Conflict of law in International commercial Arbitration: International Sale of Goods Contract

International commercial law guides international sale transactions[1]. All business activities which are run across country orders are aided by the international law on commercial activities. It is thus held that international trade s very useful as it guides the developmental agenda of the international community. However, it should be noted that without such law, international conduct of business would be clouded by a host of controversies due to disputes that abound in business dealings.

The convention on international sale of goods presents the major legal Act which governs the international sale of goods. CISG was established by UNCITRAL to offer governance regarding the conclusion of sale contracts. The convention also covers seller and buyer obligations and goes a step further to provide remedies in cases of violations. However, the convention is not concerned with contract provisions nor is it concerned with the validity in reference to the sold property[2].

While interpreting the convention, observance of good faith and uniformity must be adhered to. However, as good as a law or convention may be, there are some aspects which remain unaddressed. Such grey areas should be addressed in reference to the general principles of the CIGS or as stipulated by private international law[3].

As observed, in transacting businesses, conflicts emerge, such conflicts are supposed to be resolved using the legal provisions. These disputes should be resolved using international commerce litigation, mediation, or arbitration. International litigation faces several challenges which must be overcome if success is to be achieved in the end. Such difficulties in litigation include the reluctance by a party to have their cases settled in another country outside their own. This is based on suspicion of potential bias or unfamiliarity to the place. This explains why international commercial arbitration has shot to prominence as a means of settling business related disputes.

Arbitration is commenced to help settle disputes pursuant to an agreement struck between or among parties to a dispute. The arbitral panel or the arbiter derives the authority to conduct a case from the commercial agreement. Any decision reached by an arbitration process is referred as prima facie meaning it is binding. Arbitration is either ad hoc or institutional. Institutionalized arbitration takes place in places like ICC[4].

Through set rules, the institution governs the arbitration process. However, before a case is settled by the ICC, the terms of a commercial contract are thoroughly examined to determine the wisdom behind resorting to the institutional procedure. In the case of ad hoc arbitration, the parties to a contract have not necessarily made a particular reference to an arbitral institution[5]. So, the submission of a case to arbitration is simply made on the basis of an agreement between the conflicting parties.

Parties must agree on the state where the arbitration is supposed to take place. Secondly, parties to a dispute must agree to use the arbitration process in cases where such reference was not made in the initial contract[6]. This clearly indicates that parties to a dispute have to agree on a plethora off aspects. In seeking a common ground concerning which state to hold the case and whether to use the procedure require time. It should be noted that time is among the greatest resources available to human beings.

Towards this end, if time is consumed on reaching a decision on arbitration, then the method may fail to aid urgent matters. The other difficulty concerning g choice of state of hearing is premised on the fact that statues governing arbitration differ from one state to another, as such, there is likely to be a tussle on state preference.

If towards resolving such cases, a state which is home to one party is chosen, then issues of bias may dog the whole processes especially if the ruling is made in favor of the party who is a citizen in the country of arbitration. This does not however imply that arbitration will always present bias. The realization that commercial rules are not uniform calls for harmonization to create a uniform plank which translates into commonality in dispute settlement.

Bibliography

Ziegel, Jacob S. and Lerner, Shalom (eds), New Developments in and Consumer International Commercial  Law, Mc Grawl Hill, 1998.

[1] Ziegel, Jacob S. and Lerner, Shalom (eds), New Developments in and Consumer International Commercial  Law, Mc Grawl Hill, 1998. [2] Ziegel, Jacob S. and Lerner, Shalom (eds), New Developments in and Consumer International Commercial  Law, Mc Grawl Hill, 1998. [3] Ziegel, Jacob S. and Lerner, Shalom (eds), New Developments in and Consumer International Commercial  Law, Mc Grawl Hill, 1998.

[4]Ziegel, Jacob S. and Lerner, Shalom (eds), New Developments in and Consumer International Commercial  Law, Mc Grawl Hill, 1998. [5]Ziegel, Jacob S. and Lerner, Shalom (eds), New Developments in and Consumer International Commercial  Law, Mc Grawl Hill, 1998. [6] Ziegel, Jacob S. and Lerner, Shalom (eds), New Developments in and Consumer International Commercial  Law, Mc Grawl Hill, 1998.