The scope of the Common European Sales Law: B2B, goods, digital content and services

• Pages: 241-258
• Date: 07 September 2012
• Published date: 07 September 2012
• DOI: https://doi.org/10.1108/14770021211267351
• Author: Rafael Illescas Ortiz,Pilar Perales Viscasillas
• Subject Matter: Economics

The scope of the Common

European Sales Law: B2B, goods,

digital content and services

Rafael Illescas Ortiz and Pilar Perales Viscasillas

Department of Commercial Law, University Carlos III of Madrid,

Madrid, Spain

Abstract

Purpose – This article aims to take a critical look at the proposed Common European Sales Law

(CESL) and its f‌ield of application.

Design/methodology/approach – The article provides a comparative analysis of the scope of

application of CESL with that of the Convention on Contracts for the International Sales of Goods (CISG).

The approach is critical in nature in that it questions the regulation of business-to-business (B2B)

transactions under CESL. It also takes a critical look at the CESL and its coverage of three areas of

contracting – saleof goods, supply of digital content, and supply of services.

Findings – Thearticle exposessome of the shortcomingsof the CESL in relationto its f‌ield of application.

Research limitations/implications – The CESL as proposed offers an optional regulation that

complicates the law of transborder sales within the European Union (EU) and between EU member

states and non-EU states. The article recommends that CESL not extend its coverage to B2B

transactions and leave transborder commercial transactions to the CISG. The article also suggests other

changes to improve the CESL.

Practical implications – Further analysis is needed and more def‌ined rules should be considered

before CESL is enacted into law.

Originality/value – This article questions the wide scope of application of CESL. It further questions

the rationality and practicality of the CESL’s coverage of B2B transactions.

Keywords Common EuropeanSales Law (CESL),

Conventionon Contracts for the InternationalSale of Goods (CISG), European Unioncross-borders sales,

Internettrading, Consumerprotection,Opt-in instruments, EU Acquis,Small to medium-sizedenterprises,

Supply of goods, services, and digital content,Supply chain management

Paper type Research paper

I. Introduction

The European Union (EU)Proposal for a Regulation on a Common European Sales Law

(CESL) of11 October 2011[1] is a very ambitiousproject that can betraced back to the idea

of buildinga Civil Code within the EU. This articlewill not review this history or about the

differentprojects that have beenput forth towards the unif‌icationof private law within the

EU. Instead,we focus but just on the scopeof application of the CESL witha specif‌ic focus

on how itcompares to the well-establishedUnited Nations Conventionon Contracts forthe

InternationalSale of Goods (CISG) which wasapproved at the Vienna Conventionin 1980.

CESL and the CISG have similar scopes of application. However, the CESL is an

optional instrument for business-to-business transactions (B2B) in the area of the

The current issue and full text archive of this journal is available at

www.emeraldinsight.com/1477-0024.htm

Commercial Law Professors at University Carlos III of Madrid. The present work was written

under Research Project MEC 2008/02244 under the supervision of Prof. Perales Viscasillas.

The scope

of the CESL

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Journal of International Trade Law

and Policy

Vol. 11 No. 3, 2012

pp. 241-258

qEmerald Group Publishing Limited

1477-0024

DOI 10.1108/14770021211267351

international sale of goods[2]. Despite its title, CESL does not only apply to contracts for

the sale of goods between European enterprises, but also applies where only one of the

parties is from a EU country[3]. So in this way, the CESL may be characterized as both

a regional and an international instrument.

The optional regulation applies also to the sale of goods, digital content and services

related to any of them.

It is therefore self-evident that the optional regulation has a subjective and objective

f‌ield of application very similar to that of the CISG (Articles 1-3). The choice of the

instrument as applicable law to the contract (opting in) means the exclusion of the CISG

(opting out) as recognized by Preamble 25 of CESL[4]. The opting into the CESL is likely

to be construed as an opting out of the CISG given the freedom of contract principle and

right to derogate provided in the CISG[5].

II. The optional instrument should cover only B2C contracts

If we take into account that the CISG is the Domestic Law of 23 out of the 27 member

states[6]and that the CISG has been usedas a model law in the revision ofnumerous civil

codesaround the globe includingthose of theEU, the logical questionthat arises is whether

the CESL is a necessary addition to EU law, especially in the area of B2B contracts.

Theargument for EU legitimacyor competency to legislatein this area, according to the

Preamble of CESL[7], is anchored on a statistical survey showing that businesspersons

consider that one of the main problems in cross-border contracts is the choice of the

applicable law.The problem of choice of law is partlythe outcome of the underutilization

of the CISG and the lackof an institution that assures uniforminterpretations of the CISG.

The surveyfound that 70 percent of businesseswould choose the CESL if it wereavailable.

This rationale has been the driving forcebehind this new optional regulation[8].

In order to assess the need for this instrument, in our opinion, a distinction ought to be

made between B2B and B2C transactions. The next two subsections will review the

CESL as to how it relates to B2B and B2C transactions.

2.1 B2B contracts

In B2B transactions, the explanatory note of the optional instrument overstates some

issues, a position that is reinforced when reading the scope of the Eurobarometer survey, as

well as the stated list of questions and answers[9]. This material lodged in support of the

CESL evades an important fact – t he CISGi s thedomestic law o f mostof the E U member

states. In this regard, the continued adoption of the CISG by other countries and the possible

future applications and uses of the CISG is a better “eurobarometer” of the unif‌ication of

sales law in Europe than an adoption of an optional regional law, such as the CESL[10].

The differences between contract laws in different countries do not constitute a major

obstacle to cross-border trade, and it is not entirely correct to state that the search for the

applicable law is a barrier to trade. Although some problems might exist in certain areas

of the law, most traders use standard terms drafted by their trade organizations, while

others rely on the application of international instruments either by direct application or

by the choice of the rules of law. This coupled with the choice of arbitration as

the dominate means of commercial dispute resolution makes any variations in na tional

contract laws less important than in the area of consumer contracts.

The need for an optional instrument is unconvincing given the variety of

options available to businesses, such as the recently updated UNIDROIT Principles for

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