Research Handbooks in European Law series
Edited by Peter Stone and Youseph Farah
Chapter 7: International sales of goods and the Rome I Regulation
International sales of goods are high risk ventures. Both the seller and the buyer face many uncertainties. The seller, for instance, faces the risk of whether he will get paid on time and the buyer the risk of whether the goods will arrive on time and will meet the contract specifications. While the same uncertainties affect domestic sales of goods transactions, the parties to the contract, in the event of a dispute regarding performance, do not face any uncertainty or unpredictability about which law will apply to their contract. This is not the case in international sales. For instance, in the case of a sale contract between a seller located in England and a buyer located in China, the question that has to be determined first is what law applies to the sale contract in the event of a dispute? Is it English law or Chinese law? Or even the law of a third country, if that is what the parties have stipulated in their contract? The expectations and legal remedies available for non-performance depend on the law governing the contract, and there is no guarantee that the substantive provisions of different national sales law converge. This inevitably leads to both uncertainty (since it is not possible to say which law applies to the contract) and unpredictability (since it is not possible to predict the outcome).
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