Reproduced with permission of 25 Journal of Law and Commerce (2005-06) xvii-xxi
Jernej Sekolec [*]
It is a pleasure to welcome you on behalf of UNCITRAL, the United Nations Commission on International Trade Law, to the conference celebrating the 25th anniversary of the United Nations Convention on Contracts for the International Sale of Goods and reviewing the experience with the Convention.
The Convention has been adopted by close to 70 States. Their share in cross-border trade represents over two thirds of the total volume of international trade. The States members range from the least economically developed to the most developed and all major legal traditions of the world are represented among them. This makes the Convention a world sales law and the experience with the Convention guarantees that the membership in the Convention will continue to grow.
The Convention has made the rights and obligations of exporters and importers of goods easier to ascertain, and those rights and obligations are expressed in a way that is understandable by parties from different legal systems, resulting in a reduction in the costs of administering cross-border sales transactions. However, ultimately these benefits depend on a uniform interpretation of the Convention and the universal dissemination of information about how the Convention is being interpreted.
The Convention itself emphasizes the goal of uniform interpretation: in article 7(1) of the Convention it is stated that: "In interpretation of this Convention, regard is to be had to its international character and the need to promote uniformity." Furthermore, pursuant to article 7(2), "Questions concerning matters governed by this Convention which are not expressly settled in it are to be settled in conformity with the general principles on which it is based." Only when such principles cannot be ascertained may the interpreter of the Convention resort to the relevant national law (itself determined in accordance with the rules of private international law). [page xvii]
Uniformity does not mean that the Convention is frozen in time and independent of evolving circumstances. The Convention, if it is to be of maximum use, must be interpreted in a way that allows the uniformity regime to adapt to evolving practices and commercial expectations. Several means of ensuring this adaptability of the Convention have been built into its text. One is the provision in article 7, according to which a factor to be taken into account in interpreting the Convention is "the observance of good faith in international trade." Another is article 9, according to which "The parties are bound by any usage to which they have agreed and by any practices which they have established between themselves." The threshold for usages to become binding on the parties is rather low, since under article 9(2), "The parties are considered, unless otherwise agreed, to have impliedly made applicable to their contract or its formation a usage of which the parties knew or ought to have known and which in international trade is widely known to, and regularly observed by, parties to contracts of the type involved in the particular trade concerned." Thus, evolving usages will complement or may even supersede the express language of the Convention.
Information on how courts and arbitral tribunals in various countries have interpreted the Convention is necessary for its full understanding, including what it means to have regard "to its international character," how trade usages are being given effect in the context of the Convention, or how good faith is being understood in international trade. Such information must be reliable, widely understandable and easily accessible.
A better understanding of how the Convention is being applied among courts in various jurisdictions will also assist parties in adjusting the drafting of their contracts taking into account the provisions of the Convention, and in making informed decisions as to which matters should be addressed in a given contract or type of contract, how they should be addressed and what could be left to be governed by the Convention. The benefit of reviews of contract formulations against the background of the Convention and its interpretation is particularly significant in the case of standard contract wording, such as general contract conditions.
Better information about the use of the Convention would also make it abundantly clear that the practice of contractual exclusion of the Convention, to the extent is it is still used, is counter-productive inasmuch as it deprives parties of the benefits of performing the transaction under the aegis of a law that they understand as opposed to a national law that is typically foreign to one of the parties. [page xviii]
During the late 1980's, the UNCITRAL Secretariat established a system for collecting and disseminating information on court decisions and arbitral awards relating to Conventions and Model Laws that have emanated from the work of the Commission. The system is known under the acronym "CLOUT" ("Case law on UNCITRAL texts").
Over time, a considerable body of case law on the Convention has been collected and published. As important as it has been to continue collecting and publishing information about individual court or arbitral decisions, it became increasingly clear that practitioners, judges or arbitrators find it time-consuming or difficult to obtain an overview of positions, trends or divergent views in the understanding of the Convention from a large number of individual decisions.
Against that background, the UNCITRAL Secretariat suggested in 2001 that an analytical Digest of court and arbitration cases be prepared which would provide such an overview and at the same time link that information to the individual decisions on which the Digest is based. The Commission agreed with the suggestion and in doing so decided that the Digest should be as objective as possible in presenting the views emerging from case law and in particular should avoid criticism of the decisions of national courts.
This kind of approach is sensible on several grounds. In many States, court decisions are frequently the subject of comments, sometimes fiercely critical, by practitioners and academics, and publications expressing such comments are widely used and appreciated. However, a criticism in a publication sponsored by an intergovernmental organization such as UNCITRAL might raise a number of questions in the eyes of the courts, practitioners or States, such as who is the author of the view, are there contrary views, has the criticism taken into account all the factual particularities of the case, whether the State or the court could respond to the criticism, or whether the publication of the criticism should be regarded as a considered endorsement by UNCITRAL. Such opinionated comments in an UNCITRAL publication would draw the wrong kind of attention to the Digest and might even compromise its usefulness. Bearing in mind that the Digest is essentially an analytical summary of numerous decisions, it would also be difficult to formulate plausible criticisms without presenting in sufficient detail all the factual and legal grounds on which the decisions are based. Perhaps most importantly, it is unnecessary to complement the Digest with criticisms of individual decisions, since questionable or wrong decisions tend to draw authored criticisms in various publications in any event. Further, the Digest, by presenting the mainstream views emerging in practice, can fulfill its role of [page xix] fostering uniform interpretation, having regard "to its international character," without censuring decisions that may be regarded as aberrations.
The absence of criticism, however, does not mean that a decision that is an aberration -- and as such is likely to appear in the Digest as an isolated or minority view alongside the prevailing and mainstream position adopted by other courts -- would not attract attention of the users of the Digest. It would then be for the readers to make up their own mind, consider the divergence of views and either find the decisions that form the prevailing view (or the view supported by travaux préparatoires) as convincing, or to delve into the grounds of the decisions in search of reasons that justify distinguishing the various positions taken on the basis of facts, usages, good faith etc. Such exercise, in particular if it is undertaken by judges and then commented upon in academic writings and reflected in subsequent editions of the Digest, will contribute to a welcome refinement of the understanding and interpretation of the Convention.
Efforts have been made to make the Digest a comprehensive reflection of views taken by national courts. However, it is clear that at the current stage there are decisions, in some countries a good number of decisions, that have not been included in the Digest: nevertheless, I am confident that the Digest is for many practical purposes a sufficiently broadly based and useful reflection of views of courts on individual provisions of the Convention. This confidence is based on the fact that the National Correspondents are called upon to transmit to the UNCITRAL Secretariat a selection of court cases that are significant and representative and in their view reflect the case law in the jurisdiction concerned. In addition, efforts have been made in the preparation of the text to use cases that have not yet been reported in the CLOUT system. The wide consultation process prior to finalizing the text is also being used to increase the likelihood of obtaining information and suggestions that will help make the Digest be comprehensive and reflective of the significant judicial views.
This is the first edition of the Digest, which will be updated as new developments in case law will require. The Secretariat in cooperation with the National Correspondents and experts will take care to register such developments, include in the Digest new cases or older significant cases that may have been missed. We will also cultivate lines of communication with the academic community in order to obtain the necessary information to keep the Digest as comprehensive and useful as possible.
The Secretariat plans to circulate it widely and invite courts and others in States members of the Convention, in particular those that have no or few [page xx] decisions reflected in the Digest, to provide us on an ongoing basis with information to keep it up to date. In that vein, I would also like to request the conference participants -- and anyone else who reads these lines -- to send the UNCITRAL Secretariat comments or information that may be relevant for future editions of the text.
In conclusion, I would like to thank the Vienna International Arbitration Centre, which ably co-organized this conference with UNCITRAL, and wish all of you a fruitful conference. [page xxi]
* Secretary, UNCITRAL, and Director, International Trade Law Division of the UN Office of Legal Affairs.
1. The UNCITRAL Secretariat can be contacted at Vienna International Centre, A-1400 Vienna, Austria; tel. +431 26060-4060, fax: +431 26060-5813; e-mail: <email@example.com>.