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2012 UNCITRAL Digest of case law on the United Nations Convention on the International Sale of Goods

Digest of Article 95 case law [reproduced with permission of UNCITRAL] [*]

Article 95

Any State may declare at the time of the deposit of its instrument of ratification, acceptance, approval or accession that it will not be bound by subparagraph (1)(b) of article 1 of this Convention.

OVERVIEW

1. A State's article 95 declaration, made at the time of the deposit of its instrument of ratification, acceptance, approval or accession of the Convention, excludes the application of the Convention via article 1(1)(b) — i.e., if the rules of private international law lead to the law of a Contracting State. Accordingly, if there is a dispute between a party from a Contracting State that has made an article 95 declaration and a party located in a non-contracting State, the applicable law is determined based on the domestic conflict of laws rules. The declaration does not impact the application of the Convention between two Contracting States under article 1(1)(a). [See the discussion in the Digest for article 1 for decisions and awards applying article 1(1)(b)where an article 95 reservation was not taken by any relevant contracting country.]

2. The following States have made an article 95 declaration:[1] the People's Republic of China, Czech Republic, Saint Vincent and the Grenadines, Singapore,[2] Slovakia and the United States of America.[3]

Application of Article 95 Reservation

3. There are several decisions in which one party was from a Contracting State that has made an article 95 declaration and the other party was from a non-Contracting State. As such, the Convention was not applicable via article 1(1)(a). In the majority of these cases, the court or tribunal applied domestic conflict of law rules leading to the application of domestic sales law rather than the CISG.[4]

4. In one case between parties from a Contracting State and a non-Contracting State [5] the Court ignored that the Contracting State made an article 95 declaration and applied the CISG pursuant to article 1(1)(b).[6]

5. One court held that the Convention should not be applied in circumstances where the forum is in a non-Contracting State, the forum has determined that the applicable law is that of a Contracting State that has made an article 95 declaration, and the parties are from a non-Contracting and a Contracting State that has made an article 95 declaration.[7]

6. One court has indicated that an article 95 declaration would not preclude application of the CISG where the parties agreed during the course of legal proceedings that the Convention would apply.[8]


NOTES

* This presentation of the UNCITRAL Digest is a slightly modified version of the original UNCITRAL text at <http://www.uncitral.org/pdf/english/clout/CISG-digest-2012-e.pdf>. The following modifications were made by the Institute of International Commercial Law of the Pace University School of Law:

   -    To enhance access to contents by computer search engines, we present in html rather than pdf;
 
   -    To facilitate direct focus on aspects of the Digests of most immediate interest, we inserted linked tables of contents at the outset of most presentations;
 
   -    To support UNCITRAL's recommendation to read more on the cases reported in the Digests, we provide mouse-click access to (i) CLOUT abstracts published by UNCITRAL (and to UNILEX case abstracts and other case abstracts); and also (ii) to full-text English translations of cases with links to original texts of cases, where available, in [bracketed citations] that we have added to UNCITRAL's footnotes; and
 
   -    To enable researchers to themselves keep the case citations provided in the Digests constantly current, we have created a series of tandem documents, UNCITRAL Digest Cases + Added Cases. The new cases and other cases that are cited in these updates are coded in accordance with UNCITRAL's Thesaurus.

1. For information on reservations to the Convention made by Contracting States, see <http://www.uncitral.org/uncitral/en/uncitral_texts/sale_ goods/1980CISG_status.html>.

2. See Sub-section 3(2) of the Singapore Sale of Goods (United Nations Convention) Act:

"Subparagraph (1)(b) of article 1 of the Convention shall not have the force of law in Singapore and accordingly the Convention will apply to contracts of sale of goods only between those parties whose places of business are in different states when the States are Contracting States."

3. Upon accession to the Convention in 1991 Canada made an article 95 declaration providing that its territorial unit of British Columbia would not be bound by article 1(1)(b). In July 1992 this declaration was withdrawn.

4. [CHINA Supreme Court of the People's Republic of China 20 July 1999 (Zheng Hong Li Ltd. Hong Kong v. Jill Bert Ltd)] (a contract between a buyer from Hong Kong and a seller from Switzerland designated the law of the People's Republic of China, which has made an article 95 declaration; although not expressly stated by the court, the article 95 declaration likely was the basis for the application of domestic PRC Law on Economic Contracts); [CHINA International Economic and Trade Arbitration Commission, People's Republic of China, 24 December 2004] (because the seller was not from a Contracting State (Japan at the time) and the buyer was from a State that made an article 95 declaration (the People's Republic of China), the tribunal applied the domestic contract law of the People's Republic of China); CLOUT case no. 616 [UNITED STATES U.S. District Court, Southern District of Florida 22 November 2002 (Impuls v. Psion-Teklogix)]; [UNITED STATES U.S. District Court, Western District of Washington, 17 July 2006 (Prime Start Ltd. v. Maher Forest Products Ltd.)].

5. At the time the contract was concluded the CISG was not in effect in Germany (the buyer's country).

6. CLOUT case no. 49 [GERMANY Oberlandesgericht Dusseldorf 2 July 1993].

7. [JAPAN Tokyo Chiho Saibansho 19 March 1998].

8. CLOUT case no. 280 [GERMANY Oberlandesgericht Jena 26 May 1998] (see full text of the decision).


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