by withdrawal from negotiations should be governed by domestic law.S. 264) (position of the U. A/Conf. id. this should resolve the cases which motivated the proposal by the GDR for precontractual liability (see infra at V. 97/C. 97/C. so long as the offer has not been accepted or the acceptance has not been dispatched).9 at 10 (= O. A/Conf. See A/Conf. 1. though. 97/C.48) (= O.R. See A/Conf. 277 et seq. AGBG § 11 Nr. 278). See Farnsworth. Buyer's Obligationss at 7-12. Commentary § 160. one will probably have to decide the same way as suggested in that proposal: The public offer can be revoked if the revocation reaches the interested party before he has dispatched his acceptance. Naón § 2.g.g. . See Tallon. 95) found no support and was therefore withdrawn..168.R. See A/Conf. prohibits a single party from determining the price . 97/C. The words "or inactivity" were inserted on the basis of a British motion (A/Conf. see Article 12 sentence 2. 177. E.R. Huber at 440. 175. if domestic law. Instead. Unfortunately.Article 4(a) would control. To some extent. 94) concerning the withdrawal of a public offer found no support because of the misunderstanding that there is no such thing as a real public offer. See Feltham at 352. Compare A/Conf.1/L. Formation at 3-11.S. Article 14(1) sentence 2 has not been excluded from the autonomy of the parties. 97/C. 174.g. They were intended to indicate that totally passive behaviour is to be treated the same as silence. Accord. 169. 95).R.8 at 9.1/SR.) (discussion).1/SR. § 37 (= O. However.9 at 3 § 15 (= O.1/SR. Accord. 172a. precontractual liability and tort). 94) (British proposal). delegate).57= O. 279) (United Kingdom). See also Honnold.D. the offer will usually be considered irrevocable.4.. Accord Honnold.R.6 at 11 § 88 (= O. 175a.

179.which would have reduced the weight accorded to those terms . See A/Conf. 97/C.R. See A/Conf. 182. given the special circumstances of the case. 181. A/Conf. under certain conditions. differences between offer and acceptance. A/Conf. (= O.) (discussion)." 1974 BB 1310-11.Commentary § 164 (proposing that assent may be indicated by arrival of the goods or by notice that a requested act has been performed). Unfortunately. Concerning ULF Article 7. negotiations. See also Secretariat's Commentary at 67 § 13-14 (further examples).1/SR.61 and L. See A/Conf. 184. 191. Cf. 96) (motion). even related to these points. or usages. 97/C. 194.10 at 3 et seq. 29 RabelsZ 134 (1965) (regarding ULF). 96). 96) (motions by the U. 256). 193. See A/Conf.1/SR.C. But see Huber at 449-450.R.1/L.) (debate). (= O.91 (= O. 97/C. 219 et seq. 97/C. See supra at IV.1/SR. See Dölle (Schlechtriem) ULF Article 8 § 12. 225). 219 et seq. 97/C.95 (= O. A/Conf. 97/C.10 at 8 et seq. 189.1/SR. 97/C. A/Conf. 328 et seq. "Die Kollision von Standardbedingungen nach BGB and Einheitlichem Kaufabschlussgesetz. 178. A/Conf. 188.98 (= O.R. 98). 288).1/L. 187.10 at 12 et seq. 186. see Schlechtriem.10 at 11 § 82 (= O.1/SR. (Ghestin). 192.) (discussion). 97/C.R. 97/C. 97/C. Cf. 295).R.89 (= O. it is still possible that. 97/C. would have prevented the three kinds of terms mentioned in the third paragraph of Article 19 from being considered material. The time the contract is formed under Article 23 may therefore differ from the time it takes effect. and Bulgaria).R.1/SR. Nonetheless. This was the argument of one of the West German delegates (not the author). But see Huber at 443-444 (criticism of the 1978 Draft Convention).R. See A/Conf.18 at 2-3 (= O.K. A/Conf.1/L. A/Conf.1/L.R. 219 et seq. 190. (= O. was deleted.1/L. . 180. A proposal to complete the list in paragraph 3 by the words "inter alia" .10 at 12-13 (= O. may be considered as immaterial. the phrase in the 1978 Draft Convention (Article 17(3)) which.R. 183. An example is where the offeree proposes a different time for delivery. 97/C.R.87 (= O. See von Caemmerer.was also rejected.5 at 4 § 18 (= O.R. as well as party customs. 185.).R.1/SR.

99) (Egyptian motion). 64 (1975). 90 (1976). 328 et seq. 206. a non-conformity that can be cured by repair or substitute delivery can only be considered a breach of contract as under ULIS Article 43 . 199.12 at 11 § 68 (= O. Hungary. domestic law is irrelevant as long as the issue is a matter regulated by CISG. . 99) (motion). Pakistan.R.R. see Bericht der Bundesregierung 17 et seq. Michida at 282 et seq. 195. See Articles 49(1)(a). For example. For the development of Article 25 in the deliberations of the Vienna Conference. As to the right to avoid a contract despite the existence of grounds for exemption. 97/C.1 at 4.1/SR. A/Conf. See also Honnold.) (discussion). See also A/Conf. 6 UNCITRAL Y. See A/Conf. 202. 169 (1971). See Eörsi. 97/C. see Beinert at 56-57.1/SR. (an ironic description of the endeavours to find the perfect formulation). (contains the hypotheticals and motions which influenced the course of the UNCITRAL deliberations).. The working group consisted of representatives from Argentina. C. otherwise the balance between revocability and contractual commitment could be disturbed by domestic remedies.12 (= O. but see Gonzalez 86 (a more favourable analysis). 203. 97/C.). 6 UNCITRAL Y.1/L. 97/C.1/L. Therefore. Norway. Also Eörsi supra note 198. Czechoslovakia. 198. Commentary § 147. A Propos at 336 et seq. 97/C.R. see Article 79(5).B. the seller has the right to tender a second time before the buyer can avoid. See A/Conf.B. See 1 UNCITRAL Y. For the comparable discussions relating to the drafts of the Hague Convention. 207.1/L. Ghana.63 (= O. 196. But even the formulation of the 1978 Draft Convention was. 205. As long as the time for delivery is not of the essence in such cases. 295 et seq.R.R. 64(1)(a). 208.176 (= O. 7 UNCITRAL Y.B. a party cannot be liable under domestic law for legitimately revoking an offer under Article 16. the F. Rumania. 2 UNCITRAL Y.B. though by some delegates to be too subjective. 197.194a. Remedial Provisions at 9-15 (critical view).R. 73(1). Article 46(2). 47 (1970).1/SR. 204.G. and Spain. 53 (1975). (not yet published).106(= O. Article 70. 200. See A/Conf. 201. 51(2). even if this right is not explicitly stated in the Convention. 99). 198a. See A/Conf.B. 73(2). 72(1). 300) (discussion). 97/DC/L. Of course. See also Ziegel.18 at 3 (= O.R. because of the foreseeability criterion.if the seller cannot or will not provide this "later performance" promptly.

13 at 5 § 22 (= O. See 4 UNCITRAL Y. 222. Honnold. Although the West German motion (A/Conf. Noussias. 7 Int'l Encyclopedia Comp. See Hartley. 211. For an analysis of this solution. See 7 UNCITRAL Y.65= O. Of course a detriment must either have been produced or be expected to be produced. 48(2) and (3) in conjunction with 48(4). 97/C. 210. 97/C. ULIS Article 28 was dropped in the attempt to consolidate the remedies provisions. 215. Commentary § 183. 216.in order to include within its scope the offeror's objection under Article 19(2) . 79(4). The consequences of a contract violation can be a decisive factor. 217. Die Zugangsbedürftigkeit von Mitteilungen nach den Einheitlichen Haager Kaufgesetzen und nach dem UN-Kaufgesetz (1982). 40 § 28 (1973). 213. 221. The Convention provides that the notice is effective upon receipt in the following provisions: Articles 47(2) sentence 1. Remedial Provisions at 910. 223. See Secretariat's Commentary at 75 § 4. See Huber at 464.SR.R. 99). Ch. 220. 219. Cf.3.1/L. supra note 36.1.R. Vol. Cf. Article 10(2). VII. a later editorial change in Article 19(2).209. 63(2).104 (= O. 212. 97/C. 302). The unusual notification by messenger can be appropriate where there are special circumstances. 214. See Huber at 463 (posing a hypothetical). Remedies § 31 et seq.R. 100) to make Article 27 applicable to the formation of the contract .A. but only in conjunction with the party's special interest in the performance of the violated duty. see infra at VI. Commentary § 199.. 218. on the basis of another West German proposal. (1976). This provision was already present in the 1978 Draft Convention.1/L. such as a strike by postal or telegraph employees. . 303) (position of the Norwegian delegate). See A/Conf. Feltham at 353. Cf. 65(2).B. at § 3. 222a. A/Conf. A/Conf.09 et seq.. but cf.1 SR. there is no right of avoidance. It is nevertheless possible to assert a fundamental breach without proving the detriment . Honnold. L.the injured party need not expose its business arrangements. 97/C.was rejected. produced the same result. But see Beinert at 63.B.12 at 2 (= O. CISG does not require a reservation regarding a state's right to refuse to enter decrees of specific performance. 90 (1976). If there are no damages from the breach. XVI. but see Ziegel. Unlike ULIS. but see Huber at 464. Treitel.R.

A/Conf. 226 Rev. See supra at IV. 222. Bucher in Lausanner Kolloquium at 212 as to the "autonomous" requirements for the passing of risk. . See A/Conf. The U. 100) (U. 31 note 2 (1972) and in the Report of the Secretary General. 97/C. 407a. 133). See A/Conf. See infra at VI.34 at 4 § 10 (= O.H. 97/C. 229. 173). Widmer in Lausanner Kolloquium at 83 and 91. 3 at 15 § 11. 97/C.228 (= O.R. 228. 18 (= O. Seller's Obligations (details of the seller's obligations). But see Naón § 3. Schlechtriem. A/Conf.16. 407.).13 at 7 (= O. id. References to criticism of ULIS's concept of "delivery" during the course of UNCITRAL'S work are detailed in 3 UNCITRAL Y. 410. 97/C. 226a. 396). Farnsworth at 250.B. 97/L. A/Conf. The obligation to pay the (full) purchase price would be the buyer's damages.224.R. 411. 1977 Draft Convention Article 58. 1. see generally Honnold. In my opinion. ULIS Article 83 provided for the payment of interest as damages. See A/Conf.R. 302 et seq. 97/8 Add.R. 412. 409.S. 247 (= O.E. The various UNCITRAL drafts also contained different rules. A/Conf. which is the authoritative source for the reasons underlying this proposal. 405. recoverable for the seller's breach.R. See A/Conf. See Huber at 417-18 (concerning the consolidation of the rules in comparison to ULIS).1/SR.) (British reasoning). See generally Huber at 450-51. which would require a timely avoidance of the contract by the seller under Article 72. See also Farnsworth. the solution to the buyer's firm refusal to take delivery in the example given can be found with the help of the duty to mitigate damages in Article 77 sentence 1. 227.R. However. But see Huber at 471 (a slightly differing view). 226. 416) (Egyptian proposal for a reservation clause).1/SR. Remedial Provisions at 9-41.K. 218. Commentary § 419.A.216.30 at 7-8 (= O. 97/C. 137). See Eörsi at 316. See also Ziegel. 408.R. 225.5 at 12. for the more important case of delay in payment.1/SR. 230. Cf.113 and L.1/L. 97/C. 406. 117 (= O. repeatedly submitted motions and proposals to this effect. at 32 et seq.1/L.1/L. This duty was breached by the seller. This corresponds to ULIS Article 81(1).

413. The details of the discussion cannot be repeated here at length. See A/Conf. 97/C.1/SR.29 at 2 et seq. (= O.R. 388 et seq.); id. SR.34 at 2 et seq. (= O.R. 415 et seq.); A/Conf. 97/SR.10 at 8 et seq. (= O.R. 220) (Plenary); id. SR.11 at 3 et seq. (= O.R. 226). 414. To the extent applicable domestic law prohibits interest payments, Article 78 would, of course, be unenforceable. 415. It was primarily the F.R.G. that defended this reservation of damage claims (for lost use of capital). 416. For further discussion on the gaps in the avoidance provisions, see infra at VI.J.4. 416a. This includes defects. After a thorough analysis, Nicholas, however, concluded that the word "impediment" was used to prevent application of Article 79 in the case of nonconformity. See Nicholas at 5-10. But even if a defect is regarded as an "impediment", the seller will rarely be excused. See H.C.H. Salger, Beschaffung und Beschaffenheit at 56-58 (1985). 416b. See Nicholas at 5-2 (improvements in detail and a greater internal consistency, but . . . ). 417. Cf. 5 UNCITRAL Y.B. 58 (1974). Despite Nicholas' doubts, German jurists should not, and most likely will not, read the fault principle into the text of Article 79. See Nicholas at 512. See for the Swiss position Vischer, Lausanner Kolloquium at 174. 417a. But see Nicholas 5-7 (skeptical about determining the respective sphere of risk). 418. Cf. Secretariat's Commentary at 169-70 §§ 5-6. 419. Accord Huber at 466; Nicholas at 5-8. 420. Cf. Secretariat's Commentary at 170 § 6. 420a. Contra Naón § 3.18 at 24. 421. See also Secretariat's Commentary at 169 § 4. 422. Cf. Nicholas, Force Majeure at 240; see also 5 UNCITRAL Y.B. 39, 66-67 (1974); 6 UNCITRAL Y.B. 84-85 (1975); 8 UNCITRAL Y.B. 57 § 459; id. at 135 § 24; id. at 160 § 14. 422a. It is imperative, in my opinion to treat radically changed circumstances as "impediments" under Article 79 in exceptional cases in order to avoid the danger that courts will find a gap in the Convention and invoke domestic laws and their widely divergent solutions. But see Vischer, Lausanner Kolloquium at 177, who considers this as unavoidable. 423. The question was not specifically discussed again in Vienna. There was considerable hesitation about giving consideration to unforeseen changes in the underlying basis of the contract. This again became clear in connection with a Norwegian proposal (A/Conf. 97/C.1/L.191/Rev. 1 = O.R. 134). The Norwegian proposal concerned the case of temporary

impediments which later vanish. In that case, consideration would be given to the fact that the economic situation of the debtor might fully have changed. Though the contractual agreement should be decisive in this situation, some delegates apparently assumed that recourse to domestic law would still be possible. See A/Conf. 97/C.1/SR.27, at 9 § 58; id. at 20 § 59 (= O.R. 381). By the acceptance of the Norwegian amendment to delete the word "only" in Article 79(3), it became clear that, even if the original impediment is removed, it is still possible that a new exemption can arise for the debtor if there is a change in circumstances. In the discussion on the proposal to release a party from his duty to perform, the Norwegian interpretation - that a party could also be exempted for economic reasons - remained uncontested. See A/Conf. 97/C.1/SR.28 at 5 § 28 (= O.R. 384). But see Nicholas at 5-18 (skeptical opinion). Contra Vischer, Lausanner Kolloquium at 176. 424. A/Conf. 97/C.1/L.208 (= O.R. 134 et seq.). 425. A/Conf. 97/C.1/L.191 Rev. 1 (= O.R. 134 et seq.). 426. See A/Conf. 97/C.1/SR.26 at 5 § 25 (= O.R. 373) (position of the Swedish delegate). 427. See A/Conf. 97/C.1/SR.27 at 10 § 59 (= O.R. 381) (French position). 428. See A/Conf. 97/C.1/SR.28 at 5 § 26 (= O.R. 384) (French position). 429. Unfortunately, they were brought to a vote separately, although they were concerned with the same principle. My impression is that the result would have been different if they had been brought to a vote together. 429a. See also Nicholas at 5-18. 430. But see supra note 416a (as to the likelihood of this exception). Cf. also Vischer, Lausanner Kolloquium at 177. 431. The responsibility for one's own personnel is, however, governed by paragraph (1). See text infra. 431a. The discussions centered on sub-contractors. Nicholas interprets Article 79(2) as applying only to this class of "third persons". Nicholas at 5-22. But see judgment of March 3, 1984, BGH, 1984 NJW 2035 as to the buyer's responsibility for his lessee not taking delivery. 432. Already in the January-February 1974 sessions of the UNCITRAL Working Group, this led to considerable differences of opinion with respect to the first oil crisis. See A/Conf. 97/C.1/SR.27 at 5 § 24 (= O.R. 379) (report of the Japanese rapporteur). 433. Those proposals and motions which were designed to increase the liability of the seller for acts or omissions of third persons provided for the deletion of paragraph (2) (e.g., the Turkish motion, A/Conf. 97/C.1/L.210= O.R. 134), while others sought to reformulate it. See A/Conf. 97/C.1/L.186, L.190 (= O.R. 134) (proposals of Denmark and Finland). The reason for the proposals' divergent aims was that there was no agreement on the meaning of paragraph (2): Some saw it as an extension of responsibility and some as an extension of the grounds for exemption. See A.Conf. 97/C.1/SR.27 at 4 et seq. (= O.R. 378 et seq.) (discussion). The alternative proposals submitted by a working group (A/Conf.97/C.1/L.243=

O.R. 135) again provided for either the increased liability for third persons or the deletion of paragraph (2). The majority, which favoured increased liability for third persons, again misunderstood the new formulation of paragraph (2) as an expansion of the possibilities for exemption and therefore rejected the proposal. Cf. A/Conf. 97/C.1/SR.33 at 2 et seq. (= O.R. 410 et seq.) (discussion). 433a. Accord Nicholas at 5-23. 434. See supra at VI.G. (as to interest). 435. See supra notes 423, 425. 436. See supra note 423. 437. A Norwegian proposal (A/Conf. 97/C.1/L.191 Rev. 1= O.R. 134) to make this notice subject to the dispatch principle under Article 27 was rejected. See A/Conf. 97/C.1/SR.28 at 2 et seq. (= O.R. 383). 438. A/Conf. 97/C.1/L.217 (= O.R. 134). 439. Cf. A.Conf. 97/C.1/SR.28 at 8 (= O.R. 386). 440. A.Conf. 97/C.1/L.217 (= O.R. 134). 441. See A/Conf. 97/C.1/SR.28 at 9 § 55 (= O.R. 386) (position of the Swiss delegate; see also id. at 10 § 61 (= O.R. 387) (position of the Romanian delegate). 442. Cf. A/Conf. 97/C.1/SR.30 at 2 (= O.R. 393) (discussion). 443. Cf. Huber at 494 (on ULIS Article 79(2)(a)). 444. This is clearer in ULIS Article 79(2)(d). 445. The Convention decided for a right of avoidance despite loss or damage of the goods after the passing of risk. See Article 70. This basic decision would be significantly altered by a strict interpretation of Article 82(2)(a). See generally von Caemmerer, in Festschrift für Karl Larenz 692 et seq. (1973). 446. In contrast to ULIS Article 79, therefore, the seller carries the risk if the buyer, having transferred the item to a third person before discovering the defect, cannot get the item back from the transferee. See Huber at 493-94. 447. See A/Conf. 97/C.1/SR.28 at 11-12, primarily § 72 ( = O.R. 387 et seq.). The discussion confirms, however, the buyer's duty to return the goods, which can lead to a restriction of the right to a substitute delivery when it is impossible to return the goods as provided in Article 82. See Huber at 493. 448. Cf. Secretariat's Commentary at 176-77 § 10.

1981 WM 68-69. 456.33 at 7 § 54 (= O. Cf.R. BGH. Rather.). 1 IPRax 173 (1981). See A/Conf. Judgment of Oct. Contra Huber at 494-95. see Dölle (Weitnauer) Article 79 § 13 (with respect to ULIS). 399 et seq. 452. supra at VI.G. circumstances for which the buyer is responsible and which have caused the loss or deterioration of the goods before an avoidance has been declared preclude the remedies of avoidance or substitute delivery under Article 82. the damage claim should. 461. Thus. can be treated as a prerequisite for the duty to preserve the goods. 97/C. The discussion on a Chinese motion made it clear that Article 86(1) is not intended to provide an additional right to return the goods.R. 453. 454. but cf.1/SR. it was clarified in Vienna that delay in payment.449. also O. 450. 97/C. Judgment of Oct. 175 for the redrafting in the Plenary.1/SR. With regard to Article 74 of the 1978 Draft Convention.G.4. refers to the creditor's loss to determine the nature and extent of the claim stemming from avoidance. 459. 1980.31 at 2-3 (= O.) (as to the fears that the period could be doubled). it was clarified that the buyer in this case can also demand reimbursement for his expenses and retain possession of the goods until he is paid. See generally Schlechtriem. 451.31 at 4-5 (= O. and the obligee should be permitted to calculate his damages based on his own credit costs. 458. 97/C. supra at VI. still be available from the time the duty to repay arises. Auslegung und Lückenfüllung im Internationalen Einheitsrecht: Erfüllungsort für Rückabwicklungen im EuGVÜ und EKG. 1981 WM 68-69 (with respect to ULIS).30 at 12-13 (= O. 398 et seq.) (discussion). See Secretariat's Commentary at 197 § 6. invoked subsidiarily. When there is a delay in the repayment for which the seller is responsible. like delay in taking delivery. the right to avoid the contract or demand substitute delivery is presupposed. 460. supra at VI. 400 et seq.1/SR. Cf. Cf. 22. On the basis of an Australian motion. since that it where he made use of the purchase price. See Article 86(2) sentence 3. 22. Cf. 455. 1980. The Secretariat's Commentary assumed that the seller would be required to pay interest at the rate that is customary where his place of business is located. A/Conf.R. 457.G. BGH. nevertheless. . A/Conf. infra at J. As a rule. but cf. 174. Cf. Huber at 17. the buyer's responsibility and duty to return the goods can become relevant only in the case of insubstantial deterioration. See A/Conf.R.R. This should be the result. Cf. even if (as an exception to the rule) domestic law.1/SR. Dölle (Weitnauer) Article 79 § 6 (with respect to ULIS). 97/C. 413) (working group's reasons for the proposal). See Secretariat's Commentary at 180 § 2.

section IV. successful effects to unify the law (Article 94). At 266 et seq.) adequate Auctions (section III. supra note 275 (a comprehensive report on the 1974 Convention on the Limitation Period).) Anticipatory breach (section Vi. 36 (= O.viel Lärm um Nichts?..R.1 at 2 et seq.R.e.3 (= O. Cf.) Aircraft (section III. 434 et seq.3.A. 464. 472. 97/C. 470.A.1/SR.. A/Conf.C. At the Vienna Conference. Cf. 467.1/SR. 97/C. 1984 RIW/AWD 352.1. A/Conf. 463.) Assurance of performance (section Vi.C.A. Stumpf. As to this problem. A/Conf. see Article 99(2). 97/C.F. see Article 91(3). 465. introduction of provisions on form requirements in domestic law (Article 96).1 at 8 § 46 et seq. See A/Conf.e.J. 471. See generally Landfermann.) Autonomy of the parties (section III.R. 437 et seq. As to the accession of states that are not signatory states.) (Australian motion).H.) declaration of (section VI.2. section IV. 86) (the corresponding Canadian motion in the First Committee).F. Index Acceptance (section V.1/SR. 466.462.1. see supra at III.1/L. E.H.D.10 (= O.) (U. (= O.R. disagrees with this view. (= O. See supra at IV. Das UNCITRAL Übereinkommen über den Warenkauf und Allgemeine Geschäftsbedingungen . Cf.e.) effects of (section VI.) (see also Party autonomy) Avoidance (section III.1.g..3.R. Australia and Canada especially emphasized the need for the special rule. 97/C. section VI.E. See A/Conf. 436).) de facto equivalent of an (section Vi.F. id. section III.) .). For the states that accept or accede to the Convention after the deposit of the tenth instrument..) in regard to future obligations (section Vi. See Stumpf..'s support for these motions in the discussion).1.e.1. 468.1 at 2 para 34.e. 469.1. section IV. 144 et seq.K. 97/C.A.) based on error (section III.) with additions limitations or other modifications (section V.D. section Vi.C.1/L.

) Buyer's obligation to take delivery (section VI.e.B.. section III.2.2.) VI.) first (section VI.1. section VI..C.C..) Contracting State (section III.) for delivery of goods including their installation (section for labor or services (section IIi.) details of (section VI.A.for breach of contract (section VI. section IV.) obligations of the (section VI.) Controls for export or import (section III. section III.) Carriage VI..) Communications means of (section VI.D.1.) Contracts IIi.) VI.J.A. section VI.B. section III.2.F.F.) theory of (section Commercial character (section III.) Consideration (section Consumer protection laws (section III.5.I.protection (section I.of the contract (section II.) Conflict of laws (section .) (section V.6.C.H.2..E..) Contract modification and termination of (section VI.3.4.A.application of the Convention (section III.B. section III.1.F.) Barter (section III. section III.) Cognizance V.5. section VI..) external (section IV.H.D. section VI.a)) Consensus V.1..) perfection of the (section V.) to contract (section III.) obligations of the Contracting States (section II.A.5.B.C.) Battle of the forms Buyer breach of contract by (section II.D.A.) independent (section VI.D.A.G..1.) ..ipso facto (section obligations after (section .) Buyer's remedies .1.) Conformity of the goods (section VI.) obligations in connection with (section Carrier (section VI.A.D.) right to revoke an installment contract (section III.D.B...A.3.) II.e. section III.D.D.D.B. section III.D.A.F.D.2.F.) Capacity legal (section III.) purchases (section III.1.A.) .) Choice of an applicable law (section III.A.F. section IV.

H.) Declaration to terminate the contract (section VI.) V.C.B.a)) VI.) VI.1.B.D..B.4.) Deterioration VI.F. section VI.3) Document(s) correction of (section VI.D.f)) VI.H.5.B.4.6.b).a)) in quantity (section VI.1) danger of (section Disclaimers (section VI.4) Duty .B.) Damages compensatory (section VI.F.3.2.) III.) limitation of (section VI.5.) Defects in quality (section VI.) (section contrahendo (section V.) handing over (section VI.A.B.3.Counter-offer Culpa in Customs (section IV.B.5.a)) Deficiencies in quantity (section VI.) Depositary for the Convention (section VII.5.B.D.) V.K..C.) secondary (section VI.5.) of substitute goods (section place of (section VI.F.F.) VI.) IV.D.2.) of different goods (section VI.D.F.B.B.H.6.) Delivery concept of (section VI.C.H.E.) in offer and acceptance (section Dispatch principle (section VI.a).to mitigate damages (section VI.) Discrepancy in intent (section IV.) non-conformities (section VI.B.A.) measurement of (section VI.B.4) warehouse document (section VI.) Delay in payment (section VI.) time for (section VI.5. section VI.4.) extent of (section VI.) III.B.C. section VI.F.B.F.) Early Economic Economic Electricity Employer Error Evidence delivery difficulties impossibility (section (section (section written (section (section (section (section VI.C.) .

B.3.b)) VI.A.) controlling law on (section IV.I.4.examination of the by the buyer (section postponement of (section time for (section Excess quantity (section Exemptions (section Expenses (section Exclusion of express (section .e.) .b)) VI. section VI.1.) with regard to the instalment (section Fundamental breach of contract (section VI.to be taken over at another place than the seller's place of business (section VI.) .4.H.A.) Goods to be manufactured or produced (section IIi.6.K.H.) goods VI.) Failure to examine the goods (section VI. section VI.D.B.1. section VI. section VI.) freedom of (section requirements (section IV.D.) Forum VI.) to be expected (section Vi.) choice of (section Forwarder (section VI.6.4.) Foreseeability (section VI.5.a).5.A.1) CISG III.D.b)) Failure to give timely notice (section VI.2.3.) VI.5. section VI.b)) VI.A.) General principles (section IV.)) Federal state clause (section VII.B.4.B..) warehoused (section Guarantees (section VI.) Fishing boats (section III. section V.e.E.B.A.H.C.implied (section III.) VI.E.) Gap filling (section Gaps (section V.D.A.6.) IV.1.D.) Fundamental (section VI.) Fraud (section III.3.5.f)) VI.) Formation of contract (section V.) lack of (section V.1) Failure of performance caused by the other party (section VI.) .5.D.) Form (section IV.E.A.E.H.F.1.b.B.) Final provisions (section VII.A.D.) IV.) Vi.) Fundamental breach (section VI.) Family use (section III..B.B.J.F.D.c).A.) Good faith in international trade (section IV.B.to be picked up at the seller's place of business (section VI.e.2.

) temporary (section VI.H.) Internationality of the transaction (section III.) Industrial property rights (section VI.) damages VI.c)(2)) Instalment contracts (section III.1.2.F.) Letter of confirmation (section IV.D.1.D.B.) Know-how .B..) III. section VIII) Limitations on liability (section VI.) unforseeable (section VI.) requirement for passage of risk (section VI.of conduct (section IV.6..1.C.D.5.B.1) Intellectual property rights (section VI.C.) Identification of the goods (section VI.B.b)) Lost profits (section Lost volume losses (section VI.) of party's statements (section IV.c)) part of the goods (section Late acceptance (section V.A.e.F.) Instalment payments (section Vi.H.C.D.D..c)(2)) Intent declarations of (section V.1. section Vi.G.1.e.D.D.B.1.1.F.1.H.D.1) (section (section IV.B.) VI.) concurrence of (section Interest (section VI.) Instalment purchase (section III.2.A.5.H.) Lack of conformity VI.) Impediment to performance (section VI. section III.) of goods to the contract (section VI..H.) Intentions V.A..) for death or personal injury (section Limitations of actions (section VI.) Incoterms (section IV.1.B.) Liquidated damages (section VI.transfer of (section III.b).C. section V.B. section VI.1.6.) Interpretation (section IV.D.F. section VI.e.B.Habitual residence Hovercraft Household use (section III.D.) .1. .) Vi.5.G.) Liability III.5.) beyond control (section VI.) Main features of Market price Mistake avoidance for Mitigation the rule (section of Convention (section (section section II.) VI.F.

2.) Performance claims for (section VI. section VI.C.) by the buyer (section VI.6.6.) place and time (section VI.B.6.H.a)) by repairs or additional deliveries (section VI..) Nationality of the parties (section III.) V.e.a)) Period additional period of time (section VI.B.D. section VI.) (section IV.B.D.) Partial non-performance (section VI.) Personal injury (section III.b).c)) Party autonomy (section VI.B.duty of Modification of contract (section Moment when a contract is Money (section III.D.) of an impediment (section VI.) Place of business (section III.C.1.B.B.4.a)) specific (section VI.6.5.1.a).) Non-performance VI.B.6.) V.3.B.) Notification (section VI. section VI.e.H.B.a)) of release (section VI.a)) of non-conformity (section VI.A.B.B.2.b)) Offer (section public (section revocation of an (section withdrawal of an (section irrevocably binding (section rejection of an (section Official permits (section Opting-in or -out (section III.2.) of the intent to avoid (section Vi.D.a)) Period of grace (section VI.3..B.J.) V.5.B.) V.b).1. section Vi.E.C.2) VI.H.) V.B.B. section VI..) VI.4.2.B.B.) additional / since (section VI.6. section IV.A.A..B.) V.2.) Negotiable instruments (section III.A.) on delivery (section partial (section VI.B.2.6.C.G.) Payment VI.C.C.5.5.e.2.D.) V.2.B.C.) Personal use (section III.e)) part of the goods (section Notice of consignment (section VI.) .) Penalty clauses (section Penalties (section VI.6. formed section (section VI. section VI.H.) V.D.) premature (section VI.) Preponderant part (section IIi.F.6.

B.6.1.D.B.A.) Price determinability (section V.5. section VI.) Purchase local (section VI.) Price reduction (section VI.6.) to inspect the goods (section VI.B. section VI.G.1.B.1..) Right to cure (section VI.5.6c)) late performance (section Requirements (section III.) Sale Second Securities Self-help Seller's involving risk (section (section right remedies to (section (section carriage VI.) obligation to pay (section VI.c)(2)) the standard of the reasonable person (section IV.) Requirements of consumer protection law (section III.) IV.2.6.1) Property damage (section III.2.1.B.C.C.) Reduction of the price (section VI.) understanding of a reasonable person (section Receipt principle of (section VI. section VI.B.D.A.D.5.) sale VI.3.B.5.d)) Request VI.C.b)) Reasonable person (section II.) good faith (section Private international law (section III.B.B.F.D.a)) Reasonable excuse for failure to give notice (section VI.) registration (section III.d)) Principle IV.) requirement of a definite (section V.B.G.b).D.3..) Products liability (section III. section III.5..) VI.F.B.passing of (section VI.B. section VI.D.) Public policy (section III.a)) .F.1.) VI.) passing of tendering (section .) Reservations (section Restitution of benefits received (section VI.K.) to withhold delivery (section VI.3.3.C.) Risk .) Purpose usual (section VI.A.B.C.B. section VI.b)) to denounce 1964 Hague Conventions (section VII.B.6..A.5.a).B.B.) VII.particular (section VI.b)) III.A.2.Price determined or determinable (section V.J.1.

) Technology transfer of Termination by agreement of contract Third-party claims Trade according to German Trade usages (section Transfer of title Transit sale of goods Transport .) IV.) III.D) III.a)) .e.) III.1.D.) III.D.) Yachts (section III.c)(1)) usage law (section III.B.) VI.C.) III.C.) VI.A.) IV.) V.examination of the goods (section VI.C.) IV.passing of risk (section VI.2.Sphere of application (section Ships (section Silence acceptance (section Specific performance (section Structure of the Convention (section Subcontractor (section Supplier (section Suspension of performance (section avoidance based on anticipated breach (section III.D..) (section during (section VI. section III.1.) VI.D.H.as form requirement (section IV.) II.e.D.C.) VI.B.2.E.) (section (section (section (section IIi.F..D.1.of contract provisions (section III.F.2.) section III.) Warranty(ies) Writing .C.) (section section (section III.) IV.) III.A.) documents Unconscionability (section Unfairness (section Usages (section III.. section Standard contract terms (section Stocks (section Stoppage in right of (section Structure of Convention (section II.b)) Validity III.5.E.F.) VI. of the contract (section ..F.) transit VI.D.2.B.) III.F.1.5.) VI..5.2.C.) Vi.1.H.F.F.F.D..) Vi.F. section V. section IV. international (section Usages (section formation of the contract .) V.B.5.e.4.

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