An Overview of the CISG
The
CISG (United Nations Convention on Contracts for the International Sale of
Goods) is a treaty that aims for a uniform international sales law.[1]
It has been ratified by 83 nations and the latest member state to join is
Guyana in September 2014. The CISG has been developed by UNCITRAL (United
Nations Commission on International Trade Law) and was signed in Vienna in
1980. However, it came into force on 1st January, 1988.[2]
The
Convention prescribes a uniform law for the international sale of goods seeking
to substitute one law for the many legal systems that govern this area. The
importance of CISG lies in the fact that it establishes a comprehensive set of
legal rules that could govern the formation of contracts, the obligations of
the buyer and seller, remedies for breach of contract and other aspects of the
contract in international sale of goods. To accomplish its objectives, it is
essential to interpret it properly.[3]
The
most important provision in this respect is Article 7 of the CISG. It provides
for standards and is the key to solve the interpretative issues involved in the
international commercial transactions.[4]
The
text of CISG is divided into four parts:[5]
1.
Part I – This comprises of Articles 1-13 that deal with the sphere of
application of the convention and its general provision.
2.
Part II – This comprises of Articles 14-24 and contains the rules
governing the formation of contracts for the international sale of goods.
3.
Part III – This comprises of Articles 25-88 and it deals with
substantive rights and obligations of buyer and seller arising from the
contract.
4.
Part IV – This comprises of Articles 89-101. It provides the final
clauses of the Convention concerning such matters as how and when it comes into
force, the reservations and declarations that are permitted, and the
application of the Convention to international sales where both States
concerned have the same or similar law on the subject.
Before
moving further, let us under the scope of the application of the CISG.
Scope of the CISG
The
CISG applies to contracts of sale of goods between parties whose places of
business are in different States and either both of those States are
Contracting States, or the rules of private international law lead to the law
of a Contracting State. The CISG governs contracts for international sales
only.[6]
The CISG contains a list of types of sales that are excluded from its application,
either because of:[7]
1.
The purpose of the sale
2.
The nature of the sale
3.
The nature of the goods
Article
4 of the CISG categorically states that the subject matter of the CISG is
restricted to:
“The
formation of the contract of sale and the rights and obligations of the seller
and the buyer arising from such a contract.”
The
CISG is not concerned with:[8]
1.
The validity of the contract.
2.
The effect which the contract may have on the property in the goods sold.
3.
The liability of the seller for death or personal injury caused by the goods to
any person.
It
is important to define the scope of the CISG as it will help define the
external boundaries of interpretation of its provisions. The interpretation of
the CISG cannot applied to matters on which the CISG is silent. In the next
post, we shall talk about the interpretative issues in the CISG.
[1]
Refer to Preamble to the CISG.
[3]
Jan Hellner, Gap-Filling by Analogy: Art. 7 of the U.N. Sales
Convention in Its Historical Context, Studies in International Law,
(Stockholm 1990) 219-233.
[4]
Ibid.
[5]
Please refer to Supra note 2.
[6]
Ibid.
[7]
Vivian Grosswald Curran, The Interpretive Challenge to Uniformity, 15
J.L. & Com. 175, 176 (1995).
[8]
Ibid.
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