4.

11 第一节

Yes. OK. So good morning, everyone. Can you give me then? Hopefully yes. That's why I

called the woman. Yes, OK. Thank you. So good morning again. As you probably know, my

name is Ishan Landers. I'm from a British Lorand university that's actually a partner

university in Budapest, Hungary. I don't know if you ever been to Budapest to Hungary, but

actually right you are hearing. Unbold. That's actually nice excursion for you if you want to

come over to put the patch and visit the pet. So basically, I'm here today and for the rest of

the week to discuss some of the issues concerning the cisg with you and My first question is

that before we get into the topic, actually that can you just please tell me something about

your background like are you or law students? Yes. And have you already studied? I don't

know anything about private international law. Conflict of laws. Hmm. Contract law. CSG,

yes. OK, so we are down for the week? No, of course. And have you already started about the

CIA? So you already know what the CIS is. So what do you know already about this, IG?

Because I just don't want to repeat what you already know, so we can build upon that. OK,

don't worry, it's not an exam. So because basically what we'll do as I mentioned that the

previous study about the CIS, maybe you have already studied something about the CIA, but

we will get more into this and discuss some of the most important provisions, concepts.

Under the sea. So this is basically to some extent the structure that we will have for the week

that today we start with the general introduction with the CIG and then we will talk about

the so-called general part of the ciig then tomorrow, since you already know what the CIA G

is about. I'm. Free to tell you then that tomorrow we'll talk about the formation of the

contract. So how the CIA G regulate the formation of the contract and then on Wednesday we

will talk about the rights and obligations of the parties contract and then actually for them,

sorry that's on Thursday and then. On Thursday and Friday, we will look at some case

studies that actually we will discuss further the rights and obligations of the parties,

especially the remedies that what if one party breaches the contract then what remedies the

other party might have. So basically this is more or less the structure that we then. So you

said that you have already studied private international law, contract law. You cannot see it,

but you can see it on the desktop that let's see that we have this very short hypothetical that
we have a company which is established in Austria and it concludes a contract for the

purchase of certain would. I just really this time so for the purchase of food from Company B,

which is established in Belgium. So what happens is that in the contract they agreed on a

certain kind of food, but at the end this is not the kind of food that was delivered. So what is

what the company is so the Austrian company can do? Imagine that we represent those

same company. What could we do in this situation? What would we do? Feel free to say

anything. Actually there is no one single good answer. So basically The thing is that we have

two companies, company A and Company B, and company A intended to purchase something

from Company B. Company B delivered something, but it wasn't exactly what company.

Expected from Company B, so company A is not happy with what was there. So what can

companies do? Since we represent company a, what what would we do in this situation?

First contact the company and ask whether they have some letters to deal with this situation.

Maybe they completely can provide some like measures to maybe change what they have

delivered. I'm using. And if they cannot do this, you can. You have a contract, you have some.

Turn over contract if you have like some content like the application or you can go to the

arbitration. Place and ask for. Yes. So the first step would be a very good like we would try to

somehow negotiate with company, try to somehow find a solution. And in that regard

basically you mentioned maybe they can change the product that they deliver, maybe we can

agree on some kind of price reduction or any other kind of remedy, but it's not necessary.

You know what would matter in that case? When we are in negotiation, usually what is what

is like the driving force for the parties in negotiation. It's low is important or might be

important of course, but also what is very important is what the interest, the business

interest of the party. So what's the business interest of company. He was the business

interest of Company B. If they want to somehow save their relationship, business

relationship, they might be ready to give up what they would otherwise not give us. So

basically the business in business interest would be then the driving force and then the law

would not necessarily be that important. You also mentioned arbitration, so if they cannot.

Everything might go to arbitration. From that I assume that you have already studied

something about arbitration, right? So then basically what is required for company A? If
company A wants to initiate an arbitrary proceeding against Company B, what is required

that there should be an arbitration agreement? Somewhere, somehow, between the two

parties. It can be in a contract, it can be in a separate agreement, doesn't matter. So there has

to be an arbitration agreement and then a company could initiate an arbitrary proceeding. If

there is no such an arbitration agreement, then and we cannot negotiate a solution with the

other party. But. You want the, let's say the the particular wood and then what is what we

can do which is basically there for us under like this constitutional law and this is something

that we can do irrespective of whether we agree on that or not. Then we can go to court and

then we can seek some kind of families before. The the code and then. When it's an arbitrary

tribunal or when it's a state court, usually these third parties, because an arbitrary tribunal

arbitrator was a third parties compared to the two contracting parties, or a judge is a third

party compared to the to the two parties in the context. So they need some kind of. Point of

reference when they decide the dispute. And what is this point of reference? Basically for a

state court judge. So based on what the state court judge will decide to dispute if you have

already studied private international law. Then basically you know that it's it's so low it's it's

usually a state law because state court judges cannot fully apply so-called non state law as

law. So there is always a law, a state law and then basically somehow have to determine that

what will be there. The state law, the judge will have to determine that. What will be done?

The law governing that particular relationship? If it's an arbitrary proceeding, have you

already studied about arbitration? OK, that's always a good answer. So, so if it's an arbitrary

proceeding then previous study brought it more, but maybe you have already discussed it

that an arbitrary tribunal enjoys provider. Let's say freedom or discretionary power to

determine the applicable law. So in an arbitrary proceeding, the applicable law can be not

only a state law but also so-called rules of flow. So which is not a state like, I don't know,

German law, Chinese law, Hungarian law, Belgian law, oceano, but something that is.

Different than a state law, but represents a body of low body of fruits of flow that can be

used that can be applied in certain relationships and we will talk about this later because

these will be also important from the point of view of them. Cisg so. State law or some rules

of flow. But when it's a dispute as we discussed, we need to know that basically what is very
good relationship that we have in front of us and then basically what do you think what? OK,

So what do you think because usually I have the slides here, so that's why I keep looking

here but. Yeah. So if you if you think about it. Do they have a contract company and Company

B? Can we just tell it now based on this very simple facts? Do they have a contract or not?

Yes, you say, yes, bye. I think the contract does not need a. A does not need a paper, although

there is a whole and there is a reply as soon as they have a contract. Hmm. So it doesn't have

to be in writing, let's say, if I understood you correctly. It doesn't have to be on paper, I don't

think. For the substantive law, don't think the paper is is is necessary. So I think as long as

there is. All right. So the contract has been made. Yes. Uh, very good. Uh, any other comments

or observation? Yes. So, So what you said is that basically if I. Somehow translated it for me

that uh, I mean in the sense that in in this. Contest that on the one hand if we have an offer,

and then on the other hand if we have a reason. Sentence they're basically that these two

communications should or these two statements can make a contract because they sort of

represent what the meeting of minds of the parties, the consent that they want something

that is legally binding between them, which is very good. This is usually like the basic

structure. The contract is concluded that we have we need this kind of expression of consent

and and intention that yes we want to be bound by contract and then how it is expressed as

we will see that later on the CIA as well that in the form of an offer and in the form of an

acceptance and that was also very good what? You said that it doesn't have to be interacting

generally the contract in order to be formed and in order to be valid, because if we can prove

this consent of the parties, this meeting of mind of the parties through other means, because

usually by by return for this is is necessary or required. Maybe it's for registration purposes.

Somehow the contract has to be registered. Maybe it's for control purposes, maybe it's for

actually evidence evidentiary purposes. So somehow we have to be able to prove that the

contract was concluded, but if you don't have like one single document. In paper that this is

the contract so if it's not in writing but we can prove it, otherwise we will see later that how

we can do that. Then basically initially we can say that there is a contract. But the. This is

basically based on what? This assessment that. Full firm acceptance meeting of men's

contract. So this is based on what law, for example, what you said that was based on what?
Like if you have to indicate the legal source, the legal basis for that. Because this is an

international trade, international transaction, so I think maybe they need to maybe the the

applicable law should be determined by by, maybe by private international law and if they if

they can meet the requirements of. Yeah, that's true. So maybe they also can't, like, they have

three in this case. Yes, yes, you're right. So we have to determine that we have a low since

this is a contract that involves a foreign element because one party is from one country to

the other part is from another country. So it's not a pure internal situation. So this question

of applicable law, right. And then we will have to determine that what will be this applicable

law and then maybe it will be the city, but if it's the CIA agent, we are getting to that. Of

course, it's not a national law. The CDC is something that is a unification instrumenting the,

it's an international treaty that. Actually, one very important feature of the CIG is that it's not

mentioned. Sorry. It's not national at all. And so it's not national, but it's an international

treaty, it's a unification instrument, which basically means later what we see is that, for

example, we cannot resort to the national law when we like interpret the CIA when we see

for example the concept of offer in the CIG. In Article 14 it seems like, let's say, the complex

of concept of under Hungarian law, maybe under Chinese last word, but we cannot resort to

the national law and the interpreter CIG, because we will see it later that under article seven

of the CIG we have to take into account the international character. Uniform application, so

basically it's not something what we could use like national law to interpret these

provisions. So that's a very important, it will be a very important. Issue here and the

difference between national law and we apply national law and then we apply the CIA. So

basically usually these answers are based on some kind of legal traditions, national laws or

maybe an international treaty like CIG. But it's very important to know that what is the

applicable law, what is the applicable, let's say, source of law, because the contract itself is

already a legal constraint. So contract just do not exist because they are the creators of flow

of course, as we know. So we need to know that what is the law under which we would

assess. That whether at least something what they have between themselves company and

Company B whether that's a contract or not, whether it will be enforceable or not. And that's

why actually from all perspective you know it's important that whether they have a contract
or not because that will take us to the question that whether it will be an enforceable.

Agreement between the parties or not. So if company A is not happy with what it received

from Company B, whether a company can go to court or if they have an arbitration

agreement in arbitrary treatment. Or just. Really on on a Company B that whether Company

B will then have and and deliver the goods that they agreed on and that was very good that

you already mentioned and. So we discussed that when we have this cross-border situation,

usually two questions, two like branches of lower area flow will be relevant. One is of course

private international law. Private international law in this sense will mean what would mean

conflict of laws. In a broader sense, what is private international law. I'm sure you know.

Because it has like three parts let's say. And if we look at private international in the narrow

sense then it's conflict of laws. So for example here, no let's just forget the cisg. So Australian

company, best company, what is the applicable or maybe it's Australian law. Meet the bad

and low. Maybe it's German law. So it depends on the conflict of laws rules of the. Of what

state? Do you know that? Because it will be actually important later that. Can you read it

from there? And because it did so, so it's less. 4. And there, obviously you cannot read it from

there, but uh, next 40? Have you already heard about this concept? This next boring. And so

this. Legs 40. So next 40 this is. OK I just typed it there so you zoom so you can see it in the in

the chat. So this next 4. It is the law of the country where the forum is located. So basically if

we have this situation, company and Company B, actually the first question would be that if

it's a state of perceiving the trash, company can initiate the state court proceeding against

Company B. That would raise the question of. Jurisdiction, right. That's what. What court will

have jurisdiction or can have jurisdiction and then maybe it's. Mostly in court. Maybe it's

badge in court. So let's say the badge import so basically then the badge on court will have to

determine the applicable load and then it will apply 640 private international law rules,

conflict of laws rules to determine that. And if you have already studied private international

law. Yes. Maybe, maybe you have already heard about? This one there. Room 1 regulation. In

Europe, in the European Union, this is like the private international law source that we

would apply in sales contracts since obviously we're talk about sales contract to determine

the applicable laws of the bathroom quote would apply this promo regulation to determine
the applicable No to this. And then this next four is below the country where the form is

located. So that's the second question. And the third question is actually recognition

enforcement. So jurisdiction applicable and recognition enforcement. These are the three

main questions, private international law in the narrow sense, it's conflict of laws in the

broad sense, it's for these. 3. And then basically we know where we will see that private

international is relevant when we have this cross-border situation and also of course

substantively because somehow we will have to apply substantive law. In order to, for

example determine whether that contract exists or not, whether that contract is valid or not,

whether a company has any right to claim, let's say replacement of the goods or not, that

specific performance or not, or better, actual company can only damages because. If you look

at that, of course we are not getting into this, but if we consider the different legal systems of

the world, even if some very basic ideas of contracts were at the same or. Very similar in the

different national laws, there are or there might be actually important differences like for

example just I mentioned this specific performance. Whether we can request specific

performance so the other party does not perform the contract, whether we can request the

other party to actually perform the contract. And deliver the wood that we want to get, or

what we can just claim is damages. So the other party did not comply with the code, did not

deliver the goods. That's fine, but we cannot request specific performance, we can only claim

damages. These are for example. Issues that might be different in the different nationals or

or like the relevance of good faith. I don't know. Is it based on your studies so far? Is it no

obligation of the parties to act in good faith when they negotiate the contract when they

conclude the contract? Is there any obligation like direct obligation for the parties under

your national law? American independence. Usually on the particular national laws. In some

national laws, yes, that's a requirement, so the parties have the obligation to act in good

faith. In other national laws, there is no such requirement, so the parties. Cannot be

applicable if they do not act in good faith in the course of negotiation. Maybe that can raise

other questions later. But not contract claims, not contractual claims. So there are

differences in the different national laws and then basically somehow these differences.

Have to be overcome and how these differences are overcome through some kind of
purification and? This unification can take place at the level of private international and of

course we are not talk about that now, but it's good if you know that's where the level of

private international law, which would mean that the private international laws are unified

are standardized or at the level of substantive law. Really think is, let's say, easier. Unifying

private international law rules, or like, unifying, standardizing substantive contract law

rules. When it's about the unification of private international law rules, it would mean that,

for example, the same connecting principle that the same rule will be applied. So when we

have a sales contract, let's say, then order order countries that take part in that. Definition.

For example like the principal characteristic performance or we apply let's say the law of the

country where the seller has temperature residence. This is what we can see so. This is

something that is easier or like creation of substantive, unified, substantive rules. Sorry, I

guess you would find private information would disease, yes and right. Because substantially

more. I would like every every religion has their specific, substantive, substantial

international law, and they will stand for their own interests if you want to unify all the

substantive law. And every pleasure have their different legal system and they're all

interested over cultural history or something. So it's will be very difficult to have the

unification of their substantial yes, yes, you're right actually this is what also if we look at the

particular instruments that. Are created in this field so that and, and basically the evidence

by that that it's. It might be easier to create a unified unification instrument in the field of

private international law, then in the field of substantive law. I'm sure you have already

heard about the hey conference on private international law, which is Hague Conference on

private international law, which is an international organization dealing with private

international law and of course it's like. Everything or not necessarily everything, but it deals

with many, many aspects of private international apart of it. It says the contract and then

have already been adopted some text within the same conference dealing with the private

international law implications of sales contracts because border or international sales. That

contract. On the other hand, if we look at substantive blow unification, basically you know

actually the the source, the only source that was adopted in this field, and that's quite. Let's

say. Um. By the doctor, but basically that's the only one, the CIG, if we consider that the CIG is
the only convention from this point of view that unified certain areas or certain aspect of

contract law. There are some other unification instruments as well, but those are not

actually international conventions. But uh, some kind of other forms, we will talk about some

of these later just to show the the examples or the different approaches. So basically, yes,

that's that's a very good point that you made earlier that it is easier actually to unify and this

is what is shown by this instrument, private international law. Because if you look at

substantively, even if one can say that the contractor is a kind of commodity, which might be

good on the one hand or correct on the one hand but on the other hand, it's also very

cultural. It's also very cultural phenomenon, contract law. Because if we think about what it

is about, it's about agreements, it's about 40s negotiating. Making. OK. What we discussed

agreements expressing their concerns. So this is something what also build on or what is

also built on some kind of historical traditions and cultural traditions that how these are that

you then of course there are also very important or can be very important political

considerations in that. That how the national law can protect companies operating in the

field, in the territory of that country when they enter into international contracts and then

they're all over will be the applicable. Also how more advantages or more beneficial low can

be created for these companies. So there are many. Reasons which show or can show that it's

very difficult to unify. Unified substantive law rules in the slides actually now you see that I

skipped some slides, but basically because we discussed this, but later when you will read it,

you can it can help you to refresh what we talked about now so. Basically then to to briefly

sum up what we discussed so far that if we. If you think about this diversity that we can see

in the different national law, then basically there are different legal techniques to reduce this

diversity. One technique or one way related to the private international law, unification or

harmonization the other. One relates the right take us to the organization and unification of

substantive law and of course that can take place at global level and also at regional level

when we think about unification and communication. And of course, comparative role or the

role of comparative role will be very important. In this field, because if you think about

unification instruments or maybe also harmonizations, commands, but unification

instruments, in order to be successful for unification instrument, that has to show some kind
of compromise, so that is based on some kind of very important balanced compromise. And

that's why actually the CIG so successful, one of the reasons why the CIA is so successful, if

we look at the number of Member States of the CIG, that it represents some kind of very

good compromises in the text the CIA. And the next Mercatoria will be also important. What

is flex mercatoria? Do we know what is flex mercatoria? Love merchants or something like

that if we want to translate it. But what it what does it mean? Have you already heard about

this? Concept. Well, this is a very interesting area actually. The rest mercatoria, because on

the one hand it's very difficult to like precise your clear, you say that. This is lex macchiato

Oria and that's it. It's continuously evolving. This is something that is a transnational body of

law. So it's not not national law, it's a transnational body of law that was created or is being

created for this international transactions for this international contract. And raise it

relevant because on the one hand, it's not. It's not the national law, so it's not something

what would be applied, let's say by a state called directly that this is the applicable law. But

on the other hand, in arbitrary proceedings it can actually already happen that an arbitrary

prisoner will decide what is based on that material. So if the part is let's say. Say that in the

contract that yes, arbitration, and then the Arbitrary Tribunal should apply the next

methodia, then basically that's sort of minding. To apply the next America. So then the

decision will be based on next mercatoria and not not state law. And when we apply later,

we will see when we apply the CIS G let's make it to your availability game relevant because.

When there is a deep sorry, when there is a gap in the in the CIS, then how we can figure this

gap under the CIG? It will be actually. In article there's seven subsection 2 the relevant

because we have to look at the principles based on which these rules the CSG were created.

But what are these principles? Where can we find these principles, for example, in less

material? So if we think about that this diversity and how we can deal with this diversity,

these are like the main issues or the main? Let's say the techniques. Unification or

harmonization of private international laws. Substantive law rules. Comparative law is

important, and the rest of mercatoria. OK. And now since actually private international law

would be also interesting, but since our main topic is the CIA, so we will talk about

substantive law and substantive contract law. So if we think about the substantive contract
law. Basically, usually the starting point is national low. I know you already know that, but

this is the starting point. Like here you can see some examples from Austria, from Germany,

from France, Italy, but also from Hungary or from China. So the national laws dealing with

contracts, how do you get to that? Through private international law rules. But we already

discussed that there is also some tendency to create harmonized unified rules. What's the

difference or what might be the difference between formalization and unification if we have

to say a difference? Maybe based on just what I know that maybe you haven't studied it so

far, but like if we think about. The terms harmonization and unification. Yes. I see what to

say something. No, pinion of. That means. There is a conflict between two law laws, but we

don't. We don't. We don't set a set a unified rules, just. Some nice the the the the different

laws and try to find some connection or try to find some to help. Known as the. Unification

means we need to establish a unified rules and apply these rules to. For every case is, so I

think this is a difference. Maybe yes, no, not maybe very good that if we want to make a

difference between harmonization and and the unification, that's actually difference that

harmonization. As the name suggests, it's not about the creation of one single instrument.

That will be then the unified test. What they said about harmonizing national laws, a good

example can be for that. For example, have you already discussed about directives in the

European Union? Directives like the different legal sources within the EU law and directives.

So there are several directives that were adopted within the EU that deal with some kind of

consumer contract issues, or not several, but but some directives. So basically what it means

is that. Through these directives there are some minimum standards, or, sometimes, when

it's a so-called maximization directive, maximum standards set in the national law, so the

Member States of the EU have to implement, have to transport these. Directive standard into

their national laws. But what we will apply is basically the national law in the first place and

not the directive directly. Of course, if the national law does not comply with the directive, so

if it's not the proper implementation of the directive. That kind of his questions. But, but

basically what we would apply is the national law. And if it's. And not a maximization or a

full harmonization directive. Then Member States can set different rules, so maybe at some

certain level they are standardized. They are. But Member States can still adopt their own
rules and keeping in mind what you just mentioned. Earlier like the political strategies or or

other strategies. So that's that's possible in case of harmonization, so then we apply

nationally. But of course it's not only in the field of EU law that we can talk about

harmonization. We will see later that for example the unit reference suppose I don't know if

you have already heard about the unit. Principles principles of international commercial

contracts. No. Finally, I could say something that you haven't heard about so far. So this

unitrac principles of international commercial contracts and really talk about it later that's

kind of supplemental can be used as a supplement to the cisg. So this is also can be also

considered kind of farm. Issues for men to the extent that that national laws, national

legislators can decide to follow this on the draft principles. Of course it's not binding on

them. If they want, they do that. If they want to follow some provisions, that's fine. So that

helps to somehow create some kind of harmonized body. Flow, but it's not something what

would be like then the directly applicable text. Whereas on the other hand, if it's a

unification, it's different because then it's like unification instrument that will be applied in

the EU legal system. Basically, what is let's say, the instrument for this. Unification. When

when this same law is created so one unified low, one low is created. I mean from this

perspective of course. If the directive was for departmentalization. Then room one is. Roman

is a. It's a regulation, so the regulation, the regulation is directly applicable in the Member

States. So what we apply is not national law. What we apply is the regulation itself, the rules

of the regulation, so directly the regulation, the very same instrument. Uh, so, for example, if

Hungarian court has to determine the applicable law to this Austrian Belgium contract, then

if you apply to what aggregation it is the Austrian Court, it will apply Roma regulation. If it's

the Belgian court, it will apply Romeo regulation. So not the national implementation of

these rules, because it's not even possible. Through three placement regulation, so and in

fact if the national law would contain corresponding provisions, so the same provisions. Like

the regulation, then the national law has to be repaired. So it's only the regulation that can

exist and that will be applied. So that's a unification instrument if we think about it this way,

and also the cisg as we will see because it's. An international treaty, as you know, and this is

actually. What did you have play and not not a national. So if we. So if you think about the
different sets of stairs row and now we turn like to the sales contracts and says so. This is

basically our more or less what we can see as the landscape that of course national law

matters national or will be relevant. And even if we apply the CIA, even if we will be within

the CID yet national law might still be relevant. And now you might say that OK, but

previously I said that if you. The CIA then there is no national law, but we can only look at

the CIA. But that refer to the interpretation question as we will see later, but it might happen

that we apply the CIRD, we will have to apply the CIG. But yet national law will be also

important. This UC. Do you know what this UC might be? Most tend for here. This

abbreviation it's from the United States. Profession, you have turn off the microphone. Oh,

sorry. When did that happen? Oh, it was turned off the microphone. I I guess someone sent

the message or. Oh yeah, so and. The microphone is working. OK, but. How much did you not

hear? A lot, a lot, yeah. They can hear you now. OK. So now we will continue. Sorry about that

and and if you have any questions feel free to. So do you have any questions on June as to

what we discussed so far? Oh, I see that there are 60 participants. Maybe it's more like a

zoom plus than any person plus, yes. So sorry, I just learned that the microphone was turned

off. So do you have any questions? There. OK, so. What is this C? This is where you stop. This

is from the United States. This is the uniform commercial. Sorry. Oh, yes, the Uniform

Commercial Code. It is not a state law, even if I put it here like domestic. So it's not a state

law. This is something. What then? No, no, it's OK. Oh, no, no, it's actually it was. We can say,

we can say whatever we want. So we can say it's a statement but it's not a state law in a way

as we discuss what the state law it's, it's something that is a basis for state law in the state.

So basically United States because basically it created some kind of standardized text for the

stateless within. That the United States for the different states allow state legislations

dealing with contracts because it is regulated in state law, so not in the federal level but at

the state level and then it provided for this unified tax or like standardized test for the state.

Legislators the state laws in the United States, so basically it is state where at the end of the

day because even if they apply a particular state law, they refer to the origin that it's like the

UC or this is certain provision in the UC or this is like the transposition of certain provision

of the US. But. So from this point of view, it's it's something that is state law, but it's not state
law in a sense that it's it's something like a directive if you want to compare. It's a bit

different than a directive, but to some extent it's the same as to the fact that the state, the

states within the United States can form can implement these rules. And then from there

own state rules on contract based on this UC, why is it important now? Because of course it's

not the cisg, but why is it important to really important because previous look at some cases

where basically when the national courts come across the question. OK, we apply the CIS G

This is a concept in the CIA. We have to interpret it. How do we interpret it? And even if I

said previously that under the CIS VC member the court cannot let go back to the national

law and apply the national law to interpret certain. Provisions or concepts under the CG. But

yet they do that. So sometimes, for example, especially in the previous early years, the state

courts in the United States somehow resorted to the UCC, apply the CIS, the UCC, whereas it's

not, of course, the same, it's it's different. The CIA. And so it will be relevant in this sense, but

and it's good if you know, but it's of course not the Ch. This is some kind of sample or or

model or the standard for state laws in the United States if we look at the regional level.

Then basically for that. The African countries there is so hard the Uniform Act of general

commercial law. The second bullet point, the Becker DCF 5 system that refers to the

European Union and the. Unification. Let's say attempts that took place within the European

Union. The bacon is ambulation for the principles of European contract law. So basically

that's a set of principles. So it's not just. Like few vague principles, it's very detailed rules.

Actually. For European contract law, it's not an international treaty, it's not an EU regulation,

it's not a new directive, it's not something that would be like a binding text in the European

Union. This is a compilation of contract. The first contract rules actually based on a very,

very extensive comparative method and and exercise and then basically it was adopted in

order to provide for some sample for national legislator for EU legislators when they deal

with contacts, but also. Even if it's not our main topic, but it's good if you know that. The

parties can refer to this factor and sometimes actually look at this Packer as as kind of

expressions or expressions of international contract law or how questions in international

contract are handled. So basically that's a. Point of reference or cancer as a point of reference

it's not directly applicable you attacks but yet can be influential when there are disputes. The
discr that draft common frame of reference European contract global this is something that

was built upon the backs. Turn it into the here very comprehensive text. If you actually ever

conduct research, like for example maybe before your thesis in contractor, that's a very good

source. Actually, it's really comprehensive, but it's very good because there are the black. But

what is even more, let's say, important is the commentary to this, the CFR, and that's a very

good presentation of the different national laws. How different contract law concepts or

issues are there within the different national laws that's also based on very comprehensive.

Yeah. Assessment, but it wasn't adopted at the end this it's not an intentional threat, it's not

something that would be fine. That actually to some extent the idea was to create some kind

of European core of contract, close some kind of European contract law that was already the

idea of Packer in the first place, then later. DCF, but it was not successful. And then I mean

from this point of view and then the scissor, that's the common European sales law, that was

a proposal for an EU regulation on sales law. And we talked about the relevance of

regulation, so if the form. Is regulation, but it means that it's actually finding it is something

that is one text and it will be applied. It would have been actually an optional instrument, so

the parties could have opted to apply this scissor. It wasn't adopted again at the end, partly

because of the reasoning. What you mentioned earlier and that was very good, that's why it's

very difficult actually to create unified contract laws to some extent that was. The reason

why the sister wasn't adopted at the end at all. And then? At global level we have these two

piece that we this is that we will look at the interactive circles, the interact principles is I will

talk about it more later. So now it's just to know what it is. Interface is an instrument that

was adopted within the unigram. Do you know what the unit drives? Have you already heard

about it? It's the International Institute for the Unification of Private Law. Yes, very good. So

it's in Rome, in Italy, so this International Institute for the unification of private Law adopted

in the 90s. These principles of of international commercial contracts. And this is not an

international treaty, this is not something of what would be a binding for that. This is

actually a compilation of contract law rules. And I see rules and not principles because when

we look at it and you will look at it, you will see that it's like very detailed provisions. It looks

like the general part in contract law. So if we think about our own contract laws, we can
think about like the general part, the general questions. Contractor and the specific part

dealing with the specific types of contract. So the principles to a very large extent is like the

general part of contractor, it's very detailed, very comprehensive. So even if the name is

principles, it's it's more than just the principles. It has more than two hundred articles, so it's

very, very expensive. Very detailed. We will see it later, but it's not not international reality,

it's not something that would be from this point of view, directly, everywhere, one bit. When

will it be binding? What do you think? For example, if you can arbitral proceeding, the

parties designate the interferences as that's the applicable rules of law, because as we

discussed that in arbitral proceedings the parties can choose not only law, state law or like

what I said, is that the arbitrator. Can apply not only state, but that means that the parties

can choose not only state but also rules of law and the impact principles from this point of

view can be considered the kind of rules of law. So if we choose the principles as the

applicable law, then. That will be actually binding on the arbitral tribunal. But we will talk

about it more later and then we got to the CSG then which is again a global instrument that

deals with says contracts and this is actually what we are studying that more in. There. So

this is how we got here and then of course I will talk more about the CIA. So now that's

enough. Do you have any question as to anything that? We talked about so far. OK. Then I

have a question and that question is that how do you usually do the brakes? Will be. On turn

45 and it will be last. It will last two 30 minutes. So I think it needs. Yeah. OK. OK. So, so then

at 10:45, yes. OK. And you are not tired. Can you say yes? OK. So then let's then talk about the

CSG based on all this introduction and of course we will focus on the task of the CG. But just

to understand the context, I will briefly talk about the history of the CIA that how we got to

that point. That this text was adopted in 1980, basically it all started in the Twenties, 1920s.

Maybe you have already heard heard about rappers rapper. He had the idea to create

something that would be unification instrument for contract law. So how? Contract low

power. Certain areas within contract low can be or could be unified and actually the work

started in the unit draft. In this field. So they wanted to create something that is a is a unified

contract flow. Of course there were. Some kind of obstacles the route if we consider for

example the the second border. So it wasn't that fast proceeding actually, but sooner or later.
I know I don't get into the details, but if you want we can get into the details sooner or later

it was. Two conventions were adopted in the middle of the 60s, these two Hague

Conventions, These Hague Conventions were like, from this point of view, the first uniform

law conventions dealing with sales contracts, these two Hague Conventions. Of course that

were adopted within those pieces of the unit draft, but they were not. Just like the products

of the unigram and decent and they serve as a kind of basis for the CIG as it was later

adopted if we. We will come back to that. I just wanted to show you this too. He mentions. So

these two here Co mentions that again for the first time with this creation of unified uniform

law in the field of contracts. The first one as you can see related. To the international state of

blood, and the second one to the formation of contracts for the international sale of goods. So

one was the Uniform Sales Convention and the other one was the uniform low on the

formation of combat. These were not necessary that successful conventions. I don't know if

you can see it, but maybe it's it's a bit small and so these were not necessarily successful

conventions. Not many states actually join these two Hague Conventions. That was for many

reasons. For example, how the scope of this ECHO mentions versus. There were also some

claims that they followed more like the continental approach. Traditions towards dealing

with issues concerning contracts are contracts, contract. So they were not that widely

accepted, widely adopted. So from this point of view they were not successful. In terms of

application now like in 2023, there are still. They are they are still relevant or can be

relevant even if these are not really applied these conventions. The UK still remember of

these conventions, but these are not applied in the UK either. And one reason actually why

many states did not join this hey conventions after the adoption of the. Siig, because

basically the states had to decide that if they want to join the CIA, they join the CSG, but then

they will not join this HECO mention send for the states that were members of the HECO

mentions when they wanted to join the CG, they have to actually. We do from this hate

convention. So from this point of view these are not like very significant formations, but

from another point of view these are important conventions because these serve or the

failure of these two conventions serve as the basis or the starting point for the creation of

the CIG, so the drafters of the CIA. We learned a lot from the failure of this toggle conventions
and many provisions in the CIG are formulated or were formulated based on these eco

mention rules. So when we. Have to apply the CIG or when we apply the CIG and when we

have to interpret certain provisions of the CFG, then we can look at the traffic history of the

CLG and in that context we can also look at the corresponding provisions of this Hague

Conventions. So even if it's not like. Living below these two vehicle mentions, but from also

from the perspective of the CIA and the application of the CG, these are still relevant or can

be framed also. It's good I think, if you know that these informations. Existed. And then

basically. Yes, as there were. I as I mentioned, there were very serious doubts as to The

Hague Conventions. The verb already in the 60s started on the creation of or the drafting of

something that is more or can be more successful to some extent that led to the creation of

the UNCITRAL as well. I don't know if you. And we're really heard about that. Do you know

what else is? The only trial is and you and the organization is the United Nations

Commission on International Trade Law. These are actually two very important institutions

in the field of international trade and international business law, the unit rate, which is the

International Institute for the Unification of Private Law, and the other one, the UNCITRAL,

which is the UN Commission, International Trade Law. So the unit drive is not part of the UN

system, the. Concentration is part of this human system and then basically the answer

travels created in the 60s and it deals with international trade law. But already at a very

early stage when it was created in two important areas where it started to its work is sales

contract, so creation of some unification instruments in the field of sales. And the other one

was actually arbitration that you mentioned earlier and so basically that was very early on

the agenda for the central to create some kind of unification instrument, the field of sales. So

and then finally it was adopted in 1980 this. The Vienna Convention. Or international sale of

goods. Later, if you are interested, we can talk about that the chairperson many times during

these discussions and at this conference when it was adopted, was a Hungarian professor.

You're uh she and he also wrote a play on unification of contract law. If you are interested, I

can send it to you. It's not long, it's 5-6 pages, but basically it describes very well actually

different questions, or the issues or the problems of unification of. And by now, as you can

see by now I mean. 2023. The CIA has almost 100 members and and of course. The blue
countries from this point of view are the CID member States. Now it has. 95 Members, which

actually represents more than 8085% of international global trade. So basically that means

that the graphical reach of the CIG is or coverage of the ciig is very broad and it can go even

further, so it can go even beyond. Add these 9495 countries, because we will see later, maybe

after the break, but we will see later that the CIA can be applied in situations not only when

the contracting parties of the sales contract are coming from CIG Member State, but also. In

situations when not. Both parties are coming from see as you Member States, but the rules of

private international law. The next 40 rules of private international law lead to the

application of a CIG Member State law. So for example, as you can see the UK is not member

of the CIG, actually the UK participated actively in that. In the drafting of the CIA, but so far it

hasn't joined the CG, so the UK is not the number. So let's say one party is from the UK, the

other party is from. Germany, no, let's say Belgium and then basically in that I will tell you

later that's why not from Germany, but let's say from Belgium. And then even if the UK is not

a member of the CIG, it can happen that the CIG will be applied because if the private

international law. Use of the forum related application of the Belgian law. As Belgium is

Member State of the CG, the CIA GB applied. So this coverage, this territorial coverage, let's

say of the CIG, can be even broader than what we can see here on this map. So even

countries that are not. Let's say covered by the CIG or parties having their place of business

in countries that are not covered by the CHG can be. And subject to the application of the CIG

in certain situations. So if you look at it to remember look at this map, we will see that

basically. Many major countries trading countries are members of the CG, but there are also

actually important, let's say exceptions for non members. I've already mentioned the UK. If

we look at India for example, India is not a CIA member either. Many African countries are

not. CSG members for example, Brazil for a long time wasn't CG member but the joint

recently we look at North America, part of the CHG, South America, Australia, Europe, EU

Member States are game two available extended park are members of the CIA. The UK is not

an EU Member State anymore, but basically the UK is not CG Member state. Martha is not a

CSG member state. Portugal for a long time wasn't the service Member State but joined the

siege a few years ago. So and the other countries that you can island is not. As a Member
State, but the other countries as you can see are CIS members there, which basically actually

also is the question when the sister was negotiated, if we think back to the Sea Service,

Common European asset flow that what might be the the connection or the relationship

between the Cesar Regional Harmonization instrument. And the CIG real, the musician

instrumental unification instrument. Sorry that how these to the system and the ciig can or

put together, but basically. As the sister wasn't deducted, it's not really a question no

anymore, so. If we want to look at or just to give an idea of the first ten countries that joined

the CIG, we can see that China actually during the CIG and. In 1986, Hungary as well and

some other countries as well, it entered into force the CG 19188. So basically it's been

applied then since 1988 and then we will see that. How it is applied later? If you look at then

very briefly the structure of the CIG. So. We already know a lot of the CIA in the sense that

it's an international treaty that deals with contracts for the international sale of good. It's

substantive law. So it's not private international law or in a sense that it would provide for, I

don't know, jurisdiction rules, applicable rules for recognition forcement rules. It's uh,

actually substantive law that we can see or could see in our national laws as we are dealing

with contracts or sales contract. It has four parts. The first part is. Both like the general

questions. So the general issues concerning the CG like for example the application of the

CSG because, and that's important actually that the CIG itself determines its application or

applicability, so they will apply the CIG not because the national law would. Tell us that we

have to apply the CIG, but because under the CIG provisions we have to apply the CIG, so the

CIA itself determines its own applicability. So not it's not based on, from this point of view

generally private international law when we have privacy it's because. And. Provisions of the

CIA itself, of course, as I mentioned earlier, in the context of this territorial coverage, that it

might happen that the CI G allows the national, private international law, the next 40 to, let's

say have and then to determine the applicable. Low in a way that if it's CIS Member state

lower than the CIA will be applied, but then we apply the CG because of the CIA and not

because of the national law, then the private international law rules of the left worry will be

used as a kind of vehicle to get to the state law. Which is a siig Member states, so and then it

will be applied. Ideas with other aspects as first just for example station get feeding and
importance of usages and. So we will see it later, the second part of the CIA this with the

formation of the contract. I will talk about it later more of course, but it's good if you already

like. Learn that it's only about the formation of the contract, it's not about the validity of the

contract. So the validity of the contract is actually is not determined, is not covered by the

cisg. Then for the very little issues, we will have to apply some other source but the CIA. To

the formation of the contract that how the contract is formed like basically the structure is

what you mentioned or the way is what you mentioned. We need to offer acceptance they

somehow met and then we have a contract. So this is very, very briefly what we see in Part 2,

but of course it's a bit more complicated but. It's it's only about the formation of contract. It's

not not about the validity of the contract. But uh, two, uh is formation poetry of the CIG is

about actually the stairs contract itself. So the content of the contract, the obligations of the

parties, the obligation of the buyer, the obligation of the seller. What are the main obligations

of these parties? It deals with the breach of contract. What are the possible remedies in case

of breach of contract? It deals with the damages. It case deals with passing of risk. So

basically it deals with like this. Substantive content, part of their of their contract and then

part four of the CRS is it's more like public international law in a sense that it's it's about the

CIA, just convention itself. So for example it's about possible reservations declarations. Of

the state can do when or make when joins, the CHP will talk about it later, or for example

when the CIS enters into force and so on so. During these days, we will actually focus on part

1-2 and three, but of course I'll be very brief. You talk about part four as well. Now at the

beginning just to understand that how the the application of the CIG said through these

possible reservations or declarations. But even if we apply the CIS, and even if we actually

let's say. Study the CIG. That might be other instruments that will be still relevant, because

these are so-called related instruments. So these are instruments that are or will be most

probably applied together with the CIA. The first one is a New York to mention on the

limitation period international syllables. And limitation period is not regulated in the CIS, so

for example if you have a contract. What is this limitation period? Do you know? Maybe also

and zoom. You can answer actually if you. 1. Well, basically it's if you have, if you have a

contract like the one that we started with. OK. So yeah, I I thought you wanted to say
something. No. So if you have this contract, this illustration, regional contract and then let's

say, then no, the problem is a bit different. So the value company delivered the goods, but the

company did not pay. For these goods, so then is there any time bar, is there any limitation

as to within what period of time the Belgium company can request the payment can actually

let's say initiate a proceeding, a state court proceeding and can? Request the payment of the

purchase price before the Court of National Court. So this is what the limitation period of

prescription. Will be about that within what period of time we can enforce actually these

claims under the contract. This is not regulated in the CIG Simon mentioned. There is this

other convention. This newer convention, which is again actually within the onset trial of

was adopted within UNCITRAL. And that deals with this limitation period. Actually, not all

CIA Member States are members of this limitation period. In fact, it's about once word of the

CIA Member States that have bought into this limitation period. What happens if it's not the

case that you would apply the the limitation Convention then? For example, for this question

then we would apply national law non harmonized on unified national law as to this

limitation. The other convention actually is on the use of electronic communications

international contact. Again, this is something where. Comes from the onset that and then

basically this Convention, as the name suggests, is very specific as to whether

communications use of electronic communications in international contracts, the Member

States, number of Member States of this Convention, again less than. Than the CSG number

still, but it can be. And. The Incoterms, have you already heard about the incoterms? And the

UCP 600, basically these are also important sources or really important sources because

many times when we have a sales contract, the parties somehow referred to an incoterms

clause. And what this impact terms? Means basically this is not like intention convention. It's

not not something what would be a lower state law in the sense as we discussed these are

more like contract terms, but these are actually what, what are these? Hmm. Yes, yes.

Basically what happened is that they're sorry. No, please. Oh, it's just like in terms of sale,

that's almost most of the sales that is mine. They're gradually. Yes. So basically these are

terms. The ICC, the International Chamber of Commerce, collected. Let's say 1936 for the

first time, these international trade terms usages basically as they were developed in the
particular sector by actually the merchants, the players of that particular field of. Industry or

in international trade and basically these are like to some extent customary law in the sense

that these are custom. So then basically we can refer to an incoterms clause in our contract

and then what is covered by this incoterms clause will be then. Like sort of contract term or

will become a sort of contract term and they are being forced then by the court. So it relates

actually to the question, the incoterms that how the goods are transported from the seller to

the buyer. There are different incoterms clauses and of course these are different in terms of

cost allocation, risk allocation, how delivery is made, in what way or what form of

transportation is applied when there is passes from the seller to the buyer. So these are

different terms, different things. And then the parties in the contract can refer to the

Incoterms closed and if they do that then basically that means that to that extent they if it's a

derogation from the CG they derogated from the and many times in international sales

contracts actually parties do refer to some. You got 1 incoterms close, maybe see that later

this UCP 600. The UCP 600 is again from the ICC, from the International Chamber of

Commerce, and it relates to a very specific. Spent and this is the documentary credit. So

basically it refers to the payment mechanism. So how payment is made and why is it again

relevant for us because we will see that the the buyer has very important obligation that

paying the purchase price and how is it done, how is? Actually realized? Sometimes it's

realized through that, or many times actually. So basically that means that again, the UCP

600 might be relevant, but this UCP 600 is not. Because the part is in the says contract would

have referred to the UCP 600, would have designated the 600 as the applicable set of rules.

But because actually the the bank that opens the accretive or the letter of credit, then the

designates or refers to the UCP 600. In this sense, so it's it's a different legal relationship

where there UCP 600 will be then involved into this whole transaction. We will see it later,

but it is relevant or can be relevant as well because it relates to this payment obligation, how

the payment is made. Where is the input terms that we first of course to this issue as well,

like this. Obligations of the parties what are the obligations of the seller, the buyer in terms

of the transportation, tendering over the routes from the seller to the to the buyer? And the

PSC, the principles of international commercial contact that will be also actually relevant.
And this is what I mentioned earlier, this univap principles because as as we already know

then it's not an International Convention, it's not an international duty. This is something

that is a nonbinding compilation of like contract, law, rules or statement. Of the general part

of international contract law, commercial contracts actually. So it's, it's very detailed, it's

very comprehensive. Maybe see some examples later when we will talk about the particular

provisions of the CIA in this regard. It's, it's I've already mentioned it's like the general part

of contractual and that's why actually they very well or can very well supplement each other.

By they I mean the CIG and the unigraphics that first because the CIG is like the the specific

part of contract law concerning sales contract. It doesn't have a general part of contract law,

like for example. It doesn't deal with validity questions. Yeah, but the unit graph principles

that so they can work together or they interact principles can very well actually supplement

the CIG in this regard and we will see some some examples that how the courts in fact look at

the. Happens the first as the kind of supplement, so therefore the CIS G rules, especially if

there is of course there is a gap in the CHL that how that gap can be filled. And in that regard

again reference can be made or are usually made to the Union draft principles. And I I didn't

put it here, but of course we know that very well because these are like international

instruments, related international instruments, but the national law is also related

instrument or will be relevant even if we apply the CIG, because for the matters that would

be. That matters that icluded from the scope of the CIG. So for those matters we would apply

maybe the newer convention after limitation period. But as to other issues like variability,

for example, we we are not apply another intention instrument but national law what it

might happen that this other instrument. Could be the unit up and supposed, but that's

another story as we discussed. So the national law driven that it's important to know or not

to forget that we apply the national law when we have the privacy as we apply the national

law only to the extent that it is possible to look at the national law to resort to the national

law. Under the CIS. So for example, this luxury private international law will these are

national rules, even if it's the wrong one regulation, from this point of view, it's a kind of

national, it's not national, but from this perspective it can be considered as a national or less.

So it is possible. To look at it because the CIA itself allows us to look at these rules or for
example. And then I see stack, so maybe we're close with that that. But I know that usually

these last minutes are not necessarily the most efficient parts of of the class, but just another

example for this national law. The relevance of national law is that since I mentioned this

specific performance issue previously. So for example under the CIA it is possible if you look

at the rules of the CIA. It's possible to request specific performance, that's fine. But on the

other hand, the CIS also takes it into consideration that national national legal traditions

might be divergent as to how to deal with this specific performance, because it's some

countries it's not possible to request. Performance only damages. So then what? The CIA

says in this regard that the Court is not obliged to actually render specific performance

unless it wouldn't be so under its own national law in a similar situation. So this is Article 78.

So then basically we will see. So basically, again, there is a reference to the national or within

the CIA and we can look at the national of Wicker. The CIA itself allows us to look at the

national law. And I think that now we can close this. First part then, because this is how we

will continue with the possible reservations declaration that states can make when they join

the CIA. They also actually important as to how and so we applied the CIA, but that's after

the break of course. Do you have any questions? Can you follow the classes and it to fast

slow? OK. So thank you. So then let's have a break. Now I see it's 1046, so then we will

continue at 111616 because you get this additional minute. OK, and 50. OK, so let's see you

then. But if you stay here, inside the room, we can continue. No, of course not. That. Sure. He.

You will be. It would have. The soldier. We were doing. Oh. You know. Actually, your brother.

Your brother. Yeah. Period

4.11 第二节

Stop. Yes. OK. So I think it's. OK. So I think it's time we have to start. It's

1116, so let's then start continue. Do you have any questions as to anything

that we discussed so far so during the during the break what you can see? In

the chat i sent you the CIA did the text of the CIG so it's good if you have it

open on your computer because now we have to really talk about the city so it's
good if you other websites or web pages that I linked in the chat, those will

be actually relevant. So we will talk about those sites as well. So it's good

if you save those because. Not only in the context of the course that we have

together, but also later when you work with the CIA, it might be relevant or

important. So. We can do two things. One is that I will talk now about part

four, it's coming, so it will happen. But the other is that I don't know how

excited you are about the CSG, but I was just thinking about like like. Doing

around here that what is your question or what question you might have not

necessarily as to what we discussed so far but but generally as the seizure

what you would expect from the CIS G shall we do that? Do you want to be a bit

active no after the break or? Just leave it no better. And then maybe around

noon when you are, we are already hungry for the lunch. We can't have that. I

see the excitement is right so. OK. I will talk about part four and then we

will come back to this later. So as I mentioned before the break, this part

four is about the public international law aspects of this Convention, since it

is basically actually an International Convention, it's an international

treaty. So of course those elements or those issues that you have probably

already studied or. Learned in the context of private and public international

law will be around here as well. So this part 4 is really about these issues.

So we are not getting to this discussion that it did, but only so we will talk

only about the provisions that might be relevant as to the application or the

applicability of the CIA. And that takes us to this question of reservations or

declarations. What does it mean? It means that when a state joins, the CSG can

make a reservation, can make a declaration that it will not apply the CAG this

way, that way, or in this context on that context. So which basically means

that the CIG will not be fully applied. Regard to the particular state, it's good if we

know that because when we come across the situation, then actually this reservation or these

reservations might be relevant that have or can have actually an influence on how we build or how

we can apply the CIA. At the end if you look at the CIG now you can look at these provisions
africa 92939495 and 96 no the contract will be concluded under different set of flow, not the CIA.

The CIA will be the governing law of that particular situation to a very large extent, except for for

two to the formation of the contract will be conducted under different rules, most probably

actually under national law the same. Made part three another possible reservation. Actually there

is to a very interesting issue that you already mentioned at the beginning as to the contract or the

formation of the contract, whether they had the contract or not. Sorry, I saw that. So whether they

had the contract in the in the first place between this Austrian and and Belgium company and then

you mentioned that it doesn't have to be in writing. So if you look at the CIG. So if you look at the

CID, then basically it's not a requirement that the contract has to be in writing. So there is no

formal requirement under the CIA for a contract. So we can conclude a contract already. So we

can agree on something and that will be also actually a contract as long as those statements. That

meeting what we discussed like. Offer acceptance. They matched so then there is a contract. So

verbal offers or offers acceptances are accepted. So it doesn't have to be writing the contract. But

we know if we look at our own national laws and why I say that our own national laws because if

you look at. Your national law, Chinese law, law at this time when the CIA was drafted and

adopted so in this seventies 80s had very important requirement, had a very significant

requirement, is written form requirement. So, but not only these two countries but but other

particularly socialist. The countries had this requirement, so which basically meant that if there is

no formal requirement in the CIA, this retail format requirement, these countries would not have

joined the CIG. So that sort of compromise that we already referred to earlier that usually these

unification instruments represent. Certain kind of compromise is expressed here as well, which

means that states when they join the CIG, they can make a reservation that this written form

requirement will apply. So if there is such a reservation then the contract has to be. But if there is

no such reservation, then the contract doesn't have to be interacting, because under the CIG there

is no general form requirement that's to be suitable for many countries. Actually after this

reservation was made, especially like in the 90s and 2000 this years, these years they. We do these

reservations, for example, Hungary has, so it's not that widely. In place this written from

reservation but basically it is still existence. Some countries are still keep it or maintain it or

newly. Newly exceeding countries make this reservation even recently. So that means again then
if this reservation is. Then basically the contract has to be written and why is it important?

Actually of course this weekend phone, but we will see the later that basically, generally speaking,

the parties can delegate from the CIF. So the parties can exclude the application of the CIA, the

parties can that. Or modify any provision of the CID except for for example this one, that they

cannot contract out with this return for requirement. So they cannot derogate from the CIA

provision which actually made this return requirement with informed requirement by any

requirement if there is such a reservation so. The parties cannot contract out, cannot derogate from

this written form requirement if it is in place because of reservation. And another reservation or

possible reservation relates to this. Territorial coverage of the CIG more particular to the question.

Whether the city can be applied in situations where not both parties are coming from CG member

states. You remember we talked about it? So it is also possible to make such reservation that the

country or a country will not apply the CIG. This is Article 11B of the CIG. We'll talk about it

later, so don't look at it now. If you want you can look at it, but no, but it's not important so the

states can make this. Relation and then it will mean that they will not apply the CIG based on this

so-called private international or so. They will apply the CIG only when there's this old

application of this energy, you will see what it means better. But they do not apply this so for

example. I think you can see that this is one of the links that I put into the chat box. I don't know if

you can see this is the status table for the CIA so it lists. The countries that are members or that

are. Member States of the CG. So that joined the CIA chief and also. With these letters, for

example with China, you can see this be that what reservation that particular country has on it, for

example this be it refers to this hormone B that the country will not apply the CIG through this

gravity international law. So. Here you can check actually the countries whether they are members

or not and 2nd that what reservations they make. And maybe remember that previously I

mentioned the first place in the situation Germany and then said that no not Germany but another

country. Let's see. Welcome back Virgin, because after Germany did not really make this

reservation that but made a declaration that will not apply this. The city based on the small bomb

if there is no. Another condition that but we see later. So basically this is from this point of view

specific situation. You see and by you see I mean that if you go down to the north there you can

see that what letter means what kind of reservation and also that you can see the last one is this
Germany situation that they will not apply the CIG the other state made this kind of declaration.

OK. So that means again that we have to be very cautious because we have to check also that

whether the state, a particular state made any kind of this reservations because that means that

then video not a privacy as you're just a certain part of the CSG we will be. And this is the way

how the state can actually district the application of the CIG and that's another situation that had

the parties can exclude the CIS, how the parties could actually? Derogate from the CIG, but here

it's how the states can like sort of play around with the CIA because if they are members of the

CIG, the CIA is binding on them and they have to actually enforce the CIA. So the way how they

can sort of assign mentioned. It's not derogation, but like derogate from the CIA and the sense that

they would not enforce certain provisions of the CG is through these public international law

means these reservations. That's another story. That's how the parties can derogate from the CG.

We will talk about it later. The parties can actually freely play around. The CG, except for this

written for requirement that we saw earlier. OK, now let's talk a little bit about the application of

the CIG like getting more into the in the rules. So then when we apply the CIA and as I mentioned

already in the first place that is the CIA itself. That determines its applicability. So we will apply

the CIA not because of the national law or based on the national law, but because of the CIS

provisions itself. And from this point of view, the relevant provisions of the CIA are the ones from

Article 1 to 6. This relates to the. Territorial reach of the CIG to the to the concept of CS contract

under the CIG, the possible derogations the parties can make. As to the CIA, maybe I'll talk about

it soon. And but before we get into this, it's also good to just to make a note on that, that it's also

important or can be important that who will apply the CIS, of course the parties, they might look

at the CIA, they might apply the CIA in the sense that, OK, we have a contract, what rights we

have. Let's say under the CIA, what can we do under the city? But it's more like the the third

parties when there is a dispute, the courts or the arbitrary tribunals, who will apply the CG? Who

will actually enforce? This IG so state courts and arbitration analysis and why it is actually an

issue or why it might matter is because in the first place, yes it's binding on on the state courts. We

know that that comes from the law from the national law of that country. But on the other hand if

we think about our. Through analysis and arbitration it's a bit of a different situation. It can be also

binding actually on arbitrary terminus, but how what we saw earlier this. This next 40 it was four
state code and what is like no one was corresponding concept in arbitration. Mistakes arbitrary I

also have. This next time what is this next arbitrary. This is the law of the country by the seat of

arbitration is located so this it's it's an area but it's. Next, arbitrary. So this is the law of the country

where the seat of arbitration is located. And why is it important? Because that is like the law.

What is applied in arbitration and what is applied to the arbitrary proceeding. And basically it

means. That when the Arbiter Tribunal will determine the applicable law, then it is bound by the

next arbitrary rules and the next arbitrary rules provides for the race. How the architecture and we

will determine the applicable law like the next 40 rules for the state courts, how do they determine

the applicable rule? And it might be actually different for many, but one is that as we discussed

already that state 4th, usually they get to state law as applicable of course if it's if it's the CIA then

it's the CIG, but then it will apply the CG because it's binding on them through this last 40. Yeah,

if it's an arbitrary treatment, it's a bit different situation because basically the arbitrator can also be

bound by trade by this. But how the the legs are between rules of that particular proceeding and.

Especially when we are talking about hormone B of the CIA. This is the priority international law

application of the CID. Then we'll see that we already ordered know that arbitrary criminals enjoy

wider discretionary power. How to determine the applicable law? OK, so that's why it's important

to keep always in mind that whether it's a state word or an arbitrary tribunal that applies the CA.

And just to give another example, height matters is that if we look at the CIG and now let's look at

the CISG Article 7 subsection. One of this is you have the CIA. Go to Article 7, subsection 1. So

this Article 7. Subsection. One of the CIS you is about the interpretation of the CPU. You talk

about it more more later, but when no referring to this as an example that it really matters whether

it's an arbitrator or a state board that hears the dispute, because if you look at it, it provides for

three principles. Character to promote uniformity in the replication of the CG and the. Them. First

two are very sensitive. The international character is the first one that refers to the requirement.

Let's say that when we apply the CIA, when we interpret the CIG, we have to look at it as an

international tax. We have to look at it as a tax that regulates international transactions. And it's an

international, that text, so it's not based on national Rd. We cannot apply national law to interpret

the CIS when it's actually an arbitrary treatment. Now it is easier for the arbitral tribunal to

actually depart from the national law or from any nationality, especially if we, for example,
consider that if it's a panel, 3 arbitrators. Maybe Because yes, it's it's a very general statement, but

usually state for judges are trained in their national laws. They are trained to the apply to enforce

their national laws. Of course there are exceptions to these as well. So there might be state court

judges who are specialized in international transactions, state courts that. Specialized in

international transactions. So then the situation might be different then, but but generally speaking

it's a different approach. What an arbitrator has and what a state, what judge has as to the the

departure from national law when the CIS is interpreted and the other. Important principle here is

to promote uniformity in its application. What does it mean to promote uniformity in its

application? We will see it later. For example, it means that it doesn't matter. There before me is

located, for example in Hungary. Hungarian Court has to apply this theology then, in order to

promote uniformity in its application, it means that the Hungarian court should consider how

German court, Chinese court, no arbitrary tribunal, exit ICC, arbitrary tribunal or any other

arbitrary. Applied. Again, for another trade tribunal, it might be easier to do this exercise than for

a state court judge. And so there is of course relevance in this regard, whether it's a state board or

Arbitrary Tribunal will be decided this because yes, we have the same. The unified text. But we

also know that what really matters from the point of view of legal certainty and possibility is that

how the text itself is enforced. And then there is no one single CSG court as you know. So

basically it is applied the CI Z4 through the National court, national judges and arbitrary

criminals. So there is no similar system like in the European Union, this Court of Justice of the

European Union when referring to this because. You talked about directives or regulations. How is

it ensured that, for example, regulation is applied, interpreted the same way by the national courts

in the EU? Through this criminal proceedings that national courts can. I turned to the Court of

Justice of the European Union and request primary ruling because it's the competencies with

competence of the of the Court of Justice to actually that direct the law, you know, so basically

this kind of uniform interpretation is insured through an institutionalized body, the Court of. Of

the European, there is no such thing in. The CIG so it's it's really challenging or can be

challenging hard to meet this requirement under Article 7, subsection one. This to promote

uniformity in its application and for arbitrary treatments actually it can be easier. We will look at

some examples that how state course even if they don't want to. But uh, so sort of inadvertent.
They they tend to apply national law, then actually they should apply something that is not a

national order, the CIG. So that's why it's important that who will apply and of course it's what

does it mean for us if we are like legal counsels or representatives or just like giving advice that. It

very much depends on on for example whether we have an arbitration clause in the contract. So if

you want, if we keep in mind or if we have that somewhere the the future that maybe there might

be a dispute, maybe the city will be applied, maybe we want some other CI to be applied then of

course that. Will have an influence or can have an influence on how we determine the forum and

the dispute settlement mechanism, because even if there is this Article 717, subsection one in the

CSG concerning this uniform interpretation. There are. And not one, but actually many, many

issues under the CG where national reports or different bodies tend to follow different line of

interpretation. So it's also good to know that if you go to a particular court how this particular

court via apply or multiply actually the the city so. Let's keep that team. Right. So the CIG I know,

let's talk about the the application of the CIG, the sense that provisions are not here. If you look at

article one, it provides for the application of the CIG that it applies. Very decent, applicable to

international sales contract. More contracts for the international sale of wood. So as to this subject

matter, first we have to look at or first we can. Discarded what it means international sales

contract. So how can we define what is international sales contract. So qualification if you have

already started private international law and you you did you you said so they're basically you

know or you know that it's a very important question that how we qualify. Probably classify the

particular legal question, what concept, what legal instrument it is. That's actually a crucial

question in private international, but it's also crucial question here in the CIA as well that when

can we say that the contract is an international sales contract. So in this regard, we have to talk

about 3 concepts contract. International contract and sales contract. So what is a contract, what is

an international contract and what the sales contracts are? CDs contracts under the CIG Nevada.

The CIG will be applicable to this sales contract. If you look at the CIG for when you look at the

CIG you get not find actually definitions. So many definitions. There is not a list of definitions in

the CIG like maybe article one or Article 2 or Article 99 that in the context. Ciig these conceptual

so it should be interpreted or should be considered as this or that. There are some descriptions

actually. For example, if we think about Article 25 of the CIA, Article 25 of the CIG is about
fundamental breach. So basically then there in Article 25 there is a sort of description or definition

for fundamental belief that what is a fundamental breach or another hand what are the

requirements or the conditions for a fundamental breach. So basically when we want to claim that

the other party. This bridge, the Monster, Fundamental Bridge, what elements, what conditions we

have to actually prove. So that's the sort of description for what is a fundamental read. But if we

look at actually the particular conditions, there again we do not see definition. So what is like a

substantial deprivation? How do we, because that's a requirement under this 25, we see. So it's not

not defined, just like if you come back to here to the contract, so what's the concept of contract?

Just for the sake of cooperation, I put here scissor Article 2. The scissor is a 0 PM regulation or?

Proposed regulation is to know this common European status, low regulation. This you can see

that they aim to provide some kind of description or definition for a contract. Contract means an

agreement intended to give rise to obligations or other legal effects. If we think about it actually to

some extent that that corresponds to the concept of contract under the CIG as well. So then

basically we have some kind of voluntary undertakings on the side of the parties that they want to

create. Yeah, no dictation the binding obligation that will actually have regular effect on them and

then it will be of course enforceable. It's very important that it has to be voluntary. So it's based on

the the three decision of the parties that they want to be banned by this. Please legal ties, let's say

or this legal obligations. What is? Any that national contract, so how international is defined for

that? Actually the CIA provides for the description and if we look at Article one, subsection one of

the CIA there we can see that what is international, it's not yet that this is going to be applied, it is

that what is an international. Contract under the sea that the parties space of business so located in

different states, so it can be actually any state. So it's not required that it should be CIS remember

state. So the positive space of business is allocated in different states then it's actually

international. So it's not. Other elements of the transaction, what would make the contract

international. So for example, if there are two German companies, they conclude the contract or

the pace of performance of the contract is let's say in in France that that wouldn't be actually

international contract even if it has an international. From Patient international though, it can be

actually something that has an international element. So we have to determine that recoverable.

But from this point of view, it's not because it's not an international concern, but it's also important
that it's not there if you have already studied private international law It's not the personal of the

company, so it's not what matters is for the nationality of the company. So it's not what matters

here, but what matters is like the place of business, the real place of business that is involved in

that particular transaction. So it might happen that we have a Hungarian. Company which has its

nationality as Hungary because it is registered in Hungary but it has a subsidiary, it has other place

of business, let's say here in Germany. And then this place of business concludes a contract with

another company I don't know from from China. Then basically it's. Something that we are being

damaged and what we matter, of course it's not. They got this Hungarian company having a place

of business in Germany is not Hungary as like that's the nationality of the company, but Germany

because this is the place of business of the company from the perspective of the particular

contract, because if there is one, there is a company which has more than one. Place of business

then basically what we have to look at is actually the place of business that is in the closest

connection with that particular contract and of course that might also happen that like as to

nationality we have to that OK. The next I will talk later about the mixed contracts when there are

additional elements, additional obligations as well not only these. What is good? Because it's

about the sale of goods. So what? What is good in the context of the CID? Again, it's not defined

in the CID. So basically, where can we look at them? To prepare the material case law on how

goods are defined in international trade, in international commerce and basically what you can see

is that it's a very, very broad concept. And they're concept of rules and the IG. Of course it refers

to movable properties, so it refers to tangible objects, move property. Immovable property is not

covered by the CIF, the sale of immovable property, but for example the sale of this building. Is

not covered by the CIG, but actually the sale of the building, the building materials, the

construction materials, that is something that would be of course, recovered by the CIA. So it's it's

it's very broad the concept of goods under the CIG. So basically anything any any move to work

property or any tangible object can that can be subject to commercial transactions that can actually

be. The value of which can be expressed in in money. Basically that can be subject to the CIA GS

for example. Living animals can also be subject of course to the CIA, as you can also qualify as

good, sorry. Um, we will see that there are some exceptions to this under article two. That what?

It's not that it's not that good, but for what kind of goods if we have a sales contract will not be
covered by the CG, but it doesn't mean that those would not qualify that could not. They're curious

as good. And recently there are some questions or interesting questions or maybe it's not that very

simply because it's like some decades now that for example, this technological development

softwares whether softwares can be qualified as goods or not because. Basically what really

matters in case of a software is basically the right to access the software. It's not necessarily

transfer the property in the software in a software license, but whether software license can be

considered as a sales contract under the CG or not, that can be questioned. What do you think

about this? So we do not get like the. Ownership. So we will not acquire property ownership in in

the software, but basically we have. Uh, license to use the software as long as we want. We're

asking as that software first anything. But this is an issue that you can see in the slide. That's that.

The views are different actually if you look at the case though. Visiting the case where is quite

restrictive in distance. Software contracts are considered tangible matters and. Something that can

be characterized actually as a kind of service contract. It really depends on the kind of software. If

it, if it's an individualized software, it might be different then if it's a standardized software. So if

it's like, I don't know, Microsoft, whatever, but we purchase or when, it's a very special. They're

still there designed for a particular company to, I don't know, run a certain equipment or an

apparatus. Then basically there might be differences, we see it later but but generally it's not that

straightforward in the EU and no, I will not talk about it, but in the EU there is recently on some

low adopted. As to digital rules that how digital goods are, are treated or should be treated, here

this question can arise as well that what's the what's the treatment of digital goods in or under the

CIG. As long as they qualify as goods, they can be considered as goods under the CRS right. But

of course, in that regard, what qualifies as good cannot be assessed under the national law. So

what is a good is not to be assessed under the national law, but like under this general concept of

the CIG. Whereas on the other hand, so for example as to whether a good can be the property in

certain goods can be transferred to another person or not, or whether a good can be subject to a

particular good can be subject to commercial transaction, that is something what will be regulated

under the national law and of course in that regard. You're not apply the CG because the CIA

doesn't deal with this question. National law can restrict. And certain commerce in certain foods

but that's like the marshmallow and then of course we will have to apply that but but the other
hand under the CSG this. Concept of wood is not to be interpreted or for like applied under a

national row. OK, as to the. Mixed contracts that I mentioned, if you look at Article three,

basically it has two paragraphs, article three, it talks about mixed contracts. So when we have a

contract that includes some kind of service, includes some kind of sales segment, what other

elements as well? So for example, when the materials are supplied by the buyer and then the seller

produces the product, manufacturers this product from these materials, is it a sales contract or it's

it's something else? And so this is what you can see for example in this article says subsection one.

Or when it has other elements like for example service elements, then would that change this

qualification? Because in the first place we saw that if we consider article so 30 and 53. Of the city

based on these two articles, we can classify a contract as a system that. But if there are these

additional elements, additional obligations, then the question can arise whether that contract will

still. Forward under the scope of the CIS or not and then if you read if we did no article three what

is like the the general standard there or the general rule there how how could we rephrase this

Article 3 then then will it be steered a sales contract. Even if it contains or if it has additional

elements or a certain part of the materials were provided by the buyer. So we have to look at that

what is the the substantial part or the preponderant part and if the preponderant part is still

something that would keep us in this stress field, so which would still mean that it's a sales

contract then basically. It will be assessed on that, so, for example, if the preponderant part or the

substantial substantial part of the materials from which the product is manufactured is provided by

the buyer, then it will not qualify as assessment or if the preponderant part is the service.

Watching the contact and not the sales part then it will not be qualified as assess the contract,

which basically means that it will for our the scope of the CIF. So in the first place he has the CIA

is applied because it's a sales contract under the rules that we saw but under articles. It would

actually fall out of the scope of the CG because it's a mixed contract and then we cannot under

Article three, we cannot apply the CIG to this contract anymore. It can also serve as a kind of

defense if we don't want the CIA to be applied, right that if you can show if you. Prove that this

country has maybe has some sense and but additional elements as well. And then because of this

additional element if we do not qualify as a sales contract under the CIG that it would be covered

by the CIA then basically we can go back to the machinery because on the other hand and we will
see that later in the CIA. But then it is applicable. So what I mean is that is that we cannot just say

that, OK, like we are reported that we don't want the CI should be applied. If we want to derogate

from the CIA, we need the consent of both parties. But if the other party wants to apply the CIG,

then of course it will be applicable. This is one way how we can sort of escape the CG3. Want to

do that? And as I mentioned. The node see that what is an international sales contract. We saw

what is a contract, what is an international contract, what is sales contract, what contracts when

these are miss contract will not qualify anymore as a contract that would fall under the scope of

the CIA and then there is Article two of the CIA. Which provides for a list of excluded contracts.

These contracts are excluded from the scope. Of the CIG. Even if these are CS contracts, these are

excluded. Maybe because of the nature of the transaction, maybe because of the nature of the

goods or the way how the contract is concluded. The first one, if we look at it, it's, it's. It's for

purchasing, for personal use or families, and the CIG was created to regulate, to cover. Sort of

B2B transactions, business to business transactions. So it was not created to cover business to

consumer B2C transactions. Usually when a good is purchased for family use, for personal use,

that is something, even if it's very differently in the consumer protection law. That is something

that would be a kind of consumer contract if you think about it. I don't know if you have already

studied consumer contract law. Maybe. That uh in consumer contract. In the European Union,

consumer contracts are contracts where on the one hand we have a professional trader, so we have

a party who acts within its trade, business and profession, and on the other hand we have a party

who is a natural person and who has outside of the. Straight business and professional, so

unprofessional, natural person and a professional trader. So that's a consumer contract. And why is

it the case that it's a consumer contract? Because if you think about it, it's a sales contract, it's a

service contract. But why is it because you know, contract? Because the law. To some extent

protects the consumer. Can you give, can we give an example of how the law in contracts might

protect or by the law might protect the consumer? Because if you look at it from a contractual

perspective, it's quite strange. One can say that the law favors one party over the other in a

situation where actually the parties are in contract or in private laws, the parties are being to be

equal. But yet the law says that. But somehow II favor this part, the consumer right. Usually.

Because it's deemed that the consumer is the weaker party, right? What what makes the consumer
to be the weaker party? Because if you are, if you are compliant for, you will have more more

financial support or legal support. You can have a, but if you are just a rational person, you don't

have enough money, you don't have enough label information. Apology to. Also in real life you

are allowed equal party when you sign the contract. Yes, sorry. Yeah, OK. Yes, the one thing is

that the consumer is, is. Less equipped with financial resources, with knowledge, legal knowledge,

legal expertise, so it seems to be the the weaker party from this economic point of view, from your

point of view and lower protects the consumers whose different ways. So, for example,

information requirements. Which means that the trader has to provide and the lowest says what,

but the the trader has to provide certain information about the product, about the service, about the

loss of the customer, even if the consumer doesn't ask about it. If you think about the normal

course of negotiation, it's not necessarily the case. Especially if there is no good first obligation on

the seller to disclose. Anything or everything about the product. If the buyer wants to ask about

something, then yes, the buyer can ask what the buyer wants to us, but the trader does not

necessarily. The seller does not necessarily actually have the obligation to disclose everything

about the product or every important information about the product in consumer. Contract is not

every information, but the law itself provides for actually a list of of pieces of information that has

to be disclosed to the consumer or for example distracted. With Grover, maybe you have. Yeah,

heard about that. For example, in online sales, the consumer has certain period of time, 14 days to

withdraw from the contract. So somehow just to cut it short, the consumer is protected for some

reason because it seemed to be the weaker party, the CIA GP come back to the CIA. The CIA's it's

not in to regulate business to consumer transactions. It's aimed to regulate business to business

transactions, which means also that the CIA does not protect one party over the other, so it does

not protect the buyer against the seller, or the other way around, so the two parties are equal. And

that is also actually expressed in the way how they negotiated their contract. If you look at the

CIA, the CIA doesn't provide for information obligations that say it might have some come. And

consequences if the, let's say the the seller do that the the good is not. As it was required under the

contract, but it's not information obligation of course it's it's a kind of consequence that whether

than that the buyer can still advance some claims or not. So there is no like this information

obligations under the CIS for the server or for the buyer. So it's it's it's based on the Sumption that.
Parties are equal, so they know what they want, they can negotiate the deal what they want, and

then the law looks at them as two equal parties surrounded by and. Why keep emphasizing the

equilibrium? Because on the other hand, if you look at it, it's not necessarily the case that the two

companies that. The two parties that enter this sales contract would be really that equal in terms of

like the expertise, what you mentioned earlier, legal expertise or the financial resources or the the

bargaining power, the potential to negotiate the deal that they want us to their best interest. So he

had them right be differences as to the bargaining power of the parties who actually concluded

contract. But the CIA doesn't aim to protect any of these over the other. So for example this

complex size cluded or contracts relating to certain. Goods such as, for example, airplanes or

vessels. Actually usually these are subject to special rules, the transaction in these in these goods

and then when we assess that why they are excluded is because many times because of the special

provision special rules dealing with. The sale of these boots are these products or the purpose for

which they are used? And. I don't know, maybe some of you know about this. Do you know the be

smooth PMC smooth? Have you already heard about that? OK. So that's why you know that the

CIA, did you also take part in that? No, because what I wanted to say for example this year that

we smooth case or one issue and the bismuth case related to this exceptions that drones, so not

airplanes but drones, whether drones are covered by the CIA SGR and not. Um, if we consider for

example military drones, if we look at Article two of the CIA schools like this airplanes as I

mentioned, whether military drone can be considered can be qualified as? It's an airplane or not so

or aircraft. So basically these are excluded for this reason, because usually special version applied

to them. Actually. What is on the other hand important to note that if we look at the spare parts of

these objects, these. Thank you. Those are covered by the CIA. One of the first cases of the CIG

and it turned into forces we saw in 88 and in the early 90s that lowered the cases concerning the

application of the CG and one of these first cases was actually relating to Hungary. And to this

exception of aircraft because maybe you have heard about that it doesn't exist anymore, but maybe

you've heard about there was this Hungarian air base company this morning. Have you heard

about that? No. Yes. So but. But The thing is that not the case but the company itself. So basically

they purchased engines for aircraft and then the question was that not the entire aircraft but the

engine for the aircraft whether that is covered by the CG or not. And if you look at this exception
it it refers. To the to the aircraft itself or the airplane itself, but the spare parts like for example the

engine that is not excluded from the CG, so the CIA is applied to that. So that's that's important for

example. Money is also excluded from the scope of the CIG, but the material, the paper that say

that is used to to produce bank notes, that is something that can be covered by the CIG or that is

covered by the CIA. Interesting question again this as we mentioned this new technological

developments, Bitcoin and this digital currency that whether it is excluded under the CIG or not to

some extent what matters here, and that's interesting is that what makes something to be a

currency. Basically it's a low. So even if it's if the CIA is international instrument and we talked

about the national yet at the end of the day somehow it's it's national law which would say that

something can be considered as a valid currency has this legal tender so basically. Something that

we can use in order to pay that we have to pay. So in that regard it can be interesting, but that's

that's a, you know. She and also what is excluded from the scope of the CIG like how the the

contract is concluded is auctions. So if a sales contract is concluded at an auction that's again

excluded from the scope of the CG usually for these these transactions. That that concluded that

auctions decide these are very specialized trades, commodity trades and then basically it's it's

special rules. Usually that's also an exception on their private international the West left, for

example, if they think about room 1 aggression, and usually what matters is the laws that currently

by the auction they expect. So that's that's the governing law for these contracts. OK. And now

now we know that. What is the international sales contract that forces under the material scope of

the CIF? And now let's say that, OK, we have this contract whether the CIA will be applied or not,

there are two rules, two ways in this regard, but how the CIA applied? One is the so-called.

Dictation of the CIG. And the other one is the private international application of the CIA, so the

autonomous application and the private international application. Redirection alone application.

The autumn is in that application, or the CIG means this is Article 1A of the CIG that. The parties

place of businesses are located in CIG Member state, so. So you can see that the the Convention

applies to contract for the sale of goods between parties was placed on businesses are in different

state than the states are contracting states. So for example, China is a CG member State, Hungary

is a CG member state if we have a contract that is concluded between a Chinese company.

Hungarian company, it's assess contract, then basically it will be governed by the CIG at least
based on this provision. So when the parties have their place of business in CG member States, of

course it is important that the CIA should turn into force. Actually by the time that the contract is

concluded. So if for example now. I just give another interesting example that. So we can apply in

this case the city, the city is already turned into force with regard to these countries. And this is for

state course, of course, but for arbitral tribunals, again it can be different because there was a case

and that the arbitrator was Franco Ferrari. I don't know if you. What are the heard about that name

in other classes is widely recognized as in the field of international trade or international

commercial arbitration. So he was the arbitrator, so arbitrator and then basically the question was

that for those particular countries involved? In the in the transaction, I mean the parties were

coming from these two countries. The CG had not yet entered into force at that time, but they

already signed the CI, so they joined the CG, but the CG had not already entered 4. So under the

CIG it means that it wouldn't be applicable. The siege. But the Army traitor considered that on the

one hand there was already intention on the side of the state to actually replace their national laws

with this unified tax. As to this, because it really means, if you think about it, that if a country

joins the CIA, but does it mean? It means from this point of view, it means that the country will

not apply its own international sales law or the law what would apply or could be applied

intentions as transaction, but instead of that law or any other state law, it will apply the CIA. So

it's a quite a big, big undertaking. On this side of the state actually when they join the CSG from

this point of view. So there was already this intention to join the CIS to to apply the CIS G and

also CIS actually represents. Ten nationally accepted set of rules as to how to deal with

international sales contract. So this is something like, if you think about it, something like the

slacks macro torias we discussed. So it's not why we apply is because it's binding but because it's

this is something what is widely accepted. Has adequate truths or set of rules dealing with

international sales contracts so that's why territorial coverage of the CIS discussed previously,

because it would render the CIA applicable only respect of parties or also not only, sorry, also in

respect of parties who are coming from not CCI Member States. So we. Consider this undertaking

on the state that joined the CHP, that it will actually replace its own low or it will apply the Cle

instead of its own law. Then, uh basically it would mean that those parties who are having the

place of business in these countries that did not join the clergy would not necessarily actually have
the expectation that one day would expect one day would day, one day they would end up with the

application of the CIS because they are from that point of view. Nothing to do with the CIA. So

that's not part of the legal system, that's not part of the law where they have their place of business.

But the CIA makes it possible. And that's why actually if you think about it or when you think

back what we discussed concerning reservations states when they joined the siege, they can make

a reservation that they will not apply. The CIG on the this one 1B, so they would only apply the

CIG this autonomous. Then we think about private international law. Usually there are two ways

how they are applicable was determined in private international law for contracts, right? The

choice of law rules. So choice of. Laura was and this objective connecting principles so the choice

of flow, which means that the parties can choose the applicable law the generally it's it's widely

accepted in private international law that the parties can choose whatever law they want. So it's

not required that. Below, the chosen law should be in any way connected with the. The underlying

contract with the parties. So for example if you have this contract like Hungarian party and.

Chinese party. And if you apply the Roma regulation to this, then it might be possible that they

can choose whatever law they want. They can choose, I don't know, German or Brazilian or really

whatever law they want. There might be some limitations in some cases, but generally, especially

for sales. Contracts, and especially for B2B sales contract. Usually the parties can choose

whatever law they want instead word proceeding it means state law, usually in arbitrary

proceedings as we already know it means state law and also rules of law. And so it also means or

can mean, if you think about it, that if we have to. Like. Non CI G state. So the fact is that coming

from donors CHG state but they choose the low of a country as the governing law which is a CHP

member state, then basically that can also lead to the application of the CFG it it would be very

exceptional. Actually because usually this be 11B is applied and one is from the siege numbers

that the other one is not. But if you think about it it it can also be possible. And the objective

connecting principles. The objective connecting principles is actually what we apply when we do

not have a choice of law clause. The contract in Roma regulation, it means that the law of the

country where the seller has a temperature, that's dance. That will be the governing law of the

company. For example, if we have that situation that we have an Indian party, so a party from II is

not a CIA Member state and on the other hand we have a party from Portugal. Portugal is a CIS
member state. If the seller is from Portugal, then the sellers have the. Residence is basically

photograph see as Member States of the CIA GB applied. If the seller is the Indian 40 which

actually would be more like a kid then it will mean that the. CG did not be and also I didn't put it

here, but maybe you have when you started about drone. Drone. It's on my regulation and you

talked about this, this scale, which basically means that yes, this is the general rule that we can see

here that the sellers habitual residence. Is the governing law. But if we can prove, or if it's clear

from circumstances that the contract is manifesting more closely connected with another country,

then basically this other law will be the applicable law and not the serious habitual residence. So it

provides for some kind of flexibility in this sense. On the one hand, but on the other hand, if you

think about it, it also provides for these scape mechanism or chemically provides for Inscape

mechanism for us if we don't want this law to be applied but we want another law to be applied.

So now we see that it might also be possible to somehow escape the application of the CI. Not

meeting this IG if you apply these provisions of the CG, but also with the help of private

international or rules, because, for example, if in this case we can prove that the contract is

manifestly more closely connected with the non CIS Member state law. Then the CIG will not be

applied. The other point that you can see here is this Model Law, Article 28, subsection 2.

Basically this is. The answer to our model on international commercial application and it's not an

international treaty, it's not something that is national or state law, but it served as a basis for many

national laws. So that's why we look at it. No, it's quite narrow here, so. Here we can see that if

there is no choice of low between the parties then in in Europe, this wrong one regulation that we

saw. An objective now has actually room for assessment already in that grace that what a conflict

of laws rules, what private international law rules it would deem to be appropriate private

international rules. So that's an another sorry example that why it matters or in what regard it

might matter. Whether it's a state court proceeding or an arbitral proceeding because again in this

regard as well, the arbitral tribunal is more or can be more flexible. So that's why, for example, if

you think back to this case that I mentioned that the CIG has not yet turned to force but it was

headmaster turn to format it. Was applied because actually need to be something that is a good,

though it wasn't because of this provision of course. It just shows that the the discretionary power,

the roof for assessment for an arbitrary criminal for an arbitrator is is wider than for a state court.
OK, so the private international law route, we're talking about the private international rule. We

saw that the parties can choose the applicable law if they want, if they do not choose that. Then

basically it's the objective connecting principles that will be applied, the rules in the private

international rule that will be applied to determine the applicable law. And. As I also mentioned,

it's not private international law actually, but the parties can exclude the application of the CIS. If

you look at Article six of the CSG, then we can see that the parties can freely derogate from the

CIG. Can you modify the CIS G? I'm not the CIS for the provisions of the CSG, the contract or for

the purposes of their contract. So basically they have this freedom or this this liberty to to tailor

the CIS or to tailor these. Close to their needs, if they go into, they can exclude the CIG. It's

entirely if they want, they can exclude just certain provisions, certain parts of the CHG. For

example, I mentioned earlier this Article 25 of the CIA, which is about. Fundamental breach.

That's a general concept. Under the CG you see it better. But if the parties want, they can define

fundamental fundamental breach different. They can provide a list of potential breaches that they

would consider to be fundamental breach so they they have this freedom in the contract. If they

exclude, of course, if they exclude the CIG, what will that mean? That a national law will be

applied to the contract? And then what national will be applied to the contract? Basically that will

be determined based on the conflict of laws whose of the of the forum. And when they stood the

CIS, actually that has to be clear as to their intention that they wanted to the CG. It can be an

expressed exclusion, it can be an implied exclusion, but that's exclusion. But it has to be clear. So

even if it's implied passive, it has to clearly demonstrate. The parties intention that they wanted to

exclude the CIG. Usually what came up in the practice is question as to this exclusion that when

the parties choose a state law as the governing law, their contact and this state is a Member State

of the CSG. That whether that's inclusion of the CIG or not. What? Do you think? For example,

we have this contract Hungarian company. Chinese company and they say in the contract that the

contract shall be governed by the. Sorry. What's the law is failing? Yes, of course. Yes, that's that's

true. Yeah. Let's say it's James. Look down. OK. Is that an exclusion of the CSG or not? I mean

Hungary and China both have the edge Member States. And they say that this contract shall be

governed by Chinese law. Is that? Exclusion. How? How would you eat that practice? Would you

interpret it as an exclusion? Of the CIG or it's not an exclusion of the CIG, it's not actually in the
CIA as you don't search for this that in practice we can see some answer, but can we just form

bullet arguments? That's why it might be an exclusion, why it might not be an exclusion. I

understand that it's not a tutorial but. It's half past noon, so. When do we have to finish, may I ask?

Or yeah, or this should happen. 45 would help the last 15 minutes. Thank you. No, thank you. So

then it's my last 15 minutes. So so. What do you think? What was the question? The question was

that we have this Chinese Hungarian contract. The parties say that the governing law, this contract

with the Chinese law, is that an exclusion of the CIG or not? This after the. Dictation process.

International Convention, it becomes part of Chinese law. So actually when we see like the

contract should be governed by Chinese law, then it means that three or so is included. Yes, do

you know what I mean? Yeah, yes. OK, OK. But that's actually interesting. What you said that

under Chinese law it becomes part of Chinese law. Why? Why it's interesting is that it's like a

reference to national law. Some domestic loaded why the CSG would not be an exclusion

excluded, sorry here in this case, whereas we should assess actually whether it's an exclusion or

not, not based on national law, but based on this CIG concept, but actually that will be the.

Conclusion of what you mentioned that if we choose a CIS Member State law as the governing

law, unless we clearly say that for example, Chinese law excluding the CIG, then the CIG will be

applied. And why? Because actually if we designate. And then in that regard, you were right that

OK, we are within them Chinese law and then under within Chinese law, under Chinese law the

CSG will be binding or will be applicable, but then it will be actually because of the way that we

designated Chinese land was the situation under. The Chinese though, or that particular designated

national, but. If you want to exclude the CID and and we choose the CI G Member State law, then

we have to clear the say that the CSG is excluded. So certain national robot, the CI as your is

excluded. Chilly the 90s and early 20s, two thousand years, it happened quite often that the parties

or more like the representatives of the parties tend to exclude the CIS, so not to apply the CIA. An

interesting question for another interesting question is that what if the parties directly choose the

CIS? As that, what would you say to that so when the parties in the contract would say that this

contract shall be governed by the CIS G? Add them, as we see, this reference to the national law

in this sense, to the private international law. Rules. Basically it would mean under your right. Just

you can see the Roman equation. So on the Roma aggravation, it wouldn't mean that it's a choice
of flow. Because on their own regulation, what can be a choice of row is only a choice of state

laws. So it will be a kind of choice of rules of law, which basically means that yet we will have to

determine the applicable law, state law and then we can apply the cisg. To the extent that this

applicable state law allows derogation from that particular law, if it's an arbitrary proceeding then

it's different because usually as we know in arbitral proceedings the parties can choose non state

law as well as governing law, so if they. And directly to the CSG. Then it means that the the CIA.

Then another question might arise that whether that means that the bot is that I actually chose the

CSG, whether that means that the bot is actually wanted to exclude national doors from the

picture, so they whether they wanted to exclude that international law. That no national law can be

applied or involved in the proceeding, which basically means or can raise a question that OK, so

for the matters that are not government CG, what would be then the other create source, maybe

they interact principles, we will see that later but then it can it carries that. Question as well. OK,

so as I mentioned, excluded. Subject Matters what are excluded from the scope of the CIG?

Basically the CIS you know, it regulates international status contracts and it regulates many

aspects of international sales contract. The other we already know some excluded subject matters.

Like issues like subject matter, so the issues that are not governed by the CG but might be relevant

in the context of assess transaction. For example, the limitation period right there as we discussed

at the very big, not very beginning, but when I talked about the related instruments that we saw

this New York. Convention dictation. So the city doesn't have the limitation. So this is not

regulated in the CG. What is regulated under the CIO? By the CIGS you can see the formation of

a contract and the rights and obligations of the parties. For example, validity issues. Validity

questions are excluded from the scope of the CG, so the question whether the contract. Is valid or

not is not the CIA question. It will be assessed or can be assessed under national law, or maybe if

the principles will be applied under the undrafted principles, or what is also actually excluded

from the CG is the transfer of property and title. So this this property loss that we saw in Article

30 that that's an obligation of the seller to transfer the property in the woods. But high takes place

under one roof, whether it's possible or not. So the property lower specs of the transaction are not

covered by the CIG, those are covered actually by the. National law that we get to by the

application of the conflict of laws without the forms there. Usually the applicable national law in
this case is either the so-called extra city, which means the law of the country where the property

is located by the object is located, or. The place of let's say destination when the planes, when the

goods are in transit, and then there are some even taking place that have or might have property

low consequences, then usually there is a special rule in this priority international law rules which

would not apply this next ICT. Below the county where the property is located principally by this

place of final destination. So that law will be applied. So this is again something that is included

subject matter and compensation for personal injury and death. So this kind of product liability or

certain kind of product. These are again excluded from the scope of the CSG. OK. Do you have

any questions? If the two parties both not contracting countries, whether they can also choose to

apply? Mr. Yargee, yes. Yes, it's not too quiet that the parties should come from CSG member

states. What is required that the parties should come from different states. And it can happen that

even in that case the Civ right, either because the parties choose to apply the CSG or because.

Actually, somehow the below will be applied despite international law, rule law we we applied

which is CSG member state, so that that can happen, but it's actually very rare from this point of

view because these parties would most probably not choose at all of the country. Which is a

Member State of the CG. They do that. They might exclude the CIA, the application of the CG,

but they they can. If they want, they can. But it was kind of the federation and the truth of the

parties. Actually, it's beyond the terms of sentence because it's not included in Article 1. But just

because. Right, because they underline there are just two situations to apply. But. Like the police

choose to use their. Yes, but if we. So this is the. Application. So when the parties have their place

of business in different states, so it's not required they should have or any of them should have

generally the place of business in the CIA members state. So in different states. When these states

are contracting states of the CG then is there. Application if. Yeah, it's not the case. This is the

beat. So it's not required at one party should come from the stage number state, different state. So

that would mean that the roots of Priority International will lead to the application of the

contracting state. So which basically means that I I see your point in this regard. But which

basically means that the parties can choose a law, state law, which is a contracting state and then

the CIA, GVP apply OK through that way. But on the other hand, if they actually do choose the

CIG as the applicable law and then if the private international law. There was actually these to the
application of the contracting state, but that low private international law actually also accept the

way that the parties can choose. No state lowers the applicable law. Then they can, they can

choose, but that would actually happen. In in arbitration. Yes, because in in state court

proceedings actually it's not really accepted that the parties can choose non state lowest as

applicable law if we. The headphone France adopted I I wanted to say that previously I mentioned

the state conference. They conference adopted this so-called hate principles. They have principles

is about choice of law, international contracts, commercial contracts and then this table principles

actually makes it possible to choose non state. So not only is table but not state restaurant, but so

far actually it's only two countries I think Paraguay and do by that adopted legislation, national

legislation based on this hate principles. So for state courts, no, because actually that would mean

that somehow. Yeah, the because state courts are created from this point of view to enforce state

laws. And the only thing that why they would enforce foreign law is because the next 40 private

international law rules allow them to apply foreign law. And not their own national so they they

have to enforce from this point of view state. So they would not necessary, I would put this way

apply non state or just non state law as the applicable law because they always need a state. The

robot aggregation now it's provides for the state law. But the proposal, the original proposal or the

initial proposal of the room regulation would have provided for this choice of non state law as

well. But it was not adopted. So basically it's it's state law. But you're right in the sense that. The

The No, I just didn't want to be what I said. But you're right in the sense that it it wouldn't be

actually rare, but and for the state court it might not be accepted when they directly choose the

CIS G as the applicable. Yes, if they choose a CI number state law actually, even if they are not

coming from CBI number states, then the state court will apply the CSS because then it will be

binding on them. But if they choose the CIG directly in a state court proceeding, then. Most

probably the state courts would matter but would apply the CIG or might apply the CIG as some

kind of fruits of row because of the contract law rules or the designated law. And then the

substantive contract law rules and those substantive contract law rules would allow derogations

for the parties from certain. Provision, so that's. OK. Do you have any other questions?
4.12 第一节

OK, so then you join. And. Today we will continue what we started to discuss yesterday and

actually we can start with some kind of Community if you want, just to refresh everyone on what

we have already discussed concerning the CIA and what is coming, because I don't know. If you

know there is a CID song, have you already heard about this? So maybe we can start the day with

the CI something. I don't know how it will work through this zoom but. Can can you see it now?

Actually it's on YouTube. Yeah. So if I start then I hope you'll be able to hear it. And actually it's

it's about the CIA's name suggests, but also if you pay attention to the text of the song, it is very

important. We will discuss it later after the song because it points out some of the critical issues in

the CIA. So pay attention to the to the text as well, not only through music. But also to the text as

well. And then based on the text the lyrics, we will talk about some of the the critical issues. So try

to identify these critical issues in the city. More than enough. US courts just treated like the UC.

The young man.

Turn later but. OK, could you follow the the tags the list? Actually this song was written by a

professor who is very, very engaged in the in the study and and the research CIG and then

basically this text is to very large extent based on like real case law. So the points that. Made in

this song at to some extent valid point. So what would you say what were like these critical issues

that were? Also pointed out in this text concerning the CIH. I know that was the first time that you

heard this song, so maybe it's a bit difficult, but. Like for example, there is a reference to the UCC

that some state courts, US courts treat the CIS, yes, as the UCC. Do we remember what this UC

was or what is this UC? Yes, from the US it's a kind of sample for the harmonization, for the

unification of state laws within the United States. So from this point of it's a kind of domestic law

and the CIA should not be created from this point of view as a domestic law, as a UCC because as

we know the CIA. Is an autonomous convention and then we apply the CDM, interpret the CID

we have to use, we have to apply actually the the concepts that are or as they are in the CIA are

not based on any national or things like that. Any other points like this? Turning piece, what do
you think, what does it refer to them as a reference to attorney fees that whether we can claim

attorney fees, how could we claim attorney fees under substantive law if we think about it because

in procedural have you already studied, I guess, yes, Civil Procedure for example. Rotation you

yesterday you mentioned then when we. Have fees, legal fees, legal costs associated, sorry,

associated with litigation then basically. Usually of course it very much depends on the, the

particular low that is applied to the president, but but we can claim the legal costs that we

encounter for the from the. Leaving party. Right. So it is something where you can be something

that is a procedural issue or seems to be a procedural issue. How can it be sort of transposing to

some kind of substantive law claim this sentence? What do you think? Of course I know it's it's

very difficult and it's out of the blue now, but. Because the CIA is, it's not a procedure low as we

know, it's substantive row, it's substantive contract law. So what is what we can, OK? What is

legal cost that we encounter when the other party does not comply with the contract and we have

to go to court. And we have to ask the court to get the other parts to comply with the contract.

Then basically we have some kind of loss, right, because this is something that we shouldn't or we

wouldn't count if the other party had properly performed the contract. So we have some kind of

laws and if we have laws in the context of a contractual arrangements. Or because in in in the

back. And then usually what is the the? Like the legal concept that allows us to claim

compensation for the loss that he suffered. Like damages, damages claim. So the question might

be that whether for example these fees, these attorney fees can be claimed as as damages under the

CIA. You will see that the CIG provides photos on damages as well probably calculate the

damages increase of a breach of contract. So that's. Something that that is an interesting area or.

What that? For example, the very last sentence. No, we will not talk about everything, but it's very

last sentence was that German courts people and in 5 minutes we inspected notify. Of course it's

not real from this point of view, but on the other hand, actually that means that there is a.

Inspection or an examination rule in the CFG and we will see that. Actually tomorrow then we

will talk about part three of the cisg that for this examination, for this inspection, inspection. So

the CIA provides for a very specific time period because usually it provides for reasonable period

of time, but here in this context regarding the inspection. For examination it provides for different.

And is different. Is that within a short period as practical? So then what does it? It's not the same
term that is used here in this context then in other places, because in other places what it uses the

CI is reasonable. Period of time. And of course it depends very much on the circumstances of the

case that in a particular situation, what is reasonable or what would be reasonable. There is no one

single. Let's say. Exact. 14 days is reasonable and 20 is not. It depends on the particular

circumstances of the case. So. These are just some points that already show actually, that even if

it's a unification instrument, as we discussed in the text, is the same everywhere, the way how it is

applied by the national courts and arbitral tribunals is not necessarily the same, and this is

something that we will discuss in the first part of. Two days. For the first part of the first part of

for today's class is like this interpretation and application questions that we started to discuss

yesterday part one, but now we will wrap up part one and then we will talk about the formation of

the contract. Do you see the slide that I shared? And then after we answer this question, I will send

you the slides and slide. But just here now it's good if you don't see this the next slide. So that's

why I didn't send it to you. So if you see and of course it's not not tutorial, but we have because

you will have the tutorials in the afternoon. So we will not get in a very extensive discussion on

this on this scan area, but just to refresh what we thought talked about yesterday, yesterday

application or the applicability of the CIA. What do you think about this situation? Maybe it's a bit

too long. So I just sum up a bit that we have a German party and we have actually a party from

India. But it turns out that this party from India has also some kind of business establishment in

Switzerland. And various originally the contract is somehow negotiated them and contacted, we

don't know basically based on the fact that how it happened but between the German company and

the Indian company and. In the course of the performance of the contract, the Swiss business

establishment got more and more involved. At least this is what we see based on the fact we don't

know what happened previously. And in the contract you can see there is actually. Um. The

choice of flow grows, which says that the transactions and sales are subject to three slow. It's an

invoice, but basically, let's say that that's in a contract, in that contract. So what do you think about

this situation? Is the CIS applicable or not? In this case, would the CIS be applicable to this

situation or not? When do we apply the CIS chief? Yeah, for international sales contracts. Right.

Yeah, it is something that would be an international service contract. So that's OK. And then if we

look at article. 1. One article, one subsection, one of the CIA. There we can see these two
provisions that we discussed yesterday. So the first is like the direct application or the autonomous

application of the CIIG. What is that? Yes, you're right. I guess I didn't hear what you said, but I

guess you're right. So what? Sorry, please. When the parties have their place of business in

different states, OK, but these different states are. Yes, yes. Contracting State, CIS member states.

And the other one is the private winternational application when the private international or rules

of the forum thread to the application of lawful contracting state and in actually in in arbitration.

So that it might be even a bit different because if the parties like directly choose the IG that can be

also something that we have. Mean then then the applicable rules of law than the of the the CIA,

but coming back to this. Is it? What is it? The autonomous application of the CIA? Can we say

that we can apply the CIS because the parties place of business is allocated in CG Member States?

Actually Germany is a CG member state. Switzerland is a CIA member state. India as we saw, it's

not. The CIA Member state. So in the first or at the first glance, in the first place, it seems that we

have the two parties right. One is from Germany, the other one is from India. From this point of

view, it might seem that the Ciig will not be applicable. Based on these autonomous application

rule, because not both parties are from Ciig Member State, so maybe the second rule that private

international rule can be applied, which means that if the private international law rules of the

forum lead to the application. Projecting load contact instead then the CIGS applicable, but what

we see in this situation is is what? That we have this Indian company, but it has also some kind of

business establishment in in Switzerland. So basically it seems that this company has more than

one place of business, right. And then what we saw in this regard is that if a company has or if a

party has more than one place of business then. We have to take into account or we have to

actually come with the place of business which is in the closest connection with that particular

transaction. And here in this case actually since if we look at the facts, it seems that is the Swiss

establishment that handled. That made the necessary steps under the contract to perform the

contract. So then the court actually in this case concluded that from this point of view, the

contracting party, yes, on the one hand is general party, but on the other hand is the Swiss

establishment of this company and not the Indian establishment, so basically. Is then. The CSG

would be applicable based on this autonomous application rule, OK. And how about or what can

we do with this designation of Swiss law? That all transactions and cities are subject to Swiss law.
Is it an exclusion of the CIG? No, yes, you're right, because, uh, why? Because because we're

talking about it yesterday. I know, I know. I just. I just want to. Point out that says you will be

excluded, otherwise it will, yes. So because actually Switzerland is a Member State of the city,

and if we designate the law of a Member State of the CG, that means that the CIA will be applied

unless we make it clear that we don't want the CHG to be applied. Either we say that expressly

that the Swiss law excluding the CIG or the we refer directly to the to the particular piece of

legislation within that national law, for example being a hearing. Germany, so basically that

means that we have to make sure that it's not not the CIG what would be or what we want to be as

that, but really the the national law to domestic law in that country, which can be done through

this press statement in the choice of law clause that excluding the CG. Work with this direct

reference to the to the particular nation Sorry. Let's see. Can I go back? Oh, yes, yes, OK.al

legislation. OK. Umm, yes, I know we talked about it yesterday. Just, uh, just to refresh and pick

up the the line from yesterday. So basically what you can see, I don't know if you can see that in

the chat box. I sent you a book. This is not like mandatory reading book. I think it's a good. To

give you some background to the CHG, if you have time, hopefully you do. You can you can look

at it, you can read it it it helps you to understand more the ciig and I also then send you this. Just

one second. Yes. OK, so, uh, you received that, did you? Yes. OK, this slide. Yes. Well, OK. So

then let's continue. And this is where we start. This is where we start. Yesterday that we talked

about the application of the search, we talked about our articles 123456 of the CG and now let's

talk a little bit about the interpretation. Rules of the CG. Here we can think about two kinds of

interpretation, of course, the interpretation of the provisions of the Convention. So when we apply

the Convention, how do we interpret the concept, the text, the words, the expressions that we can

see in the CIA? And then the the interpretation as to the parties statements. So when the parties

make a statement or part to make a statement makes the statement, how do we interpret that it

refers to actually BC to port kind of statements for example the contract is something like that but.

Clear communication, written communication. So we will see that whatever one party makes a

statement will be then subject to these rules. It is an international instrument and it was designed

to regulate international transactions. So basically it's international character has to be considered.

Second, the need to promote uniformity in its application since it's actually a unification
instrument. So of course it is natural that. It's not only the tax that should be the same everywhere,

but also the way how it is applied, how it is interpreted. But you already know, if you just think

about the song itself, that it might be different actually that how the different courts, how the

different arbitral tribunals apply the CIA. So there might be. Different ways of interpretation in

real life. But if we look at the text and if we look at the variety of the CFG, shouldn't be the case

because of this uniformity or the need for uniform application and the observance of good faith.

Estimate this observance of good faith here. Again briefly touched upon this issue yesterday that

in the CIS G, if you look at the CIA, if we read the CG. There is no such a direct obligation for the

parties to to act in good faith. For example, when there is negotiation taking place between the

parties, there is no obligation for the parties that they have to act in a way that ensures them the.

Observance of good faith. But how it is actually made under the CIG by the timing that the good

faith is somehow taken the tongue is that through this interpretation rules. And if you think about

it in the first place, it's a kind of obligation for this objective third party. To discuss who we are

then enforced CIS to enforce this, this requirement, or this principle. Let's say this would phase,

but we will talk about it previously later. So international character uniformity to promote

uniformity, its application and the observance of good faith in the slides. UBS. See some other.

Instrument which provides for which we mentioned actually yesterday. Briefly, like other

unification instruments which provide for interpretation rules as well. And there you can see some

differences. For example this unitrac principles. As you see it refers to the international character,

the purpose. Including the need to promote uniformity in this application. It doesn't directly refer

to here in this place to the good faith, because the the unit reference Apple this with this good face

issue differently than the CIG. Disregard the Cesar, this common European says low proposal. As

we saw again, we provided to provide for some rules on on interpretation and as you can see, it

says that interpreted autonomously and in accordance with its objectives and principles, it's

autonomous interpretation, even if it's not there, the freckly in the CIG. Since we know what the

CIG is, this alternate interpretation should be followed in case of the CIS, of course. So it's

autonomous instruments of little autonomous. So these are these three principles. What do these

mean actually, if we talk a little bit about these principles? So this international character. So this

international character, it means that the basically the CIG was adopted to regulate international
transactions as you mentioned and it's an intentional instrument. So even if there might be some

similarities between the rules in the CIA. See and national laws may be the same concepts seem to

appear in the CIA G and in the national law. Maybe the same terminology, although actually when

the CIA was drafted there with particular attention paid to not to use the the the terminology. For

the expressions that are used in in national laws. But of course sometimes it's inevitable that the

same term or the same expression is used in the CHF. But we cannot apply, we cannot interpret

the CIA based on the national law concept of these. Concept. So for example, the CIA uses the

term offer. We cannot interpret this term, the concept of offer based on nationality. That's what the

national law says as to what is an offer or a fundamental reach. I think we mentioned that

yesterday. So this fundamental. There is a concept for fundamental breach in the CIG. In some

national laws, there is actually a concept for fundamental reach. But even if that's the case, we

cannot apply that concept to the CISU. Sometimes it's it's very unclear enjoy. It seems to be very

to apply that, especially if a court. That does not know let's say the concept of fundamental reason

from its own low how to deal with this concept maybe is not the way how it should be interpreted.

Because even if it seems to be something that is like a concept that we can see or might see in in

national laws as well, it shouldn't be interpreted based on the the national. And that's the challenge

actually. Of the so already yesterday that if it's a national judge who interprets the CSG and this

national judge is trained of course in the national law, is expert national law, and actually applies

the national law, it's very difficult or might be very difficult. For this just to to depart from the

national law and to look at something like this, like this autonomous concepts and the apply these

autonomous concepts and why is it actually especially difficult? Because even if I said that there

was this. Attempt to to make it something different. The siege, the text of the siege that national

laws. There are of course expressions that are the the same or seem to be the same and the one and

on the other hand right is also different because we know the CIA actually it's an international

treaty so. That's OK. But it also served in many cases the kind of sample for national legislation,

not like the entire debt, but but some rules or some provisions, solutions under the CIG. And why

is it interesting? Because then the national legislature. 30 formulating the national law based on

the the. Um, CSG provisions. But this national law is of course not for international transaction

because that's what the CIA is for what for this national domestic transaction. So that's another
challenge that in this case is the national courts actually apply the national law. Which is the same

because it was formulated on the CIA, the CIA, the sample for national domestic transactions and

then another case. They should apply the same principle, the same rule, in an international

transaction. With a very strong departure from the national law, how they defeated, because then

they should follow this autonomous interpretation. And the need to promote uniformity in its

application. It basically means that. It doesn't matter what form applies the CHG, whether it's a

state court here in Germany, or in China, or in Hungary or in Brazil, or it's an arbitrary tribunal

here in. I don't know Hamburg or in Paris or London or or any other location they should apply.

Actually the CSG the same way. Which is again a very big challenge, or can be a very big

challenge because. Again, national laws are different, as, for example, to the president. And cases

that, how do they treat previous cases, whether there is any binding precedent system or not. It's

not like a precedent system from this point of view, but it is something that. Has to be steel taken

into account. By this I mean the the case law developed by other followed by other treatments.

Because once the court, let's say in Hungary, applied the CG, of course this court we have to apply

the CIS or should have to apply the CI the same way as these other courses. How this code, this

Hungarian court get any information on how the the foreign courts apply the CIS? That's one

thing. The other is that why the Hungarian court would be bound by any decision decisions of

foreign court. Usually that's actually the case in every legal system. Every country that the

national courts are not bound by foreign court decisions, of course. There might be cases where

foreign court decisions will be of course taken into account, but that's different issue. So usually

there is no this kind of binding effect of a foreign court decision. And in case of a national court

proceeding, so yeah, it is something that is in expectation under the CIG that it or this should be

taken into account. If you look at case law, national case law, it's not that frequent that national

court judges would refer to. Foreign court decisions. Actually when they apply the CIG but. This

is SSA representatives, let's say of parties. This is what we can do or how to convince the court

that the CIA should be applied this way or that way is that if we can bring like evidence, that's

how it is applied broadband. Maybe that can be kind of persuasive precedent. Four for the four

there are actually. Databases or sources for. Uh, information or forgetting information on on this

question that how foreign tribunals apply at the CIG. I don't know if you know this unilag.info. I
sent you this link yesterday, this is a database. Created by the Unitrans and it provides for a case

among others for case law. For the unitrac principles and also for the CIA. So if you have to do

any research, let's say on the. On the CIA and the CIA case, though, you can look at it, you can.

Actually start maybe start your research with this union x.info. If you go to this website you will

see that you can search for case lower like back country but also by issue under the CIA. So it's

from this point of view it's very convenient and that. Actually another case load database. Which

is the so-called quote. The cloth is the case law on ancestral text. So basically it is from the

UNCITRAL. If you go to the UNCITRAL it then you can access these clothes database case law

on that and then you can again find several case go national case law on the application of the CG.

Also, don't citran. Published. What you can see here is this digest of case law on the cisg, which is

a kind of. Summary, Let's say of. To some extent, landmark cases where the CIA was applied by

national courts and arbitral criminals. You can access this digest concentrate digest via the website

as well. So this is again a good good. Going to preference as to how other tribunals, other courts

apply the CIG. Also, actually in this regard, we can look at commentaries. There are several

commentaries. For the CSG, nowadays one of the most. Let's say by the use of sited we talked

about it briefly that. In the CIS or for the CIG, so they see this in the CIO, there is no one single

CIS cord or anything like that which could provide authority interpretation of the crag, like in the

case of the European Union, if you think about the Court of Justice of the European Union. There

is no official like advisory body or anything like that who would provide for ulcerative. Binding

interpretation on the CIIG, but there is a kind of private initiative and this is what you can see

here, you see I Advisory Council. So it's not something that would be an official body to interpret

the CIG. This is a private initiative, the members of the CIG. Council are are experts in the field of

CSG and from time to time they issue opinions. On certain questions under the CIA, these are not

opinions issued in particular cases, so these are not expert opinions like an expert opinion would

be in a litigation. From this point of view, these are like general opinions regarding particular

issues, for example like the use of electronic communication. And whether the CIA and how

actually the CG can be applied in left wing transactions or? Vocational damages, for example,

exceptions, so for liability or. Avoidance of the contract, consequences of avoidance, the contract.

So here you can see it's not all the opinions, Advisory Council opinions because no, I think it's 22
Advisory Council opinions that were adopted so basically. These are and you click on this, you

will see these are like discussions of case law, large extent discussion of case law and then based

on the case law some general comments, general statement as to the particular legal issues. These

are not binding opinions as we. They discussed resting mentioned, but they have some kind of

alternative force which basically means that we can refer to these ACH visor Council opinions. It

will be not correctly binding on the court or an arbitrary tribunal what they see as the Advisory

Council said in in the particular. Their opinion, but considering this need to promote uniformity.

It's application principle under Article 7, subsection one for the CG, it has actually first CC

volume, also persuasive alterity volume. In these proceedings there are already some cases. There

tribunals and also actually court national court looked at the CIA Advisory Council opinion and

and accepted that the CIA, the Visory Council opinion represents something that is like the

generally or widely accepted interpretation of a certain. Question on the CR this so it's not

binding. But yeah, it is something what? What the taken into account or can be taken into account.

So let's not forget then that if we think about this international character and they formatting, we

need to promote uniformity. Their principle that. Because these are the two principles where. They

might send some kind of strong kind of connection or link with the national or there is very

revealing situation to go to the national law in these cases, but we cannot do that as there is no

CIA court as we discussed. Basically it's left to the to the national court. To the arbitrage given us

to apply and interpret the CSG, this case law that we saw like. State courts and arbitrariness and

this other sources, they can be considered as some kind of persuasive authorities. These are not

directly binding on on the court, but actually if you think about Article one, Article 7, subsection

one of the CIA and the binding nature of. I think there's sentence subsection one of the CG.

Basically, these are actually sources that the form should take into account. And as to the good

faith? Because that was actually the 3rd. That was actually the Third Point, that we have to

actually interpret the CI G in a way that ensures the observance of good faith. As I mentioned, it's

not like the direct obligations of the parties to acting. In faith, but on the other hand, had the CIA

is applied and interpreted is that it should be interpreted in a way that would ensure the observance

of good faith international phase. But there is no direct obligation for the parties to act in good

faith. When you look at the case though, if you have time and look at the. Look at the case boom
there you will see that there are different. Let's say impairment in implementations of this

principle, because there are some cases which talk about the parties obligation to act in good faith

in this regard. So indirectly it provides for an obligation for the parties to act in good faith. There

is case though which talks about the. Application of good space is a principle in the and also

actually when we talk about the formation of the contract, we will see, but just for the sake of

comparison, that the principles actually deals with the question of negotiating in bad faith. The

CIA doesn't do anything like that. What you can see here is the scissor provision. Again, just an

example of how other sources might deal with this question, that it clearly provided for this

obligation, that each party has a duty to act in accordance with good faith and fair. Yeah. So

basically. It's a different approach that's I think now now and what is a good faith, no, I will not

talk about it. But you can see in the in the slide as to the sister interpretation under the sister to

what? Means good face. Maybe later we can talk about it more if you are interested in this. So

that's about the interpretation. So let's not forget then these three principles international character,

uniformity and observance. That good faith. Basically, it doesn't say that it these principles are

there in order to provide for us some kind of productive. Activity. Sorry, but this is actually the

case that when we apply the CI, there should be some kind of certainty, predictability as to what

will be done interpretation of a certain concept under the CA. As we saw yesterday, the CIS

regulates certain aspects of sessions actions. Right. And there are issues, there are questions which

are not regulated by the CIS, for example, variability, it's not that created in the limitation period

as we saw yesterday again is not regulated in the CFG. The transfer of property and this property

law respects issues are again not regulated in the CG. So there are issues which are relevant or

might be relevant in the context of assist transaction persist contact, but I'm not regulated by the

CIA. On the other hand, there are actually issues matters that are covered by the CG, but the CG

does not provide for specific rules on these issues, for example. Interests. If you look at Article 78

of this year G here, we can see that if there is this monetary obligation, this payment obligation,

then there is an obligation to pay interest on it. But how do we calculate the interest? What will be

the applicable? Interest rate. How can we calculate the the applicable interest rate? It's not actually

in the CG, so there is a gap. In this regarding the seizure, because basically it talks about interest,

it talks about this obligation to pay interest, but it doesn't settle all the questions concerning this
issue. Interest or? You may see that, for example, the CSG provides for rules on the consequences

of avoidance of the contract, So what happens after the contact is avoided. But it is also possible to

terminate the contract but under the CIS. So the parties can terminate the contract, but it doesn't

provide for any rules. One, the consequences or the effect of termination, and again in that regard.

Yeah. There might be a gap, but on the other hand we will see that for example for that. They just

special special day, hard to deal with that situation. So or. I think these two 18% now, so how to

deal with them these gaps? Then this Article 7, subsection two of the CIA provides for this gap

feeling rule. And what what is it if you look at it? If you really die, I stop for a second, so it would

really did. So basically there are two. Stacks. Let's say the first is that, to the extent possible, the

state is remain within the CIS or within this international transnational body of law, because the

first step is that we have to look at the general principles on which it is based, the CIA. Reason.

And then fact, the soul of the gap, that to fill the gap based on this general principle. So this day

we remain within this transnational international law. We cannot go to the national law because

the second step if we cannot solve the issue, we cannot fill the gap with the help of these general

principles. And then we can look at the national law and this is exactly a game, an example for.

The possibility that we can go to the national or we are within the CIA, as we discussed yesterday,

and we cannot apply the CG only in the CIA allows us to apply. So we can apply national, sorry,

only if the CHG allows us to apply national law and this is actually the case. One case when it is

possible that OK. It's the CIA you want to supply, but we can't. We cannot solve the problem

based on the CID and the general principles then. We can look at the national law and then apply

the national law to fill the gap. But it doesn't mean of course that we know can remain in the

national and applied the national law. Sometimes actually national judges do that but that's wrong

that when they like sort of leave the. The CIA just through this Article 7, subsection two. They

tend to remain in the national and apply the national law further and not the CG, but it's not

possible. So basically, in this case we can look at the national law only to the extent it is necessary

to fill the gap. Under the sea edgy. So first we have to look at the general principles and then if it.

It's not. Something that could have them liquid. Look at the national level and in this regard that

what are these general principles under the CG? If we look at the CG, there is no list of principles

or anything like that. We know that. So how can we find this principle, some principles? Like
inherently the provisions of the CI, you're viewing the provisions of the CSG like for example

reasonable reasonableness. This is something which is actually underline this proof contract. We

think about it that what is reasonable? What can be reasonable solution of particular. Or for

example. Yeah. The fact that the the party autonomy actually should figure so. Again, that is a

principle can be a principle in this regard or. That when the this party autonomy also means of

course that the parties are treated the right to be treated equal. So basically that means also that

when we interpret the CIA and then we try to fill the gaps in the CFG, then very important

principle that that should. Actually deputized this equal treatment or equality of the parties in this.

Maybe you remember that. Maybe you remember yesterday we said or we discussed that the CIA

actually tries the seller and the buyer has two equal parties. So it doesn't aim to protect one over

the other like can be. We see that transaction, so this is against something. When we feel the gaps

should be considered, that should be taken into account and. There is also actually an instrument

that say which is more and more taken into account when the. Speak for general principles on

international contracts and this is the PICC view that principles of international commercial

contract. So there is also case law which suggests that basically when we have this Article 7,

subsection 2, general principles, then when can we find this? Insert first, then. Actually we can

look at the interactive the first and actually apply the Indra principles. But there is actually also

case which suggests that we cannot do that. But basically generally we can say it's more accepted

than not that the principles can be. Taken into account in this regard, because actually on the other

hand was the CIG and the person cheated as very important pieces of the so-called new lex

mercatoria. We mentioned that mercatoria yesterday. So basically they are complementary. You

will see in the slide that of course during the class here in the room, we do not have the time, we

do not have the time to talk about all the cases or many cases, but in the slides you will see. Psalm

or can be many cases and and then you will see for example the Brazilian course, which is quite

interesting from the point of view because Brazil is recent Member States or Brazil joined this

year, there's just a few years ago, but they are very active in. I mean how they support the, the

functioning and the and the operation of the CIG and actually they apply the CIG or they apply the

CSG not only as the CIA, it's an international treaty and it's applicable under the rules as we

discussed, but basically our stress is kind of. Um, part of this? Let's map it toria, because it, it
represents, as we discussed it yesterday, represents something that is widely adopted by the

accepted set of norms for international contracts. So. Yes, and this is what we can then look at or

take into account. Sometimes these are not like very. General principles as I mentioned, because

for example, maybe you remember that. Before I started to talk about it, I mentioned that spec that

the CIA doesn't talk about doesn't provide for any rules on how to deal with the effects of

termination of the contract. It provides for us on the effects of the avoidance of the contract. Very

detailed rules, let's say, but it doesn't deal with this question that. What? How what happens after

the termination of the contract and then so basically from that point of view it seems that there is a

gap because it provides for the possibility to terminate the contract. So this is an issue that is that

within the CIA, but as you can see not expressly settled in so then. That basically courts apply the

the rules that are in the CSG for the effect of avoidance of the contract in this regard as well

regarding the effects of termination of the contract. So that's again a kind of feeling in this case.

These principles, these general principles on which is based in not one single principle, but like a

mechanism that thought would be with the situation when the contractual. The arrangement is sort

of terminated or gets terminated between the parties, then how do they? What do they do what?

How do they actually return the service to the boots? Let's say that we're already delivered or the

price, the purchase price that was already paid. So how do they make this restitution for example.

So this is something that is that in the context. Of the more than one fact, but it can be applied no

longer sleep in this case as well for the termination. So so these are like this supposed to call to

deal with this situation. And. I don't know. Maybe. You have already heard about this, uh. Search

this channel 0 clean Artificial Center how these two is sorry, all these two instruments, the CIG

and the interior principles. Operating together is that they can use to supplement, can be used to

supplement each other even without the point when expressly saying that. But for example, we see

the rule as you can see the expressly provides for this possibility that of course it's up to the

parties. The parties can say that, but it actually makes them like the signal for the parties that if

they want they can do that that if you look at the point. The, the, the CIG, the plan we got to two

to two and and by the principles and they supplemented by otherwise applicable national law. So

basically it refers to the principles as well as something that can be applied. By the Arbitrary

Tribunal, then the CIA needs to be supplemented. And as we discussed, actually the unigram
principles is is like general part of contract law. So to supplement the CG, it can supplement the

CIG in questions or maybe we can also close the. Window. I don't know if you. Because I see that.

You're taking the court, which is on the one hand, it's good, but. Or you want it to be open. If you

want it to be open, it's OK. Open. OK, just not to fall asleep, OK and OK, so. So on the one hand,

it can supplement the cisg with regard to the issues that are not there within the CIA you like for

example P as we discussed previously. But on the other hand, it can also supplement the CIA as

this gap feeling instrument when the CIA deals with a certain question, but it does not. Express the

certain specific truths. Then we can look at the Ingram principles in this regard. OK, so

interpretation. Uh, we saw that interpretation is relevant for the interpretation of the CIG and also

relevant for interpretation of the statements and conduct of the parties. And here in this regard, the

relevant provision of the CAG is Article 8. And so again, it is, it is an autonomous. Concept.

Expectation on their and optimistic rule under the CIA which basically means that we cannot

resort to the national lower rules or interpretation of the parties conduct of parties statement. So

basically we had briefly the idea is that we have to look at the true intention of the parties and.

You need the prep, the statements, the conduct of the parties in line with the screen tension of the

parties. If it's not possible, because we cannot establish that based on. And the fact that we can see,

then we have to look at the reasonable person, this reasonable person of the same kind. This third

person is is a standard or a point of reference under the Ch that we can see many. Cases, for

example, here, as well as to the interpretation of the party statement. Then what a reasonable

person of the same kind in the same circumstances would say or could have understood, or how

this person could have understood the particular statement or the conduct, and then Article 8,

subsection 3. Provides for some circumstances that can be taken that can be taken into account

when we interpret the parties intention or the understanding of a reasonable person of the same

kind. And if you want to read it about, read this question a bit more, then you can look at the

seizure by the Council opinion. 3 #3 which is actually about the interpretation. It will under there.

So if you look at these provisions, the first subsection is about the through intention of the parties.

So basically it means that the statements made by conduct of party are to be interpreted according

to his intent of course but the understand what I want to say whether my intent can be properly

actually conveyed through this week. So basically that's why it's important commutative interpret
recording this intent where the other party new or couldn't have been unaware of what that intent

was. So basically it's very important. That the other party should know, or should not be actually

unaware of that intent. It is. Section cannot be applied. Then we have to look at the reasonable

person of the same kind of the same circumstances, so this objective third person and how this

objective served person could have understood that particular statement or conduct in the same.

Circumstances. So this is the kind of objective assessment here what we can see that based on the

circumstances of the case, how reasonable person, so that person would have a good head

understood the statement or the conduct of the what can be taken into. As a circumstance, this is

what Article 8 start Section 3 is about. Basically, very briefly, everything or everything can be

taken in the accounts or the circumstances or the relevant circumstances of the case, including for

example, the negotiations, the statements. In the course of negotiations practices which the parties

have stablished between themselves. Subsequent conduct or any usage, but what is important is

that if we think about negotiation statements made in the course of negotiation, for example, it

means that I'm this provision, it means that it can be taken into account as a circumstance. And we

applied already interpret the party statement. So when we apply Article eight one or two of the

CG, but it doesn't mean that it would become part of the contract because as we see that what

becomes part of the contract is basically determined based on the. Of firm and the acceptance.

And actually this is not only for the contract for example. And yesterday we talked about this

elusion of the CIS. If we have a close in the contract where the part is excluded, the cisg, then

again when we see it for the intention of the parties that whether they wanted to exclude the CIA

or not, we have to. So it's not only for these, these commercial terms of the contract or the

commercial aspects of the contract where or when we can apply or could apply this article or have

to apply this article, but like once we have been in the reactor because actually. Do you think

about this? When we exclude the CHP, we do that under the CSG. So basically we apply the CIG

not like General priority international law, then we. Exclude the searches, so that's why we have to

apply this rule of entire rotation. OK, um. The next question beginning with General APT. Of

course if you have anytime any question do you free to stop me and and then ask the questions. So

the next issue or the next question within this general part is the one that concerns usage. This is

something actually which. Was a problematic issue previously and also there was a very extensive
discussion in the drafting process of the CI that how to deal with usages and then basically this is

the compromise that you can see now because nine of the CIG which on the one hand provides.

That the the parties are bound by any usage they have agreed. So it to some extent requires the

parties agreement as to be bound by any usage, but on the other hand it sets up a presumption as

well if you. To look at Article 9, subsection 2 because basically. It is assumed that the parties

agreed to apply the usages which are widely known, regularly observed, so basically which are

part of that particular field of industry and basically this is the way how the actors. In that

industry, conduct business, perform contracts, so basically. Of course, since party autonomy is is a

very important principle in the CG, that's the first rule that the parties agreed or can agree to the

use of usages. But there is this assumption to make sure that actually what is. Again, if you think

about it, what is reasonable to assume that would be binding for the parties because this is the way

how they do the business in that particular industry. It is regularly observe it is followed that

particular process then basically it can be expected reasonably be expected that it. You're the only

guy that parties in this particular transaction as well. Of course they can exclude that and then they

can say in the contract that we don't want this or that to be applied. But if they do not do that, then

this is something what can be ordeal being taken. Into account. Actually, usage as you know, is a

set of commercial set of rules in commercial trade, regularly observed by the respective actors. It

might be actually a bit difficult to prove the content of the usage of course in. For the for the

actors involved in that particular industry, it is easy or can be easy. If it's an arbitrary proceeding

and the arbitrators or at least one of the arbitrators come from that industry, again it's a bit

different situation, because then the arbitrator might be aware of that particular usage and might

want to actually enforce that usage in that. Situation as well. Whereas if it's a state court

proceeding, it's not necessarily the case because the state court judge might not be an expert in that

particular field of industry, so might not know or might not be aware of this. Usage in that. In that

figure. There is a difference between usages under this article nine of the CIG and the

INCOTERMS. If it's think about it because usage from this point of it's not something that would

be qualified, but we know that the incoterms is qualified, that's basically codified custom qualified

usages and then basically. Things that when do we apply the incoterms? When we expressed refer

to the incoterms in the context, so we need to refer to the incoterms in the context to be applied
this Article 9. To who it doesn't doesn't mean that we could apply in comment, but on the other

hand, like general ideas, general. Concepts. Taken from um. Particular qualified rules can be also

actually considered under certain circumstances as the expression or as a tool for evidence as to

what is using some expression from. So then based on this particular 9. What do we apply? This is

what you can see that here that of course in the first place what matters is the. Negotiated contract

terms between the parties. So what is what they negotiated? And then? These itches that they

agreed upon, they apply. We know the assumption that basically. Usages that are widely known

and regularly observed and are treated or should be treated as as images that are often or should be

known by the. Actors, the particular actor, the party will be also applied all less. Of course they

can do that. So unless they exclude the application of these usages. And then of course the

provisions of the CISG will be also. Yesterday. We talked about the. Or beat be told about his

former requirements and the return form. So if you look at the CIG it's Article 11. What you can

see here. This is the rule. That provides for this lack of formal requirements or formality, which

basically means that under the CIG it's not required that. The contract of sale should be in writing

or should be evidence in writing. Of course it's easier actually the the contract is in writing, but

basically it's not required on this edge. In this regard, let's not forget the possible reservation. That

we discussed that states when they joined the CIA they can maybe servation that they will apply

or they will keep this written form requirement. So generally there is this principle of freedom of

form that is typo there but. Yeah, but freedom of form, which which basically means that it's up to

the parties to decide that how they want to, in what form they want to conclude the contract. This

is actually an implication of party autonomy if we think about it. An interesting issue is that if the

if the contract concludes contains sorry or includes. This puts settlement clause. A choice of court

clause or an arbitration clause? Because actually, for these dispute settlement clauses, dispute

federation clauses, different tools multiply. Because for the choice of court agreement in a

contract, usually of course it depends on the national rules, but usually we can see some kind of

written form requirement or some kind of requirement which we which provide the same.

Residentially. These are as a written form. Would provide and for arbitration agreements, it's a bit

more. Direct restrictor that usually what we see is that an option agreement has to be in writing or

has to be written from. Of course there are actually ways or there are actually laws under which it
is possible to agree on arbitration already. But if we look at actually the New York Convention, do

you know the New York Convention in 1958? Have you? No. So there is an International

Convention that this with the recognition enforcement of foreign are deferred awards and this is

the 1958 New York Convention. And then? This this is an 8 New York Convention, and it's. From

1958, you were commissioned on the recognition enforcement of Foreign arbitral award. It also

even with the title doesn't say that, but it also provides for rules on the recognition of arbitration

agreements and then basically similar convention refers to the arbitration agreement

disagreements. Right so this is written form this is what I want to say with this is is many times.

Requirement for dispute resolution clauses that they have to be in writing. But what if they are in a

contract? Which is governed by the CSG. But it's under the sea as we do not sleep such equipment

that the contract should be in writing. So this is again a critical issue and that the how to deal with

them the situation. But usually what happens is that it depends how we look at it, if you look at it

from the substantive below. Um. Perspective like this CIS perspective, then it might be possible

that this closes as these are part of the CIG contract. Basically it the there might not be the sweeten

from requirement, but on the other hand there is no argument to that that actually usually there is a

principle of separability for these dispute resolution clauses, which means that we have to treat or

we can create this dispute resolution clauses separate. From the main content, these are slow

comment there which says that the CIA does not apply to dispute settlement closed because it's

actually not a sales term in the contract dispute settlement. But there is again argument which says

that yes, the CIA can be applied maybe to a limited. Tend to dispute settlement clauses because,

for example, when we talk about. Formation of the contract and we will talk about the acceptance

rule there. We see that the CIA actually makes the efference to dispute settlement clauses. So it

seems that the CI G recognizes the the relevance of this would settlement clauses in a negotiation.

So basically and it's a very important question from the point of view of formation of a contract.

So then basically it means that the Ciig manager can be applied to these situations as well. If you

look at it from this question, from this procedural point of view, like from the perspective of the

list with the turn proceeding, then basically usually what is required is discrete and format what is.

From this point of using form, is this important? Sorry, is this written form refinement. So it's a

being a critical issue that is actually it's not yet out. I think an upcoming in the Azure Advisor
Council opinion on this question on the application or the applicability of CID. Settlement clauses,

so we will see, but it's good if you know that this is a sensitive issue. And of course the if just to

the last bullet point that if if there is a way to because they've already raised the question of

whether it's a question of fact or a question of flow that what is written for because if it's on paper

usually it's a question of fact that. It's a paper, it's it's written. So basically it's written form, but if

it's an electronic document then basically obviously it's not on the paper. So it's the law which

would provide for the recognition of this electronic documents as having the same evidentiary

value as traditional paper based documents. So in that regard it is actually. Legal question that

what is and I don't know what circumstances the letter in document can be considered as having

the same evidentiary value as. A paper based traditional paper based document and then in that

regard actually the loom and we also relevant. They don't know what law we have to assess that

whether it's a written document or not. There is a City Council opinion. This is actually it was the

first CG Advisory Council opinion. On the definition of CIG, this electronic commerce or

electronic? Transactions. So how the CIA, the rules of the CI G can be applied in, let's say in this

modern environment, but actually this Advisory Council opinion is like from 20 years ago, so.

From this point of view, it's it's not that very recent, but. Yet he deals with this question, OK. I see

that we have approximately like about 5 minutes from this first session. OK, so maybe we will

finish it now with this. And we have already talked about Article 12, not, let's not forget that

yesterday we did that. So let's not forget that the CIA, the parties came from the. So the city from

this point of view, something where the parties can exclude, the parties can modify the provisions,

can actually alter the provisions, I mean for their own contract. But there is one provision in the

CBA that the parties cannot modify and this is actually this written form requirements throughout

the GO tab. Is that uh, basically? Their bodies cannot contract out this written form requirement

and also the part is like what we said yesterday and then maybe we'll come back to that how we

ended yesterday. But this is that basically this autumn of the parties that they can derogate from

the Ch, they can modify the CIS. In their particular. The torso means that for example as to the

application for the applicability of the siege they can also make their own arrangements. This

article one of the CIA, what we saw that's like the the rule what is binding on the court or the

arbitrary treatment and it's the arbitrary criminal the court that has to determine. Them. Uh,
applicability of the CFG. But if the pot is one, then this is what we discussed then or how we

finished yesterday. Is that if the parties wanting other ways. So if the parties want, the CIA could

be applied even if it would not be directly based on this article. One or the the literal meaning or

the text of article one, that can be also possible, but that of course is subject or can be subject to

the other laws that to what extent the parties can do that. OK. And do you have any? Any

questions or? Any comments or any? Remarks. We have any any questions as this slide because I

I see that you are. Looking at the the screen, so maybe you're? And could you please repeat again

about the question when the national according to the national law, the contract can only be in the

return form while they said that? OK. For for a contract. And. So when the national law says that

the the contract should be in writing and how this national law provision can enforce within the

CSG. Where it can be enforced only if actually the statement this reservation. When joining the

issue that they want to keep, they want to maintain this return for requirement. Is this the so? If if

for example, there is a country which provides for this weekend from requirement international

law but doesn't make reservation when joined the CSG, this national rule cannot be enforced?

When the CI is applied, but if it makes this a servation, if the state makes this a servation, then this

rule, because usually it's a public policy kind of consideration, then it can be enforced. Is it? At the

conclusion like that if they say does not make such an like the reservation, then they said as to

where previous the national law. Yes, yes, we can say that because actually we cannot go to the

national. If we have to apply the CIZ, if the CIA is applicable, then we cannot apply the CDC. We

cannot apply the CIA. Sorry, we cannot apply that national law. We can apply the national law

only when the CIA. Allows us to apply the national law. So for example, the CSG opens the door

to the national law through this reservation to the written form requirements under the national

law. But this door has to be opened by the state when the state joined the CIA and makes this

reservation. If the state doesn't make that reservation then. Basically, it cannot enforce its written

form requirement. So yes, to some extent it previous over national law, but it previous because or

that this prevalence means that we cannot even look at the national law. It's only the CID that is

applied. Does that answer there? OK, good. But also actually we will see it when we will talk

about contract formation is that if the parties want, they can make the written form as requirement.

For the contract, so even if under the CIA is not required, the parties can say in the contact. So in
the first place they conclude the contracted with endpoint and then they can say in the contract that

any modification of this contract can take place only in Britain for. So that's again part so if the

parties. They can bring in written form requirement but they cannot exclude this reservation. The

fact of this reservation that's like the limitation here on Port Authority but but basically. In other

way or another member of the parties are free to decide that what what they want or how they

want to be. Of course we will see that again. It's not. Like the only rule, because even if the parties

agree on the return form but like that's the modification, but somehow the modification is taking

place not in every turn form and if we apply articulate it's clear that the parties intention was

modified the contract because clear intention that was. Posted uh actually to rely on the other

parties conduct then then it can be still recognized kind of modification. But the general rule is

that written form in the parties say that it should be inviting, then it should be inviting and it's

written form can mean many many things if you look at the CG you consider. The time and the

city was negotiated and then basically first of tax and that. And now, of course, e-mail

communications can be this requirement, that is, I don't know what's not. Oh, I knew that, but

what's the this instant messaging system that. You use. What's up? OK, but what's up? No, I was

thinking about something else but but for example WhatsApp messages or other messages like

with SMS like this. Traditionally if we look at it now basically this can also actually. Maybe

securement of of return form. So it's not not that sweet that it can only be on paper, but like this

modern technologies and this modern based communication can also be this requirement. OK

then. Do you have any? Other questions or anything? Maybe on zoom? Do you have any? I hope

that you're good. Follow the. Plus. I needed them all. So. Do you have any question from the

zone? We wait for one question from this room and then we will have a break. Maybe we have to

wait for like hours, but no, it's really just but. No, OK. Of course. Of course then if you have no

questions, if you have no further questions, then let them have a break and then it's, I see it's 48, so

we will then continue at. 1518 OK, so you have this problem.

4.12 第二节

So let's continue them. So do you have any question as to the to the first part of the cisg? No, then

let's continue with the second part. And that is actually contract formation and. When we talk
about contract formation, so the second part of the CG, of course there are many issues that can

come up. We will not talk about that this thing because we don't have the time for that, but we will

try to cover the most important issues in this context. Regarding contract formation, actually one

general consideration before we get to the particular provisions of the CIG disregard is that

basically it might be important and also interesting to understand that how contracts are formed

and negotiated so many times it's it's the businessman. To negotiate the actual contract and their

main purpose might be to agree on the commercial terms of the contract, whereas on the other

hand it is important, especially if there is a legal dispute, that whether a contract was properly

formed. So then basically the viewpoint is a bit different, the perspective. Maybe a bit different

because that will be more like a legal perspective and from a legal point of view the question will

arise that whether there was a contract phone between the parties or not. So sometimes it might be.

Different for businessmen, for those who are involved in the negotiation that what might be an

important consideration, what might not be an important consideration when they negotiate the

deal. And on the other hand, from a legal point of view, it might be also present that what is the

material term and what is not a material term. When we think about or when we consider whether

the contract was formed or not. And that's another very important like general consideration or

preliminary consideration before we get to the particular provisions is that it's about the formation

of the contract as we know. So it doesn't deal with the validity of the contract, these provisions

that is something that again we know that already is excluded from the scope of the CIA. So

basically as to the validity of the contract, so whether the parties had the capacity to conclude the

contract for example, this is something what will be assessed or can be assessed under the national

law because this is not covered by the CIG or for example mistake or fraud or if we think about

these typical. It is a premeditated then basically these are excluded from the scope of the CD. So

for these matters, for these issues we apply the national law and actually based the answer this

question based on national or and. Maybe that can be the case. In Orbital proceeding primary, we

can look at the unit draft and support because unitalicize process as I have already mentioned.

That basically provides for those on this question as well and. Maybe they see the particular

provisions on on this contract formation. It's also good if we keep in mind what we discussed

within the general part of the CG like Article 8 has to be interpretation of the party statement
because of course when we look at the party statements as to how they format the contract. It is

very important that how we interpret the the party statements in this regard or the party silence or

the parties conduct because of course it can be other ways of communication of intent or or

consent than just saying that they expressly. Better because that's like a keyboard here and this is

something that you have already mentioned yesterday when we talked about the concept of

contract and how the contract is or a contract is formed is that somehow we have to, we have to

sorry, establish consent. So somehow it has to be being established that the parties. Of sentence

agreed on something. So this is what this contract formation part will be able that how can we find

the contract, how can we stop the concern, establish the consent of the parties and emphasis on

that what is the content of their contract as to the former requirements, basically we know that.

That there is a freedom of form under the CG, so there is no requirement or there are no

requirements generally as in what form the contracts can be formed. And there is specific issue

which is not directly that within the CID is the treatment of general terms and conditions. This is

very typical. International trade that the parties tend to refer to their own general terms and

conditions, and that their own general terms and conditions should be incorporated into the

contract. But they might not even read the general terms and conditions, but how these general

terms and conditions can become. The part of the contract if they can become part of the contract

or what if there is a the so-called Battle of forms between these general terms and conditions?

Because party a the first party refers to its own general conditions, terms and conditions, then

other party also refers to its own general terms and conditions. Which one will then become part

of the context. So this is a very interesting area again. And this is again something where the CG

does not directly settle, but it doesn't mean that the CIG would not be or could not be applied to

this question as well. So usually when we when we come across this question that whether the

parties have a contract or not, many times what happens is that there is a disconnect already

between the parties because some party or one of the parties expected to receive something from

the other party but didn't receive. Did the expected to receive, so there is a contract and then there

is a dispute and then we have to find the contract. We have to actually establish that whether it's a

contractual claim or not, what this first party wants to claim for the other party, so do we have a

contract, is there a contract and then of course. Basically the next question what will arise is that
whether this contract was properly formed or not, when we think about the CIS G Part 2, then

basically it's good if we know that as we discussed yesterday that for example states can make

reservation to part two of the CIS. So which basically means that then the contract will not be

formed under the CIA, the rules of the CIA, but will be formed under some different laws with

some different law is actually the national law or would be the national. But for the other issues,

for the other matters, we would still apply the CIG. So that's one issue when we think about this

contract formation rules of the CG is that it might happen that we are not even in the applicable

we we are not apply part two of the city. In the slides you will see some cases on this point that the

court considered that he has. The CIA's that could cover, but since that particular state made this

reservation, that's why the contract formation is decided under different rules. That's one thing.

The other is that we know that the parties can derogate from the CG. So the parties if they want,

they can derogate from Part 2 of the CI as well. So that's one thing that we can see in part two of

the CIG that how the contract is formed. But if the parties want to form their contract otherwise

then. What actually Part 2 provides for, they can do with that. So for example we will see it later

that as to what constitutes an offer, there are some requirements under the CH1 requirement is that

somehow the offer, the statement that is to be interpreted as an offer has to make reference or

provide. For the price. Or make reference to the calculation, the determination of the price. But if

the parties want, they can actually conclude the contact without determining the price. So this is

something what the parties can do. By that I mean that they can derogate from these provisions.

And many times, of course they do that when they have one like single document and then this is

the contract. So then it's clear that what's the content of the content, there is one single document

contract. So then we know that it's a contract and what's the content of the contract. Many thanks

from the applied this part two of the CHG then situations when we do not necessarily have on this

one single document, but like a chain of correspondence, chain of negotiations and at some point

there's a contract form and then we have to determine that when this contract was formed and

what is the content of this contract. Because later there is a dispute and then for this dispute it is.

Necessary to have a contact. So then through this negotiation and this correspondence and

exchange of communications and statements, we have to be able to establish that yes, there is a

contract and this is the time when the contract was formed and then basically this is the content of
the contract. And what we will bring in the content, the content into the content, it's like these two

statements, the offer and the acceptance. So then we will have to be able to qualify statement as an

offer and then a statement as an acceptance. So then we have the contract. So usually when we

apply. Part 2 of the CSG. This is actually for for situations where we do not have one single

document. And then yes, this is the contact that we have, but we have this negotiation, this chain

of correspondence, and then. One point, at one point we have to determine whether there is a

contract or not and then if there is a contract then what the content of that contract and because

actually this is what happens is that as I mentioned I just keep this slide but you can read it later

that. A businessman who negotiated the contract, they do that in their own language and from a

legal point of view, when there is a dispute and then the existence of the contract has to be

established and the content of the contract has to be established. Like from this legal perspective

that can raise challenges. If we look at Part 2, basically it's it's not that expensive like in terms of

number of provisions basically it's just what you can see there are certain provisions that deal with

the statement that can be qualified as an offer certain provisions. Acceptance and then the time of

the conclusion of the context. So it's it's very very brief if we compare it for example and this is

what you can see here, this is Thai could put it into this slide but to the corresponding rules and

contract formation under the unitrack principles. Here you can see it's it's way more. They're

probably agents. They're way more rules than what we can see. In the in the CIG because. It's also,

I mean the provisions in the city. What you can see is it's also because. The idea is that if it's clear

that the parties wanted to conclude the contract, so when there is this clear intention of the parties

that they want to conclude the contract and also the consent of the parties that they wanted to

conclude the contract can be established, then basically the contract is formed or will be

considered. The contract is for, so for example if you. Look at the Indra principles. There you can

see provisions, for example as to confidentiality, duty of confidentiality, surprising terms, conflict

between standard terms and negotiated terms, battle of forms or conflict between standard terms

or. Negotiation in that face. So basically in in the indirect principles we can see provisions that go

beyond. From this point of view, the provisions of the CG doesn't mean that the CIS would not

provide for or we could not derive further rules from the CIA. But we can just directly see they're

based on the generally supposed that's it, but basically this is what we have or what? That the CSG
provides so and then basically. Maybe. I see that, for example, as to the to the standards, the

incorporation of standard terms into the contract and the Battle of standard terms. It's not directly

settled in the CG. If we will see that, you will see that if you look at these provisions in the city,

there is nothing about battle of standard forms. But forms, sorry but yet it is covered by the CIG

and for example in that we we got we can also look at the interactions versus guidance. If you

think about Article 7, subsection two of the CIS, yeah, this gap filling rules. And so. Then how the

contract is formed? Acceptance. So we have to have these two matching statements or conducts or

this expression of intent that offer on the one hand and on the other hand as an acceptance. If we

look at the national laws, we might see similar collisions as to and and concept as to offer. But as

we discussed, we have to interpret the CIG autonomously, not based on national law. So it doesn't

matter what the national law says as to what is an offer or what qualifies. There's no turn. This is

what you can see in Article 14, subsection one of the Ch. This is what an offer under the CIF. I

have already highlighted the three elements of the affair. If you look at it, one very important, let's

say feature or element of a statement that can be qualified as an offer is that it is addressed to one

or more specific persons if it is not addressed to one or more specific persons. Then the general

rule will default rule is that it's not an offer, it's an invitation to make an offer. But of course the

parties can derogate from that. So it is possible that even in that case it might be considered as an

offer if you look at Article 14 subsection 2. But basically the default rule is that. In that case, it's

only an invitation to make an offer. Why is it important to know that whether statement is an offer

on invitation to make an offer? Because science mentioned, for the contract to be formed they

need an offer and acceptance. And then based on the content of the offer and then acceptance we

can put together the content of the. So that's why we have to know that what is the statement from

which the content statements from which the content of the contract earlier, So it has to be

addressed to one or more specific persons and this specific person. It also means that like this

public statement. They are general public statements, cannot be or will not be considered as offers.

The second is that it has to be sufficient for definite. So yeah, what does it mean sufficiently

definite? It means that basically it has to indicate the rules and also has to provide either like

expressly or impliedly or with reference rules as to the price and the quantity. So it has to indicate

the roots. Somehow the price and somehow the quantity. And So what does it mean? It means that
if the statement does not indicate the price somehow, or the quantity somehow and doesn't

indicate or the good, then it will not qualify as an offer, because if it's not sufficient. And the third

element of the surf condition is that basically that's like the intention of the. Offeror in this case

that basically it's not just like a statement made in the air that yes I am ready to do this or want to

do this or that, but in case of acceptance basically the offer will be bound by this statement. So this

binding nature. What is banding feature will freeze us to the important because this is what creates

or can create reliance on the other side or not very that yes, if I accept if I save it then the offer

cannot say that sorry I changed my mind so I will not deliver this good. So basically that means.

Then basically then the contract will be for so this third element that indicates the intention of the

offer to be bound in case of acceptance. So it has to be addressed to one or more specific persons,

it has to be sufficiently definite and has to indicate the offerers intention to be bound in case of

acceptance. Of course it's. Not only for written statements as we discussed, that can be oral

statement as well that verbal statement what can be qualified as an offer. And since the offer

creates some kind of reliance on the other side, on the side of the offering, basically the question

can arise that actually from what? Moment or like point of time, this reliance is actually protected

by the law, which basically means that when the offer becomes effective, one thing and the other

is that whether it can be revoked, whether the offer can withdraw or revoke the offer and. The

general rule under the CIA in this regard, that's the case for the acceptance that these statements

that offer and acceptance will become effective when they reach the old ferry, so when they reach

their addressing. And usually the case is that if the offer is here of table. So if the, the offer cannot

remove the offer because let's say the offer said in the offer or maybe statement that it is for a

certain. This offer or otherwise indicated the. Definition that it will not be revocable. The offer,

even in that case it can be. It's it's more like withdrawal of the offer before the offer becomes

effective, so before the offer reaches the offering. Because again, this is to some extent based on

on reasonability in the sense that if it is clear that one party made this statement, made this binding

statement, that these are the conditions under which I'm ready to conclude the contract, then the

other party. Would have this reasonable reliance or would have this reasonable reliance on this

statement and then could be able to accept this offer. If this party wants to accept this offer as to

the acceptance, disregard basically. And. Any statement or conduct that indicates a consent, so
that indicates send to the offer is an acceptance. So even if for example the offer was made in

writing, maybe in a communication like in e-mail. Communication. It is possible to accept it in

other form than than, right? And so there is no formal requirement as we discussed, even if this

formal requirement was introduced by the offer. But of course it is also possible since we know

that part out money applies here and parties can derogate from that. And say that yes, you can

accept the offer, but only in writing. So if that's the case, then of course. It it has to be then in for

this form requirement, usually silence or inactivity in itself doesn't amount to acceptance. But

again if you think about what is reasonable, many times you can answer the questions under the

CHG based on this reasonably that. What would be reasonable? Yes, maybe silence or inactivity

does not in itself amount to accept it. But if the parties have already a practice established that if

the offer remains silent, it's clear that the offer received, the offer remains silent, then basically

that means that the contract is concluded. So that means that. So either is a practice established

between the parties in this regard. Again, that is something that can be accepted. I didn't say that.

But of course it is important that it's not like the seller or the buyer who makes the offer. So we

cannot say that is the seller who is the offeror and the buyer is the author's offering or the other. It

really depends on the content of that particular statement or communication. So how that can

mean that reacted? Whether because the seller can make an offer but also the buyer can make an

offer. So it's not linked with the with the position in the sales transaction that will make the offer,

it's linked with the statement. Interpretation of the statement that which one qualifies as an offer

and which one qualifies as an acceptance. What happens if there are? Differences as to the content

between the content of the offer and the response to the offer, because what we saw in the Article

18 that. The response statement or conduct that indicates assent to the offer that is actually an

acceptance and then I didn't get into a detailed discussion on that, but that's the general idea what I

mentioned in this regard that. Basically. This is how the the offer can be accepted. But what if the

the offer actually introduces some kind of amendment, some kind of modifications so that yes, it's

fine, I want to conclude a contract with you, but maybe the time of delivery or the date of

delivery? Should be nothing. It's in April this year, but in in June this year. So the part is it seems

that the parties have an agreement on the good, it's that they have an agreement on the price, they

have an agreement on on the quantity. But they do not have an agreement or it seems that they do
not have an agreement on the time of delivery. What do you think would them, would that mean

then then the contract was not form or it just only means that maybe? Maybe the contract was

formed, but there is an issue which is not settled in the contract, so maybe that's subject to further

negotiations. But what what do you think about this situation? If you read Article 19, this is what

you know. I hope you can see in this slide that. How would you, how could we answer this

question that we agreed on the price the? Goods the quantity. The question is this delivery. Time

of very, very, whether it should be if or in June. So there is this slight modification. Or for

example on party sets that OK, I couldn't do what I mentioned right everything. There on the FoB

terms like incoterms FoB incoterms clause this is an equal terms close this three on board it means

I don't know if you have right so this is one of the other said that's OK but I close so it's. Yeah,

close. But they are beyond all the other aspect. It's a it's a bigger difference than just the time of

delivery because it has actually very serious consequences to risk allocation, cost allocation, the

passing of this cause. It's it's more serious this difference than just the time of delivery. So what?

What do you think? Who would say that? Yes, the contract was formed. Not in this, that's just

disregarded, but this kind of delivery, the difference is regarding time of delivery would say that

the contract was formed. No one who would say that it wasn't for. Hmm, yes and right. Because it

seems to be something that isn't important. Yes. So basically what happens is that in this situation

that if you look at Article 19, subsection one, then if there is a response if there is a reply to the

offer, which if you look at it is intended to be. The next step is, but it contains different terms,

alterations, modifications. The general rule, the default rule is that it's not an acceptance, it is the

rejection of an offer and it's a counter offer. So basically then the position is shifted, so then who

was previously the offering now became the offeror, and then. Is it? This is that they offer? So

when we have to identify these steps that led to the conclusion of the contract, then this is then the

offer and not the previous communication. So that's the default tool, that's the general rule. But of

course if you keep it, it's very legal from this point of view. If you think back to the general

condition, general considerations that we had at the beginning of this part two of the CG

formation, the contract that basically on the one hand it's it's the business person, the.

Businessman who negotiated the contract to actually negotiate the commercial terms of the

contract and on the other hand, it's also legal question that how long when the contract is formed
and and this is from this point of view very legal approach. Of course this is the rule but that also

means that what question can. OK. But they have agreement on like like 90% of the deal like on

90% of the commercial terms of 95% of the commercial terms. So is that really or should that

really be a deal breaker from this point of view? So actually the the CIA agent in this regard

provides a bit of? Liberal approach compared to this Article 19, one this before 2 is that if you

look at Article 19, subsection 2, basically if it's not a material alteration, not a material, so not a

substantial significant material alteration or modification, then the contract can be still. Form so if

the response, the reply to the offer contains modifications or amendments, then the contract can be

formed if these modifications alterations are not material, not significant or essential

modifications, and indeed in that case. What happens is that basically the contract is formed with

the content as we can see it in this modified. Modified the first so in this we this alterations with

these modifications, unless the original offer or actually rejects this. So basically what we can see

here is that to some extent the position is shifted. So who was originally the offer now became the

offer and then what? 160 was an acceptance on the side of the original offeror is basically the

silence or inactivity that we saw earlier under Article 18 that in itself it can not constitute

acceptance. So this is this is the rule, which basically means that if it's not a matter. Then the idea

is that if the parties agree on that they negotiated there, then it should be recognized as a contract

under the CIA as well. What is a material alteration or substantial alteration? If you look at Article

19, subsection 3, there you can see. Exemplary list of this so it's not a full list, but. As you can see,

additional time among other things to the price, to which actually one hand opens the room for

some kind of. Extension on what can be material alteration because it's not a closed list in this

regard. So again if we think about. Case law in this regard it is or it will be very important here as

well that whether and how other other things or other elements can be or will be considered as

material alterations, but for example, the price, payment quality, quantity. Time of delivery as we

saw a place of delivery or the dispute settlement clause, for example, an arbitration clause that can

be something that is not the articulation. So, uh, we see actually that. It's very broader here. This

range of elements then what we saw in Article 14 of the CIS as to what is a substantial. What is

sufficiently definite under article? 14 subsection one that what means sufficiently definite good

price and. Quantity, yes. Whereas here in this case we see that it's it's it's more what can actually
lead to this. Result and what is this result? That if there is actually some kind of disagreement or

conflict at this terms then basically that would mean under Article 19, but there is no contract

between the parties and usually when does it come out of this question as I mentioned that? OK.

They agreed on some commercial terms. They started to perform or maybe didn't start to perform

and that's the problem. So there is a dispute. And then from the dispute we have to go back in time

and establish whether there is a contract or not. What happens if we see this difference, for

example, as to the settlement of disputes in the standard? Terms and conditions, so maybe the

seller standard terms and conditions, let's say the seller is from from China and then the sellers

terms and conditions provide that any disputes arising out of or everything to these contracts that

are concluded under the standard terms and conditions should be. Set be. They started by. Quote

in China so there is a jurisdiction clause for Chinese all the buyers standard terms provide that any

disputes arising out of this contract shall be Submitted to arbitration under the ICC rules, the ICC,

the International Chamber of Commerce, it has actually 1/4 fabrication. So basically it has

arbitration rules. I think maybe you have already talked about that. So in the first standard terms

you see this reference. To state courts. The second in arbitration agreement. So is it some sorry is

it something that? He said the America from this point of view, what do you think? Because the

settlement of these views is a material element. Under presidential 19. It's not individual

negotiating because it's in the standard terms. If it's into the negotiating, maybe it's a bit easier,

because then, let's say in the correspondence the offer refers to this choice of court. Requirement.

Let's say that this is how they conclude contracts with this of course close to. Please be aware of

that. On the other hand, the other says that yes, we always go to arbitration and this is the

arbitration clause that we usually apply. So then if this issue comes up in the negotiations, it might

be easier. This study, because then the parties might actually. Read these communications.

Understand this communication with, specially if we look at what article that might be relevant as

to the interpretation of the parties. Yeah, statements. Eight, right, Article 8. So it might be when

we interpret the party statements, we have to look at Article 8 as we discussed. So how, how, how

would you? Solve this. What could be an argument? Let's let's. Maybe you can look at this case

load the same time. Let's look at it from from. Another perspective and that is that. What could be

your argument if you want to argue that? The contract was formed. So what would be an argument
in that regard? If we consider Article 19 of the CSG, this conflict is different between the standard

terms. And still we want to argue that the contract was formed. Because actually the CSG flies,

and there is also a Council of Advisory Council opinion on that, that the CIA also flags to

incorporation of standard terms into the into the context. So even if the CIG does not directly deal

with this question, they. Operational standard terms the CIG is applicable to this question that how

standard terms can be incorporated into the into the contract and then basically it follows the same

structure like what is the structure for the formation of the contract that like. In the terms or if the

OR for the inclusion of the standard terms, there has to be, you know, firm sentence, so it should

be indicated. You know there should be a respective offer for the inclusion of the standard term

and there should be a respective acceptance for the acceptance of the inclusion of the standard

terms. So, but but basically the CIA during the CIA you this possible to incorporate standard terms

into their contract. So, uh, what, what could be an argument in this regard? Because here what we

have is basically some kind of battle of forms. So it's, it's a bit different than individual negotiated

turn because individual negotiated terms are of course, as the name suggests, are terms that are

negotiating. In the course of negotiations. So the parties are aware of those terms, they pay

attention to these terms, they actually want to formulate these terms that actually serve their

interest best interest of course, on the other hand. If these terms are in standard terms and

conditions, those are of course formulated drafted by one party, the particular party be keeping in

mind the interest of that particular party, but these are not not negotiated in the course of

negotiation. So it's it's different. So the attention that is paid or might be paid to the standard terms

or provisions of the standard terms is less of course than the attention that might be paid to the the

Indian they're negotiated the third so. The question is clear there that. What does the question? But

how could we argue that even if, even if? There is this conflict in the standard terms. The contract

is still four or still. If you look at this. It might have, actually. There are different approaches

actually how to deal with these conflicting terms in standard. If you mind that these are nothing.

As I mentioned, we set up right. So usually therefore is that just because there is, if it's clear they

do not discern that the parties wanting to conclude the contract, there is a general constant

between the parties that they wanted the contract, then the difference is in the standard terms

would not lead to the. Back to the non existence of the non formation of the contract. So it
basically would mean that the question is that whether the standard terms become part of the

contract or not. What provisions of the standard terms become part of the contract? And what

about the conflicting provisions of the standard? That which one if any became part of the

contract. So usually it's not something if we can see that the parties wanted to conclude the

contract because they agreed on the individual negotiating terms and it's clear the point is

concerned that they wanted the contract that the difference in these conflicts in the standard. Them

would not in the failure of this entire contract. So then basically. Uh, what what solutions can you

read out from this text that is this knockout dolphin? What it might mean? What might it mean this

knockout doctrine if we read it? Conflicting study dangerous charms don't become the partial

contract, yes. So they're basically. Is that, if so, they sort of knock out each other. So that basically

means that yes, on the terms that of course they individually negotiated terms. So in the terms of

the parties agree that part of the contract, the standard terms or the part of the standard terms

which are not conflicting can become part of the contract. The conflicting terms, standard terms,

they sort of knockout each other, so basically they will not become part of the contract. This is

actually to some extent the majority we would. The minority view is this sort of so-called last shot

doctrine or last shot principle. What does it mean? There is also a reference to this lawsuit

principle, in this case the last part of this sentence, that basically it's like. Quote The A says my

standard terms party. Says my standard terms party. Again it says my party says nothing. So

basically the last statement as to what standard terms would become part of the contract is party

statement. So that means that this is like the last shot Industry got, so basically that standard term

became a part of the contract, but this is the minority UNDP consider it, it's not necessarily

reasonable but actually on one hand it might be or we could argue also that it's reasonable because

of course if you look at professionals how they negotiated. Maybe they have to pay attention,

please. And then if there is an exact reference, clear reference to the standard terms, and you don't

react to that, you don't say that you don't want it, or you don't refer to your own standard terms,

that means or can mean that you accepted it. So basically that can create a reasonable reliance on

the side of this party who makes this. Last shot in this regard. OK, so you are convinced, let's say

that my standard terms will be applied, but. It's the minority view because generally what is what

is more? Let's say to accepted. Is this this knockout rule that considering that? Like who is the last
who says or refers to the sentence? Maybe actually also by accident but considering the nature that

the reason why there are conflicting terms in the standard terms whereas both refer to the standard

terms that they wanted to apply the standard terms is because they didn't really pay attention. To

that difference or why it should be interpreted in favor of one party then at the other. So then it

means that it's not part of the contract. But of course it's important that I mentioned the third, but

it's important that the party should refer to the standard term. So just to have a standard to general

standard term. It doesn't mean that it would be relevant in the contract formation unless the parties

expressly first at this time mentioned that the same same mechanism like that has to be respective

of firm respective acceptance as to this standard terms. So basically. Through the CIS, Jim does

not provide for any rules on this question or this problem of battle of forms. But if you look at the

unit draft principles, actually again. It can be a good supplement, although there is also case

though that says that the ingredients the person cannot be used as a supplement because what we

have to look at here in this case is the case law of the CIA. But basically if you look at the

principles here we can see the. The provision which rule applies here? If we if we read it and

assess it from the point of view of whether it's knockout rule or the last sort of frame. Right. So

what do you think? What would you say? Who would save the sort of knockout rule? It says the

last shot. Who would say we should stop this? Who would say questions? Yes. So if we did it then

together the suppose the one article 2122. That's basically see that when both parties referred to

the standard terms, they have an agreement, general agreement on the negotiated terms, but the

context, so basically it's clear that they wanted to go to the contract, they have the consent to

conclude the contract and intention can be established that yes they they want. With the contract

but. There is a difference as to some terms in the standard terms then basically it means that where

there is this conflicting standard terms. So for the conflicting standard terms. This solution is that

they will not become part of the contract unless actually one of the parties indicates that OK,

without these terms I don't want to call through the contract. So if unless one party indicates that

yes, it's in the standard turns, but it is very important for me. So actually without that I you know.

Sorry, not conclude the contract then basically wouldn't mean then then the contract is concluded.

But if it's not the case then basically it will mean that the contract is concluded on the negotiated

terms and on the terms of the standard terms which are common in a substance which are. Stop
dictating. Then there is no no. Agreement, basically. So the contract is not concluded. OK. And so

this is the situation. So this basically means again that if we look at the cisg because even if it's not

in the, it's quite significant issue from this point of view. This incorporation of standard terms and

the better of standard terms, so even if it's not in the CHCH covers this question. It applies to the

incorporation of standard terms. But we have to apply the same structure for the incorporation of

standard terms, like the structure we solve for the conclusion of the contract. And then if there is

this conflict between the standard terms, then basically it means that we have to of course has the

content of these standard terms and then. Apply or not apply the certain provisions of the standard

terms. There are conflicting provisions not, but the provisions that are commonly substance those

we can apply. OK and. Do you have any questions or any remarks, comments? This forces is

happening in the offering. How how can there be two standard terms and same? Sorry and can you

please? I'm not quite clear about this part because. This is a unique Droid principle that both

parties use standard terms and reach agreements. How could they have two then terms but to reach

an agreement? It means that one part offers. And. Eight offers in contracts and use its standard

form and B the. Agree with this content, but use another form form. So there have two standard

contracts. Yes, it's not 100, it's actually it's two points. One is that there might be sometimes

contracts are concluded especially in special industries based on standard contracts. So it's not just

the general terms and conditions or standard, sorry. The terms and conditions that one party

prepared, but like standard contracts that for example in comedy it is not unusual that the trader,

the parties used standard contract forms and as to this question, to this tender terms. Politicians.

Yes, it might seem unimaginable that if there are two different sets of standard terms and

positions, how can they be common in substance on certain point, but it can happen actually that

and that's why it says that if they are so, if they have the same provisions. Because it might happen

that that's the case. Then on that basically there is an agreement on those rules, but when these are

conflicting then there is no agreement. So that's why they are not. Incorporated by reference into

the contract. Or I don't know. Altering the stage. I will. Sorry. You say it have like conflicts of

warm and this better of forms happening in which stage of this whole progress? I like this contract

formation progress and. Maybe I should come to you. So. So now just help it and this, let's say this

is a statement, statement one and it refers to the standard terms and then there is a response to this
statement too and it also refers to the standard terms, its own standard term. And you're right, it's

it's like a negotiation process of the contract. So it it this question comes up like this, references to

the standard terms in the course of the negotiation and so if this statement can be qualified in

November, then the question is that whether it's an acceptance or not, let's say that these are equal

like these, these are the individual negotiated. Yeah, but there is a conflict here in the standard

terms. So they refer, that's important that they have to refer to the standard terms in this statement

because if they do not refer to the standard then they will not be incorporated by reference into the

contract. So this is where it happens that. I mean from technical point of view that part is referred

to different standard terms and they they like move on with the with the contract formation and

then at some point this, this is for the dispute. So there is a dispute and then we have to look back

that when the contract was formed and what's the content of the contract and let's say that. Since

there's this conflict, but let's say this is the point when the contract was formed and then we have

to establish the content. It's clear that as to this what is the content, but the other question is that

from this. Two standard terms. Which one, if any, become part of the contract? So basically the

assessment from this point of view that whether a standard terms become part of the content and

with what content comes up when there is a dispute. Actually, but how these are incorporated into

the contract is through this negotiation. If that's. What's the question? No, I haven't. But so yes. I

don't know. Yes. OK. So then then I know the drawings might not be that clear but but so this is

how it comes out this question that they refer to their own standard terms and during negotiation

and then they they do not really care about. Because if they, I mean. Generally, if they care about

this, they might look at this. Because it just creates more problem for them later if they intentional,

intentional, do not care about this, they service conflicting terms might cause problems, especially

if it's about the dispute settlement mechanism, but also like for liability issues as well. So that's.

That's the case. But and then they realize that there are actually standard terms and then the

question is that whether. This standard does became part of the contract or not? And why is it

interesting? Because there is a clear consent as to the individual negotiated terms, but since they

didn't I see from distances. And not that clear knowing but but basically what is clear is that

basically they agree on. When they, they're negotiated terms, so there is a constant. But since they

didn't really look at these standard terms, we cannot really say that they have an agreement to
understand their terms, but somehow we have to deal with this reference. That these statements,

they refer to the standard terms, so it should be some high knowledge there are friends and how it

is acknowledged is that yes, maybe these terms are not individual negotiated, but this reference to

the standard terms, it was individual negotiated, so it is accepted and basically forced by the law

and what's the? Enforcement of this references that it became part of the contract, but if there is

conflict because that would be easier to say that yes, if there is conflict then under Article 19 and

basically it's it's about different term alterations, modifications. There was no contract concluded,

so it's a counteroffer. But if we look at like from a practical point of view and what is the practical

reality? If you take a photo, maybe I I make a better. Venture the online students. So. Yes, so, but

what I wanted to say is that. No, I forgot. No, no, it's OK. It's OK. Yes. So somehow yes from

practical point of view and if we think about it what is reasonable it is also on our that like on 90%

or 95% of the deal. For the the terms of the deal, the parties agreed. So that should be then there is

actually reason why they didn't look at these standard turn because it seems that for them it was

not that material because if it's that material for them, they would have looked at it, they would

have negotiated. So basically that feeds that to some extent. They made the same mistake, like

they both refer to their own terms, they did both didn't care about the other terms. So that's why.

That's why. Actually this is recognized that even if under Article 19, subsection 3, it might be

material alteration the terms that we can find in the standard terms. But it still can, uh still can lead

to the conclusion of the contract without agreement on these conflicting terms. Do you think it's a

good solution? No. Reactions. Because actually national laws might be different as to what rule

for example, they for this knockout rule or the last shot to some extent, since the CIA does not

deal with this question, these national law solutions are transposed into the CIA G contacts. But

even if you consider like Article 7. Subsection under the siege. We shouldn't do that, but somehow

these concepts are applied implemented in this assignment either. Parties are coming from

different traditions, like this one is from. This knockout tool tradition, this one is from this last

tradition. This party might believe that since I was the last one who's referred to the standard

terms, this is what became part of the contract. So whereas that's like based on national law and

not not. The CISU. So what's the, what's the conclusion here in this regard that what is what you

have to do if we want to make sure that our standard terms will become part of the contract. And it
will actually be like the food standard terms. What what would you advise to? They're fine.

Exclude the CIG of the binational law. No, it was a joke, but So what? What would be the advice

then? How to deal with this? Inclusion or incorporation of standard, if you want that, all standard

terms. Should be then the standard terms that are applied, and it's entirely and not like just part of

it. And how do we know that which one is the last? OK, yes. Uh, and what do you mean by last

offer? OK, yes, we we actually never know if it's the last of her or not, because I I didn't use it so

far. But what if this is the reaction? Of the first party. And so this one again, what is the second

statement? And again, it refers to its own standard terms that yes, thank you, I received your e-

mail. Happy to deliver you the goods and please know that you conclude those contracts on their

own standard terms and conditions. So then. Maybe at this point we thought that this is the last

one, the last shot, but here there is this. In reference. Always dream for the other party that you

have this danger. Yeah, that's one thing that's very important. Inform the other party of the

standard terms and of their intention to incorporate the standard terms into the contract. It is also

important. Actually I haven't talked about that, but since we don't have time, but basically it's also

important under. The CIG for the improved incorporation of standard terms that these standard

terms should be available. So it's it's not possible that we say that OK as we conclude our contacts

on the standard terms but very you can find it nowhere. So it's not possible. So it's important that

for a standard terms to be incorporated. Into the contract it has to be developer reasonably

available, which basically means that it's not a requirement that it should be sent together with the

communication, but for example if it's accessible, easily accessible on the website of this party

then. That's that's acceptable from this point of view, but it's it's important that it should be

available and also of course it should remain available. So it's it's should be something that is

accessible. Anytime when there is other party would like to access these standard terms. So yes,

that's very important to inform the other party that we want to understand the terms to be

incorporated in the contract and maybe also something what we can see here in this is the first

provision, the second part like the intention that, OK, if we have these like conflicting standard

terms and then we end up. For court and then course we said OK, apply this knockout rule then we

might lose some provisions of or standard terms. So if you don't want to lose these provisions

actually it's it's important or can be good to refer to this standard terms as that this is under which
we cannot just we conclude that. But without that standard terms and development. Let's say all

the provisions of the standard terms, we are not conclude the contract because these are material

provisions for S so something like what you can see in this principles in this provision to make

clear that intention that without these. At the parties would not. This party will not conclude the

content because, again, if you think about Article 19, this is a provision from which the parties can

delegate. Alright, so if the party is safe, that. It's like all the provisions in Part 2, the parties can

delegate from these provisions. So if the parties say the parties agree that yes, maybe standard

terms might be or this dispute resolution close or whatever, what we can see there might be.

Relevant in stressing whether there is material alteration or not, but basically they can, you know,

they rise and they can say that. No, we don't apply this provision in Article 19. So this is how the

contract is formed or I want to conclude contracts under only under these terms and if it is clearly

communicated in the in the negotiated terms of this negotiation. Then basically that if we consider

Article eight of the CFG as an interpretation of the intent of the parties, then basically it can be.

Yeah. From this point of view, a good way to make sure that our standard terms will be applied or

will. In their time, they. Incorporated into the contract. So. OK. So do you have any questions on

this? OK. So the next question is basically we so like we are still doing this contract formation and

offer acceptance with. So then the next question or the third question is the time of conclusion of

the contract. So what is the time when the contract is concluded, so how can we define? Like the

the. Sorry. None more. With the other party Acception resolved. So, yes, you, you, you mean that

when the contract is called? Yes. So then basically what is like the point in time from which we

have this binding contractual obligation? Yes. And in this regard Article 23 there will be relevant

and then provided the contract is formed, the contract is concluded at the moment. And acceptance

of an offer becomes effective when it becomes effective when it reaches the actually the other

party. So then the contract is formed which basically means that then from that point of time or

from that woman time there is a binding relationship. Because dictation ship between the parties.

And. There is another provision in the CIA which is still relevant as to this formation, contract

formation or modification, Russo termination, which is not in part two of the CIG but in part three

of the CG in. Article 29. Which is actually about the termination or modification of the contract.

Basically. It's still very large extended the same like the formation of the contract like what is?
Important here that the termination of the contract is not remedy. It's the agreement of the parties

that if they want they can terminate the contract for the termination of the contract. Actually, of

course, it is again required that there has to be an offer as to the termination of the contract and

there has to be an acceptance. The termination of the contract. So this is not a remedy for non

compliance under the CSG or under the contract. This is the agreement of the parties to terminate

the contract because on the other hand actually. From the point of view of the siege, your contract

is a very strong. Creates very stone. Legal obligations for the parties, and entities for the parties by

the time that means that as long as it is possible that the contract exists, established that the

contract exists between the parties, the parties have to actually comply with them. The contract so

basically it is not that easy to escape from the ties of contract. So Bombay, how the parties can be

relieved from this obligations or from this type of contract is that if they agree that they would

terminate, but that requires. The consent of the parties. If we change our mind here, like we don't

want this contract anymore, we cannot just terminate the contract. By. Any statement that, OK, as

of today we turn it the contract. So we cannot do that. It requires the agreement of the parties. We

cannot just avoid the contract. So, uh, you obviously later and we'll talk about the obligations of

the parties and the possible remedies for the breach of the parties obligation that avoidance is, is

really a very exceptional remedy. So for example yesterday we talked a little bit about the

fundamental. You know what, the code 25 with the CG for example, we can avoid the contract if

it's a fundamental region. If it's not a fundamental reach, we cannot just avoid the contract. So in

that case it means that the other party breached their contract. But if it's not a fundamental risk

generally of course, even if it's not a fundamental right. At the end we might be able to avoid the

contact, but not in the first place without any other step. But here, in case of the fundamental we

we can avoid the contract and so this is. This is very serious from this point of view that once the

contract is formed between the parties, it's. Very, very important, very strong and very protective

ties from this point of view under the sea. But of course the parties can terminate the contract if

they want, but for that, these mechanisms that we saw that offer acceptance has to be. Following.

And also as to the effects or the consequences of damnation as I mentioned it in the context of get

feeling today. That, yeah, this is what you can see in Article 29 of the CG. But the parties can

terminate the contract by they made agreement, but it doesn't really deal with the consequences of
termination. So what happens after termination of the contract and of course they can terminate

the contract before. Any of the parties starting performance under the contract but also in the

performance phase as well. So once the OR after one party or they perform all or part of its

obligations under the content so so they can create terminate it later as well. But once there is

already. Some performance taking place, then basically the question arises what happens or what

would happen if these already performed? Obligations like, for example, the goods that were

already delivered, or with the payment with the price that was already paid, or the part of the price

for the part of the good that delivered or or pay so. Tension. Nothing in the CIS release, but

actually we can apply the provisions that the CSG has regarding the effect or the consequences of

avoidance, the contract in this case as well to this termination issue as well. So basically it means

that. For example, as the restitution after termination, we can apply the corresponding provisions

from the CG. And. The modification of the contract it is of course also possible, and sometimes

this question arises that. OK, let's say that. This one said something, this party, the other party is

founded, the contract is formed and the first party then says something else. Let's say the time of

delivery here in this statement was that the time of delivery is April this year. This statement says

OK and then this statement says that yes, thank you, I received. Your e-mail this e-mail thank you

very much for your order and Please note that the time of delivery will be in June. So. What is it?

Up would be. So listen to me. It said OK and then it said OK, close June. Is there a contract

between the parties? Or So what what are the possible? Solutions. Then there's no contacts. But

maybe that wouldn't be the solution. Um. Is there a contract? But people have contract content for,

is that contract modification or an offer to modify the contract and maybe this first party will

accept June delivery date or not. So which one do you think is the case or would be the case? In

this situation. Change the time. Materially. Alters the term of but if the both parties continue to

perform the contract, it's have the contract form. This service situation. Modification, so this is the

contract and then this is no fair to modify the contract if the both party continue to perform the

contract is kind of the contract modification. Hmm. Yes, OK. And? Any other? Because yes,

exactly that question. OK, now we agreed, but then you come with this e-mail and say that, OK,

this is June, is it a modification of the contract where it's like a notice that I will not be able to

perform within the set delivery did. So basically this party breaches the contract? Later tomorrow,
actually. Because. Yes, tomorrow we will talk about part three of the CIG, which is like the parties

obligation, service obligation buyers obligation, things like that. But that can raise actually

questions and of interpretation as you will see that all to deal with this because if we want. Need to

be a breach of contract that OK we agreed on this data, but you. Actually. Sentence and notice that

you will not be able to meet that line. That's basically even if you send this notice, that's a breach

of contract, but if it is treated as a as a. And modification, let's say your proposal to modify the

contract, then basically again, this bridge can come up, but then it actually means that. That maybe

if the contract is modified then certain remedies that might be available under the CIA in case of it

will not be or cannot be exercised if it's something that you mentioned in the first place like a kind

of counter offer would be a kind of counter offer. Then if we don't find this contract, we are this

party and we see that we don't want this contract. Why wouldn't we want this contract anymore?

Because let's say that we don't want, we want these goods from. I mean in April or May or we

managed to find another supplier who would supply these goods the lower price and for us. So we

don't want this contract to be anymore a contract then maybe we can argue that this is actually

what. Sorry. Yes, please. Don't worry. Modification, yeah. Mm-hmm. Yes. So we might argue

then. Then actually it is like we're still in the negotiation phase. And this is a material alteration

would be a material alteration that OK it's not clear but it's June, so there is no contract or the

contract was not formed because of my contract from that this party sends this note, sends this e-

mail that OK. Thank you for this. Maybe your daddy Please note that the goods will be delivered

in June. We do not react to this and the boots arrive in June. What do they do with this? Because

then this party actually very, very good because there's the interest of this party to deliver the

goods and the collective purchase price for that. So then. We added these things so. Maybe a

tutorial earlier talk about things like this, but also so I see we have approximately 5 minutes.

Media continue these, then tomorrow you can. In the meantime you can think about this, because

here we can see that all of these are two separate chapters, like of course two separate chapters,

Chapter 2 and chapter 3G. Then we format legal arguments as. Get them then. We might might

think about different ways how to actually apply in our situation, the CIA, but of course. We can

try one, but basically it will be the core who will decide that whether it's a good argument or

whether it's convincing enough or not. But in situations like this, we can think about these possible
scanners. But actually it might. Create the impression that it's very uncertain that what might be

the outcome if we apply this theology. So there is a very high level of certainty and predictability

as to the the outcome when we apply the CL. So for example, how you started your answer here in

this regard if it's clear that. Basically the parties agreed on all the material elements and so step for

them substantial elements of this transaction. And then there is this. Let's say automation then,

basically. Uh, it might be also argued that the contract is. Form, but uh, it would be, sorry. It

would be a kind of modification, maybe attempt to modify the contract, but it wasn't accepted. So

it's not necessarily something that would be considered entire counter offer. And then the contract

is not really depends on the circumstances. For the case that, how would we? OK, please. OK.

Umm. So do you have any? Question and from mobile it came here is because looking at the zone.

So do you by any chance have any questions either here? Or from the zoom. OK. Then just the

last note understand national modification is that this former requirements as you said that if the

part is actually one day, of course they can set format requirements this written form or this

writing requirement and then basically this is 29. They stop Section 2 then. Basically it means that

the then the contract can be modified or terminated only in writing unless if you. See there's the

second sentence in the second subsection is that unless actually the conduct of the party indicates

something different, and the party could rely on that, but basically. And then generally, if it's a, if

it's set by the parties that this formal requirement is written from, requirement applied, then

basically it has to be or it will be followed and. What I just wanted to tell you. Now before we

start for today, I expect here because I. And notice that there was. Call here maybe Vestment

pointed out, but basically it's there. So if you come back to this slide, what you can see now of

course it's not Article 9/2 and Article 93. I don't know why it's why, but it's Article 91 and article.

And. Here in this slide, so it's it's not two and three, it's it's one and two. And I don't know, OK?

So then we finish. We need to finish them this Chapter 2, this formation of the contract for today.

So let's not forget that the CIG deals with the formation of the contract, not the. Everything of the

contract. So for example if in this case the question would be raised that OK yes, but here it was a

mistake. That we mentioned April, but it's really June. It might be actually something what would

raise or could raise these questions, but also adaptation questions as we saw it earlier. So basically

this with the formation of a contract, it's also. Would defeat. Don't forget that states Member
States can make reservation to this Chapter 2, then it will not be applied. Parties can also delegate

from this chapter two so they can. Conclude the contract basically anyway how they be so they

can derogate from the CIG, but if they do not derogate from the CFG then we have to apply this,

this basic mechanism, this basic structure that there is a need for acceptance and there is a need for

offer in some some. Countries, national laws, common law, maybe you have studied that or or

learned that about that that there's other element like this consideration which might be important

or necessary for a contract to be formally concluded. There is no such. Here it's only what is

required because we saw is an offer and an acceptance and this is what the CIG regulate the CIG.

If you look at the provisions of the Cisg and finish soon because I see it's time so. If you look at

the provisions of the CG, it's not that expensive, but of course, like for example, if you think about

the standard terms, incorporation of standards and better forms, there are more in the CIG from

this point of view, what we can see directly if we look at the text like the. Particular words or the

search invite matters from this point of view, because it means that these are covered by the CHD

questions based on practice and based on the Advisory Council opinions, respective opinion,

which basically means that it's not something where we would go to the national level and then

apply the national law. For example, for the incorporation of standard terms or for these better

forms. These are within the CIS geography within the CIA. OK. Do you have any any questions or

anything? If not. Then. Probably then that's the end then for today then. Thank you and. Are there

any questions on this? There's no question. OK. So if you have no questions there, then thank you

and then see you tomorrow. Thank you. Thank you. Put that. Go.

4.13 第一节

Already related to part three of the CIGIG obligations of the parties obligation of the satisfaction

of the buyer, OK. So then you talk about to some extent the application, the applicability of this

the IG yesterday we talked about the formation of the contract under the CIA. Do you do you have

any question concerning that or as to that? And. The other day I mentioned the play, so now I see
that many of you are here, I send it. Zoom straight this is from your ship, who was chairman of the

committee, that doctor that I, as we discussed. And it's not about the CIA, it's about the indication

of law, the challenges of unification of law, what issues might come up? Probably difficult it is to

reach an agreement if especially if we think about the different legal traditions, how they see

different concepts and this is what we saw actually in the CIA as well that. And maybe the

concept that I used in the C III concepts that are similar to national law concepts, but basically we

have to interpret these concepts autonomously as we discussed. So any questions to anything? No,

if not, then let's continue and today we will talk about chapter three of the CI, part three of the

CIG, which is about. Actually the seer of good, so it's about the content, the content of this we saw

that how the content of the contract is created actually by the parties through the conclusion

process based on the offer and the acceptance we. OK make reservation to this part three, which

means that if the state then join the CIS, you make this reservation, then basically it will not be

applied. Part Three also part, the autonomy is very important. Again, as we discussed it

previously, it's it's actually very important in the context. The horse CSG. But they'll tell me which

basically here in this regard means that of course the parties can freely agree otherwise. So what?

The rules that we can see in the CSG industry are of course default rules. So the parties, if they

want, they can. Be otherwise, they can modify these provisions. They can amend these provisions

so. You know, this is what party autonomy would mean in this idea can exclude. As we discussed

the CIG hole in part. That of course refers to this part three of the CIG as well. We look at the like

the structure of this. Party of the C as you did, you can see that there are some general provisions

and we will start with this general provisions and then we will continue with the obligations of the

parties, obligation of the seller, obligation of the buyer and then the possible remedies that are

available for the seller and the buyer in case of. The beach on the other side, and then there are

some common provisions to the obligations of them serving the buyer and then. Yeah, also some

provisions concerning the passing of this, so. Again, these are the default rules for the parties can

derogate and sometimes the derogated by writing like the provisions into the context. So they put

different provisions, different clauses in the contract that we can see or maybe they refer to

something as and what would it be? They might refer to, which actually can be relevant in this.

Contact. Do you remember this? Um, kind of. It's a, let's say, product from the ICC, which the
parties can. Refer to designate like for example. FB is from that as we saw yesterday. Probably

quality. So what's the name of this? Yes, yes, the input them. So the part is referring the contract

to a particular input term that of course that's a derogation in that regard, that's a derogation from

the CIG and then basically we have to apply them so. Let's then start with some issues in the

general provisions. Actually in this regard, I will talk about two. Let's say concept. One is

fundamental reach. Of course, so far we haven't talked about like the obligations of the seller and

the buyer in details. But since we have already mentioned several times fundamental breach, it's

good if you look at it now and actually if we follow the the structure of the CIG. This is like the

very first provision here in this regard. What is this fundamental reach? Why is it relevant, this

fundamental reach? If we look at national laws, usually what we can see is there is breach of

contract, which basically means non compliance. In the conflict, but in some cases and in some

laws, we see that there is a a concept for a serious speech or something that is fun. There's

something that is significant, something that is actually qualified from some point of view, which

means that different remedies might standpoint. That particular region, so this is the case here in

the CID as well that. There is like the general return just the bridge contract but if this bridge is

serious to be

Are not complying with the contract because the goods are not the type of goods that were ordered

by the buyer. What is a possible remedy that the buyer might actually resolve to that the request of

substitute goods, but it is not it if you think about it actually. The request for substitute goods or

when the seller would be obliged to deliver substitute goods, that's a very serious. There it has

very serious consequences on the seller if we consider the financial aspects of this situation. So it's

basically like delivering the game good, doing something with a good dessert already delivered.

So it's a very big financial. Burden on or can be a very, very very significant financial burden on

the set. So, for example, if we look at Article 46, subsection two of the CHP talks about possible

remedies that the buyer might resort to in case of the sellers beach. And here this in this particular

provision, we see that the buyer can request the substitute goods so that the seller should supply

substitute goods. But when? When it's actually a fundamental reach. So if it's not a fundamental,

really so if the requirements under Article 25 are not met. Order party do not take the otherwise

then basically the buyer does not have the right to request substitute because if you think about it,
it's pretty very very burdensome or can be very burdensome remedy or another example for the

relevance of this fundamental which is avoidance. That when? Party can avoid the contract. It is

not that easy to avoid the contract under the CIA because the idea is that if, as we discussed

yesterday, that if there is already a contact between the parties, then every effort has to be made in

order to actually fulfill that. That coincide the contractual obligation. So what happens to the other

party does not comply with its obligations. Let's say the other party delivered some goods, but

these are the goods that we expected under the contract. Can we just avoid the contract? Actually,

no, but only if, as you can see. And this article 49, if it's a fundamental breach, if this

noncompliance amounts to the fundamental, if it's not a fundamental breach, then basically we

have to set an additional period of time for performance and if the seller does not perform it is

additional period of time, then we can. Avoid. It won't take this back, but generally we cannot just

avoid the conflict. But in case of fundamental bridge there are no additional requirements for

avoidance, so then we can avoid the content. So basically. This is just, this is the two examples,

let's say, or just two examples to show that why is it important whether the bridge, what we talk

about is a fundamental reach, so whether it amounts to be a fundamental reach or not, and then

what is the fundamental breach under the contract? Under the CIA, sorry, if you look at Article 25

this is the default rule. But as we know party autonomy is like a very important principle in the

CSG. The parties can actually in their contract forming different this. So they can for example

provide the list of possible. Bridges or non compliances that they would say that. If this happens,

then that's a fundamental breach or it will be a fundamental breach. So again, let's not forget party

autonomy in this regard. But if we look at this 25, Article 25, there are actually 3. Conditions or

three requirements, or three elements, whatever the recorded. What that is? If you really did

believe, what are these three? Elements here or conditions. Of course there has to be a bridge.

Obvious stablishing that was a bridge. Video scene clear there. So maybe you look at the different

provisions, for example. 42 Article 42 is about intellectual property rights. BBC later so it's not

free. The goods that were very good are not free from third party intellectual property rights. OK,

so that's actually a breach. Under the CSG. OK, so that is a. That's of course important, but. When

this bridge will be a fundamental reach, if we look at what? Would be. What? What would you

say? Yes. So now we are looking without the currently five and if we read it, maybe we can read it
together, then Article 25 breach of the contract committed by one of the parties is fundamental if it

results. Is such detriment to the other party a substantially to deprive him of what he is impacted to

expect on the deployment. So this is one requirement and that's why I stop here that this so-called

substantial deprivation that basically it's not just the breed because if you think about it of course.

Of the expect under the blunt fact that the other party will do what they have paid them. So

anything that the other party does not do in line with the contract, we might think that this is not

what we expected. Uh, so everybody can be contrary to our expectations, of course, but it's not

just. It's not just. What we don't get what we actually, so that we would get like we have some

kind of disappointment and this regard, but it has to be a substantial deprivation, so substantial it's

so. So is that the decrease, the decrement that is created is substantial to deprive the other party or

as to what this other party is impacted to expect under the contract. So there has to be a breach this

substantial deprivation and the third one if we? Read the last part of this provision. Basically the

third one is is more like a defense or can be more like a defense on the other side if you think

about it, because it reads that unless the four team reach did not foresee and the reasonable person

of the same kind in the same circumstances. Would not have forces such a result. So that's about

the foreseeability or enforceability, so that the result, not the bridge, but the consequence of the

bridge, this serious consequence, this substantial deprivation, is not foreseeable or was

unforeseeable. For the party, so this is this element or this third requirement, this foreseeability or.

Looking at this from another perspective, the unforeseeable of the consequence, so not the bridge

itself that the bridge would occur, but the consequence, the result that it's actually a substantial

deprivation or it will be a substantial deviation? And here you can see again what we discussed

yesterday in the context of Article eight of the CG, this standard of third person, this reasonable

person of the same kind. So here we can see the reference to the party and the reasonable person

of the same kind in the same circumstances. Would not have foreseen such a result. So it's this

objective standard what we can see here. But of course we will talk about it more when we talk

about the different approaches. So this is. And the concept of fundamental reach under the CIA

and we saw that why it's. Do you have any question? To this. No. Then the next or the other

concept that I wanted to mention before we get to the obligations of the parties is this rule of

specific performance. Esv. As we discussed previously, basically when we applied the CLG, we
applied the CIG and not the national. We can resort to the national law only when the CIG allows

us to to go back to the national law to apply nationally. That's. The other thing is that basically,

again, when we discussed some general issues concerning the different national traditions to or

towards or rules towards contractual issues, is that the specific performances against something

which is not treated the same way. The different legal systems this regard because in some cases,

in some legal systems, it is possible to request specific performance that is guaranteed, that is

possible under the respective nationals. In other legal traditions it's not possible to request specific

performance. What is possible actually to claim damages? And then basically it means that the

damages can make up the harm that the party suffers from the bridge of the breach of the contract

by the other party. So for example if we order some goods under the contract. Of this seller does

not deliver this good then under this clause which do not. Let's say they recognize specific

performance. What we can claim is damages and of course the damages. How the damages will be

calculated? The damages will be calculated in a day that would enable us to actually purchase the

goods from other suppliers but this first supplier, so the seller cannot be obliged to deliver. The

roots in the seller does not deliver. In other legal system content legal systems, it is actually

possible to claim to request specific performance. Sometimes it has like requirements that when

we can claim specific performance, not under any circumstances. In any case, but for example, if

it's unique, if it's something that is not generally available on the market, it's something that is very

unique, very special. So it's only this supplier who could supply this good or just a very, very

small group of suppliers. Supply this. Good. Then maybe we can claim a specific performance. So

there are different approaches to this. And this is somehow recognized in the CIS G in this Article

28 of the CID. If we look at it, what does it say? That would be that practice. Text the IT again,

maybe together so that. Yes. So what does it mean? It means that basically the CIA actually

provides for this possibility that we can request performance specific performance because

actually if for example we have buyer and the seller does not deliver the wood, we can request the

seller to deliver. So it's possible. Could you please specific performance? But what it provides for

this provision is that the Court and here the Court means Court, but can also mean actually arbitral

tribunal depending on the particular dispute settlement mechanism. So the code is not obliged, is

not bound to enter a judgment for. Performance, unless the court would do that under its own law
in a same situation if the governing law was not the CSG but its own law. So basically what it

means is that, for example. Let's say in Germany, the court is here, in Germany, is located here in

Germany and then the party request specific performance. So this provision means that this

German court will not be obliged to enter judgment for specific performance unless under the

German law, the Court would do the same. With the German law would be the applicable law and

not the CIG, so this is. Again, let's say a room to the application of national. Then we apply the CI

and this is possible because actually the. The CIA itself refers to the national, but here the national

law that is applied by looking there is because that's there the next 40. So it's the law of the current

divider forum is located. So it's a different national law than the national law what we saw. In

Artica 7 subsection 2. We remember this Article 7, subsection 2 is about get feeding. That how do

we feel the gaps under the CIG and how do we feel the gaps? Do you do you remember? Do you

remember? So if there is a gap in the CIA illegal gap. So the CIG regulates a certain issue but does

not provide free express provisions on certain aspects. So if there is this gap, so yes, very good the

general principles and. The next step is basically. Yes, the national load applicable law, but in that

case, the applicable law, what we would apply to fill the gap is the so-called next causes. So the

law that would be the other right governing below of the contract. So it's a different law or I mean

at least the way how we get to that maybe at the end of the day will be the same. You don't know

but the that's the governing globe the contract or the otherwise governing global contract in the

sense that if the CIA wasn't the law what we apply then that would be the governing law here it's

the flex for the national law of the currently that the that the court. And located so here in this

regard it will be. It will be, yeah. Yeah. The and it's actually substantive law question and

substantive contract law question. Later, if we have time, we will see some case studies in this

issue regarding this issue, this specific performance. So now let's. To the obligations of the parties.

Article 30 and 53 we have already looked at these two articles right when we talked about the

concept of. Well, when we talked about the concept of server contract. Under the CIG we saw that

basically the CIG does not provide for a definition for the concept of self contract. But what it

does is that it provides for these two provisions, so it provides for obligations for parties where

parties in assessment. So which basically means that if on the one hand we have a party who has

these obligations like the seller, on the other hand we have a party, another party who. Has there
obligations that buyer then basically it's a sales contract and it's not necessarily only two parties

who are involved actually in the contract because the CIA can be applied in situations when there

are more parties involved, not only just two parties in are involved in the situation. But he had this

is something what should we should be able to establish that we have. Someone who is center and

then or who would be then the seller under articles and then someone who would be then the

buyer under 53. So that's a sales contract. And then of course in that regard what you mentioned,

you discussed yesterday also in the afternoon this mixed contract that might be actually. Some

kind of fixed or from this, but I mean from the application of the CIG. But basically this is the

concept of safe conduct. So in that regard we already looked at this, but of course now we will get

a bit more into these two. Uh. Sets of rules, let's say so as to the setup. If we look at Article 30,

what are the three main obligations of the seller? The seller must deliver the goods. Handover any

documents relating to them and transfer the property in the goods. So basically delivering. So

deliver the goods, hand over the documents relating to them, so the goods. Document and transfer.

The property in the good. As we discussed, the CI G does not deal with the property respects. So it

doesn't deal with, for example, the question whether it's possible in a certain good or in the case of

a certain good that this good can be subject to sales transactions. Let's say this is not what the CIA

would regulate in this regard, but in a sense. That's because of this property law implications or

questions. What the CIG was regulates in this regard is the obligation of the seller that the seller

has to transfer the property in the woods. And why is it the case? Because this is what would.

Make them this contract to be. Serious contract. So this is something, if we think about it as a

characteristic performance under that contract, that the seller actually, yes, delivers the goods hand

over the document, but also transfers the property. What's the agreed the relevant flow in this

regard? I mean regarding the transfer of property like when it takes place, how it takes place, how

the buyer can acquire property, it's a property law question and then from private international law

point of view, I don't know. If you have already studied private international law. To some extent

then, usually for property law questions, what is the the applicable law? Yes, where the property is

located, where the object is located. This is the so-called lakeside city. Something like this. So this

the law of the country where the object where the property is located. So for example this item this

laptop is no located in Germany and that's the property law implications or set of this. Laptop we
have to actually apply the German law to determine that who is the owner of this particular. And

the more object, so basically that's the law of the country where the property is located. In some

cases actually the national priority international rules provide for specific rule when the goods are

in transit, so this race in transit too, so when the goods are. On transit, let's say from Germany to

to Hungary, and then basically it means that the place of of the departure is. Germany and then

let's say the transfer takes place from Germany, Czech Republic, Slovakia and Hungary. And then

basically since we know that the place of destination, the final destination is Hungary for the

property to aspects actually. We can apply this law that that's the final destination, so the

Hungarian. So even if for example the particular shipment is located, I don't know in the Czech

Republic, but there is a transaction that takes place which effects or can affect actually the

property law. Espectral that shipment, then basically it's not the. The place where the object is or

the property is located the check below, but the Hungarian row would be down there applicable

because that's like the the destination of this shipment, but basically. The general rule is that the

law of the country where the object to other properties are located. And that's actually what might

be also relevant here. But we will not get into that. But how it is possible to acquire property,

maybe like ownership? Maybe you have already talked about the differences between national

laws as to whether it is required that the acquirer should be a good face acquire or not a good face

acquire. So whether when we acquire property, you know certain jet and we know that. Better we

have to be good faith acquire, so we have to have some kind of good faith when we have fire the

property or not. So which basically means that whether we can acquire for example property over

ownership overnight and which is let's say stolen item. And then basically we have the seller and

the seller said yes this is the good and I'm. Ready to sell this to you? But this good is actually or

these woods are not owned by the seller for some reason, maybe because these were stolen,

whatever. So then we are the buyers can be acquired ownership. Based on this transaction,

whereas the seller was not actually the owner of this. Um, goods or items? So this is something

that is a proper pillow question or what would be a proper pillow question? And then basically this

is. Something what will be then or should be then decided under this property law, the rules. And

it is intentional actually, that the CIA does not talk about the transfer of property, partly because of

these differences in the national law, but what it does, which is a very important aspects of
ownership, is that who is the risk, who takes the risk and actually. The CIG talks about the passing

of freeze, so when the risk passes from the seller to the buyer. So when some damage occurs to the

goods, then who should be at the consequences of that damage, whether it's the seller or it's still

the seller? Or it's already the buyer, so usually what we can see? You know that that's a very

important aspect of ownership that actually could be as their risk and the owner with the risk

generally as to whatever harm ipur or happened to that particular object or. But here under

contract law, what you can see it's a bit. The approach in the CG is that it regulates the passing of

it under contract flow or in contract law. So it's not the property law implications or or anything

that would have property replications that put it this way. This passing office, it doesn't determine

that. Who will be then? The owner? Who will be then actually the one who owns the goods? It

only talks about when the risk and how the risk passes from the seller to the buyer and. Of course,

while that is because of the incoterms that when the parties agree on a certain income terms,

actually the INCOTERMS closes provide for us on passing of risk. So basically it means that if

the parties agree on a specific incoterms close, like for example FoB, then basically it means that

this question is suspect of questioning or freeze will be regulated in the import terms clause in the

FoB clause. So it's not. The sea, so it's good if it's OK. So that's. Like Article 33? Obligations for

the seller and as to the buyer. There are two obligations. One is the buyer must pay the price and

take delivery of the goods. So this price is. The purchase price it's a renumeration for the the

sellers performance for the seller service especially. The transfer of property in the goods so that

makes it to be a purchase price. So that buyer must pay the price and must take delivery of the

goods. So three obligations on the side of the seller and two on the side of the buyer. Now let's get

a bit more into the. Sellers obligations. So the seller must deliver the goods, hand over the

documents and transfer the property in the woods as required by the contract and. The convention.

Umm. As we discussed, basically bought the from is of course very important in this regardless,

right? Which basically means that the parties are free to agree on the aspects of delivery of the

goods and handing over the documents in their contract so they can determine. In the contract, the

time of delivery? The place of delivery whether? Third party can be involved or should be

involved in this for example, because actually there is a company who will transport the goods

from the seller to the buyer. So basically the parties are free to agree on all these aspects of course.
Either contact So what the CIA agent provides for you this figure some basic default rules that

OK, if the parties did not agree then what should be then the solution? So that's why. OK let's not

forget that this is something where the parties that can agreement. Also what we saw yesterday in

Article 19 Stop Section 3, if we remember actually not the number is not important but like the the

concept, what we saw there is this. Do you remember in what regard did we talk about yesterday?

Yesterday we talked about this. Time of delivery. Question. Listen, there is a difference between

the offer and the acceptance. And what was the solution? The acceptance or the response to the

offer that actually aimed to be an exceptions, but it contains different terms, amendments,

modifications? Then what's the treatment of this response? Is it then acceptance or? Not.

Generally. Yes, yes, very good. So it's it's treated as they rejection of the offer and it's a new offer,

it's a counter offer. But. If this amendment, this modification, is not. Material, yes. Then it can still

lead to the conclusion of the contact and then we saw that what might be a material alteration,

material modification. This is what we saw in Article 19 three and there actually these delivery

issues were also mentioned like. For example, the place of delivery, the time of delivery. So these

are from this point of view substantial elements or material elements in the process of contract

formation. And so if the parties that you know this, that's fine, but if they do not agree, so if they

do not. Agree, because they have different proposals. That means that there is no contract, as we

saw. If they do not agree because they didn't deal with this question actually in the course of

negotiations, then basically we apply these default rules under the. CISD. So now I will, we will

not talk about all the particular provisions, but like the general idea that we can see because we

don't have time to get into very detailed discussion of each provision, but like the general idea, the

general concepts that we can see here. So usually. This is what we can see in Article 31 of the

CG8. Provides for rules on the place of delivery. So then where and how sorry the delivery should

take place when the delivery takes place. And then basically as you can see, different rules apply

if the carriage of goods is involved in. The contract and if the carriage of goods is not involved in

the contract when the parties agree on an income terms, then basically that means that carriage is

also to some extent in Word and then basically of course we will not apply these rules, but we will

then apply the particular incoterms. The provisions and. The carriage is carriage of goods is

involved then basically when the seller hands over the goods to the first carrier that that's actually
the. Delivery for them. Place of delivery of that of the particular goods and another possibility for

this place of delivery is, and usually this is what the gain some kind of general concept or

principle is when? The the good. Are placed at the buyers disposal, so basically the buyer will

then have the possibility we'll have them the option to. And. In other cases it's the sellers, um,

place of business that we have matter and usually this is again a kind of principle what you can see

in the CSU when there is some kind of obligation then usually it's the, the. The place of the party

or the place of business of the party whose obligation we talk about, that will be the relevant place

or the relevant. Location. As to them. Time and it's again not only for this but but general in

general if we think about it. And basically the parties can freely agree on the time of delivery if

they do not agree. On the time of delivery and then basically. If you look at the Article 33

subsection, see then the it's reasonable period of time after the conclusion of after the conclusion

of the contract, which basically means that this is, from this point of view, the first time that we

see this reasonable. Refinement that when the CIG talks about the uses this time period, usually

it's reasonable period of time. And this is something what we mentioned yesterday that

reasonability or what is reasonable is is a very important principle. Under the CIG and in contract

law as well, and this is what we can see here in this. And case so well that if the parties do not

agree on a particular time of delivery, then basically it's it should take place within a reasonable

period of time after the conclusion of the contract. What is a reasonable period of time in this

regard? It's not an exact date. It depends on the circumstances of the of the case. It depends on the

type of the goods. Let's say it depends on actually if the parties have some kind of previous

contract. Feelings that might also be that and in this regard, if they have previously established

practice as we saw it earlier under Article nine of the CIA, that can be relevant here as well.

Article nine of the CIA was about usages and the parties practices. And then they saw that

basically generally. The parties can agree on this and then this will be the beginning, but on the

other hand we see that there is Sumption as to usages that. And if these are widely known and

widely respected and followed, then basically those will be considered as being agreed upon by

the parties and will be relevant. As to the parties practice, that will be also relevant. So there are

many many aspects or many issues that might be taken or can be taken into account when this says

that what is in this case. And the time. As the documents, the handing over the document then
basically again the city provides for. Start these free to the again, otherwise and. While you look at

now, he thought the cursor before because it shows that there being very another very, let's say

important principle. And what is that if you read the second sentence of Article 34? OK. What?

What does it mean? Could we? Sort of. Summarize or. So usually about the same. Here is usually

what we can see in the CSG is that yes, there is time for performance of a certain obligation here,

in this case the time set in the contract for handling over the document. But if the party. Here in

this case, the seller actually hands over these documents before this time and there is some defect

in this document. So this document do not conform to the contract or the requirements. Then

basically the seller has. Back to the party who has the regulation to to perform certain. Then the

party has the right to cure the defect. And. On this, and it's not important, but honest, it would

cause unreasonable inconvenience or unreasonable expense for the other party. So we basically

that means that the party who has to. Provide some kind of like here in this case. Document to the

other party, so the seller. So the party who has to perform a certain obligation under the contract,

but does that before it was due to like the final. The due to perform that obligation has the right

answer to cure the defects. Unless it goes reasonable inconvenience or invoicing about expense for

the other parties. So this is again something that would make it reasonable in this situation that

actually the party can cure the defects can cure actually the. The. Let's say the the negative

consequences that stem from or that derive from the non compliance with the contract and the last

sentence or the third sentence is very important because it means that it will not. Then they

actually. The bridge that would allow the other parties to advance the remedies that we talked

about earlier like for example, avoidance of contact, but the buyer in this case still retained the

right right to claim damages. So actually. The Bible, even if that's the case that the seller accused

this defect, can claim damages. So this general principle, what we can see here there as being

implied or applied in the context of handing over the document, is that if the party is obliged to

perform a certain obligation. But it's defective. How? The party from the publication has the right

to cure the defect unless it causes the unreasonable inconvenience or unreasonable expense for the

other party. And in this case, the other party does not lose the right to claim damages if. The other

party suffer damages due to this act of the first party. We're still getting the delivery of the goods,

so. When can we say that the goods that are delivered or delivered comply with? The requirements
under the CIA, actually under the CIA, given we talk about the delivery of the boots, the seller has

basically we think about it two obligations. One is that the seller has to deliver goods and second,

the goods that are delivered must be in compliance. The contract and the CIG so much deliver

goods, and the goods that are delivered must. Being compliance with the contract and the CIA in

this regard, so whether they are in conformity with these. Instruments contract and the CIG. In this

regard the the most important provision is Article 35 of the CNG which talks about the conformity

of the IS that how we can determine the whether the goods that were delivered? And conform to

the contracts like Conformative Media contract and the CIG requirements of the CG board right

now. And what is also important actually in this regard is possible third party claims, but that does

not refer to the conformity of the goods. Ask whether they conform with the. Contract, how the

parties agreed on what goods will be delivered. But basically it relates more to an obligation of the

seller to provide goods that can be actually used by the fire as we would expect under a sales

contract that the buyer. Would acquire goods and the buyer would be them free to use the goods as

the buyer wants to use these goods. Meaning this third party claims that, for example, there is no

third party who would have any right or claim as to let's say the ownership of the goods or any

intellectual property rights. The plane that could have actually impact on how the buyer can work

with the goods later. So let's then look at this article 35. This Article 35 is about the conformity of

goods. But how can we assess that whether? The goods that are delivered are in conformity with

them. Contract or not, in this regard, there is a CIA visory Council opinion that can help us

actually to to apply this article certified. So if we look at Article 35, it has more paragraphs than

two, but like the first two paragraphs are the relevant. In this regard, that how can we determine

the conformity of the police? The first one, Article 31, subsection 1, provides that the seller must

deliver goods which are of the quantity, quality, and description required by the contract and

which are contained or packaged in the manner required by the contract. So probably it's not a

surprise that we see this provision, it's very reasonable again that what is. The standard for

conformity that actually the seller has delivered the goods as they agreed in the contract. So with

the quantity, quality and description required by the contract and it's also important that it is

expected case it contained in a manner that. Was required by the company. If we look at Article 35

two there we can see actually a rule which provides that unless certain standards are met, the.
Good do not conform with the contract, so of course the parties can agree otherwise, as we saw

earlier. So particularly of course is relevant here today as well. So we cannot or we should not

forget that, but in this regard the CIG. Again, as to how the assess conformity sets up these

standards or conditions or requirements that how do we have to assess that whether the goods that

were delivered conform to the contract or not. It does not necessarily mean of course it depends on

the contract very much and the circumstances of the code of the case that the seller has to deliver

like 100%, not in terms of quantity, but like what the buyer would expect. Under the contract.

Yeah. So there is a range in this regard within which the seller can still deliver and will can

deliver, sorry, and still be or will be in conformity with the contract. Because if you look at the

first point here in Article 35, subsection 2.8. So that's like the ordinary purpose. So what? What

does it say if we, if we read it, if we look at it that if the goods are fit for the purpose for which the

goods of the same description would ordinarily be used? So if it's good, if it fits for the purpose

that we have this type of good? And what's the ordinary purpose, the ordinary use of these?

They're good fits for that. Then it's a, it's a good performance, then it is in conformity with the

contract. So basically doesn't mean even if it's not exactly 100%, but the buyer had in mind that

OK, this is what I will receive under the contract, but if. And from this objective perspective, look

at it, if it fits for the ordinary purpose, then basically it's a, it's a proper performance. So if it's let's

say table, we'll talk about table and it's what it's, it's great. Let's say that the parties negotiated that

they would purchase every stables, but what is delivered is not, let's say the the buyer expected

something like this and just and I'm pointing to the to the table in this shed what what was

delivered as? I think maybe that's the difference. So that color, it doesn't matter from this point of

view because there's still a proper performance under the contract since if we look at this

particular good or this item, what is the ordinary use we see both are capable of. Meeting this

requirements, so basically it's it's a proper performance, so it would be a proper performance. Of

course the situation would be different if the buyer and the seller would agree on a particular color

or a particular shape, because then it's specially if it's a. Essential element of the women then it

might mean that it's not actually a proper performance, but basically, generally speaking it is. I

mean, if you look at it general, then it is. If you look at. The second point, which is for the

purchase of a particular purpose. So if it's not like just. Virtualizing ordinary for ordinary purpose,
and use that for ordinary purposes, but for something that is very particular, very special. Then

basically what we can see is that it will actually be a proper performance under the contract if the

boots that are delivered we are fit for this particular purpose when. If you read it, read it. So what

is actually reasonable or can be a reasonable expectation in that regard? Yes, the seller will be

obliged to deliver goods that are fit for that particular purpose then. You look at. B. Point B. If, of

course, it's reasonable that the sellers should be aware of this particular purpose. Yeah, that's one

thing. And it's also important that the buyer should be able to rely actually on the seller skills and

judgment that the goods that will be delivered where we feel feel sorry for this particular purpose.

And here we see that actually articulate is is very large for can be very, very articulate was about.

But. Remember it's about interpretation, how we interpret the parties statement, so how the parties

communicate, what they want, what they expect under the contract. So. For example, when we

apply this particular purpose provision, of course, since it's a requirement on the one hand that the

seller should be aware of this particular purpose so that at the time of the conclusion of the

contract. So basically that's already a question of interpretation whether it was properly

communicated. Yeah, by the buyer to the seller that what is this particular purpose and then the

second is that actually whether the buyer could rely on the sellers skills and judgment that these

goods will fit for this particular purpose. Can we think of? Any possible situation where this

particular purpose issue might be hypothetically if you so it's not me now, but it's you who would

bring an example. Of course it's not like a real case example or anything, but if you just make up a

story or a hypothetical. What would be a particular purpose? When we have a good or certain

good, yeah. That would be used for a particular purpose, and then it would matter whether we

actually apply B or a. I order some wine to sell on the Christmas market, so my purpose is silly at

this particular time. Hmm. And then you. Hmm, yeah, very good example, because that raises the

question that whether for example is time of delivery is something what is a conformity issue or

not. If I understood you correctly, is it a special Christmas wine? OK, it's a special Christmas line,

so. Right. No, no. Maybe no, no. OK. No, OK, because no, I'm just thinking about what kind of

ring could be special Christmas wine. But maybe. Sorry. Maybe that's what is important is a child.

Well, yes, yes. But if it's a special Christmas time because, I don't know, maybe the flavouring or

there's some added elements which makes it like a Christmas favor flavor wine, then it's actually.
Something that if you look at. The good itself then maybe it's a conformity issue whether what the

good was delivered was this Christmas flavoured vine or not flavored wine or not. Because if it's

not Christmas table behind then basically it will not be them proper performance as to the

conformity of the group. The other issue is actually the time of delivery. If we order, let's say a

larger amount of time, we are really terrible and we order a larger amount of wine because we

expect that in the Christmas season we will, sadies Irvine. But it turns out that the time of delivery.

We agreed that it would be, I don't know, the 20th of November or around the 20th of November,

but it turns out that when at the end it would be delivered is in January. What is it? Can we say

and it turns out in, let's say on the 14th of November the other party notifies us that yes, we

should. And. Send you the right, we should deliver the vine as we agreed around the 20th of

November, but we cannot do that, sorry, because of this and that reason. So we will be able to

deliver the vine sometime in December or in January at the latest. What can we do? So it will not

be a conformity issue under Article 35 of the CIA. It will be something different. Actually, it will

be. It will be a bridge. We will be a bridge based on what you already know or sense. From the

CG. Yes, actually it's a beach or it will be a breeze. That because if there is an every time delivery

and the seller does not deliver even if the seller does not deliver and make it gives us a notice in

advance notice that I will not be able to deliver. And the 20th of November that's still a breach or

we appeal brief? But. Do we have to wait and take this vining in January, January, sorry. Or can

we say that OK, but we want the vine? No, because the Christmas season is now where it's

happening and and it's coming now. So we want to sell the vine now here in the Christmas season

and not in January. How could we? Let's say. Get out of this contract. What is what we should

then say that if we want to avoid this contract? We see it on the 14th of December that. Sorry,

November that OK. We will not receive the fine for vine from this supplier. We have to purchase

this fine from another supplier. So we don't wait until January to to receive this wine and so. Can

we just terminate the contract? No, we cannot terminate the contract, but can we avoid the

contract? Would say yes. Would say no. When could we avoid this contract? In this case, if it was.

What kind of breach? Fundamental breach, if it's a fundamental breach, then basically we could

avoid then the contract and then we can be free from this contract and then we can look for the

suppliers and of course we can claim damages from the first supplier and then basically we can be
still fine. For this Christmas season. But yes, if it's not a fundamental breach, then maybe we are

not. And be able to actually. That we will not be able to purchase wine from the other suppliers if

we do not have the necessary sources, financial resources for that to to comply with these tools

effects or to get into problems with this first contract, OK. So any, any other example can be

because so this time of delivery it's not a conformity issue. So it's not not conformity, that's

another issue. So and maybe that's like a fundamental breach or maybe a fundamental vision and

we can avoid the contract, but that's another. And. What could be then this. Another example for

this conforming issue, maybe also from the zoom if if you are here would be. Where to hear? If

you. Say something but also no I talking to some but So what? What could be? Buy together

purpose. Maybe some? From China to Germany and the possibly must be like protective because

the person is really fragile. If you not package it very well, insert some soft materials, it will be

broken. So if the seller. Protected well, so the qualification and the the. That's possibly will be

broken, so it's didn't well. Didn't fulfill the purpose of this self of the contract. Hmm, uh, good

example. Actually it would be more for the for the article certified 1S2 packaged and contained

and packaged in a manner required by the contract and in this case by the contract. It also means

that if there is a special. Way to to pack these special items is 47. Then of course that has to

comply with that. And you know that because you know that hundred Articles, 32 certified

profession 2 is the last one point D which talks about how it is contained and and so it's basically

means that then the seller will have to actually pack these porcelain. That we protect the loose so it

will not be damaged during the carriage of these very goods. So this by refer to this article

certified one because it refers like the basis for this is the content or package. And then if we look

at Articles 35 two .3 means that what it means that containment packaged in a way that. It is

required under the contract, but when we talk about this conformity, it's more like quality, quality

and description. So what? What is the quality of of the rules? But very good examples and maybe

another one. Like when it's for let's say for a special use. Um, can we think of any special? Use.

And she's told about packaging. Let's say it's a packaging machine. For different kind of

commodity like what coffee? And other kind of community. But when it's sorted like let's say

sorted not, that would require some kind of special treatment of the surface of certain surface of

these packaging machines. So if the buyer wants to use the packaging machine for. Becky doing
sorted materials, that would require, that's a special purpose from this point of view because like

the ordinary purpose of this packaging machine is that it would be used for for actually packaging

certain communities, but if it's a special one because it's like so. Materials then it would mean that

it is for a particular purpose because it is for the packaging of these special goods. So then it's not

just the ordinary purpose, would be that it's possible to generally use it for packaging different

kind of committees. Communities, sorry. But if it is used for sorting materials, then maybe you're

not work. But if the particular purpose is that I want to package sorted materials with this

machine, then it's actually a particular purpose I have to communicate as a buyer, I have to

communicate it to the seller. That they want to use it for this purpose. And also actually I have to

be able to rely on the sellers skills and judgment that the seller knows that in order to meet this

particular purpose, what kind of machine should be. That. OK. And any other or maybe you want

to add any other example here or? Let's just leave it. Yeah, that's why, like. So you from a buyer

like in Germany wanted to buy some special food like from the seller and the seller. Actually they

send some food but doesn't get the requirements of the German. Maybe the law of. And then that

means like it's, so it's. It doesn't get the requirement of the. Because the seller, if the seller knows

like the food is sold in Germany, then it must be. Clear. This time it's great show. Let's say a good,

very, very good example. Let's say that the buyer would actually sell these goods or these

products, this food not only in Germany but in other countries as well, but with this particular

goods that you mentioned, actually the buyer wants to sell these. Yeah. But I'm saying it is

because if it's only Germany that it might not be the the particular purpose. Yeah, the requirement,

the German law. But like if the buyer doesn't say like I would just sell it in Germany that it will be

more complicated because. Yes. Yes, very good. OK. And? And the other. OK. So yes, the. Third

Point, if we because we still have actually two in this Article 35 two. So we saw the ordinary

purpose rule, the particular purpose rule and then if actually there is a sample. Which uh, the seller

showed or a model that the seller showed to the to the buyer? Then basically the requirement is

that the deliver goods. The delivery of boots must meet the. The. Characteristics of the sample or a

model that. Was shown to the buyer, so it's not like just talking about, I don't know, tables or the

machine or whatever, but like the characteristics of the sample should be present in the in the

deliverables as well, but of course that can open again. The door to several questions it how can
we define what sample is or what the model is? What are the the important characteristics, the

important elements? It does not necessarily mean that again like this hundred percent, 100%

similarity. So it has to be the the same. It uses the term if it's. Think of reading that possess the

qualities of the goods which the seller has had over to the virus and so possesses the qualities of

the room. What are these qualities of the good? So it's not the same as the model of the sample

that was shown to the buyer. It possesses the qualities. What are these? It is again articulate will be

relevant in this regarded how the parties understand that what are the qualities of the particular

sample or the model which actually made it to be attractive for the buyer and why the buyer

wanted to purchase that particular room. So again it does not require. Under the person died entity,

from this point of view, it means that there might be differences, but as to the to the qualities that

made it the good to be attractive for the buyer and the reason why the buyer purchased this wood

based on the sample of the model more than those. That should be present in the deliver goods as

well. And the fourth one, basically what we have already to some extent referred to when you,

when you mentioned this or when you refer to this example of postal from China, is that it's also

required of course that the goods should be contained or packaged in a manner usually for such.

Was or where there is no such manner, in a manner adequate to preserve and protect. And that

again means that one thing is that what we see in the contract, but the other thing is that if you

think about Article nine of the CIG, the role of usages, for example, as to packaging that how

certain things or goods should be packaged, sometimes it's about usages. And sometimes it's about

practices that how they will be done, how they will become packaged. So that's again something

but we have to keep in mind. But here in this regard, these other sources or other. Rules can be

also. OK. And do you have any questions? Because all the time thinking about is that no, it's I say

it's. It's about what, 5 minutes that we have left from this first session. I think maybe what we can

because if we start the next phase then we will not get through this before the break so. In order

not to cut that in half, maybe we can, if that's OK with you, maybe we can start the breaking out

like 5 minutes. Yes, OK. Yeah, 5 minutes earlier and then we will continue again this fine and

then. Will not be cut in half. Do you have any questions? For any questions from the zoom. There

are so many. OK. So do you have any questions or any comments any any anything, any remarks?
No. Then thank you. So now we have this break and then after we are gone. Mail. We. Or. If we.

Oh.

4.13 第二节

Go to. OK, so maybe. Seattle. OK, so maybe we can. OK, because it's it's time so. Yes. And I just

sent the message in zoom, but of course it's not primarily for you, but of course if you want you

can do that on zoom as well. So if you have any questions or anything, you can raise these

questions or some standard questions or comments or remarks. In the chat. Books as well, but of

course you are free to speak as well. Either you are here in person or somewhere. So let's let's

continue then. We decided to go 35 as we discussed that deals with the conformity of the wood

and. Here we sold. Yes, last last class. So the. And this. For the particular purpose. Culture

distinguishing. I'm going to make dental dental if I want to find a bunch of phones present. These

phones originally did not have a design for like blind people I wanted to aid. Blind people. This

request is a particular. Or just my request for the quantity of the goods? Quantitative. Watch. Yes

uh no actually that could be i i see your point no it like the ordinary you insert for Brian paper then

actually if you wanted to use for this purpose, so you want to handle these forms to prime paper

and people, sorry. And the requirement is that the phone should be able to operate that regard that

it can be actually a particular purpose. It depends on how the particular. Because being honest, I

don't know if these phones are like default set as they are usable by people as well, are they? It

really depends actually on the particular product we are talking about. If these phones are already

set that they can be usable by client people as well, then it wouldn't be a particular purpose. If it's

something that is a special feature, would be a special feature and would require particular

attention by the seller that. The goods would comply with this. So it's not like the ordinary product

what you would then it would be a particular purpose. So actually the to assess what is a particular

it's not sorry. Oh yes. So. So it's not just it's not that exact it's very much depends on the

circumstances of the case. We. I didn't talk about that, but you can see it here. The slides, if you

come down to the slide that what can be taken into account when we assess compliance under

Article 35 to end whether it fits for particular purpose or not. There is a whole list of different

circumstances that we have to take into account. Then the actually assess the so if the goods, the
ordinary goods do not. Provide for this possibility that they could be used by buying paper. Then

basically it's not. And. Like the quality requirement if we especially want to use it. Yes, like

handing over to blind people, then it would be a particular purpose if we actually just want to

order goods that we do not want to like. For example, because we work in an institution where

with which is. Um. Specializing in teaching by the people, let's say, and we want to use the phones

in these institutions for this purpose, then it will be a particular purpose if for example. It's a it's a

repair. So we are in Thailand and then the order phones and we expect that these phones will be

also usable for many purposes among others for this purpose that blind people could assist in that

regard. It might be actually different maybe in that regard it. Would be a quality issue under the

first paragraph that if it's fit for this ordinary purpose, like it, it is sellable actually. So there will be

people who will sell a bike, sorry this phone from us, then it's fine. But if it's especially for these.

People for this institutional right, but when it is clearly communicated that it's a very special

feature that we want to be present because this is what we want to use it for them, it would be a

particular purpose that could be a particular purpose. I don't understand about that. First thing you

need should be according to the specific situation and sometimes the article. And B1 and two

seems in is like. Can be used together. Use it again. I see. Mm-hmm. Yes. So then basically if we

if we look at this article certified one is will not be the article certified one that says this general

standard. This general standard that what is the obligation of the seller? The seller must deliver the

goods which before this buyer and then off because of the five. Two actually. Provides that unless

the parties every other device so basically means that in the contract they can say otherwise, but if

they don't then when we assess that whether the goods that were delivered were in conformity

with the contract as to one quality and description and then we have to look at these. Standards. If

the contract is clear, so if there is a description, a detailed description in the contract that what is

what the seller has to deliver, then basically we will not apply that this because then the parties

agreed otherwise and then we know exactly what they agreed on, but for example when they agree

on. I don't know because I wanted to bring another example with streams, but so for example

when they agree on streams that they would purchase, the buyer would purchase streams or maybe

like phones in general then. So when there is no exact specification for the route in the contract

then we apply these standards and this says that whether under these standards is it conforms the
contract or not. Yes, there. Any other? Questions maybe. So we have to talk about this, but now I

will not talk about it again, but if you want, if you have any questions on that. If you to these

questions, if you look at the slides when or when you look at the slides, you will see that like for

assessment whether the goods that are delivered conformed with the contract under article

certified too. There are a lot of things, there are a lot of considerations circumstances that. We

have to orbit. We can take into account in order to assess that what is actually the standard that we

have to apply the ordinary purpose standard or the particular purpose standard, and also to

understand that what is the particular purpose or what could have been the particular purpose. In

that. In that transaction. So maybe sometimes something is an ordinary purpose, but in in other

circumstances, in other case, that's a particular purpose. OK. And? Again, that's somehow general

what we can see now. So we saw them that under article certified 1/2, what is the obligation of the

seller that what good the seller has to deliver in order to be in conformity with the contract. And

the Convention the seller, as you see, is not liable. Do you not be liable? If actually at the time of

the conclusion of the contract, the buyer knew or couldn't have been unaware that the goods that

will be delivered or would be delivered would not meet that requirement that we can see on the 35

one or 35 two. So basically again this is something. That is the some extent, the general principle

in in this CIG or in the CIG that actually if the other party knew were couldn't have been unaware

of something, then the first party will not be held liable or cannot be held liable for. So in this case

it means that the the seller is not liable for his nonconformity if the other party, the buyer, you or

couldn't have been unaware of such lack of conformity. And the time, what matters from this point

of view, the time when there is so there is passes from the seller to the buyer and then basically

this is regulated. This question is regulated again in the CIS G there. And then there is passes from

the seller to the buyer, but also if the parties won, they can agree on different sets of rules and the

incoterms in this regard will be or can be relevant because as we know that very well that regulate.

This aspect as well. Talk about the passing of frisk actually later, but it's good if you already know

that it is in the CSGO so and it's in these articles that you can see here and again what we see here

in this context as well what we saw if you remember. The handling of the document and the

documents that if the seller handled over the document before the date it was due and there were

defects, then basically the server could cure the defect. This is the same here as well. So if the
seller seller actually delivers, it was before. Um. The date of delivery then basically the seller can

remedy this defect, can cure the defect, unless actually that would not cause unreasonable

inconvenience or unreasonable expense for the buyer and also the buyer. You have the right to

retain the right to claim damages. So this is the principle that we saw order, the approach that we

saw also in the context of the handing over the documents as well. And maybe you remember

yesterday when you listened to the CI G song. Did you listen to again? I don't know, maybe the

evening and have a party. But. So do you remember how it ended? Of course not, right, I mean.

But the I I wouldn't see member. So that's why I said of course not. If someone would ask me that

yesterday you heard something and how it ended for the first time. But maybe. Like this

gentleman courts just five minutes to inspect that, notify that. OK, so The thing is that. Already

then, when we listen to the CIA's on this issue, came up this inspection, this examination of the

good, and this is what we. Do you not talk about, so when the goods are there, you learn to the

buyer, then the buyer has a kind of obligation to inspect to examine the why I said that it's a kind

of obligation because it's not like a direct obligation of the buyer that would have like sanctions if

the buyer would not. Comply with the supervision, but it's an obligation or it's actually something

but the buyer should do in order to be able to actually enforce remedies, to claim remedies for non

compliance to the side of the the. Said so basically it's an obligation, but not as an obligation as we

saw it in Article 30 and for the buyer 53, but it's something what is important for the buyer to do if

the buyer wants to actually. Advanced later claims for remedies due to lack of conformity of the

goods. Again BC I see that maybe the buyer fails to do this, but if the seller knew or wasn't

couldn't have been unable. For this lack of conformity, then, the buyer will not lose its stride. Like

the principle of what we saw earlier, that one party is is aware of the. Let's say the fact and then

the other party who should do this or that will not be deprived of this possibility to advance certain

plate. So this examination of the goods. So as as you can see it's an important, it's a very important

issue. There is a CIG. Advisory Council opinion, which deals with this question. It's CI Advisory

Council opinion two. So maybe that also signals the importance of this examination, because the

second opinion, the second let's say most most important. Issue that came to the mind or came to

the table of this Advisory Council, so very briefly and then we will talk about it more in detail, but

like the the idea is that the buyer has to examine the rule or make. Like examined by by someone
else. So there has to be an examination of the good. And then if it turns out that because of this

examination and thanks to this examination that there is a lack of conformity in the goods or the

goods, then the buyer will have to notify the seller of this lack of conformity. So it has to send the

notice to the seller and then actually in this notice the buyer also. Has to indicate that what kind of

remedy it would like to request or maybe within a reasonable time after this notice was sent to the

seller as the buyer or we have the buyer. Obligation to notify the seller of what remedy it would

like to use and then basically. Yeah, this is like what I said. This basic structure of this

examination or rises. So when we look at the CIS then in this regard, we see that it talks about the

examination, for example, but it doesn't define what examination is. What would it mean

examination for example? Is this shipment we look at it? Is it examination or not? Or for example

when the examination is? Based on some kind of sampling that what is the proper examination

home? For example, it's about frozen shrimps, shrimps and the good is frozen shrimps and what

portion of the daily word? Actually, is it 1%, less than 1% more than one person? How can we

take the samples? So basically it's not regulated from this point of view in the CIG. What does that

mean that here in this regard actually the custom, the usages will be very important in the

particular? Industrial in the particular field of trade. So that's why, again, if you think about Article

nine of the CSG, which is about the role of usages and this kind of Brexit, that will be especially

relevant here that when can we say that it was another quiet and practical? Examination. The CIA

debates also that when they tested their place and what happens if there is no proper examination.

As I mentioned that there is no like direct sanction for not doing this examination for the buyer,

but it has consequences and then basically. The consequences that the buyer might not be able to

advance certain claims as to remedies. So if we now look at the relevant provision of the CIG, this

is Article 38 of the CIG and the very first subsection of the CIO of this CG. Article 38 provides.

That the buyer must examine the roots or cause them to be examined within as short a period as

practicable in the circumstances. So here we already see that it's a bit different than. Than what we

saw earlier in terms of how. And tell you it's, I've said in the CIG because usually what is the time

period side by the CIG, it's reasonable period of time. Here it's not the reasonable period of time.

What it says is that within a short period of table in the circumstances it's. Within a short period as

possible in the circumstances, because the practicability is very, very important here, it doesn't
require any immediate examination. We have to take into account the circumstances of the case,

of course, and then based on that we can decide that what. Is this practical period of time to

examine the good other text? Maybe you? When we talked about on Tuesday about The Hague

Conventions, do you still remember this hate conventions? Like this police and the rules this hate

conventions were about. Uniform local mentions right? This second mentions it. These were the

sort of predecessors to the CIS league right from 64. These two people mentioned the uniform law

on contracts for sale of goods and the uniform law on the formation for the contract of sale. Right.

And then basically. Because if you do I not be enough, I do not talk about it again. Not that much.

Then maybe I will say few sentences about it. Maybe. OK, OK, sure. So these two

commendations were like the first two commendations that deal with this unified law. Uh and as

we saw that these are not that widely adopted conventions because of many reasons. One is that

that was the the idea that they were more based on this continental approach and that means that it

was unacceptable for many states to join. And also when the state actually wanted to join the CIA,

G had to denounce these two echo mentioned. But these are very important pieces because these

serve as a kind of predecessor to the CIA. These were the first two international conventions in

this field in the. Unified says little substantive law, and the CIG or the drafters of the CIG learned

a lot from the failure of these two people mentioned that one thing. The other is that even if there

are differences, like for example in this context between the heat conventions. And the CIG. Yet

when we look at the CIG, we can see that some provisions of the CGI based on this here

Convention. And so when we apply and interpret the ciig, we can look at it like a kind of draft

history or drafting history or sources for the drafting history. For the city so to interpret to

understand the CIA why I said that for example in this context it was different because the Heat

convention said in the sense that promptly so it's not within a short period of time as practicable or

or a reasonable period of time or anything like that but but. Promptly. So it required the prompt

examination and actually that was the case in in many national laws are very strict requirement

that's to be 6 amination that the examination has to be prompt examination, which if you think

about it can be. Reasonable from the point of view of the seller, because it creates certainty. Why?

Because then the seller will know that, OK, I supply the goods, you receive the goods, so now you

can tell me if it's good or not, if there is lack of conformity or not. So why should I? In this
uncertainty for a period of time because I don't know that whether you think that the good is in

conformity or not with the contact. So maybe like after one week, two weeks or three weeks, I we

receive notice saying that, OK, but the rules that you delivered like three weeks ago. Do not

conform to the contract, so will be sending. So there can be some kind of argument that by this

from prompt examination can be accepted on the one hand, but on the other hand we also see that

it's not necessary practicable from a business point of view under any. Because especially for

example, the goods are not to be used by the direct buyer, but it would be used by another person.

So the buyer would transform this, transport these goods to the other person and this other person.

We use this or for example, it's a machinery. And the machinery is not. To be used for a certain

period of time after the purchase, but but later because the machinery is to be built, I don't know.

This is the building. So the machinery is supposed to be built within the building and then it will

turn out only when actually it is in use. In the beginning, whether it's operates properly or not. So

it might be not practical to examine always the goods like the moment when it is delivered. So

basically that's why the CIA follows his different approach than what we can see or could see.

Echo mentioned, so it's not a prompt examination. It is a short period of. Should be a relatively

short period, but it's not prompt, it's not. With this possible, so it it doesn't require like every effort

to make it as as soon as possible within as short as player does things possible. But what is

practicable under the circumstances, keeping in mind that what is practicable from an economy,

from a business session or point of view. So this is again something what is we can see in the CI,

just kind of general principle that. Like the CIA agents to ensure that whatever would happen in

the in the contract or in this contracture management then basically that would reflect business

rational reasonability, business practicality in this sense. So that's why it is not. It's a short

appeared as possible or contest I mentioned but like practicable. Um, in the circumstances. And if

you look at or when you look at. The second subsection and orders third subsection of this 38.

There you will see that basically if the contracting was carriage of goods, then this examination

can take place when the goods arrive the final destination. Or if the goods are redirected in transit

or dispatched by the buyer without having actual reasonable opportunity for examination, then

basically it is possible to have this examination at the time when the goods arrive at their. New

direction or this destination, but of course it cannot be a an unreasonable risk or burden for the
seller either that OK, then the buyer will examine the good so because the seller who also deserves

some kind of certainty. Leader certainty as to. Whether the transaction was proper transaction so it

was properly fulfilled and the goods were properly delivered, not so of course there is again what

you can see here in this Article 18 this kind of balance. Between these two parties, so again that

under Article 38, then the time when the examination has to take place is within as short period as

practicable in the circumstances we have to take into account. By the circumstances of the case,

it's not an exact date, so we cannot say some courts, state courts try to set like this exact abstract

standards like 14 days, 21 days, seven days, things like that. But it's not like that. It really. And

actually on the circumstances of the kid, on the type of the wood, on the nature of the wood, if it's

for example perishable good, then of course this. Is shorter. If it's something that for example I

mentioned earlier machinery, it can be longer this. So it really depends on the circumstances. And

I hope that OK. And the other thing which is important here, as I mentioned, is it's not about the

possibility when the seller, when the buyers only has the possibility to examine them, but when it

is commercially practicable to examine the good. So that what matters here and. If the goods are

sold or transported, then basically this examination can be conducted later. And the Article 39

talks about the notice simulation you know previously. Like the basic structure of this system is an

examination notice. And in the northeast, the the buyer has to indicate the lack of conformity,

nature of the lack of conformity, and also the possible remedy that the buyer might want to resort

to. So this article is 39 is about this notice. Requirement because it says if you look at it or when

you look at it, that actually the buyer loses the right to rely on this lack of conformity. It doesn't

send a notice to the other party to the seller within. Reasonable period of time as to actually this.

This lack of conformity and in this notice, and that's again that's a question for interpretation and

and case law might be different from that that this notice that the buyer sends to the seller based

on this lack of conformity should specify the nature. Of the lack of conformity and also later BC

should also refer to the remedy that the buyer want to actually. In both. So for example, earlier we

saw that the buyer can request substitute goods, right? It's possible if it's a fundamental breach of

contract. So for example, if the buyer notices that upon this examination that the goods. Are still

not confirming that this non conformity will. Amount to a fundamental breach of the contract,

then yes the buyer could avoid the contract. But the buyer doesn't want to avoid the contract
because the buyer wants the good. So once the the product from the seller. So then basically the

buyer can request substitute goods, but when the buyer should. Generally, as the default would

require this substitute would like. Indicating this claim that the buyer has sold that would like to

resolve this family is in this notice. So when the buyer notifies the seller of this lack of

conformity, the nature of the lack of conformity. Also this remedy that the buyer wants to resort to

establish. And the indication of the remedy, basically, it is also possible that the buyer would

indicate it later within a reasonable period of time, but. The default rule is what I said. And here

we see that there is an additional time period again like. The delivery takes place. And then the

examination has to be conducted within esoterica, stackable in the circumstances, and then from

the moment that actually the buyer learns that there is a lack of conformity, the buyer has a

reasonable period of time to notify the seller of the lack of conformity. And. Of the possible

remedies that I mentioned, so I will not repeat. This nature of the lack of conformity, so it doesn't

require the buyer like to hire an expert and to send the seller an expert opinion that why it's not

complying the particular. Delivered product. So it it doesn't require this kind of expert assessment

from this point of view, it requires like to indicate the seller that what's very. That was the

problem with the particular goodbye. The buyer believes that he does not comply with the

requirements under the contract, so it doesn't require very detailed description of the defect. It

doesn't require expert opinion. Or anything like that from the buyer, because the idea is that the

seller should be notified of the problem. The seller should be notified of of not only the existence

of the problem, but also the the nature of the problem that generally was the problem or what the

the buyer believes the problem is, and then. Basically, the seller would also have the opportunity

to react to this or to to be with this situation. If. The buyer doesn't. Send this notice to the seller,

then actually the the. Bayer can lose its right to rely on this lack of conformity. Actually, the CIA

doesn't operate with like this exact. Deadlines except for here. If you look at it, there is this two

years failure that in this Article 39, subsection 2 it says it in even the buyer loses the right to the

left of conformity of the goods if he does not need the seller notice there at least at the latest. Even

the period of two years from the date of which the woods were actually handed over to the buyer.

So basically that also suggests that this whole time period like for the examination and for the

notice might be actually if we look at it might be actually long. So it's not like. 123 days or one or
two weeks, but it can be actually longer, so depending on the circumstances of course. When this

time period starts for the Northeast, so when the buyer as we discussed, the buyer will have to

send a notice to the seller and there is a reasonable period of time for this notice sending this

notice. So what is the the? Starting day or the date for this. Is basically when the buyer discovered

or ought to have discovered the lack of conformity, which is basically if we look at the good and

it's clear that it's not what was ordered, so if it doesn't. By any specific examination, then already

by just seeing the wood it can be possible to say that there is a lack of conformity. Then it is of

course if it requires some kind of specific examination. So for example if the buyer looks at the

blue then it seems good, but. Yeah, basically, let's say it's about frozen food. So part of it has to be

different. That's the quality of the food. Then basically, of course, it's it is something that is a bit

more specific examination. So it means that this time period commences the time when actually.

This devastation takes place and the testing of the product the takes place. So basically there are

these two time periods in this regard, but I mentioned so if it is evident the lack of conformity just

by looking at the rules that yes, they do not conform. Then it's actually. Not really subject to many

discussion that what is then? Within a short period as practicable, because immediately it is visible

that it's not conforming. So basically that's like the examination in this sense, and then the

reasonable period of time the game starts running from the moment that it becomes evident that

it's. Performing. So. If this is not the case, then basically these two separate periods and like the

one for the examination of the Article 38, this is the the commercially practicable time period for

examination and then the notice. Time period is reasonable period of time. So that's again startram

from the moment that the buyer. Becomes aware of. The left of conformity for all to have become

a better lack of conformity, and runs, depending on the circumstances to. So these two time

periods are, as you can see, to be distinguished and and we have to pay these separate. On the.

Under the CIG. As to the reasonability of of the time period for giving notice, very similar

considerations can be taken into account and what we saw earlier. For example, the the nature of

the defect, the certain or the circumstances of the case, of course, and within that nature of the

defect, the parties. Situation trade usages, relevant trade usages. So basically, again, it depends on

the circumstances. OK, sometimes it can be the same day actually, if it is that kind of product.

Because earlier received so sorry. For example spanishburg good. So if it's perishable good, then it
should be a very short period, because on the other hand it might be also important for the seller to

do something with this good to use it to somehow mitigate. Actually also the defect or or the

rotator, it's very interesting maybe. Not necessarily today, if I look at the time, but tomorrow or

maybe in the afternoon, the two today we'll talk about that, that there is a mitigation of loss or an

obligation on the parties mitigation of flows that's also generally in national contract laws as well.

So how does that? Operating this context, that's interesting and we will see that later that, but

something has to be done even if it's not like for example the strawberry that we ordered because

it's, I don't know, it's not strawberry, but what? BlackBerry, let's say so. Different kind of food. So

this is not what we are. It's a lack of conformity. It's to some extent we can say it's perishable. So

of course it requires not necessarily instant notice, but actually quite. Prompt notice in the sense

that in that case this reasonable period of time is not that long, because then the other party should

be able to do something with this if we request substitute goods to do something with these goods

that were delivered. But sometimes it can be actually longer when it's for example about complex.

Machineries. Then of course it it it's not only the the. The defect itself that is identified or might

take time to identify, but also the kind or the nature of the defect because. I mentioned earlier in

this notice the buyer has to notify the seller of the nature of the defect as well. So it's not necessary

sufficient just to say that it's missionary doesn't work, but it's something more that what's the

problem with that and maybe that's subject, I mean in order to find out. But the problem is with

that particular machinery that takes their time. So again, it's. It really depends on the

circumstances of the case. So it's a case by case examination that what is or what was reasonable

period of time. Need that but. Say, mention that this examination and and identification of the

defect does not require or. There is no requirement that it should be like based on an expert

assessment. So what it means from this point of view is that for the. Buyer as you see that the

notice should be based on the information over the buyer. So it's for the buyers and for the buyers

assessment to say that, OK, it doesn't work, I will look at it and tried it, it doesn't work. It seems

that this might be the problem, but that might be a problem, but it's not. Next, it doesn't require

next step for being, yeah. As you can see, if it describes like the the symptoms, that's that's enough

so that that's not the symptom that it doesn't work, but maybe it depending again on the

circumstances, but. You see, I I see what it means that it does not require special expertise or
special knowledge from the buyer. It's like this ordinary buyer. But of course if it's for example

about the particular purposes you ask or mentioned earlier when we assess this. Conformity. Lack

of conformity in the context of the particular purpose. Of course, that's a bit more special in this

sense, because then the lack of conformity is not that the woods is not conforming to the ordinary

purpose of the wood, but like this special particular purpose. Of course, in that regard it requires

some kind of special. Isolation in this case. That's why it does not conform to this particular

purpose. So it's it's really about the the very circumstances of the case. And again, here we see this

principle that we have already seen earlier in other contexts that. Yes. The buyer has to examine

the rules. The buyer has to give notice to the other party if the buyer doesn't examine the wood. If

the buyer doesn't give notice to the other party, then the buyer might lose its right to rely on this

lack of conformity. But what if the seller? You or couldn't have been unavailable this level for

pharmacy. So basically again for this balance of interest and for this reasonable active what we see

is that the CIA provides that, OK, maybe the buyer didn't examine the good, maybe the buyer

didn't give notice, but the seller knew or couldn't have been. You know this lack of conformity so

which basically means that the seller cannot rely on this lack of examination of lack of or lack of

notice, proper notice under 3839. So it's again about. Like what we saw earlier that it's not

protecting one over the other. It's about treating the seller and the buyer equal and then basically

trying to find a balance as to the interest of these. To the parties. I see it's the same price, sorry.

And. We will see later that what remedies actually the the buyer can resort to and 111 remedy in

this regard is this. Reduction of the price, so it's not renegotiating the price. Uh, with the seller, it's

about. Reducing the price. So if the buyer believes that the goods that were delivered of less

volume than what was actually contracted for, then the buyer can reduce the price. Of course, that

can open the door to two disputes about. This compliance, lack of conformity, the difference in

terms of the value of the goods ordered and the grocery word and the the ratio of this price

reduction, but basically. Means that the the buyer has this right to reduce the price. In this case we

will see it later. OK. So that's about uh. We are still in in the sellers obligation, the sellers

obligation. We saw that it has the seller has three obligations. What were these three obligations?

So what were these? I was just thinking that when we opened the window, the sun is always

covered by close, but once the window is closed, then the sun is shining. So it's it's very
interesting. No. Anyway, So what were these three obligations? Yes. Yes, yes. So the goods has to

deliver the goods and over the documents relating to them and transfer the property in the wood.

Very good. So basically we are still within that and the goods that the seller has to deliver the

wood. And in that regard, we saw that the time of delivery, the place of delivery, conformity of the

goods, and then this is the 4th. Important part is to serve part of that. What's third party claims and

rights for right so? When we talked about the transfer of property in the woods, then we saw that

the CIA doesn't affect it. Transfer of property does not take the property, but it has actually the

provisions on the obligation of the seller to transfer to to deliver the goods in a way or in a manner

that. Basically, the buyer will be able to actually. Use the goods as the buyer would be the owner

of the building doesn't mean that actually the the seller would under the CIA transfer the property

in a sense that the property would be transferred because of the. Yes, yeah, because that would be

actually subjective national rule as we saw what the seller has to deliver the goods in a form that

would not prevent actually the buyer to acquire property in the. This is the general rule what we

see in Article 41. This is actually usually the case in national laws as well. If we think about the

obligations of a salary sales contract that the seller has to deliver the goods free for many third

party right or claims. So that will prevent for example the buyer. Decrease acquired the property.

It doesn't talk about good faith in this regard, whether the buyer should act in good faith or not or

anything better because that's a property law issue in this case like the better the buyer should be

good face apply or or not. But it only talks about this. Negation of the seller that the the. Yeah,

could be deadly bird for your penny. That's right. I think her 42 is about the very special. And.

Kind of right and intellectual property rights, I don't know if you. Classes on intellectual property

law? Maybe yes, like patterns, trademarks, design. Popeyes, all these, these are all these, all these

methods. Why is it special? What do you see? Why? Why might there be a special provision on

intellectual property rights? In the CIS? Because many times, actually, these goods are. I basically

covered by different forms of intellectual property rights, for example the form that you

mentioned. What kind of intellectual property rights forms of protection can be relevant in the

context of the phone? Men should yes, right? For example. Patterns and the design of the outlook,

yes. So patterns can be relevant as to the technical elements that are embodied in the design like

the outlook of of the particular phone. So the design in Europe it's or in the European Union and
many countries that. Clear protection in in the United States called design pattern. But like the

design, what else? Trademarks can be also relevant, yes. Webcast programs. And usually

programs, computer programs are protected under what? Formatting tecture property? Yes and

what, what, what for? Copy copyright. Usually computer programs are considered to be literary

works, so they are protected us as copyright works. So then basically copyright protects them. But

on the other hand, maybe when you talk about it you mentioned that there is also an interest. To

somehow bring the computer software under patent protection, I mean for the developments,

because. Uh, right. What do you think? Now this question seems to be a distance from the CIG

because it's more likely to actual property. But on the other hand, it can have an implication in this

field, in the CIA field and in this library field as well, because. That could tection usually lasts for

how long? A lot, right? Copyright protection that that last long quite long because usually that's

long last for the life of those Sir plus like 50 or even 70 years. So that's that's very very well if you

compare this term of protection. Better than protection. The protection was the usual length of

patent protection. We're not usual. So that's actually the protection. 1020 years. So it's it's way

shorter one thing. The other is that if, for example, a computer program is protected under

copyright, and that's the case, then basically what is what we cannot do with the program. We

cannot copy the problem, but if we of course. But if we actually managed to reach the same result

through a different program when we run the program on the computer, then we are fine from

copyright point of view, because that's not a breach of copyright. That's not a copyright.

Impeachment and the real value of a computer program is required. It's not necessarily how it is

written, how it is expressed in the source code objective, but what is the result that we can

achieve? And we run this computer program on the computer on an apparatus and this is

something what the result. Insert what we can achieve when we run this program on The

Apprentice. It cannot be protected by copyright or under copyright. What matters you could

protect this. So if we formulate the pattern claims like those would be directed to this result, then it

doesn't matter how this result is. Three, that can be any treatment or for patterns, right? So that's

why there is an interest or might be an interest to to bring these in these creations, let's say under

patent law. Of course it depends very much on the different pattern. close, maybe you have heard

about this concept of computer implemented invention, so that was created to some extent to deal
with this situation, because computer software generally as such is not a pattern of table subject

matter, because. Qualify and for a patent of our subject matter it is important that it should be an

invention, but we like discrediting drafting. It might be somehow transformed into this technical

invention, and then it might be subject to patent protection. So when you talk about this now is

because this is what this Article 42 is about intellectual property rights. And why is it so special?

Because this is not property rights in in the traditional sense as we saw. But if we could these

right, these are very strong. Right. And a very important feature of this writing that these are

exclusive. Yeah right. What does it mean? So for example, if the the like we mentioned the

pattern, So what does it mean if we have a pattern? With regard to a certain field of technology, so

this is. The field of technology where we have the patterns. So basically this is the invention

actually what we have. So what does it mean if we have a pattern for this field of technology?

Exactly. So we can exclude anyone else from the exploitation of this field of technology, which

basically means that if we have a patient in a product or so something in in that let's say in

Germany and then someone else. Being fought products that would be based on the same

invention, then basically the pattern holder could enforce its patent rights against the importation

of these products. So it's it's very important here in this field because if we consider these goods,

these products, many times they are somehow affected or can be. Connected with these different

forms of intellectual property rights or if you think about trademark, what does it mean trademark?

Trademarks. Yes, yes, exactly. So we have the product and there is a sign attached to that product.

This is the trademark, the sign that we attached to the product and then basically like the the

traditional. Function of a trademark is what that it has to identify the origin of the product as to we

know that what manufacturer, what producer it comes from. So we can distinguish as to the origin

of the product and so that's like the first function of trademark lower traditional. Function of fit

macro is to to actually. Um. Prevent consumer confusion? So lower the consumer costs in order to

find the product that the. Once you move back to purchase based on this trademark. Which

basically means that what is the trademark infringement? Anything that can create confusion on

the side of the on the consumer, which basically means he has that if another company would use

the same or a similar mark with regard to the same or similar product, that's actually a trademark

infringement. So then this other company can say that we cannot import these goods into this
country. We cannot sell these goods in this country because I have a trademark for this part for the

use of this particular signing bonus. So basically the fact that you're using a similar slide with

similar products that can create. Consumer confusion. So basically it's a trademark infringement

and then? Another function, though straight Macclure, is to protect the investment actually by the

trademark owner order put into the to them. Market safe into the marketing power of that mark,

the sign. So that protects actually the investment that was made into that map, which basically

means that it's not only, not anymore, only the same or similar products and the same. Similar but

also the same or similar mark with any kind of product because then it can create this risk of

association. This is the second type of trade marking treatment. So it's of confusion and this will

association. So then the the consumers would think that, OK, I know that. That doesn't produce, I

don't know this kind of products, but since it uses the the logo Coca-Cola, I might assume that

maybe something happened so it is some somehow associated with Coca-Cola or anything like

that, so which in this case it goes even beyond this. The same products and same, same or similar

product, which means that again it's very strong. From this point of view and especially in this

field, when we think about products, goods under CG can very easily be the case that the products

are goods are somehow linked. Signs and trademarks are used and then if we consider this very

broad. Breach of trade macro in this sense that it's not only identical products and identical marks,

but any marks that can create confusion or this risk of association so that it's it's a very. Broad,

let's say uncertainty as to when and how another party, third party would come up and say that no,

you cannot sell these products in this country and then we can, if we consider this aspect of

intellectual property rights, that these are very strong exclusive, right. Then you might also say

that if the goods do not comply and we will talk about this Article 42, don't worry about it. The

goods do not comply with Article 42. That might be very easily the case that it's a fundamental

breach because we cannot do anything. For example, that would be a patent infringement in that

country. So we what was this fundamental breach? The the requirement that we remember. They

this substantial deprivation. Next substance should deprive the party of what he's entitled to,

expected under the contract. So actually enforcing intellectual property rights by third party

against us as prior, that's really like a substantial deprivation because that means that we cannot

market that good in the country. You might not even be poor even be able to import that good into
the into the country, the territory. So basically it's, it's very strong. There are limitations. I mean,

generally if you think about intellectual property life, what are these two? Patients to these rights

that these are territorially limited, so usually they exist with regard to a certain territory, country

like for example German patterns exist here in Germany or provide for this exclusive right.

German trade match provides policies positive, active in Germany. Sometimes this territoriality is

more than just one country. You heard about the European Union trade mark? OK. No, no, no, it's

OK. Finally again, the second thing I could tell you, you haven't heard about that that first was the

person, this is the second one. So basically this European and hopefully it's more than just losing,

but this. Mac is a very special form of intellectual property in the European Union because it's a

unitary form of protection. So there are national trademarks in the European Union Member States

that, like national marks, national forms of protection. To some extent those are harmonized

because there is a trademark directive in Europe, but nationally, but there is this unitary form of

protection. This European Union trademark, which since its unitary form, it means that it covers

the entire territory of the European Union. So here in this regard, the territoriality is not one

particular country, but like the entire European Union, it's not possible. Would have European

Union trademark, for example, for five EU Member States or for 10 new Member States. It's

either all or nothing. So, so that's from this point of view very important facts. So we cannot it's

either for the entire territory of the European Union. For for with contracts we can sort of split the

use of this smart, but like as to the existence it is for the entire territory, there is actually an EU

intellectual property office in Alicante in in Spain which manages this EU. They're taking my

system, so basically this is also a form of protection, and here the territory is more than one state.

And. The other limitation is the time right. Usually they last for a certain period of time. These

feature property right, especially if we talk about if we think about the economic rights, those last

four certain available time moral rights or personal rights. Actually might be different or a

different in this regard, that the economic rights last for a certain period of time. Is the form of

intellectual property. There, although it is for a limited period of time, but basically it can last

forever. As long as we pay proper attention, proper attention to its maintenance, but it can last

forever. So it's renewable, renewable, renewable, renewable, renewable. So it's not limited in

terms of how many times we can renew it. And that's why, if you think about it, that's an inherent
interest of the companies to bring. Many boy use under this form of protection anybody using the

stand that what is valuable for them and the market to bring under this form of protection because

it can last like forever. Of course, renewable, renewable, renewable, but. Which is this? What

would you say? Better protection can be it's not not that, but can be renewed patent protection. Not

really, no. Uh. Copyright protection it last for a long time but basically it's not renewable design

protection. You mentioned earlier design protection which protects the the outlook of the product.

Basically it depends on the laws it is renewable but. It is limited how many times you can renew

it. So what might be then the form of protection which is like living renewable for an unlimited

times? The very strong if we consider that it's not only the identical product, identical sign, but

like similar sign as well. Similar products like this confusion, association, risk of confusion is

Capacitation trademark. Yes, the trademark protection or paying for or. No no, please feel

anytime. Please feel free to tell me to slow the sorry. OK then. So what is then the form of

protection that can last basically forever? Of course it is granted for a certain period of time. But

we can renew it and renew it and renew it again in the game again. End the game. Yeah, it's a

trademark protection actually. So usually it's for a certain period of time, 10 years, but we can

review it and view it. So basically it means that if we have something that is valuable for us.

Maybe because that makes our product attractive for the consumers and we can get trademark

protection for that, that can create for us very exclusive right and the monopoly in the market to

use that particular feature, effective feature in the context of certain goods. So this basically means

that if you think about trademark protection, this risk of confusion and risk of association then it's

a very broad right, exclusive right in terms of what we can do as create Mark waters and on the

other hand if we are let's say buyers on their. Says contact. Then there might be a risk actually that

a third party would come and say that OK, but this would has a sign which would mean trademark

infringement. So which would infringe alright. So these are very strong, right, and very important,

right? In this context, in the context of international sales, because many times these goods that are

subject to these sales transactions are affected are covered by certain forms of intellectual property

and usually it's patterns, trademarks, copyrights. But it's. It's actually. Broader than just these

forms. So let's then look at these particular provisions now after this introduction. So this Article

41 of the this is the general rule on this third party, right? And here you can see that the seller
must. Very, very good. Which are free from any right or claim of certain party unless the buyer

agreed that the goods can be like that, I mean affected by third party rights or plate. So basically

this is the general obligation and it means that any right or claim so for example any right of claim

observe party as to ownership of the goods. So then there will be no other party who would come

and say that. Oh, OK. But these woods were not owned by the seller actually. But these boots

were owned by us. And then basically the Sarah wouldn't have the possibility actually to sell these

goods because the seller was not the owner and didn't have any authorization for months to sell

these. They're good. So basically the server has has to. Deliver the goods like this free from any

party rights or claims in order to make it possible, as we discussed earlier, that basically the buyer

will be able to enjoy an undisturbed possession of the goods undisturbed. Possession of ownership

industry that so that's that's yeah it actually better the buyer can acquire ownership or not that's the

property little question here as like a contractual obligation for the parties that the party the seller

must deliver the boots free for many. Kinds of things. And the 42. Article 42 is about intellectual

property rights as we saw. Basically it means that the the seller must deliver goods which are free

from any right or claim of a third party based on industrial property or other intellectual property.

Then we look at and have you not treat it now further because we are talking about that later. But

now if you just start with this immediately, we can see that there is a question of qualification.

Right. Or pacification here that what is industrial property or other intellectual property. So

basically it requires a very, it's an obvious concept as we know under the CIA. So it is not to be

interpreted based on certain national laws in this regard. What the national law would say is

intellectual property, industrial property, many times actually, what we can see is that in many

fields of intellectual property rights that to a very large extent these are. Based on these, internship

property law systems are based on international treaties. Do we know any of these antennas? Can

we name any of these international treaties that might be relevant in this field, in the field of

intellectual property? Hello. Can you report any treaties? This agreement, yes, that's, that's very

good actually that's a very important treaty, the TRIPS agreement from the WTO and trade related

aspects of intellectual property rights, because if we consider that all things, all WTO members

have to be members of the TRIPS agreement. Basically that's that's a very bad coverage, yes, for

example the tips agreement. Any other agreement, and the TRIPS agreement itself refers to some
other conventions. Like the TRIPS agreement is from. 94.9 nineteen 9495 and and then like in the

previous century, in the 19th century there were already some treaties, conventions, creative,

adoptive. Convention for Projection of industrial property, yes, and the. Commission for the

protection of literature and artistic works, yes. Very good. So this Paris Convention on the

protection of Industrial Property, industrial property rights and the Burn Convention, very brief.

It's like for this copyright protection, even if it says differently, but it's like copyright protection.

And there is also the Rome. Which deal with this intellectual property rights and and the creation

of this intellectual property infrastructure. So many forms of intellectual property rights are

present in the national laws, but it might happen that a certain form is not the drug. So. That's why

it is not based on national law. What is intellectual property? Industrial property under Article 42,

the CIG. It is like the general understanding of what is intellectual property. What is industrial

property in this context is in this international. For example, all these conventions that you

mentioned set up this general framework or general, let's say what is picture of intellectual

property that what forms of intellectual property might exist we haven't mentioned yet the you

bold convention, I don't know. If you have already heard about this upon commenting, that's

about. Readers rides Brent readers. Readers, right. So that's also something that is a form of

intellectual property. So it's it's a very broad. Concept might be see here or what we can follow

here. What makes it a bit actually, sorry. More interesting is that any right or claim. So any right

or claim it doesn't have to be like. Clear that it is a trademark infringement, for example, but.

Well, we still have time. So for example we have two companies, company A and Company B.

Company is from let's say Spain, Company B's from and from Germany and then a company A

says let's say what the company. Well. OK, he shirts to Company B and there is a logo on this T-

shirt with bees. Let's say and then we Spanish company says these products to this German

company and the German, German company starts to sell these products on the German market

and then basically like. So you. Months after the German company put these products on the

German market, there is another German company who says that Company B. So the buyer under

the original contract you cannot sell these products here in Germany because I have registered

trademark for. These but these so. Let's say this is the original. And so this is this is that. So this is

what is what you can see on the. Be sure and this is the registered mark for this German company.
And actually this German company uses this, so it was for this shirt and this German company

uses this mark the satisfaction for sporting. Equipments, so it's not for closing, but generally for

sporting equipments, if you think about T-shirt, those might also be used for sporting activities. So

that's also kind of sporting equipment. So at this German company says that you cannot sell these

products here in Germany because I have the exclusive, right? For using this mark. What? What is

the situation? Would it be something that, and this is the so this is Germany and this is Spain. So

here is the seller, here is the buyer. So would it raise any liability for the seller under Article 42?

That here is the second. So this is see another German company who says that it's a. Infringement.

Tabacky infringement that Company B, you're selling this product here in Germany? It's not a

core decision. So not no German coordinator said that yes, it's a trademark infringement. So oh,

it's only, let's say this German company receives a letter from Southern German company that

stopped selling these products or using this mark because that's the trademark. If you don't stop

using the smart in Germany, then we will take the necessary legal steps. Is it something that would

raise an issue for the seller under Article 42? What do you think? Could you follow the? Problem.

OK, so. As a buyer that's then change the bid. So we are the buyer, the first German company,

what would we do? Received the shipment from the Spanish company. We put it on the market.

Then this other company comes and says that if you keep doing this, we will take you to court. We

are discounting what we do. What would we do? Completely and should make them to make sure

if whether there is a discussion about three months. So we would. Notify the other company, the

seller, that we received this e-mail or this letter from this other German company. And then? Well.

And then, OK, we send this notice to this Spanish company and then the reaction is that, oh, don't

worry. It's fine. You don't have to worry about just keep selling these products. Should it happen

that this other German company here any legal proceeding against you, then we are ready to help

you with this legal proceedings. In fact, we are also ready to cover half of the regular costs that

you encounter in this. Savings. They only cover half of the yeah, but they said that of course we

will have you. Don't. Don't worry. It's fine. Don't worry. It has already happened in other countries

as well. It was fine. Yes. OK, so then what what, what could be the what? What could we do then?

I would charge you. If the if there obligation to make sure that there is no conflict in the

trademarks cohesion. So you can't just say that it's fine, you need to prove it all you need to make
sure that there is no compilation, yeah, yes, yes. Any other comments or remarks on this? Yes,

very good, because actually it doesn't require Article 42 doesn't require that. For example, here

that would be vision, which would say that yes really it's a trademark infringement or anything

like that because this right or claim. So if we have this third party claim, who claims that? Means

that the use of this mark might. Lead to trademark infringement, which might lead to the fact

actually later as consequence that we will not be able to sell this product in Germany. That can be

actually sufficient to say that the seller did not comply with this requirement that any right or

claim of third party. Of course. When we look at the article for to the earlier. Or another important

part of our because that toward the real essence of particular 32 that it. Fortitude. They say certain.

So 42 so Article 42. Yeah, is that it defines or determines that what country we have to take into

account when we assess whether the seller deliver the goods free from any third party that

property rights or claims so because if these intellectual property rights, territorial rights, of course

it matters. That under what law can be assessed whether it's free from any third party intellectual

property right or claim. So here you can see that. This is like what you can see now Article 42,

subsection one that what country will be relevant. And. What is the underland country? The first is

that basically the country where the goods will be resolved or otherwise used. Of course, it is

important that the seller should be aware of this at the time of the conclusion of the contract that.

Contract that the goods would be or will be resolved or delivered to that or used in that particular

country. If not, then it's the country where the barrier has its place of business. And now we have.

I see. 2 minutes. So maybe we will not have the time to finish for part three of the CI today. So

obviously no, we will finish it now today, but because we have to finish at 12:45, right at 12:45.

No or. OK, so maybe you can think about it until tomorrow that yes, OK the in this situation.

Should then the Spanish seller with any research on the German? Yeah. If you got to Germany

better this this is actually something that would create a trademark infringement in this country in

Germany or that would have been to some extent obligation of the German buyer to to make some

kind of fears prior clearance. OK, so I purchased this product then whether that will make any

infringement. So it's very easy to say that yes, the seller has to deliver these goods free from an

intellectual property rights OK under this row. But what extent is this network to expect the seller

that it will actually very well? Because it's not the same as we saw. So it would require some kind
of further assessment to know that yes, OK, there exists this other map, but what are the chances

that it would be actually a third party claim later concerning them, the marketing of these? Product

so. If you have time in the afternoon, then then think a bit about this, because then this is how we

will continue them tomorrow. OK, so bad. Basically than today, but we did. Is that we talked

about part three of the CI. Let's not forget the general considerations that we discussed in this

regard, the importance of party autonomy, that yes, of course we talked about default rules, but

basically the parties can always be otherwise they can modify these. That provisions and the

obligations of the seller basically that we have gone through. The main streaming obligations of

the seller and then basically this is how we will continue tomorrow that we will talk about the

obligations of the buyer that will be actually very less from this point of view then the status

obligation and also the remedies that can be involved. And that's for the first part of tomorrow's

class and then in the second part, we will look at some case studies as well. So do you have any?

Questions and comments. I check on zoom as well. Maybe there are questions. So. OK. If not then

thank you. That's it done for it. Do you have any questions as to this? So they were discussing this.

OK. So if there are no questions, then thank you. That's it for today and then see you tomorrow.

Thank you. But I wanted to say also if you want it, of course you don't have to do this. But if you

want you can bring some hypotheticals, you can create some hypotheticals based on the issue like

case studies, cases, stories that we discussed and then we can talk about these as well tomorrow.

OK. So.

4.14 第一节 questions and the second part would be a case study exercise. What do you think

about that? What do you like? What kind of pizza do you like? What kind of pizza questions do

you like? Like open-ended questions, essay questions, test questions? We don't. We. Yes. So then

at the exam, what what kind of questions do you like? Like open-ended questions like for

example? Please describe the scope of the C ISD and then you have to provide the type that OK,

this is to you or like test questions, but you have to choose different possibilities. So there's a

question ABC and D and you have to pick one of these. Of this ABC and D so this move by
choice question or yes or no or two or four questions or case of the so. What kind of exams do you

usually have? Even have kids. In last year they also have like kids relating to this. It's mainly this.

It's not. In. Course of human rights and would be in that. We have more awards to talk about this

process, I think because the terms are fixed and maybe the conflicts. I see, OK. And so, but last

year you already had a class on the CIA. Actually, it's about national frequency. And then we did

international business law, you started this CI. And how about the others? What what do you

think? What do you think? We just arrived. Yes. So So what? What? What do you think? If we

take the exam case case study. Can we have this? You can. I think. Please. Be a little difficult to

remember all the course. You don't have to study the CID by heart, so you don't, you don't have to

memorize the CIA. You have to be familiar with the CIA, like the structure and So what we

discussed in class, but you don't have to memorize the particular provisions. Well, at the exam

when you have to apply the CFG, then basically you will have access to the CIA so that you can

of course it's the exam. So as I was told, it's one hour. So basically we will not have the time then

to study the CIA and then to get to know the CIA, of course you have to prepare. For that. But like

safety blanket or I don't know, it's it there. So you can look at the CIA. You can of course. Use

that because that's what you would do in in that real life as well. So of course it's good if you

know the text and you know how it works, but always it's it's important to verify. So basically I

think it's. It's not the problem you you to see that, of course. Or can you use the legal taxing other

exams? No, no. By you I mean that the one location that does, but OK, So what was usually the

case in other other users? You you have, so it's it's open book exams. We can just use these rules

without other materials. Money down. So then the first part would be then some test questions and

then that would be around 15 minutes or 20 minutes and then the next part would be the case that.

Not very very complex case study, but a case study exercise that you will then have to solve, is

that OK? OK. So and I don't know when we will have the exam, but I was told that it might be

sometime in July. So you still have time to prepare for that of course, now we end this course

today, you know that of course. So this is the last class but. You have them interior, so you have

the slides, and I also sent you an updated finalized site, so you have these. You have the book that

I sent to you or have the book that I sent you the other day over zoom. If not, no problem that I've

just send it again so you will have it and also the other materials like the CIG and I was just
waiting for everyone to arrive, but I will send two pieces today as well. One is the because you

don't have to memorize the principles of course, so it's it's not. Well, that is just it's good if you

have it, if you can look at it, if you actually get to know it in the sense that as we talked about it

earlier that it, it complements or can complement the CID and that is. Guy, which was prepared by

the Unitarian on Citran and The Hague Conference on Private International Law. Because as you

remember that we talked about at the first class, we talked about these different instruments and

different ways. How? CS Lewis Unified Carbonite and the head conference on parity international

law actually active in the field of private international law and adopted text in the field of private

international that might be relevant in the context of sales contracts as well the adopted the CIA.

So this is topic and then the user. The user admins first. So basically these three organizations put

together a guide. How these different instruments can operate together, different instruments

coming from these different organizations. So basically this guide is about this, it's not something

that you have to study, I mean like memorize or anything like that. They're not not studying the

sense that. If you have done it, it's something that is recommended or might be recommended not

for the exam. You can do the exam perfectly without using this guide, but I think it's good if you

have it if you can look at it when you have time because that helps to understand more the

relationship between these different. Instrument and if so, it it enables you to see this portfolio

picture. OK i think i i sent this two period 5 so the first one is the

There's some Dave time and date to reserve it and then she did communicate it to you and then

you can pick any of these and then we can we can talk. So you don't have to decide right now.

And also actually it's not mandatory. So if you don't think that it's something that you would need,

then it's fine. It's not a problem. It's just if you want to talk about it or if you need help in any

regard, then we can do that. We can talk. Just a moment with you about this context. The question

will come. Yes, yes, exactly. That's why. That's what I'm thinking about because now you've got

like everything within a very, very short period of time. So it takes time to digest everything, to

think about everything. So that's why. I think it's. It's good if we have this, yes. Maybe any

questions on zoom? Oh. That is one question or no, no, no, no question. OK. Then if you have no

questions or comments or remarks or anything like that, then let's continue. So this is very with

this article quoted to yes today, did you I I know that you had this tutorial in the afternoon. Um.
What did you do? Did you this? No. Race passing them the risk and which we haven't. Yes. So far

we haven't talked about the past single phase, but you did that then in the afternoon yesterday, so

now you know it. OK. OK. Good. So then let's continue then with the disc factual property. Right

issue this Article 42. This is where we finished yesterday and then of course sooner or later we

will get to discussing office as well. So did you have any? Time to think about this. Do you

remember where we stopped yesterday? So yes, that was the situation and so it's. Similar, but

different at the same time, because if we pronounce maybe it sounds the same like Reese, Reese,

Reese, Reese. But if we look at it like the first two letters are the same but the third one is is

different. So. What was the question where we stopped yesterday? This discussion. Need to

investigate the intellectual property situation about the journey. Yes, because under the CIA there

is this obligation for the seller that the seller must deliver the goods free from any third party

intellectual property rights or claim. And then what the CIA defines in this regard that they what

territory this question has to be assessed, this is not. We've got a 42 subsection 1A and B that

where the goods will be restored or otherwise used. Of course in that case the the seller must be an

aware of this possibility or the player the buyers place of business so. What then? Uh, what? What

do you think then? Or what did you? Think about in this regard. And then can we expect or should

we expect from the seller to investigate the intellectual property scenario, let's say in Germany for

the Spanish or or maybe it's easier actually for the buyer to know that, OK, what's the? Situation

here in this country, but other globals marks are are used, especially if it's a special area of trade.

So what? What do you see? Is it just talking about freedom? It's. We just we have the concept of.

In the field of. Countries ourselves into emphasis on easy to get the information. If if young with

you country, like for example signals from China, that supplier is in Germany, I think maybe it's.

If you leave the Chinese company to investigate on EU trademarks, it may be a little bit over.

Hmm. Yes, yes. So basically you're saying that if it is reasonable to assume that that the seller

would have access to these particular information as to the syntactical property rights in the

country, then basically it's, it's reasonable to assume that the. That can be applied to forever, so the

seller should seek for information in that regard. But when it is. It doesn't seem reasonable then

basically the seller should not be held liable for that. There should not be an obligation to settle

things by about that previously if it's the case or not. But as to this European Union trademark,
that's perfect. But you said that there is this European Union. In the European Union, which covers

the entire title of the European Union saying this regard, it's the same in Spain and German, but at

the same time there are also national trademark close and national trademarks in the EU Member

States. So there is Spanish trademark system, German stuff. So basically it can be possible that

something is protected under journal law, it's a registered mark and then basically it will be a

national, the domestic trademark, the same with the with space. So these two systems like the.

You systems unitary form of protection and the national protection system. They operate together

for each other. And yes, OK, so any other. Comments or or ideas here? The time of the conclusion

of the contract, the failing new or could not have. It's told us that it's kept the obligation. I think

that the salary. To some obligations, you know it's your third party. Have some rides without

these. Nice. OK. Yeah, very good. Thank you. Maybe anything from this side? Because now it's

two to zero. The comments. I'm just kidding. Sorry, don't. To make the investigation to all the

about the. Intellectual property or less there's the buyer is some kind of some specialized in this

or? Or else it would be the. 10-4 that everyone else could. 20,000. A firm such an intellectual

property right on his goals that he is selling to the right. Yes. So basically it seems that you all

agree that it would be the sellers of dictation tools to do the research or to inquire about. This

situation. OK. And then let's turn now a bit this around and let's say that we represent the buyer

and the seller in this case and we want to argue that it's the buyers obligation or it should be the

buyers obligation to inform us that maybe. Happy existence. Power from the. Because it says

you're right that the seller new or couldn't have been under there for that. But what does that

mean? Does it mean that actually? The buyer should disclose it to the seller that actually in this

market there are these other players with these other trademarks that safely talk about trademark

or it's it's something that you actually always said that it would create some other obligation for

the seller other than just the. Listening to the buyer or the would be buyer, so other obligation to to

do some research, to do some inquiry in this regard. So we will see that was the solution. But

before we get to that just for a second, if we look at the second subsection because to some extent

that provides for some kind of defense. For the seller because. As you can see the IT says that if

any of these situations. Happen or occur, then the seller will not be liable or cannot be held liable

for these IP rights in treatment or these claims or these. Nothing feeling. So it's like these claims
or the existence of rights or claims this regard. One is that actually that the buyer you or couldn't

have been unaware of the right or claim at that time and the conclusion of the contract which

basically means that if the buyer is operating in this market. In this e-mail of the existence of this

mark and the use of this mark in this market, and actually it might be possible to argue that in this

case the buyer could have been aware of the existence of these other market in the market. That

might be some kind of danger as to the use of. This is Mark in this market. So it's not just the

seller or the buyer who should make the Inquirer or who should act inquiry or who should do the

research. In this regard, it's about the case. So like case by case analysis is based on all the

circumstances of the case. And the second one is the battery. The reason why, for example, the

boots that are delivered might be subject to these claims from third parties is because maybe they

were created based on the drawings supplied by the buyers. So basically the buyer contributed to

the fact that the goods would be then. Infringing goods or would be then subject to these claims, of

course third parties. So this is the the second subprogram. Articulate. So basically this is. Then the

structure and the main or the rules of this Article 42. So that's very important that it doesn't deal

with the existence of intellectual property rights. The CIG it doesn't deal with the existence of the

intellectual property is the extent of the intellectual property right in the sense that whether it's a

valid intellectual property. Not so. It's not something that would be covered by the CIG. What is

covered by the CIG is the sellers liability. As we saw that the seller must make sure that the goose

that type that you're that freeform is third party rights and paint and it's not required that it should

be like the body. Beach from this point of view will be a bit interesting, but can be a bit interesting

because. Even. Like, uh, uh, unfounded claims can serve as the basis for the establishment of the

bridge under Article 42 of the CIA, because that can endanger actually the barriers ability to do

whatever the buyer wants to do with the group, because even if it's not. That funded the pain it

might end up before or so. That has of course a consequence on that how the buyer can disposes

the goods? How the buyer can use the goods that were that. I just didn't say no, but we discussed

that already that basically the concept of intellectual property rights under this Article 42 is very

broad. It's not based on the national law, how the national law treats, or what the national law

thinks about intellectual property. Yeah, it's it's more like this international transnational concept

of intellectual property, right as we can see these in the different international equities. Yesterday
you mentioned the Paris Convention, which is about the industrial property right that already is a

very broad. Mentioning terms of school, that's what is an industrial property like what you

mentioned. But also for example unfair competition is covered or can be covered by this. So it it's

very broad, this concept and of course even if at the time and the CAD was drafted there were no

such instruments that like the EU trademark, so you should pay but not usually what was the case

then is that these intellectual property rights. These four existed on based on national. Of course

international treaties influence these national laws, but basically these were based on national

laws. Now it's a bit different because of this EU market, for example, or there is also a pattern, the

unitary. You better or there is also the community design. These are all unitary form of

protections. So basically no if disregard, the territory is not only state territory in this sense, but

like the entire territory of this country and then just for a second. To come back to this Article 42,

this slide, because that might also make it interesting that in the case or in the context of these

unitary forms of protection, how can we interpret this state, the notion of state there under Article

42? That, like in what state we're under what law it should be. Free from any third party

intellectual property. So if we talk about them, EU Member States, of course it might mean not

only the national trademarks, like in German, the national trademark law, but also the EU trade

macro, because in the UK because that. So something that is very right in the context or in regard

to the territory of Germany. So that can be the basis for the third party rights and claims as well.

So here it means not only national. Forms of protection, but also this. I I wanted to say

community, but it's not communities now the European Union, but this community or European

Union form of protections as well. And as you very well said at the beginning or not the

beginning, so when when we came back to this question that basically. It was seller like to what is

reasonable or what would be reasonable in this situation. If the seller cannot be unaware of the

existence of data actual property right when you or cannot be unaware of the existence of the

intellectual property right or claim, then basically that. So that establishes the liability for the

seller for this article for two, but it depends on the circumstances of the case. So we have to assess

it in a case by case analysis and in this regard what we can take into account. This is what you can

see in this. And of course basically like the the bathroom rule or the general rule is that everything,

so all the circumstances of the case we can take into account of the situation we can take into
account. But if you break it down a bit. That might be factors relating to the intellectual property

rights, to the underlying good itself, or actually to the seller, so the nature of the kind of the seller.

So if. For example, look at the the intellectual property rights. So what factors might be relevant in

the context of intellectual property right then? Basically that's an important element in this case

that how the intellectual property rights is actually created. So what do we have to do in order to

obtain? That protection because when we think about the industrial property rights, usually it is

subject to so how can we obtain protection, for example patent protection? Usually trademark

protection. So how can we get? Patterns. We have to make an application. Right. So there is a

process and actually it's registration. So there is a registration process and then when it is

registered, then basically we get the pattern. Usually that's the case with trademark as well. So

when we have to go through the registration process in order to obtain protection, then basically it

is easier. If you think about it to. You search or to conduct any search yesterday existence of any

other rights or possible rights under Article 42 because then there are these databases. These are

actually usually accessible by public as well. So basically these are not that difficult to in. 1980 it

was not yet the case, but now actually these are all online databases. Probably you have already

talked about this in the context of intellectual property law. Maybe so then now it's it's easier, but

there are so when it is registration. Is registered and there are these public registries so we can or

it's easier to check. But what if certain right is? Same or similar to this exclusive right, but is not

subject to legislation or can be established not only through legislation, but for example under

common law it is possible to have right and exclusive right which will have the same effect as a

trademark right would have without registration. Of course, the territorial scope would be different

because it would extend only in the area, but it is in use in in trade, that particular market, but it is

not registered. So we cannot look at, if we are the seller, we cannot look at the public registry, we

cannot see that. OK, maybe this is something that would be. Government in this case, who would

be actually more aware of the existence of this unregistered mark? The value because the buyer.

But if you think about that, under what law the seller should deliver free from any third party item

claim apply. By a space of business, country or bad, the goods would be sold or used. So basically

that means that that's the area where the buyer is active or at least that's the Sumption. So basically

it means that for example for this unregistered marks or this not registered, right? Of course it is.
More like the the buyer to The Who would have access to information on the existence of this

kind of rights in. As the copyright, because it's not going to industry, right? It's also about

copyright, and we know that. For copyright protection, actually, do we have to do anything

generally in order to get the copyright protection? For example, the? Create a menu just dreaming

this field. So we create a menu and then for that in order to be protected under copyright, is it

necessary or is it the environment that it should be registered somewhere? Or yes, you're right, so

no registration is required and no formalities. Add acquired for copyright protection. So in that

case it would be even more difficult. Actually one could say, but on the other hand it might make

it even crazier. Why? Because then what could be the like the the default situation since it's not?

Uh, subject to registration. Copyright. What does that mean? That it is protected by the law? So

basically it means that unless it is in public domain. Basically, someone somewhere has the

copyright in that particular material. The challenge might be to find the challenge, so it might be

to find the season who might be the copyright owner, but but basically in that regard it it's to some

extent from this point of view can be easier. OK, so if we look at these different factors that might

be relevant in the context of. Of intellectual property rights or given in intellectual property right.

This is what you can see like what we can take into usually actually the intellectual property rights

that are. I infected by this. I of course probably not surprised trademark and patterns, but also

sometimes actually design. But like trademarks and patterns, they are almost always there if you

look at the good itself, like nature. Of that which can be like a student nature that for example,

what what might it mean? The Nature II just. Please do so. To what? What would you say? What

might it mean or how the nature of the good might be relevant in this regard or might have any

kind of message in this regard. Like for example, if it's if it's something technical. Then it might

happen. So if it's attacking it, eating in embodies something technical, so then so technology,

things like that, then basically chances are high that somehow it might be affected by patterns or

pattern protection. Of course it might also happen that the patterns already. But, but basically if we

consider the value of these intellectual properties, then basically most probabilities somehow

protected under pattern. Um, or when it is a new product then basically again, most probably it is

somehow protective, even if it's not patent law. But maybe design protection can be in place

because design protection lost. Not that long like a trademark protection or even practical
protection, but in the early, early stage of life, kind of the good, let's say most probably if it is

something that can be subject to design protection. Their parents do their parents of the good, then

that might be protected under design below. And then again we see or might see an interesting

spec because I I talked about trademarks like registered trademarks and unregistered trademarks or

registered. The same being industrial design as well, there is a system for registered industrial

design but also there are countries actually that industrial designs are protected or can be protected

even if they are not registered so which basically means that it might be difficult to to. Investigate

that whether a particular appearance is protected under design law or not. So whether there might

be a third person who once would come and say that. This is my design solution and use it. If we

look at then the seller that was should be taken to, what can we take into account when we

consider that to what extent we should be the sellers obligation to inquire as to this data or

information like the experience of the salary, the specific good. Being specific market actually in

the the particular country, the kind of the seller that whether it's like a global company operating

in different locations, supplying different countries, different markets or several markets where it's

just like a small company primarily operating domestic. Uh, in the domestic market and

sometimes exporting goods to other countries. So that's also something that might be important

and like. Other issues which are not necessarily that very legal but of course important, like for

example the language issues, the language skills of the seller because. Well, if you for example

consider just all languages, by all I mean that the Chinese language and the Hungarian language. I

don't know if you have ever. Wanted to study Hungarian. No, of course like would you do that but

but The thing is that it's not, I mean foreigner says that it's not that easy, it's it's different than than

many other languages. So basically it means that it might be also different difficult for foreigners

if it's not the German market by the Hungarian and then to to seeking. So this language issue can

be also also. Actually I I once I wanted to study Chinese or started, I just didn't want to bring the

topic because I'm. Very afraid of the pronunciation, but yes. And maybe idea? 8 Hungarian. OK,

do you understand? OK, no. I will say something in Chinese and then it will turn out that whether

you understand it or not or whether my pronunciation is good or not probably know. Woman. So

that no. Because I wanted to say that in Hungarian the number. What do I want to say? Yes, I I see

woman. We have. I have to go. We have to go. How do you say that? Yes. Thank you. Yes. Uh, so
that. Oh, woman. Yes. Well, man, cash for that. Yeah. Yes, so I need Hungarian. It means many.

Menu go be go cabins must or have so many many. Yes, this is the language issue from this point

of view, but but I think you understand. Because it's not me how that, but it's very basic, yes and

yes, yeah. Yes, so this OK. And of course the knowledge of the specific use invented by the

buyers you also refer to earlier. Actually that if it's something like special, then basically of

course. That might be. Yeah. The fact that I swapped OK as to the as to the burden of proof

basically. After as you can see after the buyer uh took the delivery so has taken over the woods.

The buyer has the burden of proof regarding the sellers liability under Article 42 in these aspects

that basically there is this third party right or claim this. Right or claim it doesn't have to be like a

very famously so it doesn't have to be very established again. But like I said there is this right of

frame right or claim so positive. For example, for this German company, it is German company

actually provides evidence that this other Germany approach this. German company said this

season this letter so stop selling these products so and communicate sends these. Letter to the

Spanish company that's like providing adequate proof in this regard. The goods are encumbered

by this IP right or claim. The seller newer couldn't have been on the date of this right or claim and

then basically the state. There this issue came up is a state which. Food is the requirement of the

article for 218. So this is the state where the goods were to be resold or used and then the seller.

Of course newer couldn't have been underway of this at the time of the conclusion of the contract

and As for the seller that. What is what the Saturn should improve? As we saw in Article 42 two,

there are some defenses, possible defenses for the seller against this library thing. So for example.

Those aspects can be or should be proven by the sellers. So for example if this product that is.

That event here. And turns out that it infringes some patents here in Germany. Then it is because

actually it was the barrier to supply the drawings for this. So basically it is due to the buyers.

Failure that these products are infringing products, so. You can see all these, but you mentioned

yesterday that you talked about also in the tutorial about this missed contracts, if you think about

it. That. Do you remember this Article 3? The article three of the CD is about this mixed contract,

and the first. Some paragraph or the first paragraph or 5 + 3 is that. If the buyer supplies the the

material part of the ingredients, then basically so the materials. From each actually the the good is

produced then basically it will not be a sales contract. So if you think about it like. It. It can be
drawing be what do you think material in this sense so the buyer supplies the drawing? For for the

product. So based on that drawing the seller. Produces the product and then. Sassy to the body,

without the drawing it wouldn't be possible actually to produce that particular product, but in that

case it wouldn't mean that it's not a circle, right? Even if it's an essential element actually for the

product. Yeah, from this point of view, it's still safe and it would be covered by the CIA. That's

why I just refer to because this because this, let's say, leading for connection between these

particles. Yes. And then uh, just like in other situations, as we saw. Basically, if there is any

problem like if we think about the conformity issues that we discussed yesterday and the

examination or here. If there is this third party that I can claim or claim, then the buyer has no

obligation to notify the seller. And then the time period for this notification is the usual, the usual

time period in the sense that it's reasonable period of time. And basically, the seller cannot rely on

this lack of notice if the seller actually was aware or couldn't have been aware of the existence of

these third party rights and OK, which basically means again that like the general structure, the

general principle. Of his thought earlier, yes there is a problem. There has to be a notification. But

if the other party should be considered as being aware of this problem, then just the fact that there

was no notification would not be tied after the party invoking theorized that this party could. So

this is what place here and just like as we saw it in the context of this conformity issue. That. Price

induction can be available even. In this case for the. Via. Of course in this regard. We can't think

about what it might mean the price reduction if the goods are infringing goods. If it's something

like pattern floor maybe or design flow, then probably it's it's not possible that you're this problem.

But if it is trademark? Then, uh, maybe if it's possible to actually remove the logo, let's say from

the cloth and then attach another logo. Of course that. Raises some damages springs or can raise

some damage so but maybe that case it can be. Possible to somehow cure this situation or this cure

this problem? What is the fact of the good and then the the buyer can reduce the price but once

you actually can claim damages? Yeah. OK. So that's about the obligations of the seller under the

CICS we saw and I just. OK. There's only there. Any questions? Um. So that's the obligations of

the seller. The three main obligations, let's not forget. The seller must deliver the goods, hand over

the documents relating to them and transfer the property in the group. And then basically the CIA

G sets up the default rules in this regard, but of course the parties can derogate from these rules.
So basically the parties cannot be otherwise. So whatever we saw in this figure out, of course the

parties can change, the parties can that locate from this. Pandemic can have their own system and

ask the buyers of deviation. The buyer has two obligation like in this context. But of course, if you

think about it, for example, this inspection or examination is also a kind of obligation of the buyer,

but it's it doesn't. Have any direct consequences or sanctions if the buyer doesn't conduct this

examination. But it might lead to the situation that the buyer will not be able to enforce its rights

under the CSG, but so that might also be a kind of obligation, but here what we will. Talk about is

actually the obligations that the prior has buyer has, sorry, as the main obligations as. It is the

buyer. So basically it means that the buyer has to take the delivery and pay the. Price the purchase

price for the. So these are these two-minute agitations of the fire. They sound probably and we of

course we will talk about these two obligations, but before we get to that there is a provision

which you can see here is 55. In the CIG. How is it possible? I mean. That what that. What would

happen? But this actually here in this Article 55 basically it says that if there is a contract, but it

doesn't. Um, talk about the price. So it doesn't provide for any provisions on the determination of

the price. Then what is the price? The price is very brief to the market price of the. So, but how is

it possible then to have a contract? Umm. Which doesn't. Provide for anything regarding the price.

If, as we saw it in Article 14, like the offer, it's very important that the offer has to be all for a

statement. In order to be qualified as an offer, it has to be sufficiently definite, and one aspect of

this being sufficiently definite is that it has to indicate somehow the price. But yet it might be

possible that there is actually a contract which does not provide for any. Same regarding the price.

Yes, that can happen. Actually the parties that we have from these rules or for example, they have

already some kind of established. Practice between themselves and then. In the course of that they

do not sell the price, but they would just agree that if the market price, but actually if that's the

case then it's not 55 what would be relevant but like the part is practice but it's the market price.

But that's that's OK that the party standard would be it from actually Article 14. So they can, if

they want, they can conclude contract without indicating the price of course it would be. Be.

Unreasonable or can be a bit unreasonable, not even mentioning that then then the market price

would be the the. Guiding passed, but basically the parties want we can. They can say that, David

said later the market price and sorry, they said later the price, but something happens. So there's a
dispute between the parties and then they cannot be anymore the price and then they would go to

the court or most probably none of them would go to court and then. The court would like. Please

provision so it is. Something. But even if there is this Article 14 in the CIA, it's not contradicting

but 14 because the parties can delegate from Article 14 and also it is possible if you remember

that. That. States can make reservation to part two of the CIF. So basically it means that the

contract will be concluded under national also under different rulings. Yeah. So then basically we

apply this is in part three of the CID, this provision. So basically it means that we apply this part

three of the CIG but not part two of the CIG. So that's a game possible option when is the

provision can be or will be. Usually. So the payment of the price paying the price, that's the. I'd

say the first obligation of the of the barrier and so basically usually it is settled in the contract that

how the. The buyer will pay the price and basically the contract will most probably provide for a

close. About the payment method, what kind of payment method can we think? Of course would

be simpler. I don't know if you have already, but if you study this international business law, then

probably you talked about. Some kind of payment mechanism? Payment methods? So what? What

could be? Then. Cash payment might not necessarily be the case in these transactions, but that can

happen. But there are actually. Rules like financial valuation. So you see the 600 letter of credit

and sorry, what did you say I didn't? Yes, that's actually not, it's not get payment. I was just saying

that they can tell you that can be possible but it's not and also it is actually limited or restricted by

the amount of these payments or can be needed. So that's not maybe like. And transfer that can

also be a way to pay for the purchase price, especially if there is a certain level of trust already

between the seller and the buyer. So the buyer knows that, OK, if I make an advance payment to

the seller, then the seller will deliver the goods. Or the other way around, that the seller knows

trust the buyer that OK, if I deliver the goods, the buyer will transfer the the price. And then if

there is not that. High level of trust between the trader and so between the seller and the and the

buyer or for any other reason. There might be other mechanisms as well, like what you refer to

this letter of credit. What what is it? That's OK, that's good because that's extra usually that kind of

mechanism that is employed here, what what is it? Is that OK and then you say P600 is also

relevant because that's like the rules for this, yes. How? How does it work then? It is? This type?

Normally they don't have the. Yes, we have. Or from the buyer side. Yeah. This is the seller of the
buyer of the bank, yes. Issue in LC and yes, so it opens the laptop, yes. If the seller makes the

goods delivered and they have like a proof of delivery and all the documents the buyer needed and

then. They're also banking. It can't have any. Maybe a directly after the bank one? Or if there is an

operation between the background and venture, is it better can give this proof of delivery and

documents and property to the bank too, and then the bank you will pay the directly to the father

and then? Connect you. Actually I sentence macula have already gives it and finally they go back

to the Fire Chief and ask for the money. Yes, yes, exactly. So basically what happens or how it

works is that yes, there is like. Some kind of contract right here. It's a sales contract between the

seller and the buyer. And then in this service contact they agree that the payment would be

through this letter of credit. How it works? Why is it good actually why is it an insurance for the

for the seller? So what what? Why? Why is it good for the seller if it's if the payment is through

this letter, pay them not. Not like a diet transfer from the buyer. Attracting documents? Yes,

exactly. So. Because there are some documents. So these are the documents that has to be

presented to the bank. To the bank and then basically the buyer, the seller we receive payment. So

if we are not anymore depend on your buyers ability to pay or the buyers willingness to pay for

the wood, it is something that will be from this point of you know ultimately procedure, so

basically the seller. The supplies commissary documents that are listed in this letter edit them. The

seller will be paid so the seller will receive this payment irrespective again of the ability and the

willingness of the buyer to pay this price because it might happen that the buyer. They must have

the necessary regulation at the time when the contract is concluded, but it doesn't matter because,

as you said, this is the bank that which opened the letter of credit. This is the bank that promised

that, OK, if these materials, these documents are presented, then I will make this payment. So, and

of course that's their own legal relationship probably deal with this but basically this is a good way

for the starter to be sure that if the seller's compliance with the contract and complies with the

terms of director create test Word document has to be. Presented then the seller, we received the

prize. So how it works is then that they agree that OK, it will be like letter. Then the buyer we

have to approach its own bank and as its own bank are actually. Agree with this man, that is the

bank will issue letter of OK so this is the issuing bank or the opening bank this figure and then

basically this letter of credit will provide for the list of documents like for example what can be a
document in this invoices. Something voices and. Which have to be prevented and that's very

important that basically and then you know it, this is a different. Regular relationship then this one

so which basically means that these two regular relationships like the original one it says contact

and the legal relationship between the buyer and the issue is that two separate legal relationship

which means that the bank has an independent obligation to pay. Under this one and the other one,

what does that mean? For example that? Let's say that the buyer has some kind of rights under the

contract that if the seller does not comply with the contract because what the seller deliver is not

what the buyer ordered, then the buyer would, let's say what we saw here, reduce the price. Is it

possible actually to to enforce these kind of families in the context of this payment? No, no,

because it's independent from this point of view. So basically it means that yes, well, if the seller

presents this document we discussed, then basically the payment will be made. So these banks

opens the letter and it notifies the. Buyer and also. If it's through these, but it can be several other

banks as well involved seller, then the seller knows that OK the letter of credit was properly open

and then we have dispatched the boots and also these documents will be done, presented to the

bank and then this whole payment process. Clear start and we'll be actually conducted

independently of this other transaction. So then maybe by the time the goods arrive to the buyer,

somehow, someway, the seller will be also the possession of the price, so the seller will. Received

the prize, the purchase price, so it's a good or can be a good mechanism for this payment?

Obligation under the CI, so even if in this case it's not the buyer. Who pays directly? But it's the

bank. Of course this is also something that wouldn't mean that it's the bias of the relation. OK, so

how the payment is made is then it's not necessary by the buyer directly, but the buyer has to make

actually the steps necessary steps in order. The purchase price to be paid and what you mentioned

earlier this UCP 600, where will it be relevant? They will see three 600 in this. Pull up contacts.

Here. So the bank will open the letter of credit under most probably because this is usually what

they do under this UCP 600. Did you talk about this in the other? Plus course. But on the other

hand, it's very important because of course it depends on the applicable rules, but for the seller,

let's say it's very important that it should provide the very same documents that are enlisted,

because if there is. Any any difference then it might happen then the bank will say that I will not

pay under this letter, OK, because this thick compliance is required. So if it's not the case, you
didn't present what you should have presented them. Basically there would be no. And of course

that also means that different rules might be applicable here into this because there are these

several other bigger relationships, this one to this one, to this one and to this one. But what matters

for us now is this one and basically to some extent this one that the buyer. Um. The bank to open

this letter of credit in order to comply with its obligation to pay the purchase. Price. OK. And?

Because, as you can see that the buyers obligation to pay the price includes taking such steps and

complying with such formalities as may be required under the contract or any laws and

regulations, the usual payment to be made. So this is what I. Mentioned or or referred to here. And

of course if the parties agree on anything for turn clause that can also have an effect on the buyers

obligation in this regard. And that also means of course that then we will not apply the CIA

provisions but but the part is available because of course these provisions. But also provisions

from which the parties if they want, they can derogate. The CIA also regulates the place of

payment. You can see in the time when the payment should be made what might be interesting or

important to more specially because if you. Look at the when you look at this Article 57 and 58,

you will see that there is nothing extraordinary from this point of view there, but that this

obligation of the buyer to pay the purchase price is an obligation that the buyer has to comply with

even without any request. From the side of the seller. So basically the buyers will dictation to

purchase price is not dependent on whether the seller requests the purchase or the payment of the

purchase price or not. So without even. Receiving any note or notice or court from the seller, the

buyer has to make the payment, which basically means if the buyer doesn't do so, then basically

it's a breach of contract on the side of the buyer. As to the other obligation of the buyer, because I

see that time is. Running very fast, so or maybe it's not how you. But it's running very fast, so. Uh,

the other obligation is taking very, very. And you mentioned yesterday that the day before

yesterday in the tutorial, you had a case study whether the buyer can refuse taking delivery. Yes,

you know. The contract. Have. Specify which shape which. Actually there are two shoes have the

same name, but the goods and the harbor is departs is different. So maybe there is a conflict about

which she should want. OK. Yes. OK. OK, good. Now I'm just. Thinking, but yes. So if it's about

shapes and maybe then the design would also be relevant. That you got. Yes, because why has that

both this or if her back to this is because actually it's an obligation of the bias of table that
anybody. Especially if we think about this international contact that, for example, the goods are

shipped from China to Hungary and then the Hungarian still say that I don't like these products, I

won't have you not take delivery. So it doesn't mean they sorry, taking delivery. Mean that's the

confirmation or the acceptance or verification that it's the proper performance under the contract.

So it still happened or might happen that the contract is not properly performed by the seller, but

the buyer has the obligation to take delivery because if the buyer doesn't take delivery then. What

will happen? What could happen with the goods in that situation? That's another issue. If the

goods do not conform to the contract, then the buyer has the different prices. With you see that

what the buyer can resort to an import, but that's an obligation of the buyer. To take anybody, even

factually, these are. Not. Not the boots that you ordered, yes. Yesterday about. Peacock the. No,

it's OK. But so then yesterday you had a case something like this, OK and then what was then the

the finding was station? Contract about the senator needs to propel the goods. That's it's just stored

in the cells. In the yeah, in the sellers anyway, in the sellers case. Is that a period of time? It's

maybe about one or two week. During this time the buyer needs to pick up the goods. So they

have like two situations. One is that during this time the goose was fired and it. So, so who needs

you reliable for this situation? And the next situation is that. The the it's. Just temporary endings.

After this time. Tired from true people? Comfortably so. Yes. And then I I think in this context

you also talked about in the past single phase. Now then there is crisis to the from the seller to the

buyer because of this buyer and then we should be the consequences and what was the the

conclusion so situation there. Similar to that. And why is the syllable in the first situation? The

contract did not involve the transportation then before the transportation. But. The memory really

happens. For the risk is still bothered by the setup, so the setting is to be responsible for the loss of

the group. And the second and second chances. Well, it's it has been. I think it's already in. Or I

didn't remember clearly, but it has passed a period of time that the buyer needs to take delivery

while the buyer did not take delivery. According to the USCIS G, the risk has been passed to the

buyer, so the other this second chances the buyer need to take responsible for not. One is the fire

was caused by the seller. Or to some extent, it's negligence oversight. Oh, I'd be attributed to this

server. Yes. OK, so. Then the buyer has this obligation to take delivery. I just. Well, I just wanted

to say that I just come back to this because it would be interesting to discuss this further, but I
looked at the time. So we have approximately about 9 minutes of this first session and then

basically now we will talk about these remedies very briefly. And then we can come back to this

case studies as well and the other case studies as well. So we saw them these obligations for the

seller and these obligations for the buyer and then basically what happens if there is a free in that

context, we have already talked about the fundamental. Let's not forget this is in Article 25 of the

CIG. And why is it relevant? Because when we look at the possible remedies for the breach of

contract then basically we will see or we can see that certain remedies. Subject to reconditioner on

this fundamental read, of course the parties can derogate from these provisions, and they can say,

for example, that the buyer can't request substitute goods even if it's not a fundamental belief, but

basically under the CIG as the default. It was. Sometimes it is. On conditional on on this

fundamental rate. So what was the concept of this fundamental breach? There has to be a breach

of contract, which we assess under the contract or under the provisions that we discussed, for

example, 35, as to the conformity of the goods like this, ordinary purpose, particular purpose,

sample model or, for example, Article 42 that we. Discussed yesterday and this morning. So that's

a village. So when this bridge will be fundamental? Any pause? The detriment to the other party,

which is? Yes. The substantial activation, yes. So it causes the detriment to the other party which

is substantial that it. Substantial that it actually deprives the other party is what it is expected under

the contract. So substantially deprived the other party of what it is is that that takes back under the

contract. So again, it depends on the circumstances of the case that how can we establish that what

is a substance? The deprivation. But that's one. Condition and what was the other one which we

saw here which is also a kind of for Cambian kind of defense for them? Saturday or the buyer

because actually and you can. Committee fundamental REACH So what? What? What would be

this? Defense. Or the other? This foreseeability or unforeseeable, so unless the parting reach or

reasonable person of the same kind, the same circumstances would not have foreseen such a

result. Like this substantial activation then basically. This is then the rule for for this fundamental

reason. So if this possibility does not stand, then it's not a fundamental breach. So what are the

possible remedies for the breach of contract by the seller? So what is what the buyer can claim?

Then the celebrations, the contact. The buyer can claim damages, that's that's usually there and

then. Together with the damages, can claim or require performance of the contract. Can require
the delivery of substitute goods. Can require the sellers to remedy the lack of conformity by

repairs, so can request the seller to repair. That would can fix an additional period of time for their

performance, can avoid the contract and also can reduce the price. As to the substitute goods, so

the requesting the delivery of substitute goods and avoidance, basically we saw that there is this

requirement. Of fundamental read. So generally the default rule under the CIA is that the seller

breaches the contract, then the buyer can request a delivery of substitute or can avoid a contract

only if it's a fundamental bid, if the seller, let's say, doesn't deliver the boots. And then the buyer,

but it's not a fundamental breach or wouldn't be a fundamental really for some reason because let's

say then the deadline, although that case will be suggest that if there is a fix that line by in the

contract agreed by the parties they're not meeting this airline would be always a fundamental right.

It's not necessary to correct. It really depends on the circumstances of the case whether that fix that

line is because of some very particular reason yesterday we talked about or you mentioned this

Christmas sale and and the purchase for Christmas sale them actually it might be might be

important the time of delivery. But if it's like for an ordinary reset and then the parties agreed that

the time of delivery would be, I don't know what's this 14th of April today. So that will be the time

of delivery, but the seller will deliver sometime next week, but it's it's not something that is a

seasonal, very special. Good for this weekend let's say then basically even if the seller does not

meet this fixed delivery time, it's will not be or it would be actually a reasonable to say that it's a

fundamental, but basically. That means that we have to assess the based on the circumstances, the

kid. So if the seller breaches the contract and the buyer fixes an additional period of time for

performance, if it's not a fundamental reason, but the seller does not deliver, does not comply with

its obligations within this additional period of time. Then basically the buyer can avoid the

contract again, so without. This further step, the buyer can avoid the contract only if it's a

fundamental which or of course if the parties want they can put that into the contract that when the

buyer can avoid the contract and then basically they can say that even if what I mentioned that in

this situation these four things. April would not be that very significant deadline or time fixed

time. For there, even if the parties agreed on that, if it's not because of special reasons, then

basically the parties can still say in the contract that they, the seller doesn't meet this fixed time.

Then the buyer can can avoid the contract so the parties can. Agree otherwise, but if they do not
agree otherwise, then these are actually rules, and let's not forget that. You expect people of what

remedies the buyer would resort to. Like what we saw here, the buyer can still claim their

damages. And. Yes. And I see that it's, uh, 245. OK, I wanted to say what we said earlier. So it's

it's break, it's getting there and then we have to go. But I'm woman. And. OK. So it's it's break

now and then we will continue at at 151115. Sherry, open the window. Or you just close it. OK.

No. You called. Yeah. Yes. You. You. Well. So. You. What? They should. You know someone?

Which? How you want? 2000. I'm. You. I don't. Oh. You don't have to have. Reflection paper.

Make sure the. Yeah. Yeah. Yeah. Here. Welcome. Oh. But if you could. Which? Also. That.

Who's? No. They couldn't do. Good. James. But it's just. Show commands Question one. Oh.

Received the schedule from you later. For the. Not really, but when do you have to submit it? And

there is also an order for think this is the last time. Yes. I see you. Party. And then? But. Complete

athlete active. Yes. No you don't. You don't have to, actually. He said this just about. Will you?

And we can actually talk. And so that's why you commenting your cases. Thank you. Are you

planning? Search or. So I think that's that's what because. Trust you. So last year. Yes, it's fine.

Yes, OK. So you say June on the 5th of June, so we can if you want. I'm. Finding time. Yes, no

problem. But let me talk. 39 on Friday because because I think today that's fine, but should be.

Some of the issues if you want. No, I'm not. Don't think you're. Yes, after. I want you to go first.

Yes, sure, no problem. So I just send you the. Maybe. I can't have the outline. This 19 consultation

if you want so that you can talk about different course. I see that. So this reflection paper would be

something, right? And then I'm sure you get table to do that. Yes, let's see. Forwarding. Yeah.

Yes, OK. It's. Whole. Also Chinese and Egypt. It's before this. Should. That is related to. That.

Yes. So I would say maybe 6 hours. And yes, that's yes. Yeah. What do you want? Why is it

called the whole? No. Do you? You you stay. So that's that's fine. Talking about the whole

regulation. Yes, if it doesn't case. Yes. So like case study or something like that, based on that you

can also talk about some of the issues. Think about it. Next. If you have. Maybe it's. I think it's

something like. To show that you're. Or something like this. And it went right through. And. The

Chinese word for class, whether you want to me is you need to go or to begin. So I'm not sure.

This phrase yes, yes. White oh, I see, I see. What did I see? The real you want to express is the

thing you want to express, its view. Or you want to go? Yes, I want to go. No problem. No
problem, it's OK. I know that I'm really sorry, so you need to say. Rather than well, so countries

should begin. See. So that's the beginning the class. I see. So that's a different point. But you're

already. Yes, but it's not. It was years ago. It was just for very short. And you see how

successfully. Yeah. So then basically what I said then or what you said that I should say then, then

basically it was that we started. That. And we shouldn't be how many how are you

Please. Oh, so it's not like. Because that's where is Washington and how or something like that.

Exactly. That means that that has. It's not that type, yeah. Yeah, I'm good. Obviously you were

feeling really happy or feeling good. Yeah. What's on channel 10 or something like that? OK.

That's the. Assume so. Let's let them. I think. Back maybe, yes. So let's then continue, yes. OK, so

let's then going to you. This is where the start. Before we started the class actually as it turned out.

So this is where we start that we saw that the buyer can claim damages and also can resolve them

of these. Remedies depending on, of course, the kind of free. And very briefly, we have already

talked about this specific performance issue, so now I. And you talk about it a bit again because

this is a very special rule in the CIG. And as we saw that this rule allows the application of

national law in this context, because it says this is Article 28 of the CG that what is the specific

performance. That would be a specific performance that if the seller does not very good the good,

then the buyer would want this to deliver the wood so it would require the seller to deliver. So that

is what the buyer would ask for. So then the seller will be actually obliged by a court, or can be

obliged by the court for this specific performance. This is what this Article 28 provides for,

because as you remember, there are differences in different national laws as to whether it's

possible to order specific performance. And the compromise here, what we can see is that

basically if under its own national law, the court would order specific performance in a similar

situation, if the situation in the contract was not governed by the CFG but by national law, then.

Basically, the court. Deal or Cam order or obliged to order into this order? Judgment or enter

judgment for specific performance. So basically if it is not possible under the national law then.

The court is not obliged to apply that provision of the CIA Jewish provides for specific

performance. So this is a door let's say to this national law and in that regard or in this regard in

the slides you can see two cases, one is from Florida course. Comments from the US and the other
one is from an arbitral tribunal and in most cases the question came out that the the there was a

request for specific performance and then the question was that whether it is possible to. Again,

these specific performance or not, in the first case, as you can see that was a car vintage car. So

the US buyer wanted to buy a mintage car from the Canadian seller and then basically the problem

was that the Canadian seller did not deliver this. And it was a very special car. So the US buyer

wanted this car, not just the car from Canada, but this particular car because it was a very special

car. So requested this specific performance. And then basically even if it's like not commodity or

anything like that as we saw, but it's. 21 car the very special vintage pharmacy edge of course can

be still applicable because it's a good under the CIG US, Canada, CIC member states. So basically

the CIA is applicable or was applicable to this situation, but what happened or what the court did

is as you can see. That basically the CSG provides for this Article 28 as to specific performance.

So the court looked at its own national law, the Florida Law, State law to determine that whether

the requirements for requesting specific performance are met or not. So whether under the national

law actually then the court, the further court can. Enter a judgment for specific performance and

then as you can see. That it's a very especially exceptional remedy under that low because if it is

available only if it's a very unique product or in the circumstance communicate so and since in this

case it was a very unique product, a very unique. Very good discard card, sorry. So that's why.

Yeah, here it could be. Yeah, applied. And then this specific performance could have been

handled, but yet what it shows to us that the Court actually looked at it's on and relied on its own

law and then only in that regard as to the requirements as to the conditions for specific

performance and then basically. They started the case yesterday. The other case is a bit. More

complex from this point of view and it is actually an arbitration case or it was an arbitration case.

So here you can see the basic facts of the case that there was a company, Russian company, that

entered into a contract with the German company for a sale of metal products, the goods. To be

delivered in installments within. Seven months. The buyer sent the seller number of orders for the

goods in accordance with the contract. But the seller delivered only fraction or only small part of

the boots. So the buyer initiated arbitration and claim specific performance. So wanted no

damages or not only. But like the the product, the metal product because that was important for

the the buyer. So basically that's what the question that whether it is possible to. Grant specific
performance in this case and it was an arbitration case as you can see. So the Arbitrary Tribunal

had to assess that whether the requirement for specific performance are met in this case or not.

And why is it? Different from this point of view than the Florida case was because here if you

read or then you read it later, now you don't have to read it enough if you just listen to me now. So

when you read it, you will see that basically here the co-author says that OK, what is the

applicable below the CIA, the CIA doesn't talk about. The requirements for specific performance,

the otherwise applicable law would have been the Russian law. It didn't talk about the specific

requirements for specific performance either. And then the court looked at another source and it's

an arbitrary tribunal, so the arbitral tribunal had this. This freedom, this flexibility to look at other

sources as well. As we discussed in the previous case, the the State Court in Florida, it was bound

by its own national law, but here it's in arbitration. It's a bit more flexible as we saw. So what

could have been, but you can also read it. Yeah, but what would have been this other source? This.

Little debt. The unit draft principles that we have already mentioned some. Time to go that

basically and several times that basically the Indra principles was looked at by this tribunal,

because even the principles was considered as an expression of rules that are widely accepted by

the followed by the representing the way. Call international contracts are concluded how

international dealings are carried out. So basically it's a good point of reference to decide issues of

decide questions like this even if there is no designation of the principles that yes the under

principles would be or should be the applicable law. Loss of law or whatever in this particular

proceeding and then they interact. Principles actually provide 4 rules on a specific performance. If

I can. So you can see the rule here that performance of. Monetary obligations. So basically

specific performance in this sense that the party who owns an obligation other than want to pay

money does not perform. The other party may require performance, unless here we see that vanity

is not possible, so basically referred to this. The unit grant principles and then basically based on

the principles concluded that it is not possible to grant clear specific performance because of the

time limit because if we. Look at the last part or the last sentence, last point here. But the point is

that the performance doesn't require performance within a reasonable time after it has a role to

have become aware of the non performance. I want to go back to the slides I just. Can. Yes. So

that's why actually the court looked at the arbitration, looked at these two interactions processes
supplement in this regard but and that like the principles but the conclusion was that based on the

application in their principles it is not possible. To grant specific performance. But The thing is

that here we see actually the difference between national courts, how national courts can look at it,

because for a second I come back to this 28. So the court is not bound to enter judgment for

specific performance on the court would do so under its own law. So it it it's it's. For state courts,

it's obvious that it's the state court and its own law is the national law of the country where the

state court is located. So basically it's like the legs 40 what is looked at work can be looked at in

this regard, but for arbitration or in arbitration it's a bit different because for an arbitrary tribunal

what is like the own? Go under its own law. What is its own law in arbitration? But what is it? It's

basically the left arbitrary. So it's not like for state court what you can see. So it's it's it's more. It

provides for more flexibility, for more freedom, for the Tribunal to determine that what is then

below. But it will apply because the next arbitrary is like the arbitration law of the seat of

arbitration. So whether arbitration is located, the seat of arbitration is located, that is. This list, but

then based on that, that's the arbitration law from this point of it's not the contract law in that

regard. And so basically for the arbitral tribunal to find the contractor, that's already an exercise,

whereas for a state code that's the contract law in that country that the form is located. So that's

fine arbitrary treatment. So enjoys this wider discretionary power or this wider possibility to

determine here in this regard the applicable law so. National courts might not. Goal and apply the

principles in this regard because they would stick to this national laws, but but arbitrage even as

they can do that and they are more actually willing to do that by that timing to apply the UNIVAC

principle so to resort to the unit. Yeah, principles. OK, So what are the possible remedies if the

seller? But from the contract, let's say about the buyer breaches the contract. So what are the

possible remedies for the future of contract by the buyer? Basically in this case it's very the

structure is very similar to the other side that the buyer can request damages. And damages or

together with damages can require the fire to pay the price to take delivery for from his other

obligations. So basically can require performance of their obligations and can also fix an

additional period of time for performance. And then can. Avoid the phone back and avoid the

contract if it's a fundamental breach and if it's not a fundamental which then if it is fixed

additional. The buyer doesn't comply with its obligations then basically the the seller can avoid the
the contract. So from this point of view it's. A similar to the one that we saw in the context of the.

Remedies for the breach of contract by the by the seller, so the. Structure then for both is that they

can claim damages and there are different remedies available for the salary. So what remedies? I

mean if the buyer breaches, if the seller breaches the contract authorities, the buyer might have

and then here we see that if the buyer breaches the contract that the seller wants. And these and

has. But what is common or one thing what is common is this damages so they can claim damages

and their core provision of the main provision in this regard regarding damages in the CIA is this

74. Marcus 74. If it is it Africa 74, we see that it's based on the concept of full compensation. So it

basically means that what can be claimed as damages they actually lost and also so the actual

damages, the actual loss and also loss of. Profit can be claimed as damages. So basically these are

the two legs of heads of damages that can be claimed. And of course it's it's very general like

actual loss and loss of profit there might be. Um, let's say items which might raise the question

whether this can be claimed damages or not. Maybe you remember one is earlier we talked about

the sleep dictation cost for example, or dictation cost that whether the cost of enforcing the rights

under the CIG can be considered. Damages and can be claimed as damages under the CIG or not

the CIA you some guidance know if you still remember the CIA some. No. Then it will be on the

exam. No, sorry, just no. But there is also mentioning of this problem in the CIS zone that whether

attorney fees can be claimed as damages or not. So it's not like it seems to be something that is. To

remote from this concept like what is the damage that stems from or comes from a sales contract.

But if you think about that, what is the damage, it's a kind of loss naturally loss. So basically that's

actually also a loss and it's an extra course that we encounter if we have to go to court and if we

have to enforce. All rights under the siege because the other party does not comply with its

obligations. So basically that reason why we have to do that is because the other party breached

the contract. So that's a consequence of the breach of contract by the other party that we have to go

to court and have to pay these fees. So if you think about it. That might be reasonable or

remanded, yes. It could also be somehow or should also be somehow pain. But on the other hand,

that's also so that these costs can be also considered as cause that income occur in the course of the

proceeding and can be enforced under the procedure. Rules, for example Civil Procedure rules,

usually provide for that possibility that the winning party can be the cost of the winning party can
be recovered. From the the losing party. But that's like the procedure perspective. This is like the

substantive law that what they want, whether under substantive law, it can be possible or not. So if

you see it later, that is possible or not. So it's the full compensation principle that applies here.

Actual damages and the loss of property. Is there any maximum to this that what can be claimed

as the images? Basically, if you look at the stagnant substance Subs. So second sentence or the

part of this of this article, then you can say this limit, this maximum limit, and this is the limit of

foreseeability. So what is forcible or what could have been foreseeable as possible damages that

might occur? If there is a breach later, when I say that, if there is a bridge later because the

moment time, what matters in this regard is the time of conclusion of the contract. So whether the

party who is liable to pay damages could have foreseen, road would have foreseen? That actually

this amount of damages because anything that goes above this foreseeability level then basically to

will not be possible. To claim as damages, it's a bit similar to the standard like foreseeability,

enforceability that we saw in the context of fundamental breach. In 25 in Article 25, right then

there again that was a kind of. Let's say the defense that right, it's not a fundamental base because

it was not unforeseeable. The consequences? And here is the saying that they the claim amount is.

In a month that could not have been for silver at the time of the conclusion of the contest as

possible consequence of the bridge, then basically it's not possible to claim that part it. Of course it

doesn't mean that. The lower amount of damages could not be claimed. It's just like that amount or

that part which exceeds this for civility and cannot be claimed, for example. Actually this is the

provision of the CSG, this Article 74, which served as a model or sample. For some national

legislators as well, when they drafted their own national Civil Code or or contract law, that also

influenced actually the Hungarian Civil Code as well, or this respective provision of the

Hungarian stereo code as well. So that's why it's it can be a challenge. If you think about it or if

you think back to this Article 7, subsection one, this interpretation like international character

uniformity, what we're told and observance of good faith. But here what matters is this

international character uniformity and its application is that if there are like this similar provisions

in the national. For domestic transactions, then for a court which for a judge which decides both

domestic and international case, it might be difficult to distinguish the two situations when the

principal or when the rule is the same, but if it's the CIS it would require a different interpretation
and application. Then the national. Low so this. I think 74 is again like the basic provision for this

damages and it is based on this principle or this general principle of full compensation, it covers

the actual damages and the loss of. Profit as well. Actually. The party who claims the damages

must provide proof, evidence as to the amount of damages, what it claims and. The thing is that as

to the litigation costs that we mentioned or that we talked about earlier, basically that's the the

general view on this regard that litigation costs cannot be enforced as damages under this. Clear

Article 74. And. That's also usually what we can see in national law that. The damages came

cannot bring the party in a better position that it would have been without the bridge. So basically

this is a principle that applies here as well. So the damages for the payment of damages cannot

bring the power to the parties, to the party because the damages. In the better position than this

party would be if there would not have been any breach of the contract. So it's not possible to gain

any profit on damages. I mean any profit compared to the properly performed contract, what the

party would gain as profit. Yeah, if the contract was properly performed in some countries, there

is this for national laws, legal systems, there is this concept of punitive damages. Have you

already heard about these punitive damages? If not, it's not problem of course. It's like for example

we talked about patterns low earlier and in patent in case of patent. Infringement. There is also the

possibility to claim damages, but in some cases it is possible to pay double or triple damages like

the actual damages, because for example, it was a beautiful infringement of the pattern right? Or

actually the party who you think the pattern right knew that it's. Actually impeachment, but

continued when it's actually so when it has some kind of punitive nature as well. So it's not only

about recovering the loss, but it's also somehow punishing the the party who did something wrong,

let's say. So here under the CDC it is not. Possible to claim and to avoid actually punitive

damages. Many times, maybe if you have already sorry, study private international and

recognition enforcement of judgments. Have you? Like how a foreign judgment can be recognized

and enforced. So for example when there is a judgment which was rendered by let's say a German

court and then the debtor has assets, so the party who lost the case has assets in Hungary. So then

this German. Judgment would be enforcing Hungary because the the assets, the monies in

Hungary or like this German judgment that would be enforced or that would be guided to get

enforced in China because the money or the stuff is in China, so in a foreign country and usually it
is based on. Of course, the law of the country by the enforcement is so, but there are international

treaties, some international treaties dealing with this issue, bilateral treaties, multilateral treaty and

also in the EU. Maybe you have already heard about this so-called Brussels one regulation. This is

this is not directly on this topic, so that's why I don't get into this too much just to give the idea,

but. So you don't it's not something that would come up at the exam like this process from or

anything, but as to this punitive damages because usually what happens is that if we have a foreign

judgment actually under any of these regimes like versus one in the international combinations as

well, there are some requirements. For the recognition forcement of foreign judgments, like, for

example, there cannot be any any cause that would lead to the rejection of this. Maybe if the party

against whom the judgment was and wasn't given the proper opportunity to present its case, it

wasn't. Given a proper notice of the proceeding and maybe that's a ground to reject the actual

enforcement of the foreign judgment. And there is another ground based on which the foreign

judgment, the enforcement of the foreign judgment can be injected and there's public policy. So

this is where I wanted to get to this public policy. Consideration, punitive damages actually can be

also public policy considerations. So if we have a foreign judgment which renders punitive

damages, but in the country that the enforcement of punitive damages is not available, then the

recognition enforcement of this foreign. These men can be challenged based on this public policy

consideration, right public policy, because, like the very fundamental principle of damages, and is

different than because generally, where punitive damages is not allowed, it is not possible to use

any of these or this. Instrumented instruments as to punish the party, but it's it's more like about

the covering the the loss, so it's not that kind of sanction so basically. Under the community, that

means that not possible should not be possible. Even if that was the case, most probably it would

not be actually enforceable because it would contradict public policy. Of course only in the

country that it is not possible and there is a CI Advisory Council opinion, not because 74 of the

CIA on the calculation of damages, and this is. The idea that the Council opinion #6 if you want to

look at this. So basically then FBI reading the CSG, then we see that any damages claim has to be

based on the CIG. I mean of course if we have it within the CSG, so it's not national. What would

be in this regard? So whatever the national says in this regard as the calculation of damages as to

the different heads of damages, that's not relevant here because here in this context, the CIA does
not allow the application of national law. So basically it means that when the party claims. The

damages that the creditor claims the damages, then actually it must be proven by the party who

claims their damages and, as we saw, the limit. Under 74 discomfort civility. So it is also

important that it should be forcible. The particular amount should be forcible and. Usually what

we see in national news as well that there is a duty to mitigate the loss, so we cannot just, for

example, there is a delivery of goods and we don't want to take this delivery because let's say this

is not what. We ordered, but we have to take it. So we leave it here and then there comes the item,

don't know maybe the flood or the fire and we do not do anything in order to actually prevent that

it would happen or you would know that wouldn't do anything actually to to reduce the possibility

to mitigate. The possible loss damages. So there is a duty to mitigate loss, to mitigate damages

under the CI as well. So basically to the extent that the party who is liable for the damages

complied with this mitigation, that can have an effect on the amount of damages. That can be

claimed. So that can actually be again something that can result in the lowering of the. The

amount of damages that can be claimed. Of course it's like actual damages and and lots of profit,

but. As you can see. Um, that? If. There is a substitute transaction because either the goods were

not delivered by the seller to the buyer, or they will deliver, but they are not the goods what the

buyer wanted to receive. And basically that's the Monster Fundamental Bridge. Committee of the

Roots and then the buyer avoids the the contract. So then basically when there is the possibility for

this point of view to make substitute transaction or the need to conduct the substitute transaction,

then how we calculate damages based on this transaction and then? What can be claimed as

damages is the difference. Between the price under the original contract and the price in the

substitute transaction. So basically that difference can be then claimed as as damages. What I

underlined here is this reasonable? So here it means that. In this context, that this substitute

transaction must be a reasonable substitute transaction. So if the price, because what happens is

that, OK, the seller did not deliver the goods. OK, so the buyer then purchased the goods from

another supplier, but the price is let's say five times higher in the substitute. Transaction. Then

what would be the price under the the original contract? Because the buyer and the second

supplier agrees that, OK, I charge this price for the goods because then the first supplier, the first

seller will pay for it and then maybe it's. Good for us for many reasons. Maybe because there is
actually also some kind of flipping between this second supplier and the buyer under the first

contact, so they want to somehow benefit from this. Or maybe it's just because the circumstances

changed so much so. It's important that the substitute transaction should be reasonable substitute

transaction or at least it can also be unreasonable. But what is unreasonable cannot be claimed as

damages. So basically it means that OK, maybe the substitute transaction can be accepted. What I

mentioned like despite. Times higher price, but the price is different because create the damages

from this point of view that the price of the substitute transaction cannot be considered like that

would be the guiding pricing disregard is five times higher, but what would be a reasonable price

for this substitute transaction and probably that. Would be, if we think about the principle under

55 or 55, this price setting the price, the reasonable market price, then for the substitute transaction

it would be then the relevant price. So it cannot be like any price that's. That's the idea here. And

this is Sandy Seven Article 77 which is about, as you can see the mitigation of laws this

obligation. So I mentioned that the party relies on a breach of contract must take such measures as

reasonable as a reasonable circumstances to mitigate. That loss including loss of profit resulting

from the bridge. So basically it means that we cannot decide, decide, we cannot just sit back and

wait for the damages for the monitor because we know that OK, the other party read the contract

so. Did you get demoted to an important to comply with this obligation to to mitigate the loss?

And again it is question because here you again see this reasonability that what is reasonable in

the circumstances, So what measures? Can be reasonable in the circumstances. Those measures

should be of them will be considered as measures that the party will license. The bridge should

have done in the circumstances. Of course, if the party doesn't comply with this requirement, then

the party cannot claim. And. That part of the damages which occurred due to the fact that the party

did not comply with this mitigation of loss obligation, it doesn't mean that it wouldn't be able to

claim. Damages in general, but this part not so basically that can you see lower this amount of

damages that can be claimed. I don't know if it's too small or not. Probably it's. Rather than not.

Can you read? No. Can you read? But I think it's also possible to somehow. Yes. Zoom in out.

You can play with this no, but The thing is that why I put it here. Maybe. If yes, invest. Can you

see actually what I did so it was just the same what you already so it's all it's now in large the

CAS. OK. Thank you. Sorry I didn't want to look at yes OK so. Do you remember in what context
we have already talked about this 78? What's the, let's say, problem with this 78? I mean, it's not a

problem, but. It was an example for something. Yes, yes, of course, you're right. So when we

talked about the gaps, legal gaps in the CIG that the CIA regulates something but does not provide

for express provision on certain aspects and this is exactly what. We can see here in Article 78

because here we see that it provides for interest so the party who can claim for example the

payment of price or can. Any sound increase, as you can see, can. Receiver is entitled to interest

on it and stuff, but it doesn't actually regulate how they interest should be. The applicable interest

rate should be determined. And then? Basically, what can we do then? Or what should we do

then? I just have these two other the sister and the interaction supposed to show that for example,

these other documents the sister. Indent it to there with the intent. Need to deal with this interest

rate or or specific provisions and interest? Do you drive principles? Also this with this question

that how the interest rate can be or should be determined by the CIG as we can see in Article 17.

Doesn't talk about this. So how can we then solve this problem? Because what was the problem?

Because. Maybe the interest rate, active interest rate is different in the country of the seller and in

the country of the buyer. Maybe in one country it's, I don't know, 18% the general interest rate for

late payments. In the other country it's. 7% so then which one should be applied what? What

would you say? Which one should be applied and what should be here? The the principle? The

guiding principle? That. What are you thinking about? Then what? What should you do at the

weekend? No, sorry. Yeah. Well. What can be a possible because since it is not regulated in the

CIG, what can be a possible source for the determination of the interest rate? National law?

National. Sorry. Is general principles some transnational principles? Let's say OK, yes, national

law, transnational principles and general principles of the CISU. Let's see if it's national law.

Could we accept that it should be the national law what is applied here? Here. When could we

apply the national law in this case? If it's like the last resort under Article 7, subsection 2 late again

feeling rule because yes, as you mentioned very well that in in this gap filling the first is basically

the first step is the general principles based on which the CIA that provision is based. And then

national law. So that would be like the final or the last resort in this sense. And so if you look at

the general principles, then what general principles can be or? Could be a simple general

principles that might be somewhere somehow in the CIG. And or general principles that are
considered to be like expressions or the qualifications of general principles of international context

like the supposed. So what happened actually in practice is that in some cases the court resorted

more like arbitrary. Resorted to that application of the principles in this regard, but there are also

actual decisions which did not apply the indifference, but did not even think about the principles

as possible source to solve this problem, but like within the CIA or. Wanted to stay in the CIA and

then thought about that what is or what might be the general principle under the CIA he has to call

to determine that? What is the relevant? Place of performance, because if it's the relevant pace of

performance for this payment you think he's remove country, then maybe it can be reasonable to

say that then the law of that country has to. Uh, they seemed a state can be or should be applied.

So if you think about it, what might be then? General principle for the pace of performance. What

do you think? But if I came to the southern this slide, because if you look at the 4th point and then

we will go back to the previous side, but then how it is then determined that basically is the place

of business? The of their creditors or the person who is claiming the money and then based on the

money the interest is is located and then what would be then the applicable interest rate in that

country, because that would be actually the place of performance. For this payment of regulation

and the country where actually this creditor or the place of business of the creditor is located. So

there is actually a CIA Advisory Council opinion and you can see #14 if you want to look it up

which talks about the application. Of this Article 78 of the CIG and it says that all aspects of

interest are governed by the CIG. So it basically means that it doesn't want to leave the door open

to the national investigation. So basically. The idea is that as long as we talk about interest and it

is the CIG what is the governing law and not the national law, so there is no, from this point of

view, no room for national law in this regard. And it also provides that what is like the starting

time or day for the calculation of this interest and any monetary obligation liquidated or

antiquated, can have this interest consequences and just like what we saw in the case of payment.

Of the purchase price. It doesn't require any formalities. To be entitled to interest, so it doesn't

require the request by the party and who claims interest to claim actually interest, because this is

something that is an obligation of the party who is bound to pay certain amount of money to the

other. Party to pay interest on it. And of course, the parties can agree on the applicable interest

rate. They can also agree that, for example, the Internet principles would be or should be taken
into account in order to determine the applicable interest rate. But if it's not the case, then.

Basically as you see and as we discussed, the applicable rate of interest is the rate which the Court

and the creditors place of business would have been in a similar contract of sale. If it wasn't the

CIG that would be. Not the governing rule, but the national compound interest is a very interesting

question because what we can see here, what you can see here, this is basically. What the CIA

Advisory Council opinion says that the compound interest can be payable, so it is possible to get

company interest as well under the CSG if the parties have agreed to it or if the court at the

creditors place of business. Low company testing similar contract of sale not governed by the

CIA. That actually quote decision we said that the same, sorry that under the CIA, this is the CIA

doesn't talk about compound interest, it talks about interest. That interest is you and the so the

party is entitled to receive interest. So basically it doesn't talk about this company Still, the seizure

does not. Hello. For this possibility to request the compound interest. So basically that can raise

questions. So that can open the questions in this regard because this is what we see here is that this

is like a reference to the national model in that country and then what the national law in that

country would say, but that. Maybe arguments whether it is possible to open the CG here now in

this regard to the national because the CIA itself, if you look at the CIA, it doesn't provide for this

possibility. And we didn't talk about it at the time when we talked about the purchase price, the

payment of the purchase price, we talked only about the, the method, the payment method. But

like the currency that can also be actually an issue. It's not necessarily an issue when when the

parties expressed the. In the context or imply the in the contract on the purchase price, because

then most probably they would also determine the currency that should be applied. Of course

situations can happen in the course of the contractual relationship which would make it. Not the

most favorable form of currency anymore for at least one of the parties, but they agreed on in the

first place in the contract. And then basically the question can arise whether it can be changed,

whether it can be modified or not. That's one thing. But the other thing is that if they do not agree

on this. And we apply this market price as we saw earlier, then what is the currency or how the

currency of the price then can be or should be determined? And of course again this is a question

if the two countries have different currencies. Umm. The CIA doesn't deal with this question, but

again, usually what matters is the place of performance or where the performance of the toggle
gation is due. And then basically that is then the currency that would be or should be applied. But

of course the parties can freely agree on this. By failure agree on this, it means that from a

contractor point of view, that's another question. That's what public law might say in the in that

regard which is applicable or might be applicable to certain parties that in both currencies they can

enter into contract. So that's another issue, but under the CIA they are free to agree. On what kind

of say they would? David. He is. And then we talked about currency like it. It suggests that this is

like something. That that is. Currency the particular country in particular. Under a particular

nation of law. But when we talk about goods then briefly mention this this Bitcoin and similar

digital. Currency that whether that can also be considered as a currency in this regard regarding

the purchase price, payment of the purchase price and also for the calculation of damages and

actually the answer is that to the extent that it is recognized as as currency then. It is where it can

be recognized in this context as well, so as to the interest. What you can see is that it should be

expressed in the same currency as the the payment obligation is you. If it's like the purchase price,

then basically the same currency as the purchase price in the purchase price is. You. As to the

burden of proof in this regard, basically the creditor must prove like what we saw earlier, the

existence of the sun, you and applicable interest rate in the given case. Like in case of damages, as

we saw the party who claims damages the party to prove the amount of damages. That's the case

here as well that the creditor must prove this is some of. Design based on which interest is

claimed. OK. Do you have any questions? No. OK. So then how would we solve this situation?

And they are coming to this Article 79 that you will see italics is an exception of liability. So when

the party who does not comply with the contract can be exempted from liability. So let's say that

we have. I don't know. It shouldn't be always Hungarian. So what party? Do you plan to visit any

other countries here in why you are here next to them? That means Hungarian. I don't know. And

so why you are here in? Germany. France. OK, so let's say this is France. So basically there is a

French company that ordered and this one should be. Italy. OK, then I changed the product.

Thinking about. OK, so then let's say that this is a French company that orders. Then tomato from

Italy. And then basically it turns out that the. The Italian. Told me so. No, no. You can also bring

up some facts. It's it doesn't matter. The product or the French products? I see you are hungry. No,

sorry. So what I wanted to say is to be serious that this this French buyer orders a certain amount
of tomato from the Italian seller. This is actually Sir of vegetables and other kind of products is

green. And basically this Italian party, even if we would say or you would think that these

tomatoes are tearing in Italy, but basically they. Imported from Morocco. So The thing is that the

stallion company says this tomato imported from Morocco to this French company. And it turns

out that, let's say for some reason, because you had this fire exemption, there is a fire. In the

warehouse of this medical company and basically the shipment that was used to be shipped to the

Italian company actually was demolished. So basically it means that the Italian company does not

deliver the tomato to the French company and then let's say that was a delivery date. The pencil.

April so. For these ago and then this French company did not receive this shipment. Is the Italian

company, what do you think? Is the Italian company liable or can it be held liable for this brief

because? Is it the bridge? Of contract under the CIG. Yes, yes. It's because the seller had to deliver

the goods until the 10th of April. They didn't deliver the goods. So basically it's a breach of

contract. At this point, it doesn't really matter why the seller did not deliver the who's. The fact is

that it did not deliver the wood. So basically it's a bridge. OK. If it's a breach. Based on what we

discussed so far, what can this? French company claim. From from this seller. Reduce the price or

something like that. Yes. One thing is that this company can claim damages. Yeah, OK. What that

is? Sorry. Avoid, yeah. Yes, it could also avoid the contract. And. This price reduction is not

necessarily the case because the goods are not there, right? So we don't know the difference

between the good. I mean it would be the case for example, if they agreed on a certain quality of

tomato, but what was delivered is of the last like first class and what was delivered the second

class, so then the difference. Could be claimed as as. Any strike difference and this price reduction

avoidance? Let's say we don't want to avoid the contract. But it could also be possible that would

be expired for avoidance. That it should be done. Fundamental breach? Yes, and. But we can

claim just like performance of the contract. So we can say, I mean the the French buyer can say

the Italian instead of that. Deliver the tomato as we agreed. So you you have to deliberate. OK, So

what what happens is that this company says that OK, it did not arrive by the 10th of April this

shipment so purchased large amounts of tomato from another French company that say on the

therefore. So two days after the delivery was due and then basically. Does what you mentioned

earlier that it doesn't want this shipment anymore. So basically the voice, the contract says that
this is a fundamental breach. So we avoid the contract and we. Ask for damages and what are the

damages that this company can ask for? Yes, yes, you're right. OK. OK. So yeah, it's a bit quick.

So yes, generally what is the damages? Yes, actual damages and loss of profit with these smokes.

More for cigarette and also mitigation of loss CP consider but here is a substitute transaction. So

there is a price that the French buyer paid under the substitute transaction to this French Sarah,

because it doesn't have to be an international sailor, you know, of course. So let's say here the

price was. And this guys is +5 for some reason. So basically it means that what can be claimed as

damages from this point of view the difference. Between these guys and this price S2. Then they

lost industry, OK. But what? If this Italian company says when receives this notice. Because when

the French company avoids the contract, has to send a notice to the Italian company that we avoid

the contract because it did not comply with this requirement. This French sorry this Italian

company says that all the reason why we didn't comply because you didn't receive this tomato

from our supplier. So it's not our fault. Yeah, but it's it's their fault or it's someone else, but it's not

our fault. So you cannot just avoid the contract because it's not us who who breached the contract.

So it's it's. Really, we wanted to perform. We wanted to. Send you this tomato, but it wasn't

possible. So when we look at this Article 79 can we what what is what this Italian company should

be able to prove? In order to be extended for liability for this breach of contract. So if you look at

Article 79, it talks about situations or situations that then the positive and it doesn't comply with

the requirements of the contract can actually. Be exempted for liability for the breach of contract

and basic. Sorry, I just see it is that the those who are on zoom didn't I can take a picture? Yes, if

they are interested, yes. Although I don't know how much bigger and see from that but. Yes, sorry,

sorry about that. So this Article 79 of the CIG the provides for this. Structure that when and how

the party who actually breaches the contract can be exempted for liability and if we look at it, this

is actually a 2 levels Article 79 subsection. One is about situations when it relates to the party who

would be obliged. To perform the contract under the contract and Article 79, subsection 2 is about

the situation when the party cannot. Perform the contract due to a third parties. Failure. Let's say

failure. But it's not really a failure, so. What if we look at the Martica 79, subsection one? What

are then these conditions? Let's say your requirement. But what is what is Italian? Company

should be able to prove. Let's say. Or maybe this is Diane Company would just say that yes, we
have the shipment. Pick that for you, but. There was a robbery last night at our house and then

basically they stole everything. They took all the goods that we have already prepared for

shipment, so that's why we couldn't send you the tomato. So what is what then should be proven?

Or are you? He cannot expect this situation will happen. Yes. So it has to be an impediment. So it

is due to an impediment that is beyond that part is confront. Sydney payment beyond concern and

it could not have been reasonably expected to take that into account at the time of the conclusion

of the contract and the third condition or the third element is that another part of this is that to have

it couldn't have been. Expected the party to have avoided overcoming or its consequences. Of this

impediment. So basically, for the party to be exempted for librarything, for this beach have to be,

or should be able to prove for this that it's an impediment beyond its control, and then it would not

have been or could not have been reasonable to expect this party to take it into account. The

damage that conclusion of the contract, or to have avoided or overcome its consequences. If. Is

this third parties failure or this fact that the party cannot perform the contract is due to a third party

because and it has to be an independent third party actually independent of the the first party then

basically. The requirements are similar, but then this party should be able to or must be able to

actually establish this set of requirements, or the fulfillment of this set of requirements, at both at

the level of the third party and also at its own level. So because if it's. Then then the party should

be accepted under Article 79 one and also the third party. This person should be exempted or

should be considered exempted under these rules. So then in that case it should be applied to both

parties. And I see that we have a skip some slides because maybe we are not talking about

everything. Investigate because I see that it's. It's. These three, so we have approximately 2022

minutes left. So but I've already told you many things that you can see written in the in the slide

here in this case maybe it's good to refer to the City Advisory Council opinion. 7 So there is also

CG Advisory Council opinion that deals with this question with the application of 79 when we

talk about. This, this impediment, it doesn't mean that. It has to be impossible. Yeah. Actually

what it means from this point of view, generally what we can see and now I to some extent

summarize what you can see in a detailed manner in the slides later is that. That these practicality,

commercial practicality, what we saw earlier in the case of, for example, examination, there is

usually an example or a good example in this regard is not necessarily using example like this
minefield. It might be actually possible to go through, but it cannot be reasonably. Effective that

someone would go through this minefield. So it's it's like what is what can be reasonably expected

what is practical to expect in this case? So to overcome its its consequences or to avoid it, or like

just the impediment is that it's not it doesn't mean. That it should be something that is is or it

would render impossible the performance of the contract. It is just not practical anymore and

reasonably not practical anymore to perform that contract. And as to what is an impediment or

what can be an impediment so for example. What happened and the other actually some

discussions on that, but what happened with this COVID-19 globally as we know that affected

many times the performance of contracts in this regard. So basically that is something what could

be or could be considered as an impediment usually. Of the Seas that if something happened

already, then it cannot really be an impediment anymore, because then this is something what the

parties can come with or can think about when they conclude the contract. So for example, there

was a case when the problem was not like this, but let's say the reason why this company could

not. Of course it's not for Italy from this point of view. It referred to Saint Petersburg, this case

and Russia, so the northern part. So what happened that by the party could not deliver the rules,

could not? And they both actually the the treatment because the harbor, the water in the harbor got

frozen at an unusual time. So when usually there is no that code that the water in the harbor would

frost. So that's why actually the shipment couldn't be. Yeah, said to the buyer. And then of course,

what could be? So it was not possible to transport the goods on the sea. So is it possible if I? I

come back here, so you you see here the acquirement. So is it possible that to say that OK, maybe

it's not possible to deliver the goods anymore on seeing on water because of this situation, but

there are other ways as well, other means, transportation means as well how these moves could be

delivered? Another means. For example train. Train railways right for Rd. Noise or noise or

whatever. Maybe air transportation. So we cannot say that, OK, it's not possible to transport it

water. So then you should pick any of these others because it's not necessarily reasonable. So if we

for example consider the cost of transportation on the sea and. Air transportation, it's it's very high

here. So it wouldn't be reasonable to say that like 40 here is that like the requirement to say is that

yes then the seller should have sent the shipment via air because that's not from this point of view

commercial practical that. This is how it will be overcome these consequences. As to road
transportation, if it's actually a a long transport then again road transportation might not be a good

like like say substitute to this C transportation. So if it means that. When we think about how the

the negative consequences can be or could be overcoming the situation, again, it's not what is

possible or might be possible on there only certain instances, but what is reasonable in this

situation? What is commercially practical in the given circumstances that how the. Performance of

the contract will be still and. Managers. And so for example, as to this case that the hard work has

frozen, that for the first time it happened, yes, that can be considered as an impediment, but since

we know that it can happen in the future, this is something what we can. Can be all that's the

conclusion because another case this issue came up again then since it has already happened in the

past, so there can be or could have been a kind of expectation that it might happen again. So that's

why it's not something that is totally unforeseeable. And unacceptable. And. In this regard. And

they just don't come here. And basically what we see is that what happens is that somehow at the

time it's conclusion of the contract. The parties knew the circumstances. They knew what they

want under the circumstances. This is how they formulated the contract. They formulated the

contract to their economic, commercial interest under the given circumstances. Or maybe they

also took into consideration some. Possible changes of circumstances within which it's still for

them. It's still worth concluding that particular contract, but if actually the circumstances change

radically, this is what, from this point of view, to some extent, this 79 is about, and also. Maybe in

some national laws where you have already started about this hardship. Yeah, which actually

renders as you can see the performance except extend excessively in ours, which makes it it's very,

very difficult, very, very costly, very, very hard and to perform the contract and. The CIA

Advisory Council opinion that talks about this 79 basically. Consider that hardship can be

considered as an impediment, so it's not impossibility from this point of view, just that it's it's

very, very, very, very difficult and burdensome to perform, still perform the contract, but that can

be from this point of view. Impediment. There is actually a separate CIA by the Council opinion

on one hardship which came out. Years, years, years later than the than the previous Advisory

Council opinion, which actually now refers to hardship as something that is covered by. So it's

clear now that it's covered by the CIG and that hardly. Yeah, DSP's and then basically how it deals

with this is that. The party should. Comply with its contractual obligations to the extent possible.
So even if actually the performance of the contract as they originally agreed on the conditions of

the contract became more enormous than it was previously, it's still. Something different dictation

of the party to perform the contract, because this is something that might be a commercial risk or

to some extent that commercial is that the party can take into consideration then concludes a

contract. And. Maybe you have already heard about situations like on the national look. Then the

the parties agree on something at the time of the conclusion of the contract, given the

circumstances, given their business interest, comic interest, everything. And then the

circumstances changes and then the question arises that OK, it's. What can happen with the bone

track it because the circumstances jaded changed a lot, then basically what was previously

balanced in the contract is not really balanced anymore. So basically the parties interest might

have changed, but what might not have changed is that actually at least one of the parties still on

the contract. Of course, for example, if the price is nowadays, that's very difficult. Especially that

was like. In the past 2-3 years if you consider the pandemic and and what happened after the

pandemic is that like prices got higher like 2 * 3 * 5 times higher from one day to another. So

when there is this. Increase in price. Of course that might be the interest of the buyer steel by the

either know tomato at €1 when they purchase when the market price for the tomatoes, let's say €5,

so then it's not necessary the interest of the seller anymore to sell it for five. So what happens

then? What would happen then? Because can it be still expected from the seller to deliver the

tomato for €1? Then the price is already 5 euros. No, but if this is what they agreed on them.

Because. Perform this on contract. It will really unfair to one party, so it will maybe. Will they

conclude this contract or just a wise this contract? But who could avoid that? The most interesting

loss party lost the most interest party. Yeah OK. I I see from practical point of view that the party

would avoid the contract was probably it's not the buyer but it's the seller. But based on what? I

mean, what what could be the basis for this avoidance? Because you were also right that it seems

very unreasonable that it didn't say that, but that I I sensed that that basically like when the price

was one, they agreed on that and now it's like five times higher. Why should. Salary still that

could that ever this at the price which is not anymore the the the real price for the wood. But why

would the seller avoid the contract in this case? If of course if it is in the contract? They like in

this case, the seller can avoid the contract, then the seller can avoid the contract. But if we look at
the. CISG then, is there any possibility for the seller to avoid the contract if the seller is not

anymore interested in the contract? Not. Not really. So basically, the seller could avoid the

contract only if the buyer breaches its obligation under the contract. So then the seller can avoid,

but just because the seller has no any more interest in the contract. The senator cannot actually

avoid eight. We look at the sorry test of the CD cell count, all the context. So then how would this

situation could? Be then stored or it's like what it says, one Euro, one euro. Maybe next time the

seller will be more cautious and put a clause in the contract which would say that if this happens

then. The series read of its obligations. So this is the price for the seller pays for this teaching or

and the model for this lesson. That's not teaching. Would it be possible? But do you think that then

the seller would say, well, OK, he has what you see buyer that and of course the seller would like

to, let's say that we renegotiate the contract with the buyer would resist because the buyer wouldn't

want to pay that higher amount. So then the seller would say that, OK, let's go to court. And then

the court might adapt or contract to the changed circumstances. What do you think? Using the

culture, change the contracts. But if I'm the seller, I will just. I can't, I can't. I can't be possible for

the breach of the obligation, but I get I will contact the interest, which I can. By which way I can

earn the most and maybe I will pressure contract? Yes, that can also be a practical solution just to

be the contact and see what will happen. And if the buyer is not good, maybe we're not going to

court or. Not go to court. So we are fine, that's OK but. What if you don't just don't want to use the

contract? What if it's important for you to have this buyer? So it's it's a long term business partner

and we expect that it will be the case in the future as well. Now we have this dispute but we

cannot agree because now we have some very current interest but. So we we just don't want to, but

because actually you're right that in practice that can happen very easily that the party just

breaches the contract and. That's because what would happen if we breached the contract? This

way, what would happen if you read the contract if you don't deliver their tomato for one euro?

Me and she. Claim the damages and maybe ask. Ask me to. Oh, praise. Like like some money,

because he has his own laws and all the interest. And if I'm the buyer and I, I will also say that.

You you must. Compositionally, add surprise. Now, rather than the price, we have a deal because

I can't buy the same thing by this price as before. Hmm. Yes, actually, if you say that there's a

seller, you or anyone else would like to have something. Maybe. In this trade off surprise when to
these kingfish it's the change of circumstances or it's just the normal business risk. If it's a business

risk, I don't think we can. We can we we can keep not perform this contract. We we also need to

perform this contract if it's belongs to. Yes, we can do some Randy or just do do not keep

performing this contract. I think we need to distinguish in the. Special insert particular cases. Yes,

yes, exactly. You're both right. That one is that from practical point of it can be a solution that the

seller just doesn't deliver these goods for one euro. What the buyer would do is that maybe the

buyer would go to court and then it would take some time for the buyer actor to. And these claims

for the court to decide this case and it might be actually also difficult, probably difficult to find the

court which would say that if the price is already five and it's like 5 throughout the entire court

proceeding, let's say, or on that and the Court would still say that yes, this is something that should

have been. Uh, like honored by the seller or comply with the seller. So because actually if we

think about that even if we will see that the court does not necessarily have the right to adopt the

contract between the parties but can assess actually the the, the balance that. People want the

contact and then yes, you are also right that there is actually a difference between situations when

it's because of the core measure is the price increase is because of let's say the market, it said that

maybe it's not one euro anymore. That's 1.5 or maybe two years. But then there is this very

extensive change like it's five times higher. This is not naturally something what the parties could

could count with at the time of conclusion on the contract like this is a normal business or

commercial is in this. Because if you think about like what was the case 2023, so four years ago in

2019 probably no business is really counted with the possibility that what could come in

20212223 as regard to prices and everything. So basically that means that it's. Not something

where the parties could come be, yes. So that's also would that we have to distinguish between

these different situations. Um. Oh. And this is also something that we couldn't come with that no,

it's 44. So it's basically means that. We have one minute left. Yes. So less than briefly talk about in

one minute about the facts of avoidance. So then you clear it and then we will close. This session,

so as to the effect of avoidance, basically we have already talked about it. So, so it will not be that

new. What the CG degrades in this regard is that if the party actually avoid the contracts because

of the bridge and then what happens and then basically that releases the parties from their

contractual obligations except for two sets of rules or set of provisions in the contract. One is that
which deals with the termination of the contract or the consequence of avoidance of the contract

and the second one is that relates to dispute settlement. Yeah, because actually that's of course

relevant talent in that regard that that how these boots as to avoidance can be done. And this is

again the other example or the other. The provision that this could settlement clauses are

recognized by the CIS G when you think back that we discussed previously as the dispute

settlement clauses that whether the CIA is applicable to dispute settlement clauses or not or to

what extent then we saw that in 1919 as to this material. Representation. It refers to this settlement

also here in this context, in Article 81, it refers to this settlement. So basically it is somehow

dispute settlement clauses are somehow seen by the the CIA. So that's the basis for the argument

that the CSG covers or extends to this. Settlement clauses as well. So basically these two set of

provisions remain in force between the parties and then if the. Was any kind of performance either

part performance partly or or the entire? Obligation was performed like the shipment or the

purchase price was paid. Then there is an obligation to return these already performed obligations.

So there is this obligation for restitution and then this is what is regulated here. Why? It's good to

pay attention to this provision, Article 82, because. When we talked about avoidance that when the

party can avoid the contract, then basically we saw that the requirement for for that is that there

should be a breach, fundamental breach or it's not a fundamental breach then there should be no.

Northeast as to the additional time of performance, it has to be of reasonable and and then if there

is no performance within this additional pair of time then basically the party can avoid the

contract. But here we can see some provisions which can actually limit. The the possibility of the

buyer to avoid the contact, because in the course of this classification the buyer has to return the

goods to the seller in the quantity and the quality as the buyer received the goods. And the general

rule is that if the buyer cannot return the goods, the same quality the same quantity as it reserved

from the seller. Cannot avoid the contract or cannot require actually substitute goods either. So,

but you will see here the the relevant provisions and. Yes, in the slide, because I I see that we are a

bit beyond the schedule in the size. You will see some some other provisions as well of the CIA

concerning the preservation of the goods. It's good if you look at it but. But basically. I think I can

tell you since we didn't talk about it during the class, it will not come up in the exam this part. By

this part I mean the preservation of goods, because at the exam what will be covered or what kind
of questions cannot. Can come up basically questions relating to the issues, to the questions that

we discussed together here in class. So this basically means that there are some provisions in the

CIA previous covered, but basically it means that those we are not. Be there among the exam

questions so. This is the end as you can see. Basically I will not like summarize everything now

what we discussed during these four days. These are just some key, let's say takeaways or

something that you should always. Remember, of course it's it's more than just these five points.

But let's not forget that the CIA, I know you know that very well, but that the CIA is international

unification instrument, which means not only that it's a unification instrument, but everything that

is compiled that that the author misinterpretation. The departure from national laws, the distance

between the unification instrument and the National hobby applied the CIA. What's the relevance

of the CIA? How it replaced the national or in the Member State? And also that when we apply

the Ch, this is something but usually occurs. But not necessary anymore usually but but can occur

in especially in state court practice. The state courts tend to apply the national laws, national law

concepts in the context of the CIS right. But as you can see in the second grade point that there is

no place, no room for the national law when we apply the CG except. Then the CIA itself allows

the application of the national law. As there is no CIG court as we saw, so there is no one also

thinking that presentation forum for the CIG. It is left to the different national courts and arbitrary

divinas, which basically of course. Should follow Article 7, subsection one of the CIG and they

interpret and apply the CIG, but it is. It is a mission that is never accomplished. Actually, we can

say, because there are always decisions which do not necessarily follow these main trends of other

decisions and it's very difficult actually actually to challenge these decisions because, for example,

if it's an audit. The board, we cannot really do anything. We decided to reward because I don't

know if you already have classes nor dictation. No, maybe. But usually it's not the possible run to

challenge the validity of an award or to to reject the recognition enforcement of an award if the

arbitral tribunal did not properly apply the substantive law. So just because it's not the way how

other tribunals would apply the substantive law, it's not not an adequate grounds to challenge the

validity of the word recognition enforcement and basically if you don't want the CIA to be applied

as we discussed it is. Excluded implied there as well, so that's exclusion is also possible, but as we

discussed, the possible. Interpretations of these situations? Or is better if we want to exclude the
CG? Or this better to do that expressly and then? This part, the autonomy that what we see in the

CIA has of course like default rules. The parties can that will get from the CIA can modify it.

Provisions can set their own rules within the CG. Of course they cannot add rules to the CIA. So if

something is not. Regulated in search, they can of course put that into the contract, but that

wouldn't make it to be falling under the scope of the CIG under the unification instrument. So the

unified the this one principle to rule them. It refers to the fact that party autonomy can be. There in

the CIS sold except for the provision where the parties cannot derogate from the CIA if the CIA is

applicable. And do you remember which was this? Where the parties cannot derogate, which the

parties cannot contract out. And I see that now we exceeded the time with like 8 minutes. You can

get back this 8 minutes at believe them. So it will be less than 60 to be only 52 minutes. No, it's a

bad joke. Yeah, So what? What was this provision from which the parties cannot delegate so? The

It's a kind of reserve it it's it's one of the reservations or relates to one of the reservations. Like.

What's equality? Some point of time, like the countries I mean? It's written for very quietly. Sorry.

Oh, you you know that so you remember that under the siege there is no form of environment, so

it's not required that the contract should be right. But the states when they join the CIA, they can

make a reservation that yet if they have their own laws this requirement that. The the contact

stabbing writing, they can make this reservation and then this is what the parties cannot contract

out. This is what the parties cannot exclude. So if there is this reservation of written form, the

parties cannot that away from this. So this is this almost. By this almost refers to that that this is a

provision of the CG from which the parties cannot derogate. OK, so that's then. 84 today so it was

great and thank you for your participation and if you have any questions, any comments here you

can find the e-mail. Let's feel free to send me an e-mail and also ask this consultation online

consultation that we. Uh, discuss with the beginning of today's session then maybe May and June,

we can have some of this. It's not mandatory. If you want you can part if you have any question

concerning anything that we discussed or based on the materials that you. They said don't you see

then basically we can talk about it and what you will still still and then I will finish that these

lines. You already have this slide but I noticed but I also told you that at the time that there are

some typos. So I will correct this and then. We received the the like the final slides and. Yes, I

think that's it because all the other materials you have already received. OK. Do you have any
questions or or anything? And the comments and the. OK, the last thing is that maybe if you want

some test questions, test sample test questions or test test questions you will be able to access. So I

will prepare some samples for test questions. So what kind of test questions you can? We expect

that the exam and I will send the link to. To be there on and then she will or someone here I think

forward that to you. So there you'll be able to access these tests and if you want you can practice

or you can look at it just to see that how it might look the exam done OK so if you have no

questions. It's very hard to say goodbye but that's why I'm trying to somehow use the time. But

basically then that's it. Thank you and then and good luck for your future and and the exam. And

also to the zone. We have questions.