1、a. The sale must be international.1) The buyer and seller must have their places of business in different states.2) Additionally, either:a) Both of the states must be contracting parties to the convention, orb) The rules of private international law must lead to the application of the law of a Contr
2、acting State.1 Note: CISG may apply even if the buyers and sellers places of business are not in a contracting state.2 Exception: The final provisions of the Convention allow a ratifying state, if it wishes, to declare that it will apply the CISG only when the buyer and seller are both from contract
3、ing states.2. Opting In and Outa. The parties to a contract may exclude or modify the CISGs application by a “choice of law” clause.b. Whether parties can exclude a domestic law and adopt the CISG in its place depends on the rules of the state where the case is heard.Case 10-1. Asante Technologies,
4、Inc. v. PMC-Sierra, Inc.3. Sale Defineda. CISG does not directly define a sale.b. Implied definition: The delivery of the goods and their supporting documentation by the seller and the payment of their price by the buyer.4. Goods Defineda. CISG does not directly define goods.1) The drafters assumed
5、that the CISG only applies to goods that are movable and tangible.a) This is in accord with international usage.b. CISG list the sales and goods that are excluded from its coverage.1) Sales transactions that are excluded:a) Goods bought for personal, family or household use.1 This exclusion does not
6、 apply unless the seller knew or ought to have known that the goods were bought for personal use or consumption.b) Auction sales.c) Sales on execution or otherwise by authority of law.2) Goods that are excluded:a) Stocks, shares, investment securities, negotiable instruments or money. Many similar g
7、oods are not excluded (e.g., patents, copyrights, and trademarks).b) Ships, vessels, hovercraft or aircraft.c) Electricity.5. Mixed Salesa. Mixed sales and services contracts are treated by the CISG as sales of goods, unless “the preponderant part of the obligations” of the seller “consists in the s
8、upply of labor or other services.”1) Preponderant probably means more than half.2) Whether this is measured by the cost, the sale price, or by some other basis is not clear.b. Contracts for goods to be manufactured are sales unless the buyer undertakes to supply a substantial part of the materials.1
9、) Substantial is probably less than half.C. CONTRACTUAL ISSUES EXCLUDED FROM THE COVERAGE OF THE CONVENTION1. The CISG Only Deals With:a. The formation of contracts.b. The remedies available to the buyer and seller.2. The CISG Specifically Excludes Questions About:a. The legality of the contract.c.
10、The rights of third parties.d. Liability for death or personal injury.3. Preemption: When the CISG applies, domestic law is preempted.a. Reason: the CISGs basic function is to establish uniform rules for international sales contracts.b. Scope of the CISG.1) CISG applies to contractual issues.a) CISG
11、 preempts the local law even if the local law gives a different name to a particular remedy.b) CISG preempts the local law even if the local law adds additional elements to a matter that is contractual in nature.D. INTERPRETING THE CONVENTION1. Interpreting the Provisions of the CISGb. Consider the
12、following sources, in the following order:1) The Convention.2) The general principles on which the Convention is based.3) The rules of private international law.2. Interpreting the CISGa. To interpret the words of the CISG itself, consider:1) The international character of the Convention.2) The need
13、 to promote uniformity in the Conventions application.3) The obligation to observe good faith.b. Rules of interpretation.1) “Plain meaning”: Look at the words of Convention itself.2) Travaux preparatoires: Look to the CISGs legislative history to determine its intent.3) Precedent: Use case law to in
14、terpret the CISG.3. General Principlesa. The CISG calls for courts to look to the general principles on which the Convention is based when interpreting its provisions.1) The CISG gives no list of general principles.a) Suggested principles (that appear, in varying forms, throughout the convention): 2
15、 Parties have the obligation to mitigate damages resulting from a breach.2) The CISG requires that general principles be derived only from rules given within the Convention itself.4. Rules of Private International Lawa. Rules of private international law may be used only when:1) The Convention itself does not directly settle
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