The Interpretation and Fairness of Standardized Terms: Certainty and Predictability under the CESL and the CISG Compared

Abstract

The vast majority of cross-border commercial sales transactions are concluded on the basis of standardized contracts. When assessing the competitive advantage of various regulatory instruments such as the new proposal for a Common European Sales Law (CESL) and the UN Convention on the International Sale of Goods (CISG), the nature and purpose of such contracts has to be borne in mind. Since standardized contracts aim to promote certainty, predictability and uniformity with respect to a business' rights and obligations in numerous transactions, a set of rules that fosters certainty, predictability and uniformity in the interpretation and enforceability of such standardized contracts should be preferred. This contribution compares the CESL and the CISG in relation to contract interpretation and the control of fairness of standardized contract terms and concludes that although the CESL may have a competitive advantage in the sense that it deals with standard contract terms more comprehensively, the nature of many of its provisions will not promote legal certainty, predictability and uniformity.