Private International Law

With its applicability only to specific aspects of a contract for an international sale of goods, there is indeed wide array that calls for the application of other sources of rules and laws to regulate and govern an international contract of sale. By its limited applicability alone, the Vienna Convention admits of its contingency and the necessity that it be supported by other legal systems to fill in the gaps and the vacuum that the Vienna Convention does not cover.

The Domestic Law and other sources of international rules on commercial transactions are not totally left out, and rendered useless simply because of the promulgation of the Vienna Convention. These sources of laws can always come in to supplement the incomplete provisions of the Vienna Convention (CISG). Domestic laws and other legal systems remain to have their place in international commercial transaction not only when the forum does not prescribe the application of the Vienna Convention (CISG) but even if the forum is properly laid in a Contracting State where the application of the Vienna Convention is mandated to be applied.

In such event, the domestic law and other binding and existing legal systems, are juxtaposed with the Conventions and penetrating the fringes where the force and effect of the Vienna Convention is basically nil. Impact on the Buyer and the Seller: The Doctrine of Party Autonomy: In almost all jurisdictions, parties, which are mainly, consist of individuals, firms, entities, or juridical persons have the so-called liberty to bind themselves through the execution of a contract.

The said contract is the law as between the parties and each party thereto has the legal obligation to perform the terms and conditions set forth therein. These terms and conditions are product of the will of the parties upon their stipulation of the terms and conditions before a contract is formally or finally perfected. It has been a common tendency of the International agreements, and even of domestic law, to bind the parties to the provisions of the said laws or treaties.

This is a drastic measure whereby the individuals or persons have no leeway to exercise their discretion and freedom to stipulate. “In international treaties, the autonomy of these individual persons, natural or juridical is totally excluded in the consideration and contemplation of these international agreements, as only states or government are the proper subjects of these international agreements.

” Conventions and Treaties directly and primarily binds the states that has become signatory thereto, but still the individuals persons or entities should abide by the terms of the said international treaties and agreements as being subjects of the contracting states. A radical shift to the mainstream style on international agreement was attempted by the Vienna Convention. “The interpretation of the convention is based on three principles: its international character, the need to promote uniformity in its application and the observance of good faith in international trade.

” It likewise, introduces the principle of “Party autonomy”, adhering to the liberty of the parties to either include or exclude the provisions of the Vienna Convention (CISG) within the terms and conditions of the contract. Article 6 of the Vienna Convention (CISG) has set out the basic policy of party autonomy by stating that: “The parties may exclude the application of this Convention or, subject to article 12, derogate from or vary the effect of any of its provisions ”.

“In other words, although the buyer may not unilaterally exclude the convention after the sales contract is concluded, he may agree with the seller at any time to exclude the conventions or to accept terms varying the effect of the convention”. If the contract has not yet been concluded the buyer may also exercise control by conditioning acceptance of his offer upon exclusion of all or part of the convention  ” The principle on party autonomy serves the very purpose of an expeditious and convenient formation of international transaction and the movement of goods.

It does not undermine the confidence of the businesses to contract for the exchange, transfer, disposition and other related transaction because of the uncertainty and difficulty of applying and harmonizing the law to their contracts. The Vienna Convention (CISG) was made more responsive and adoptive to the needs and requirements of business expediencies, without impeding to a certain extent the movement and flow of international transaction.

There are two aspects in which party autonomy may be shown in relation to the Vienna Convention on Contracts for the International Sales of Goods. First, parties to a contract, which belongs to a Non-contracting state, may agree that the Vienna Convention (CISG) will govern their commercial transaction. The Vienna convention, subject to other rules of private international law and domestic substantive law may apply in the said international commercial transaction.

Secondly, the parties belonging to a Contracting State, or where the law of a Contracting is most likely to apply in the contract upon due consideration and application of the rules under Private International Law, may stipulate in their contract that their transaction will not be governed of is excluded within the coverage of the Vienna Convention. “To any business person who believes “no one can screw up a good deal like lawyers and accountants,” the best advice is to know and trust your trading partners. ” That is, after all, the cornerstone of international trade.

” In cases of the exclusion of the Vienna Convention (CISG), other mandatory national laws or international laws will govern the said transaction. However, once being in a Contracting State, a party to the contract may not easily derogate the provisions of the Convention. In cases of derogation by the parties in order to a have their choice of law, such derogation must be stated in express terms, or at least in a language clear enough to determine the intention of the parties that indeed the provisions of the convention is not to be applied to the contract.

“When determining whether to exclude application of the CISG, one should keep in mind: (1) exclusion should be explicit because some commentators question whether the CISG may be excluded by implication; and (2) the contract term should both exclude application of the CISG and specify what law is to govern. ” The exclusion cannot simply be implied from the language and circumstances of the contract and the court has not duty to interpret whether the Vienna Convention (CISG) has been excluded impliedly, absent such express declaration of exclusion of the convention.