International commercial law

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International Commercial Law is a body of legal rules, conventions, treaties, domestic legislation and commercial customs or usages, that governs international commercial or business transactions. [1] A transaction will qualify to be international if elements of more than one country are involved. [2]

Contents

Lex mercatoria refers to that part of international commercial law which is unwritten, including customary commercial law; customary rules of evidence and procedure; and general principles of commercial law. [3]

International commercial contracts

International commercial contracts are sale transaction agreements made between parties from different countries. [4]

The methods of entering the foreign market, [5] with choice made balancing costs, control and risk, include: [6]

  1. Export directly.
  2. Use of foreign agent to sell and distribute. [7]
  3. Use of foreign distributor to on-sell to local customers.
  4. Manufacture products in the foreign country by either setting up business or by acquiring a foreign subsidiary. [8]
  5. Licence to a local producer.
  6. Enter into a joint venture with a foreign entity.
  7. Appoint a franchisee in the foreign country.

Incoterms 2010

While Incoterms were first published in 1936, it has been revised every 10 years. [9] Incoterms inform sales contract by defining respective obligations, costs, and risks involved in the delivery of goods from seller to buyer. Incoterms 2010, the 8th revision, refers to the newest collection of essential international commercial and trade terms with 11 rules. Incoterm 2010 was effective on and from January 1, 2011. The terms were devised in recognition of non-uniform standard trade usages between various States. When incorporated into a sale contract, the Incoterm code provides a detailed interpretation of rights and obligations between parties.

Any given Incoterm, in most jurisdictions, will not be incorporated into a contract without express or implied reference to it being an Incoterm. They are standardised and published, available for incorporation into international sale contracts at the parties’ discretion. Parties should specifically refer to the Incoterms in the sale contract to indicate incorporation. The International Chamber of Commerce (ICC) is responsible for revising Incoterms periodically to reflect changing practices in international trade.

The Incoterms are classified in 4 different classes:

The 11 terms can also be classified into two different categories depending on its contents: [10]

See also

Related Research Articles

Uniform Commercial Code

The Uniform Commercial Code (UCC), first published in 1952, is one of a number of Uniform Acts that have been established as law with the goal of harmonizing the laws of sales and other commercial transactions across the United States through UCC adoption by all 50 states, the District of Columbia, and the Territories of the United States.

The Incoterms or International Commercial Terms are a series of pre-defined commercial terms published by the International Chamber of Commerce (ICC) relating to international commercial law. They are widely used in international commercial transactions or procurement processes and their use is encouraged by trade councils, courts and international lawyers. A series of three-letter trade terms related to common contractual sales practices, the Incoterms rules are intended primarily to clearly communicate the tasks, costs, and risks associated with the global or international transportation and delivery of goods. Incoterms inform sales contracts defining respective obligations, costs, and risks involved in the delivery of goods from the seller to the buyer, but they do not themselves conclude a contract, determine the price payable, currency or credit terms, govern contract law or define where title to goods transfers.

Commercial law – body of law that governs business and commercial transactions. It is often considered to be a branch of civil law and deals with issues of both private law and public law. It is also called business law.

FOB (shipping) International Chamber of Commerce term referring to transfer of liability from seller to buyer

FOB is a term in international commercial law specifying at what point respective obligations, costs, and risk involved in the delivery of goods shift from the seller to the buyer under the Incoterms standard published by the International Chamber of Commerce. FOB is only used in non-containerized sea freight or inland waterway transport. As with all Incoterms, FOB does not define the point at which ownership of the goods is transferred.

International trade law Rules for trade between countries

International trade law includes the appropriate rules and customs for handling trade between countries. However, it is also used in legal writings as trade between private sectors. This branch of law is now an independent field of study as most governments have become part of the world trade, as members of the World Trade Organization (WTO). Since the transaction between private sectors of different countries is an important part of the WTO activities, this latter branch of law is now a very important part of the academic works and is under study in many universities across the world.

United Nations Commission on International Trade Law Trade law body of the UN

The United Nations Commission on International Trade Law (UNCITRAL) is a subsidiary body of the U.N. General Assembly (UNGA) responsible for helping to facilitate international trade and investment.

UNIDROIT Intergovernmental legal organization

UNIDROIT is an intergovernmental organization whose objective is to harmonize international private law across countries through uniform rules, international conventions, and the production of model laws, sets of principles, guides and guidelines. Established in 1926 as part of the League of Nations, it was reestablished in 1940 following the League's dissolution through a multilateral agreement, the UNIDROIT Statute. As at 2019 UNIDROIT has 63 member states.

United Nations Convention on Contracts for the International Sale of Goods 1980 international sales treaty

The United Nations Convention on Contracts for the International Sale of Goods (CISG), sometimes known as the Vienna Convention, is a multilateral treaty that establishes a uniform framework for international commerce. As of 2022, it has been ratified by 95 countries, representing two-thirds of world trade.

Freight forwarder Handles logistics for freight

A freight forwarder, or forwarding agent, is a person or company that organizes shipments for individuals or corporations to get goods from the manufacturer or producer to a market, customer or final point of distribution. Forwarders contract with a carrier or often multiple carriers to move the goods from one country to another.

Willem C. Vis Moot

The Willem C. Vis International Commercial Arbitration Moot or Vis Moot is an international moot competition. Since 1994, it has been held annually in Vienna, Austria attracting more than 300 law schools from all around the world and spurring the creation of more than 20 pre-moots each year before the actual rounds are held in Vienna. It is the largest arbitration moot competition, and second-largest moot overall, in the world; considered a grand slam or major moot. A sister moot, known as the Willem C. Vis (East) Moot, is held in Hong Kong just before the rounds in Vienna. It was established in 2003 and attracts around 150 teams every year, making it the second largest commercial arbitration moot and also a grand slam moot. It uses the same moot problem as the Vis Moot, as does the various pre-moot friendlies.

Lex mercatoria, often referred to as "the Law Merchant" in English, is the body of commercial law used by merchants throughout Europe during the medieval period. It evolved similar to English common law as a system of custom and best practice, which was enforced through a system of merchant courts along the main trade routes. It developed into an integrated body of law that was voluntarily produced, adjudicated and enforced on a voluntary basis, alleviating the friction stemming from the diverse backgrounds and local traditions of the participants. Due to the international background local state law was not always applicable and the merchant law provided a leveled framework to conduct transactions reducing the preliminary of a trusted second party. It emphasized contractual freedom and inalienability of property, while shunning legal technicalities and deciding cases ex aequo et bono. With lex mercatoria professional merchants revitalized the almost nonexistent commercial activities in Europe, which had plummeted after the fall of the Roman Empire.

Canadian contract law

Canadian contract law is composed of two parallel systems: a common law framework outside Québec and a civil law framework within Québec. Outside Québec, Canadian contract law is derived from English contract law, though it has developed distinctly since Canadian Confederation in 1867. While Québecois contract law was originally derived from that which existed in France at the time of Québec's annexation into the British Empire, it was overhauled and codified first in the Civil Code of Lower Canada and later in the current Civil Code of Quebec, which codifies most elements of contract law as part of its provisions on the broader law of obligations. Individual common law provinces have codified certain contractual rules in a Sale of Goods Act, resembling equivalent statutes elsewhere in the Commonwealth. As most aspects of contract law in Canada are the subject of provincial jurisdiction under the Canadian Constitution, contract law may differ even between the country's common law provinces and territories. Conversely; as the law regarding bills of exchange and promissory notes, trade and commerce, maritime law, and banking among other related areas is governed by federal law under Section 91 of the Constitution Act, 1867; aspects of contract law pertaining to these topics are harmonised between Québec and the common law provinces.

Peter Schlechtriem was a German jurisprudential scholar.

United Kingdom commercial law

United Kingdom commercial law is the law which regulates the sale and purchase of goods and services, when doing business in the United Kingdom.

Contract Legally binding document establishing rights and duties between parties

A contract is a legally enforceable agreement that creates, defines, and governs mutual rights and obligations among its parties. A contract typically involves the transfer of goods, services, money, or a promise to transfer any of those at a future date. In the event of a breach of contract, the injured party may seek judicial remedies such as damages or rescission. Contract law, the field of the law of obligations concerned with contracts, is based on the principle that agreements must be honoured.

Jan Åke Ramberg was a Swedish lawyer and professor emeritus specialising in commercial law, and national and international arbitration court judge. Ramberg was also a member of the International Arbitration Court of London.

The Principles of European Contract Law (PECL) is a set of model rules drawn up by leading contract law academics in Europe. It attempts to elucidate basic rules of contract law and more generally the law of obligations which most legal systems of the member states of the European Union hold in common. The Principles of European Contract Law are based on the concept of a uniform European contract law system and were created by the self-styled Commission on European Contract Law set up by Ole Lando. The PECL take into account the requirements of the European domestic trade.

Bill of lading Document issued by a carrier (or their agent) to acknowledge receipt of cargo for shipment

A bill of lading is a document issued by a carrier to acknowledge receipt of cargo for shipment. Although the term historically related only to carriage by sea, a bill of lading may today be used for any type of carriage of goods. Bills of lading are one of three crucial documents used in international trade to ensure that exporters receive payment and importers receive the merchandise. The other two documents are a policy of insurance and an invoice. Whereas a bill of lading is negotiable, both a policy and an invoice are assignable. In international trade outside the United States, bills of lading are distinct from waybills in that the latter are not transferable and do not confer title. Nevertheless, the UK Carriage of Goods by Sea Act 1992 grants "all rights of suit under the contract of carriage" to the lawful holder of a bill of lading, or to the consignee under a sea waybill or a ship's delivery order.

The United Nations Convention on the Use of Electronic Communications in International Contracts is a treaty that aims at facilitating the use of electronic communications in international trade. It was prepared by the United Nations Commission on International Trade Law (UNCITRAL) and adopted by the United Nations General Assembly on 23 November 2005. Pursuant to Article 23, it entered into force on 1 March 2013, the first day of the month after six months passed following adoption by three States parties, namely the Dominican Republic, Honduras, and Singapore.

The Convention on the Limitation Period in the International Sale of Goods is a uniform law treaty prepared by the United Nations Commission on International Trade Law (UNCITRAL). It deals with the prescription of actions relating to contracts for the international sale of goods due to the passage of time.

References

  1. Mo, John S.; International Commercial Law (2003) 1.
  2. Pryles, Jeff Waincymer, and Davis, Martin; International Trade Law (2004) 74.
  3. Ziegel, Jacob S. and Lerner, Shalom (eds), New Developments in International Commercial and Consumer Law (1998) 5.
  4. Mo, above n 1, 8.
  5. Pryles, above n 2, 323.
  6. Gilligan, Colin and Hird, Marin; International Marketing: Strategy and Management (1986) 99.
  7. Used where inadequate knowledge of the foreign market.
  8. Used where adequate knowledge of the foreign market.
  9. "Incoterm Rules". ICC. Retrieved 26 September 2016.
  10. Mayer, Ray August ; with revisions by Don; Bixby, Michael (2013). International business law : text, cases, and readings (6th ed., international ed.). Harlow [etc.]: Pearson. ISBN   0273768611.

Further reading