International Business Transactions

International Business Transactions - INTERNATIONAL...

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Unformatted text preview: INTERNATIONAL BUSINESS TRANSACTIONS Fall 2005 I. SALES A. Convention on Contracts for International Sales of Goods (CISG) 1. Transactions Covered : (a) Article 1 CISG applies to contracts for the international sales of goods between parties whose places of business are in different states (i) when both states signed the CISG; or (ii) rules of private international law lead to the application of the law of a state who is party to the CISG (b) Article 10 if a party has more than one place of business, the place of business is that which has the closest relationship to the contract 2. Opting In and Out : (a) Article 6 parties may opt out of or modify the application of the CISG by an express choice of law clause (b) Asante Technologies v. PMC-Sierra (U.S. 2001) in the absence of express language indicating intent to opt out of or modify CISG (i.e. the UN CISG will not apply), a choice of law clause will not preclude CISG 3. Goods : (a) Article 2 CISG only covers the sale of goods that are movable and tangible, but does not cover the sale of: (i) consumer goods (ii) auction goods (iii) securities or negotiable instruments (iv)vessels (v) electricity (vi)assembly/development contracts 4. Contractual Issues : (a) Article 4 CISG covers: (i) formation of contract (gap-filling) (ii) remedies available to the buyer and seller (b) Article 4 CISG does not cover: (i) legality of contract (ii) competency of the parties (iii) rights of third parties (iv)liability for death or personal injury 5. Preemption : (a) Article 7 if the CISG applies, then it preempts domestic law 6. CISG Interpretation : (a) Article 7 interpretation of CISG should favor international good faith, not local interests, by looking to: (i) CISG (plain meaning) (ii) general principles on which CISG based (international uniformity) (iii) rules of private international law (last resort) B. Contract Interpretation 1. Intent : requires an inquiry into a partys subjective intent as long as other party to contract was aware, or should have been aware, of such intent, 1 but if either party is unaware of the others subjective intent, then look to objective intent of parties per reasonable person standard 2. Parol Evidence : may look to parol evidence to determine subjective intent, unless parties include an integration/merger clause (Article 96 permits states with statutes of frauds to opt out) 3. Trade Practices : parties bound by any practices they have established between themselves as well as prevalent trade practices 4. Form : contracts of sale need not be in writing (Article 96 permits states with statutes of frauds to opt out) C. Contract Formation 1. Offer : offer is a proposal to specific persons indicating an intention by offeror to be bound to the sale or purchase of particular goods for a price 2. Definiteness : offer must describe the goods with sufficient clarity that parties know what is offered for sale, and it must state quantity and price, or some manner of...
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International Business Transactions - INTERNATIONAL...

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