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8/13/2019 Business Law Syllabus Dispute Resolutions
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Rotterdam Business School
PArt 3
Business Law
RegularSyllabus
Dispute resolution
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Table of Contents
TABLE OF CONTENTS......................................................................................................................... 2
CHAPTE 1. !NTOD"CT!ON !NTO LA#........................................................................................11
PARAGRAPH1.1 - WHATS!T"R!AT#!A$$AW%................................................................................1&
PARAGRAPH1.& - $AW#'S(PRA!AT#!A$#RGA!SAT#!S) TH" "(...................................................1*
PARAGRAPH1.+ - "( $AW.................................................................................................................. &,
PARAGRAPH1. - !T"R!AT#!A$PRAT"$AW..................................................................................&/
0("ST#!S- HAPT"R1A !T"R!AT#!A$$AW..................................................................................+1
0("ST#!S- HAPT"R1B !T"R!AT#!A$$AW..................................................................................+&
CHAPTE 2. D!SP"TE ESOL"T!ON.............................................................................................. 3$
0("ST#!S2 HAPT"R& 3SP(T"R"S#$(T#!.................................................................................+*
CHAPTE 3. EE%............................................................................................................................... 3&
PARAGRAPH+.1 2 !TR#3(T#!.......................................................................................................+4
PARAGRAPH+.& 2 TH"S"PARAT#!#'P#W"RS.................................................................................+/
PARAGRAPH+.+ 2 TH"!AT#!A$5(3A$S6ST"7.............................................................................1
PARAGRAPH+. 2 PR!P$"S#'$TGAT#!......................................................................................+
PARAGRAPH+.8 2 5(RS3T#!.........................................................................................................8
PARAGRAPH+.* 2 "9"(T#!............................................................................................................4
PARAGRAPH+., 2 ARBTRAT#!........................................................................................................../
0("ST#!S2 HAPT"R +A ""9.........................................................................................................8:
0("ST#!S2 HAPT"R +B ""9.........................................................................................................8&
CHAPTE '. ECO............................................................................................................................... $$
PARAGRAPH.1 2!TR#3(T#!........................................................................................................8*
PARAGRAPH.& 2 !T"R!AT#!A$PRAT"$AW.................................................................................8,
PARAGRAPH.+ 2 APP$AB$"$AW!AS"#'!T"R!AT#!A$#!'$T...........................................84
PARAGRAPH. 2 7#ST7P#RTA!TART$"S#'TH" "#...............................................................8/
4.4.1Choice of law........................................................................................................................ 59
4.4.2General provisions in the absence of a choice of law...........................................................59
4.4.3Law applicable to consumer contracts..................................................................................59
4.4.4Law applicable to individual employment contract................................................................!
4.4.5Law applicable under certain circumstances........................................................................!
4.4.Law applicable under certain circumstances........................................................................!
PARAGRAPH.8 2 $AWAPP$AB$"!AS"S#'!T"R!AT#!A$T#RT................................................*&0("ST#!S2 HAPT"R A "#........................................................................................................*+
0("ST#!S2 HAPT"R B "#........................................................................................................*8
CHAPTE $. C!S(.............................................................................................................................. )*
PARAGRAPH8.1 2!TR#3(T#!........................................................................................................*/
PARAGRAPH8.& 2 '#R7A$R"0(R"7"!TS#'TH" SG....................................................................,:
PARAGRAPH8.+ 2!TR#3(T#!APP$AB$"$AW!AS"#'!T"R!AT#!A$#!'$T......................,
PARAGRAPH8. 2 TH"#!T"!T#' SG..........................................................................................,
5.4.1 Contract formation..............................................................................................................."4
5.4.2 #he content of the a$reement.............................................................................................."5
5.4.3 %reach of contract..............................................................................................................."5
5.4.4 &ffects of termination of the contract..................................................................................."
0("ST#!S2 HAPT"R 8A SG.......................................................................................................,,
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0("ST#!S2 HAPT"R 8B SG.......................................................................................................4:
CHAPTE ). TANSPOT AND !NCOTE+S..................................................................................*2
PARAGRAPH*.1 2!TR#3(T#!........................................................................................................4+
PARAGRAPH*.& 2T"R7S#'SA$"A!33"$"R6................................................................................4+
PARAGRAPH*.+ 2 #!T"!T#'T"R7S#'SA$"A!33"$"R6............................................................4+
PARAGRAPH*. 2 !#T"R7S............................................................................................................4+
PARAGRAPH*.8 2 TH"PASS!G#'TH"RS;......................................................................................4
PARAGRAPH*.* 2 G"!"RA$S"T(P#'TH"!#T"R7S......................................................................4
PARAGRAPH*., 2 !#T"R7S &:11...................................................................................................4*
PARAGRAPH*.4 2 7R..................................................................................................................... /:
.'.1 (ntroduction.......................................................................................................................... 9!
.'.2 #he parties involved in carria$e...........................................................................................9!
.'.3 #reaties on carria$e.............................................................................................................94
.'.4 #he C)* convention...........................................................................................................94
SEE B"S!NESS LA# BLOC, 2- #EE, '- !NTOD"CT!ON !NTO !NTENAT!ONAL P!/ATE
LA#0- STEP 1...................................................................................................................................... '.'.5 +urisdiction...........................................................................................................................9'
.'. ,pplicable law accordin$ to &C-........................................................................................9'
0("ST#!S2 HAPT"R*A TRA!SP#RTA!3!#T"R7S..................................................................1::
0("ST#!S2 HAPT"R*B TRA!SP#RTA!3!#T"R7S..................................................................1:+
CHAPTE &. CO+PAN LA#..........................................................................................................1&
PARAGRAPH,.1 2 !TR#3(T#! ....................................................................................................1:4
PARAGRAPH,.& 2 5(R3A$P"RS#!A$T6 ......................................................................................1:/
PARAGRAPH,.+ 2 7#ST#77#!T6P"S#'B(S!"SS'#R7S..........................................................11&
".3.1 /ole proprietor ship........................................................................................................112
".3.2 0rivate Limited liability company %.............................................................................113".3.3 Limited liable company ............................................................................................115
".3.4 ifferences between 0rivate Limited Liable Company % and 0ublic Limited Liable
Company ............................................................................................................................ 11
PARAGRAPH,. 2 #RGA!S#'A5(R3A$P"RS#!..........................................................................11,
0("ST#!S2 HAPT"R,A #7PA!6$AW.......................................................................................11/
(LOSSA........................................................................................................................................ 123
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BUSINESS LAW 2
IBMS Regular BLOCK 3Code: IBMBL209R1; ECTS: 1;Year of Study: 1
Cota!t "our# $er Wee%: 2 !ota!t &our#
Study load
Cota!t &our# 16
Self'#tudy &our# 10
E(a) 120 minutes
ROM
Both knowledge-driven nd !r"tise-driven edu"tionl methodologies
re em!hsi#ed in this module$
Cotr*+ut*o to IBMS ,rof*le-Co)$ete!*e#
%tudent is &le to understnd the ethi"l' normtive nd so"il issues
relted to the !ro(essionl !r"ti"e$
%tudent develo!s &si" wreness o( the universl humn rights nd
ethi"l s!e"ts o( interntionl &usiness nd the role o( !rin"i!linstitutions like the )* nd *+$
%tudent is &le to !!l, !rin"i!l interntionl lws nd regultions'
nd is (milir with the most im!ortnt interntionl trde greements$
%tudent will "uire &si" knowledge &out the !ro"edure to set u!
"om!n, nd understnd the di((eren"e &etween t,!es o( "om!nies$
.u+l* .e#!r*$tor/#0
.*' /.' M %ee IBM% B"helor "om!eten"ies mtri IBMR%103R14
Relat*o 1*t& ot&er )odule#-#u+e!t#
Business Lw IBMBL109R1
5rin"i!les nd dvn"ed )"onomi"s
5rin"i!les nd dvn"ed Mrketing
5rin"i!les nd dvn"ed Logisti"s
Lear*g Tra!%
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Business Lw is !rogrmme' "onsisting o( two modules' IBMBL109R1
nd IBMBL209R1$ Module IBMBL109R1 ,er 1' &lo"k 1 nd 24 (o"uses
on &si" !rin"i!les o( "ivil lw nd &si" !rin"i!les o( ownershi!' legl
o&ligtions deriving (rom "ontr"ts nd tort$ Module IBMBL209R1 ,er 1'
&lo"k 4' (o"uses on vrious s!e"ilist to!i"s relted to interntionl trde
nd &usiness' es!e"ill, with regrds to logisti"s nd mrketing$
Start*g Leel
%!e"ilist legl to!i"s relted to interntionl &usiness; knowledge o(
!rin"i!les o( interntionl &usiness lw reuired
Lear*g O+e!t*e#
*nderstnding the im!ortn"e o(4 legl reuirements (or n
orgni#tion' o!erting in n interntionl &usiness environment;
.nowing whi"h legl reuirements to tke into ""ount when
trding with &usinesses in di((erent "ountries; Being &le to !!l, the lws' treties nd "onventions deling with
"ertin legl to!i" relted to do doing &usiness in n interntionlenvironment;
7rwing "on"lusions (rom the !!li"tion o( lws' treties nd
"onventions' in order to &e &le to understnd how norgni#tions o!ertions to meet relevnt legl reuirements$
Being &le to determine whi"h legl remedies re t n
orgni#tions dis!osl when involved in n interntionl legl"on(li"t$
I#tru!t*o )et&od
2 hours !er week "entrl inter"tive le"ture' in
whi"h theor, nd nswers to uestions &out
smll4 "ses will &e dis"ussed$ %tudents re
en"ourged to !rti"i!te in "lss dis"ussions
nd ssignments$
A##e##)et )et&od
8ritten Multi!le hoi"e' o!en uestions' "ses$
5ossi&le ssignments4 during "ourses$
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A##*g)et:
8ill &e dis"ussed &, the te"her$ %tudents' who
!ss the ssignments' will ern !oints tht will
&e dded to the result o( the (inl em o( tht
&lo"k$
4*al e(a) ad re#*t:
ssignment
M**)u) '
Re6u*red atteda!e
30=
S&ort outl*e of Edu!at*oal U*t
Business Lw &lo"k (o"uses on vrious s!e"ilist to!i"s relted to
interntionl &usiness' su"h s interntionl lw' "om!n, lw nd the
most relevnt interntionl !rivte lw rules ne"essr, (or !ro(essionls$
W S C SUB7ECTS
2899 ' 2892
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9 2 2 Itrodu!t*o Iterat*oal La1 %tud, introdu"tion intoInterntionl orgni#tions
nd
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= A 2 Tra#$ort > INCOTERMS %tud, In"oterms ndrrige !rovided &,
le"turer; stud, tet&ook
"h!ter 3' !rgr!h 1 2
nswer uestions &out"ses !rovided &, le"turer
? 2 Co)$ay La1 %tud, om!n, lw!rovided &, le"turer;
nswer uestions &out
"ses !rovided &, le"turer
@ 2 ue#t*o# > E(a) ,re$arat*o
EN.
4a!*l*t*e#-!la##roo)
+o s!e"i(i" reuirements
Re)ar%#
In ddition to the tet&ook other stud,ing mteril will &e !rovided &, thele"turer s listed in the !rogrm &ove
5re!rtions:
/t ll times students must !re!re themselves !rior to the le"ture nd
must &e &le to "ontri&ute the "lssroom dis"ussions$ %tudents who do
not !re!re themselves (or the le"tures m, &e e"luded (rom the
le"tures$
L*terature ad A*d#
T*tle
/ &si" guide to Interntionl Business Lw' ltest edition
Ty$e
Interntionl Business Lw
Co)$ul#ory
Ces
ISBN
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9D3-90-01-DD99A-3
Aut&or/#0
Mr$ E$ 8evers
,u+l*#&er
+oordho(
Year
Ifor)at*o-Le!turer:
Mr$ 5$5$ Fonneveld
Room 81$A0
5hone num&er 010-AD9623
)mil 5$5$FonneveldGERH$+L
Mr $$/$ +oordegr(
Room
5hone num&er
)mil $$/$+oordegr(GERH$+L
Mr M$$B vn der lier
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Pagina 1van 131
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Para8rap4 1.1 ; #4at is !nternational La7 A basi6 8ui5e to international Business La70- H. #e=ers LL+-latest e5ition.
nternational $a
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to any matter eFce>t to the eFtent that the agreement con=licts to its duties are di>lomatic@ economic andsometimesC military sanctions.
;inds o= treaties)Treaties can be divided into tendent on ho< many countries are involvedin the creation o= the treaty.- Bilateral) a treaty is called bilateral@ s betly to the inhabitants o= the countries they re>resent.So they include rules that)
Trait?s;6ontrats@ govern the relations4ips bet7een the 8o=ernents involved@mutual rights and obligations contract6li7eCK e.g. delivery o= >roducts
Trait?s;lois@ creating ne< general >ublicC la7sthat appl to t4e in4abitants of t4e6ountries o= member states law6li7eCK e.g. "uro>ean onvention on Human Rights
Trait?s;6onstitution@ establishment o= international or8anisations e.g. 8nitedations Charter
The second category o= rules is >art o= the la< that is in e==ect in a country that is a >arty tothe treaty. This category is directly e==ective@ erson@ legal entity or government able o= entering into legal relationshi>s.
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1. The government o= a country engages in negotiations >roved by the >arliaments o= thecountries involved@ so the governments arliament =ora>>roval. A>>roval can be given silently or eF>licitly. Silent a>>roval is given@ in caseno member o= the >arliament reDuests eF>licit a>>roval eriod o= time."F>licit a>>roval is given by the >arliament in case more than a certain amount o=>ositive votes is reached usually 8: N O 1 vote@ sometimes a higher >ercentage isreDuiredC.
+. A=ter a>>roval is given by the >arliament@ the treaty is rati=ied. This is an o==icialnoti=ication to the other country or countriesC involved in the treaty@ that the treaty hasbeen a>>roved and is there=ore binding. (sually this is done in an o==icial ceremony inresentatives o= the governments o= the countries@ involved in the treaty@ signa document containing the teFt o= the treaty.
. $astly an o==icial >roclamation usually done by >ublishing the treatyC is made to theinhabitants o= the countries involved@ a=ter roclamation.
ncor>oration into the national legal systemAs soon as a treaty enters into =orce@ it becomes >art o= the la< that is in e==ect in a certaincountry. Horecedence.
&. Trans=ormation system)The rules o= the treaty ean (nion. A document containing rulesC that is issued by the
(nited !ations or the ouncil o= "uro>e is usually called a onventionK documents issued by
the "uro>ean (nion generally are called Regulations. A onvention is@ in essence@ ust a
treaty. t is called onvention to maEe it clear that it is dra ean ommission.
!o other "uro>ean institution has the right to initiate legislation.
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The >ro>osal is submitted by the "uro>ean ommission to the ouncil o= ministers. Then the
"uro>ean Parliament is either asEed =or advice about the >ro>osal or@ in case the co-decision
>rocedure is a>>lied ean Parliament has to a>>rove the >ro>osal. = the Parliament doesnMt a>>rove in this
case@ the >ro>osal is reected. = the Parliament does a>>rove@ it is le=t to the ouncil o=
7inisters to =inally a>>rove or reect the >ro>osal.+
A5 urispru5en6e of !nternational Courts of usti6e@a. The im>ortance o= the uris>rudence created by the nternational ourt o= 5ustice o= the
(! is limited@ since the ourt only has the authority to rule i= the countries involved have
voluntarily submitted to the rulings o= the ourt. As a result this the court never rules over
really im>ortant matters.
b. The uris>rudence created by the "uro>ean ourt o= Human Rights is much more
im>ortant =or international legal relationshi>s. "ven though it is an intergovernmental
organi?ation@ the courtMs rulings are very im>ortant@ because the su>reme courts o= the
countries involved in the ouncil o= "uro>e regard the rulings as binding and u>hold them.
c. The rulings o= the "uro>ean ourt o= 5ustice are very im>ortant@ because they are based
on udicial >oartici>ating countries to the "uro>ean
nstitutions@ so a =ourth layer has been added to the national structure o= the udicial system
court o= =irst instance@ court o= a>>eal@ Su>reme ourtC.As a result o= this the rulings o= the
"uro>ean ourt o= 5ustice are binding ean ommunity and the details o= those >rocedures@
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address international issues not already subect either to treaty >rovisions or to bindingcustomary rules. Such general >rinci>les may arise either through civil la< or throughinternational las the most im>ortant >rinci>le o= international la< is that o= good=aith. t governs the creation and >er=ormance o= legal obligations and is the =oundation o=treaty larinci>les do not ust regulate national legal relationshi>s@ but alsohave an im>act on legal relationshi>s ect. These legal >rinci>les are)
1. Good =aith)The >rinci>le o= good =aith reDuires that every decision that is given by a civil court o= laectsC has to be reasonable and =air. This>rinci>le also governs the legal relationshi> betarties involved@ including >arties=rom di==erent countries. This means that those >arties have to act reasonably and =airlyto
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'or those ating country to do something against its artici>ating countries coo>erate rovides. The organi?ation itsel= has
only very limited >oerha>s be com>ared to a sort o=
international board room@ oating
countries./3ecisions artici>ating countries in such a art o= their ooartici>ating countries are more im>ortant than the interests o= the individual
countries. The >artici>ating countries create a treaty@ on the basis o= ating country to do something against its ean (nion is the best Enole o= a su>ranational international
organisation.
9Sovereign >ooo other countries =romreaching an agreement or establish a common >olicy. A veto can also mean that@ in case an agreement is
reached or a common >olicy is established@ that the country that eFercises its veto is not >art o= that agreement or>olicy.11As long it is
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ntergovernmental organi?ation Su>ranational organi?ation
su>ranational organi?ation
trans=er o= sovereignty
Sovereigncountry
ntergovernmental
organi?ation Sovereign country
T4e European "nion E"
The "uro>ean (nion is a uniDue economic and >olitical >artnershi> betean currency@ and is >rogressively building a single
"uro>e-le@ goods@ services@ and ca>ital move among 7ember
States as =reely as romotes human rights and democracy and has the most ambitious
emission reduction targets =or =ighting climate change in the ean (nion)1+
The "uro>ean (nion ean union re-emerged@ ho>ing to bind Germany into >an-
"uro>ean democratic institutions to the eFtent that it@ and any other allied "uro>ean
12htt>)euro>a.euabout-eubasic-in=ormationindeFen.htm13htt>)euro>a.euabout-eueu-historyindeFen.htm
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nation@ both eMs >ost rocess them in another. War had le=t "uro>e eFhausted@ ossibly unable to sto> Russia. n order to solve this siF neighbouring
countries agreed in The Treaty o= Paris to =orm an area o= =ree trade =or several Eey
resources including coal@ steel and iron ore@ chosen =or their Eey role in industry and the
military. This body ranationalM a level o= governance above the
nation stateC bodies) a ouncil o= 7inisters@ a ommon Assembly@ a High Authority and aourt o= 5ustice@ all to legislate@ develo> ideas and resolve dis>utes. t licitly stated the creation o= a =ederal "uro>e as their long term
goal.
T4e European E6onoi6 Counit
The success o= the "S led to the member nations signing tean
"conomic ommunity. This "" created a common marEet among the member nations@
ediments to the =lo< o= labour and goods. By 1/,: trade ean Parliament =rom 1/*&C to give advice@ a court ut the >olicy into a==ect. The 1/*8 Brussels Treaty
merged the commissions o= the ""@ "S and "uratom to create a oint and >ermanent
civil service.
De=elopent
#ver the ,:s and 4:s the membershi> o= the "" eF>anded@ alloain in 1/4*. The remit o= the
"" thus develo>ed@ and =oreign >olicy became an area =or consultation and grou>
action. #ther =unds and bodies ean
Act S"AC evolved the ""Ms role a ste> =urther. !o< "uro>ean Parliament members
o>ulation. BottlenecEs in the common marEet
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T4e +aastri64t Treat an5 t4e European "nion
#n 'ebruary ,th 1//& "uro>ean integration moved a ste> =urther ean (nion.
The change illarsJ) the "uro>ean ommunities@ giving more >ooing the eFisting bodies. This ean ouncilM@ and BritainMs
Baroness Ashton LHigh Re>resentative =or 'oreign A==airsM.
E" institutions
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The "uro>ean (nion "(C is not a =ederation liEe the (nited States. !or is it sim>ly an
organisation =or co-o>eration bet the "( its Lmember statesMC remain inde>endent sovereign
nations but they >ool their sovereignty in order to gain a strength and oeci=ic matters o= oint interest can be made democratically at "uro>ean level.
The "uro>ean (nion "(C is governed by se=en institutions. Article 1+ o= Treaty on
"uro>ean (nion lists them in the =olloean
ouncil@ the ouncil o= the "uro>ean (nion@ the "uro>ean ommission@ the ourt o=
5ustice o= the "uro>ean (nion@ the "uro>ean entral BanE and the ourt o= Auditors.
European Parliaent1
3irectly elected by "( voters every 8 years@ members o= the "uro>ean Parliament 7"PsC
re>resent the >eo>le. Parliament is one o= the "(Ms main laean laermission =or other im>ortant decisions@ such as alloean institutions in several >ointed@ its &, members 2 one =rom each "( country 2
cannot taEe u> o==ice until Parliament has a>>roved them. = the 7embers o= the "uro>ean
Parliament disa>>rove o= a nominee@ they can reect the entire slate. Parliament can also
call on the ommission to resign during its >eriod in o==ice. This is called a motion o=
censure.
14htt>)euro>a.euabout-euinstitutions-bodieseuro>ean->arliamentindeFen.htm
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Parliament Eee>s checE on the ommission by eFamining re>orts it >roduces and by
Duestioning ommissioners. ts committees >lay an im>ortant >art here. 7"Ps looE at
>etitions =rom citi?ens and sets u> committees o= inDuiry. When national leaders meet =or
"uro>ean ouncil summits@ Parliament gives its o>inion on the to>ics on the agenda.
Super=isin8 t4e bu58et
Parliament ado>ts the "(Ms annual budget ent@ and every year >asses udgement on the
ommissions handling o= the >revious years budget.
European Coun6il1$
"uro>ean ouncil meetings are essentially summits ean ouncil brings together the heads o= state or government o= every "(country@ the ommission President and the "uro>ean ouncil President@ olitical >riorities ouncil o= "uro>e2 notan "( body at all.
#4at 5oes it 5oort.
Ad A>>roving the "( budget)The money the "( can s>end every year is decided ointly by the ouncil and the"uro>ean Parliament.
Ad 8 'oreign and de=ence >olicy)!ational governments have inde>endent control in these areas@ but are aoint =oreign and de=ence >olicyEno
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The current President o= the "uro>ean ommission is 5osQ 7anuel Barroso
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the ommission re=ers the issue to the ourt o= 5ustice. The ourt can im>ose >enalties@
and its decisions are binding on "( countries and institutions.
Ad Re>resenting the "( internationally)
The ommission s>eaEs on behal= o= all "( countries in international bodies liEe the
World Trade #rganisation. t also negotiates international agreements =or the "( such as
the otonou Agreement on aid and trade bet>lied in the same er "( country. The ourt is hel>ed by eight
Ladvocates-generalM resent o>inions on the cases brought be=ore the
ourt. They must do so >ublicly and im>artially. "ach udge and advocate-general is
a>>ointed =or a term o= siF years@ utes bet)euro>a.euabout-euinstitutions-bodiescourt-usticeindeFen.htm19'or eF>lanation visit the )euro>a.euabout-euinstitutions-bodiescourt-usticeindeFen.htm20htt>)euro>a.euabout-euinstitutions-bodiescourt-auditorsindeFen.htm
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The "uro>ean ourt o= Auditors audits "( =inances. ts role is to im>rove "( =inancial
management and re>ort on the use o= >ublic =unds. t in 1/,8 and is based in
$uFembourg.
Purpose@
To ensure that "( taF>ayers get maFimum value =or their money@ the ourt o= Auditors
has the right to checE auditC any >erson or organisation handling "( =unds. The ourt
=reDuently carries out on-the-s>ot checEs. ts =indings are in re>orts submitted to
the ommission and "( national governments. The ourt o= Auditors has no legal >os@
#ne o= the ourts most im>ortant obs is to >resent the "uro>ean Parliament and theouncil ort on the >revious =inancial year the annual dischargeC.
Parliament eFamines the ourtMs re>ort thoroughly be=ore deciding >rove the ections in "( institutions@ member countries
and countries receiving "( aid. While the ourts ractice 4:N o= the income and eF>enditure is
managed by national authorities.
De6ision;a>in8@
The European Coun6il de=ines the general >olitical direction and >riorities o= the
"uro>ean (nion. With the entry into =orce o= the Treaty o= $isbon on 1 3ecember &::/@ it
became an institution. ts President is Herman an Rom>uy.
The "(s decision-maEing >rocess in general and the co-decision >rocedurein >articular
involve three main institutions)
the European Parliaent@ resents the "(Ms citi?ens and is directly elected
by themK
the Coun6il of t4e European "nion@ resents the individual member statesK
the European Coission@ hold the interests o= the (nion as a
ean (nion.
3e>ending on the issue on the agenda@ each country resented by the minister
res>onsible =or that subect =oreign a==airs@ =inance@ social a==airs@ trans>ort@ agriculture@
etc.C. The >residency o= the ouncil is held =or siF months by each 7ember State on a
rotational basis.
T4e Coun6il is responsible for 5e6ision;a>in8 an5 6o;or5ination
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The ouncil o= the "uro>ean (nion >asses laolicy@
based on guidelines set by the "uro>ean ouncil. The ouncil concludes@ on behal= o= the ommunity and the (nion@ international
agreements betean Parliament constitute the budgetary authority that
ado>ts the ommunityMs budget.
The acts o= the ouncil can taEe the =orm o= regulations@ directives@ decisions@ common
actions or common >ositions@ recommendations or o>inions. The ouncil can also ado>t
conclusions@ declarations or resolutions. When the ouncil acts as a legislator@ in >rinci>le
it is the "uro>ean ommission that maEes >ro>osals. These are eFamined rinci>le@ it is the ommission that >ro>oses ne< lat them. The ommission and the member states then im>lement them@
and the ommission ensures that the laro>erly taEen on board.
Tart to >lay) the ourt o= 5usticeu>holds the rule o=
"uro>ean laoonsibilities o= these institutions are laid dorime ministers o= all the "( countries@ and rati=ied by their >arliaments.
Para8rap4 1.3 ; E" la721
To clari=y this@ ean nstitutions
The institutions o= the "uro>ean ommunity can issue di==erent Einds o= legislation@
namely)
1. Regulations
&. 3irectives
+. 3ecisions
. Recommendations
21Also see htt>)euro>a.euabout-eubasic-in=ormationdecision-maEinglegal-actsindeFen.htm
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1. Regulations)
General rules that a>>ly uni=ormly throughout the "@ so they create a uni=orm set o= rules
=or all the member states and their inhabitantsC. These regulations are directly a>>licable@
so the >rovisions o= the regulations taEe e==ect in the legal systems o= the member states@
rovisions o= the regulation@ those national >rovisions have to be
abolished.
7ost regulations are created by the ouncil o= 7inisters@ sometimes in coo>eration ean ommission@ ean ommunity. n order to remove those limitations@ directives
establish an alternative rotecting those >ublic interests@ ean ommunity@
ace =or national governments to manoeuvre.3irectives are not general rules that a>>ly uni=ormly throughout the "@ they are not
directly a>>licable and they are not directly e==ective@ so civilians and legal entities cannot
invoEe them be=ore a national court o= laean
ommission or the national governments o= the member states to =ill in the =rameolicies or doctrines rotect businesses
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+. 3ecisions.
A decision is an individual act that is binding =or the member state or individualgrou> o=
individuals to ermitC@ so a decision is only
binding in an individual case. t is an eFecutive measure to eFecute an article o= the "
treaty or a regulation.
A decision can be =avourable to an individual or member state >ermission to do
somethingC or a burden a >rohibition to do somethingC.
. Recommendations.
A recommendation is ust an advice@ usually given to a member state. t is not binding@ so
i= a member state chooses to disregard it@ it canMt be =orced to acce>t the advice.
Para8rap4 1.' ; !nternational Pri=ate la7
When >osed to u>hold the la< - in mind that a udicial system is a
national >henomenon. n other ean ommunities "uro>ean ourt o= 5usticeC. With the
eFce>tion o= the "uro>ean ourt o= 5ustice@ these international courts do not have
su>ranational authority to rule over cases and their authority is largely based on the voluntary
submission by countries andor individuals. As ean (nion. The "uro>ean ourt o= 5ustice constitutes a =ourth layer
o= litigation@ in addition to the + layers that normally consist henomenaMs. Where the >arties do not
agree on arbitration@ dis>utes concerning international business transactions may be
submitted to ordinary courts =or resolution. This raises Duestions etent court@ the a>>licable la< and the en=orcement o= udgments in other states@ issues
=alling
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a>>lies to a given dis>ute. The rules ty>ically a>>ly ute has a U=oreignU
element such as a contract agreed by >arties located in di==erent countries.
The three branches o= con=lict o= lalied to resolve the dis>ute
'oreign udgements 2 the ability to recognise and en=orce a udgement =rom an
eFternal =orum rinci>le@ Private nternational $a< is >rimarily >art o= the national legal system. There are@
horanational regimes. This course =ocuses on the Private
nternational $a< regimes@ ed by the "uro>ean ommunity
institutions@ in the =orm o= conventions@ regulations@ directives and case lahasis is
on rules o= urisdiction@ a>>licable la< regarding international contracts and tort@ and
en=orcement o= national udgments in other countries.&
24htt>s)studiegids.leidenuniv.nlcoursesshoean-and-international->rivate-larohibits any com>any =rom reaching agreements anies to establish a cartel is a regulation directive decisionrecommendation@ becauseVVV%
9uestion '
a. What does Ldirectly a>>licableM mean%b. What does Ldirectly e==ectiveM mean%
9uestion $
a. Which are the institutions o= the "uro>ean ommunities%b. 3escribe brie=ly
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9uestions ; C4apter 1B !nternational La7
9uestion 1
What are the sources o= international larohibits the em>loyer =rom terminating the=iFed term contract unilaterally@ unless em>loyer and em>loyee agreed to this o>tionloyment. The 3irective >osed to beincor>orated into the national laloyment contract =or one year as a com>uter engineer. Holoyment contract a=ter * months on 1 5uly &::*@ as they arealloloyer@ rovision on this >oint beingnecessary in the em>loyment contract.
t is obvious that the BGB is in con=lict oint. t isalso clear that the German authorities did not incor>orate the 3irective into Germanla< in time. HellenbergMs contract could not have been terminated liEe this had3irective :1&+ been brought into the German legal system in time. Hellenbergstarts litigation against Porsche AG and the German State in the German court o= =irstresort@ the $abour ourt o= Stuttgart.
a. s 3irective :1&+ directly a>>licable@ according to the "-treaty%
Pagina 32van 131
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b. What issue has to be settled =irst be=ore Hellenberg can rely on the >rovisionso= 3irective :1&+ in a German court o= larecedence over the laossible =or Hellenberg to claim damages =rom the German State becauseo= the =act that they did not im>lement 3irective :1&+ in time% (se relevantcase la< in your ansrohibit clubs in the "uro>ean ?one =rom =ielding =oreign >layers
in national cham>ionshi>s layed in another country in the "uro>ean?one and have been trans=erred a=ter &4 'ebruary. A=ter that data it is still>ossible@ holayers =rom non-"uro>ean clubs to be trans=erred and to>lay.
7r $ehtonen is a 'inish basEetball >layer. At the end o= 1//81//* season heart in the =inalstage o= the Belgian cham>ionshi>s. 7r. $ehtonen concluded a contract o=em>loyment as a >ro=essional s>ortsman ril 1//*. A=ter that astors Braine layed by astors Braine >osing teams obected toastors Braine =ielding $ehtonen@ as he had been trans=erred a=ter &4 'ebruary@and they com>lained to the Belgian basEetball association that this ean ?one le o= =ree movement =or
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9uestion ).
a. A rule that aims to maEe the legislation in Holland@ concerning good lace environment@ similar to the German legislation@ is a regulation directive
decision recommendation@ becauseVVV%
b. A =orm o= legislation that =ines a s>eci=ic com>any =or maEing cartel
agreements =or trans>ort =ees is a regulation directive decision
recommendation@ becauseVVV%
c. A =orm o= legislation that >rescribes that national legislative measures have to
be taEen in order to ensure that medicinal >roducts =or human use are
>roduced@ >laced on the marEet@ distributed and utilised correctly
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C4apter 2. Dispute esolutionSee) htt>)catalog.=lat>t >resentation
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9uestions : C4apter 2 Dispute esolution
9uestion 1Please eF>lain the di==erence betartial and inde>endent.
9uestion 2Ho< is the inde>endence and im>artiality o= the 5udiciary guaranteed in Holland%
9uestion 3n &:1: and &:11 in Holland a laer@ rohibited. 7any >eo>le already had lodged in a
com>laint. n &::4@ the =ilm 'itna came out@ ortraits the slam as a very negativereligion. The Public Prosecutor decided not to start litigation. Houshed through and a laetence determine etence is determined. And also state e o=case this is and etent to handle this laress@ a >rinting o==ice situated in Belgium@ =or years. Theirrelationshi> has been very good. To >ublish the booEs on time@ both >arties have agreedthey ress has been slacE ost>one their >rinting several times. Seeing as ;luutation@ they this re>utation. #n the one hand they ress to deliver on time@ but noresult. ;luroceedings based on breach o= contract.
a. "F>lain lain the rules and >rocedure.d. What are the advantages and disadvantages o= this >rocedure%e. What i= Print"F>ress does not com>ly
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C4apter 3. EE%
Para8rap4 3.12 ntroduction
Para8rap4 3.22The se>aration o= >o
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Para8rap4 3.1 : !ntro5u6tion
(> until nohenomenon. n other ean ommunities "uro>ean ourt o= 5usticeC. With theeFce>tion o= the "uro>ean ourt o= 5ustice@ these international courts do not havesu>ranational authority to rule over cases and their authority is largely based on the voluntarysubmission by countries andor individuals. As ean (nion. The "uro>ean ourt o= 5ustice constitutes a =ourth layero= litigation@ in addition to the + layers that normally consist
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Para8rap4 3.2 : T4e separation of po7ers
Based on the idea o= the Trias Politica the se>aration o= >oortant >o
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According to the idea o= Trias Politica@ as develo>ed by 7ontesDuieu@ the + maor >ooletely se>arated and theyhave to balance each other a system o= LchecEs and balancesMC@ so that it is >racticallyim>ossible =or one institution to become the sole >ooarate and all the >oarate tasE. According to the original blue>rint =or the se>aration o=>o to the >arliament that is usually divided into a house o= re>resentatives and asenate@ to create the laarliament has a legislative tasE. t is u> to thegovernment@ at the national@ regional and local level@ to eFecute and im>lement the laarliament@ so the government >er=orms an eFecutive tasE. n case o= legalcon=lict bet to the udicial systemto a>>ly the la< and =ind a solution to the con=lict in its rulings.
The idea o= Trias Politica as described above has not been strictly im>lemented in everycountry. 'or eFam>le@ in the !etherlands the government and >arliament together createlaoointed by the government@ so the governments eFertin=luence over the udicial system.6et most democraticC countries have a system that is more or less in accordance
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Business La7 Sllabus Blo6> 2
Para8rap4 3.3 : T4e national u5i6ial sste
7ost legal rules are observed automatically. = this holding the la< ossible. t ractically im>ossible to en=orce every single rule i= the maority o=civilians and legal entities broEe the la< constantly.
n case the la< is broEen or con=licts arise betliance. This involves monitoring com>liance@ >enalties =ornon-com>liance and settlement o= dis>utes by the udicial system.
The udicial system is usually com>osed o= the =ollo
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Business La7 Sllabus Blo6> 2
nternational)
-----------------------------------------------------------------------------------------------------------------!ational)
1
Ho>ortunity to go to a court o= a>>eal.Sometimes a>>eal is >ossible@ but only to a limited eFtent or there are limitations as to theEinds o= cases in arties can a>>eal.
Since most countries have a legal system that is more or less com>osed as is shoreme ourt) deals arty or both >artiesC disagreesC >eal that ruling be=ore the su>reme court&8
As ossible =or >arties >eal itMs ruling be=ore an international court o= laean ommunities "uro>ean ourt o=5usticeC@ this court has the su>ranational authority to rule in cases ean ourt o= 5ustice constitutes a =ourth layer o= litigation.
25There is also a set o= rules to determine eal in a certain country are authori?ed to handle a certain lae o= thissubect.
Page '2o= 131
%u!reme ourt
)uro!en ourt o(
usti"e
ourt o(
!!el
ourt o(
!!el
ourt o(
!!el
7istri"t
"ourt
7istri"t
"ourt
7istri"t
"ourt
7istri"t
"ourt
7istri"t
"ourt
7istri"t
"ourt
7istri"t
"ourt
ivil se"tor riminl
se"tor
/dministrtiv
e se"tor
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Business La7 Sllabus Blo6> 2
Para8rap4 3.' : Prin6iples of liti8ation
n order to maEe sure that ustice is done in a s>eci=ic larinci>leso= litigation have to be observed by every court o= larinci>le ensures that the rinci>les nor does something that is against the larinci>le also ensures that the rinci>les nor does something that is against the laendent =rom the legislative and eFecutive >orinci>le ensures that no government organ can >ut >ressure on the udgesC tomaEe sure the udgesC arties involved in a larinci>le ensures that it is >ossible to checE arties involved should have access to every >iece o= relevant in=ormation
$. the hearin$ has to occur within a reasonable period of time
26These >rinci>les are based on article * o= the "uro>ean onvention on Human RightsK every country that is a
member state o= the ouncil o= "uro>e andor the "uro>ean (nion has to maEe sure that these >rinci>les areobserved by its national udicial systemK art * reads as =olloublic hearing endent and im>artial tribunalestablished by laronounced >ublicly by the >ress and >ublic may be eFcluded=rom all or >art o= the trial in the interest o= morals@ >ublic order or national security in a democraticsociety@ rotection o= the >rivate li=e o= the >arties so reDuire@ or theeFtent strictly necessary in the o>inion o= the court in s>ecial circumstances ublicity reudice the interests o= ustice.&. "veryone charged resumed innocent until >roved guilty according tolaen to the >ublic@ unless the la< itsel= commands that the doors are closed =or eFam>le incase a minor is on trial =or violating the laarties involved in a la>ortunity to obect tothe >artici>ation o= a s>eci=ic udge in a la>ears to be or is regarded as >reudicedbiased.29
n case the arguments >resented in the verdict cannot su>>ort the ruling@ a>>arently di==erent motives haveleaded the court to rule the rinci>le is EnoartemM@ artyM.
Page '3o= 131
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Business La7 Sllabus Blo6> 2
this >rinci>le ensures that no one involved in a laeriod o=uncertainty about the outcome o= the laarts o= the >rocedureC has to beconcluded@ sometimes the la< ust says it has to be done eriodo= timeK
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Business La7 Sllabus Blo6> 2
Para8rap4 3.$ : uris5i6tion
t is u> to the >arties involved in a civil legal con=lict to decide arties donot live or reside in the same country andor other >arties =rom di==erent countries areinvolvedC@ that laly or the eFisting rules do not give a solution =or the s>eci=ic legal con=lict the court is
dealing ly national com>etency rules to determine ean ommunity "C toensure uni=ormity in the urisdiction o= courts that reside e to determine >lied i= the >artiesinvolved in the laean(nion. = one or more >arties are =rom outside the "(@ then national P$-rules o= the countrythat is been a>>ealed to need to be used to veri=y the authority o= the court.
Sco>e and content
The Brussels Regime covers legal dis>utes o= a civil or commercial nature article 1C. Thereare some eFce>tions limiting the sco>e o= thisK rinci>al matter o= a dis>ute is oneo= =amily latcyor insolvency@ social security@ or relates to arbitration@the case isnot subect to the rules. Article & >rescribes that a >erson legal or naturalC may only be sued
31n 3utch this la< is called LWet o> de RechterliEe organisatieM.32n 3utch this la< is called LWetboeE van BurgerliEe RechtsvorderingM.
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Business La7 Sllabus Blo6> 2
in the member state in erson can be domiciled in more than one statesimultaneously. Article >reserves the traditional rules =or de=endants ly and the national court hearing the case is le=t to determine urisdiction based on thetraditional rules otherublic registersK- Registration or validity o= intellectual >ro>erty rightsK- "n=orcement o= udgements.s the choice o= =orum valid and i= it is not about an issue o= art && ""9@ then thedesignated udge has eFclusive urisdiction based on art &+ ""9. This means that allother udges have to declare themselves unauthorised@ unless the contract states thatanother udge also has urisdiction.+
B. S>ecial >rovisions in s>eci=ic situations art. 4 to &1 ""9C
1. Art. 14 to &1 ""9) urisdiction in case o= individual em>loyment contracts!f t4e eploee is t4e plaintiff@
- The court o= la< o= the country loyer has his >lace o= residenceKor- The court o= la< o= the country loyee usually lainti==)- The court o= la< o= the country loyee has hisher residence has
urisdiction2. Art. 18 to 1, ""9) urisdiction in case o= consumer contracts= the consumer is the >lainti== the consumer can choose betlainti== he can choose bet)ec.euro>a.eucivilustice>ublicationsdocsguidelitigescivilstrans=rontaliersen.>d=@> +@ X 1.347r. S. van Hall@ >Contracten in de internationale handel?< Wolters-!oordho== 1edruE@ &::,@ >. +8-+*.
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Business La7 Sllabus Blo6> 2
- "tc.= the insurer is the >lainti== the court o= la< o= the country erson liveshas eFclusive urisdiction. Art. & and 8) n the absence o= a choice o= =orum+8or a s>ecial >rovision in s>eci=ic
SituationsK general rules1. Art. & ""9)The court o= la< o= the country lainti== to choose bet
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Business La7 Sllabus Blo6> 2
Para8rap4 3.) : Ee6ution
We would now advise you to read chapter 3, paragraph 3.# of A basic guide to
International Business Law, eeping in !ind the following"
7ost countries only allo< verdicts that are given by their national courts to be eFecuted on
their territory. So 2 =or eFam>le 2 in case a hinese seller is aa.eucivilustice>ublicationsdocsguidelitigescivilstrans=rontaliersen.>d=@> 1.
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Business La7 Sllabus Blo6> 2
Para8rap4 3.& : Arbitration
We would now advise you to read chapter 3, paragraph 3.$ of A basic guide toInternational Business Law, eeping in !ind the following"
(> until no< arties have both agreed on this either by >uttingan arbitration clause in their contract or creating a se>arate agreement on arbitrationC.
n case >arties have agreed on arbitration@ the o==icial courts are no longer authori?ed tohandle the case. n case one o= the >arties does bring the case be=ore an o==icial court@ thecourt only has urisdiction in case the other >arty a>>ears be=ore the court@ unless he is thereto state that the court has no urisdiction. The other >arty immediately has to invoEe thearbitration agreement@ stating that the court has no authority. = he doesnMt do that or he does
it too late in the >roceedingsC@ the o==icial court has the authority to handle the case.
n case no arbitration clause has been included in the contract and one o= the >arties doesbring the case be=ore an arbitrator@ the other >arty immediately has to claim the arbitrator hasno urisdiction. = he doesnMt do that or he does it too late in the >roceedingsC@ he is regardedas having silently agreed
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Business La7 Sllabus Blo6> 2
9uestions : C4apter 3A EE%
9uestion 1Albert@ a 'rench national@ lives in Germany. He is hired by a Polish com>any@ er=ormed his ob >ro>erly he sho late very
o=ten@ he le=t early every day@ he any loyment contract. !o choices are made as to the la< that should be a>>lied to the
contract or the court that should handle a laany to nulli=y the
em>loyment contract%
9uestion 2Anderson@ living in S>ain@ rinting >ress@ to be used in his o==ice in7adrid S>ainC. Anderson decides to buy a >rinting >ress =rom Bayer@ a com>any establishedin Berlin GermanyC. Anderson calls Bayer and asEs =or some in=ormation on the various>rinting >resses the com>any >roduces. #n 3ecember 1& &::4 Bayer sends Anderson ano==er. The o==er states that Anderson can buy their nets this o==er be=ore 3ecember & &::4. Anderson acce>ts the o==er on 3ecember&& &::4. !o choices are made as to the la< that should be a>>lied to the contract or thecourt that should handle a la>ose@ Bayer does not deliver the >rinting >ress in 7adrid@ as >arties had agreed.Anderson >ose@ Anderson ossible%
9uestion 3Henry 7cGuiness@ a Scottish national@ lives in S>ain. He is hired by a 'rench com>anyestablished in Paris 'ranceC@ any discoversthat Henry has not >er=ormed his ob >ro>erly he sho late or he doesnMt sho< u> at
allK he misses a>>ointments regularly and he doesnMt sho< any leadershi> DualitiesC. The'rench com>any loyment contract. !o choices are made as to thela< that should be a>>lied to the contract or the court that should handle a laacEagingmaterial@ to be installed in his =actory in Athens GreeceC. 5acEson decides to buy themachine =rom Svensson@ a com>any established in StocEholm Sany
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>roduces. #n 7ay & &::/ Svensson sends 5acEson an o==er. The o==er states that 5acEsoncan buy their nets this o==er be=ore 5une1& &::/. #n 5une * &::* 5acEson sends Svensson a letter in >lied to thecontract or the court that should handle a la>ose@ Svensson does not deliver the machine in Athens@ as >arties had agreed.5acEson >ose@ 5acEson ossible%
9uestion $a. om>any A@ established in taly@ and com>any B@ established in Poland@ reach an
agreement. om>any A any B ay the amount o= Y&:.:::@- =or the
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9uestions : C4apter 3B EE%
9uestion 1Peters decides to buy a ne< Eitchen =or his home in "nschede =rom ;Zchen "cE GmbH inGronau@ Germany. His neighbours tell him that it is much chea>er than Eitchens locallyavailable and the Eitchens in the brochure sent to him certainly looE very nice.The sales contract concluded and signed in Gronau@ states that German la< >ly tomatters related to this contract. The Eitchen is to be delivered on #ctober 1@ 1//4.(n=ortunately@ ;Zchen "cE is not able to maEe delivery in time. 3ue to logistical >roblems atthe >lant in Gronau@ the Eitchen is delivered on #ctober 8@ 1//4. t trans>ires that various>arts o= PetersM ne< Eitchen are damaged and ;Zchen "cEMs em>loyees are clearly to blame=or this damage. Since ;Zchen "cE is unany.
a. The legal advisor hired by Peters claims that the contract Peters and ;Zchen "cE
entered into is a ty>ical consumer contract according to relevant internationaltreaties@ and that there=ore Peters should turn to the court o= la< o= his choice. 3o youthinE this legal advisor is right% Give your reasons.
b. Su>>ose the contract entered into betartment in Brasschaat@ a >eace=ul Belgian toulation.Problems arise in relation to o o= the a>artment due to an error committed bythe Belgian notary. n the event o= PetersM commencing litigation against the BelgiannotaryMs o==ice@ bulbs to 'loricultures de la7aresma 'lorimar Soc. oo>. $mta. n Barcelona@ S>ain@ to be delivered eF lace o= business o= the >urchaser. Trans>ortation as agreed on by the >arties has beenarranged by an Tubergen. 3ocEs de Bourgogne@ a trans>orting com>any established inHolland@ is to be the trans>orter.The trucE has engine trouble and 3ocEs delivers the bulbs tay the >rice o= Y &8@::: agreed on by the >arties and re=uses to acce>tthe goods. an Tubergen claims com>ensation =rom 3ocEs =or the damage.
a. n the event o= a la
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7Zller@ a =ormer German s>orts hero living in Bentheim GermanyC@ sells his house there to
5ansen@ a soccer coach@ ay the >rice into an account 7Zller has
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Weller to >roceed s and Weller loses a great deal o=money. Weller is not a ha>>y man and blames both advisers =or the bad advice they gavehim. Weller decides to sue both Ancelotti and Westerhagen =or com>ensation =or his loss.Ancelotti is not a ha>>y man either as Weller re=uses to >ay the =ee agreed on in theircontract.
a. n the case o= Weller vs. Ancelotti)
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C4apter '. ECO
Para8rap4 '.12 ntroduction to nternational Private $a>licable la< in case o= international con=lict
Para8rap4 '.'2 7ost im>ortant articles o= "#
Para8rap4 '.$2 $a< a>>licable in case o= international tort
9uestions : C4apter '
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Para8rap4 '.1 :!ntro5u6tion
When >arties involved in a legal con=lict have decided to taEe their case to court@ the =irst
Duestion that has to be ans
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Para8rap4 '.2 : !nternational Pri=ate La7
Ste> 1)
n order to determine >ly in a s>eci=ic case@ lied@ that gives rulesthat solve the con=lict directly. !eFt >licable@ rovides us to determine >lied to the case.'irst >ly the SG@ since the SG re=ers to the "#onvention.
#e 7oul5 no7 a5=ise ou to rea5 64apter 1- !ntro5u6tion an5 para8rap4 1.1 of Abasi6 8ui5e to !nternational Business La7.
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Para8rap4 '.3 : Appli6able la7 in 6ase of international 6onfli6t
We ortant international
sources o= P$ available to determine >lied to a legalcon=lict bet>lied by courts o= la< that reside in a member state o= the"uro>ean ommunityK
&. the con=lict betarties involved arises =rom contractual obligations in other betarties involved are living or established in di==erent countries
Art. & "# determines that the "# has a universal e==ect@ lied@ then that has to be a>>lied. Thela< that has to be a>>lied is not limited to the la< o= one o= the ontracting States o= the"#.
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Para8rap4 '.' : +ost iportant arti6les of t4e ECO3*
'.'.1 C4oi6e of la7
hoice o= la< art. + "#C
- Parties are =ree to choose the la< they >lied to their contract
'.'.2 (eneral pro=isions in t4e absen6e of a 64oi6e of la7
General >rovisions in the absence o= a choice o= la< art. "#C= the >arties have not made an eF>licit choice o= a>>licable laro>er la< >lace o= habitual residence or >lace o= central administration o= the >arty>er=orming the contract@ >rinci>al >lace o= business or other >lace o= business o= the >artyres>onsible =or >er=orming the contractC. Hoeci=ic rules a>>ly in tort o= goods@ the a>>licable la< is determined
according to the >lace o= loading or unloading@ or the >rinci>al >lace o= business o=the consignor.+/
Where the contract concerns immovable >ro>erty@ the la< a>>licable by de=ault is that
o= the country in ro>erty is situatedK in other ro>erty or a right to use immovable >ro>erty@ thecontract is most closely connected to the country74ere t4e io=able propert issituate5K:1
n other cases) the la< o= the country to >liedK
- This is the country o= the >arty that a==ects the 64ara6teristi6 perforan6e
contract o= sale) characteristic >er=ormance is done by the seller
contract o= rent) characteristic >er=ormance is done by the landlord
contract o= distribution) characteristic >er=ormance is done by the distributor
em>loyment contract) characteristic >er=ormance is done by the em>loyee
contract o= agency) characteristic >er=ormance is done by the agent
=@ horovided bythese rules@ the la< o= that country >lied.
'.'.3 La7 appli6able to 6onsuer 6ontra6ts
$a< a>>licable to consumer contracts art. * "#C
38'ind the articles in the syllabus )euro>a.eulegislationsummariesustice=reedomsecurityudicialcoo>erationincivilmattersl++1:/en.htm40"Fam>le .* o= the teFtbooE is incorrectK since both >arties in the eFam>le live in Holland@ 3utch $a< a>>lies to
their contract. #nly i= one o= the >arties lives in another country@ =or eFam>le Germany@ the eFam>le
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The "# gives s>ecial >rovisions =or certain contracts. #ne o= those s>ecial >rovisions isart. * "#@ that a>>lies to consumer contracts.- n the absence o= a choice o= la>lied in case)aC The contract rovided by his o>ly o= goods or services to a >erson is coveredby s>ecial >rovisions@ according to the >rinci>le o= the >rotection o= the arty. (nlessthe >arties decide otherly to contracts o=
carriage or contracts =or the su>>ly o= services in a country other than that in
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- as long as the contract meets the =ormal reDuirements o= the la< chosen by the>arties or those o= the la< o= the country
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Para8rap4 '.$ : La7 appli6able in 6ases of international tort
The "# only a>>lies to international contracts@ not to international torts. n case o= aninternational tort@ one has to looE at other sources to determine >lied.
According to the 3utch Su>reme ourt the criterion to determine >liedto a case o= international tort is the la< o= the country ic the la< a>>licableto non-contractual obligationsC@ generally re=erred to as Rome . This Regulation determinesthe la< a>>licable to)- TortK- Product liabilityK the a>>licable la< is the la< o= the country o= the consumerC- (n=air com>etitionK- iolation o= >rivacy and rights relating to the >ersonalityK- iolation o= the environmentK- n=ringement o= co>yrights the a>>licable la< is the la< o= the country rotectedC.
This Regulation has come into e==ect in &::/. The Regulation determines the a>>licable la>licable la< in cases concerning =or eFam>le >roduct liability@un=air com>etition etc.
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9uestions : C4apter 'A ECO
9uestion 1Anderson@ living in S>ain@ rinting >ress@ to be used in his =actory in7adrid S>ainC. Anderson decides to buy a >rinting >ress =rom Bayer@ a com>any establishedin Berlin GermanyC. Anderson calls Bayer and asEs =or some in=ormation on the various>rinting >resses the com>any >roduces. #n 3ecember 1& &::4 Bayer sends Anderson ano==er. The o==er states that Anderson can buy their nets this o==er be=ore 3ecember & &::4. Anderson acce>ts the o==er on 3ecember&& &::4. When the >rinting >ress arrives & rinting >ress doesnMt =unction >ro>erly. Anderdon lied to the contract.What la< should be a>>lied to this contract%
9uestion 2Albert@ a 'rench national@ lives in S>ain. He is hired by a Polish com>any@ er=ormed his ob >ro>erly he sho late very
o=ten@ he le=t early every day@ he any loyment contract. !o choice is made as to the la< that should be a>>lied to the contract.
What la< should be a>>lied to this contract%
9uestion 3At a marEet sDuare in Hamburg GermanyC@ 7r. 7artine?@ a S>anish national lastic. The tree is
manu=actured and sold by ole $td.@ a com>any established in the (nited ;ingdom. This
British seller had >ut an advertisement in a German nea>er@ inviting >eo>le to come to
the marEet sDuare in Hamburg on that >articular day to buy a tree =rom ole $td. When he
arrives home@ 7artine? discovers the tree is broEen and there are several >arts missing.
7arine? lied to the contract.
What la< should be a>>lied to this contract%
9uestion '5ames 5acEson@ living in Greece@ lastic >acEagingmaterial@ to be installed in his =actory in Athens GreeceC. 5acEson decides to buy themachine =rom Svensson@ a com>any established in StocEholm S
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Henry 7cGuiness@ a Scottish national@ lives in Holland. He is hired by a 'rench com>any
established in Paris 'ranceC@ any discovers
that Henry has not >er=ormed his ob >ro>erly he sho late or he doesnMt sho< u> at
allK he misses a>>ointments regularly and he doesnMt sho< any leadershi> DualitiesC. The
'rench com>any loyment contract. !o choice is made as to the la>lied to the contract.
What la< should be a>>lied to this contract%
9uestion )A buyer =rom Belgium and a seller =rom Holland are involved in a con=lict about the eFecution
o= their sales contract. The Belgian buyer claims that the 8: cars he ordered have not been
delivered to him@ so he re=uses to >ay. The seller claims that he did deliver the cars and hedemands >ayment. The >arties involved have not made a choice as to the la< that should be
a>>lied to their contract.
What la< should be a>>lied to this contract%
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9uestions : C4apter 'B ECO
9uestion 1Be? runs a loys Tomasi@
Po??obon and !erobuto@ three eF>erienced talian ice-cream maEers =rom 7ilan@ taly@ =rom
5une to Se>tember every year. The >ayment =or their services consists o= a salary in cash
and a =ree >lace to live during their months in the !etherlands. This is laid doloyment contract that loyerMs trade organi?ation that are a>>licable to all >ersonnel tember &::1 Be? dismissed all three men =rom their obs and directed that
they leave his ice-cream >arlour immediately. Tomasi@ Po??obon and !erobuto are noayment o= their salaries =or August and Se>tember &::/ in =ront o= an talian court
o= la>lies to the em>loyment contracts o= Tomasi@ Po??obon and !erobuto%
b. n vie< o= the nationality o= all >arties@ loyees have
agreed to talian la< being a>>lied to their em>loyment contracts. Hoensation as 3utch la< does. n the case
in Duestion@ ossible =or the talian em>loyees to claim com>ensation
according to the 3utch ivil ode@ even though >arties agreed to talian la< being
a>>lied%
9uestion 27c3onald@
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a. s the choice o= "nglish la< as the la< a>>licable to this em>loyment contract made
by the tarties valid and binding =or both >arties%
b. Su>>ose "nglish la< is the la< a>>licable to this contract. Also su>>ose that the
annulling o= the individual em>loyment contract does not meet the =ormal
reDuirements under "nglish laloyment contract =ormally valid
or not%
c. Su>>ose the em>loyment contract is governed 2 in accordance ossible that the contract might indeed be =ormally valid%
9uestion 'an Bemmel B.. is a com>any established in Holland that both manu=actures shoes and
acts as a any established in the (;@ at a >rice o= Y&:.:::. Both >arties
agree in a tele>hone conversation@ that in the event o= any legal >roblems arising a (; court
o= la<
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a. What la< a>>lies to the contract o= sale bet>lies to the trans>ort contract bet
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C4apter $. C!S(
Para8rap4 $.12 ntroduction
Para8rap4 $.22 'ormal reDuirements o= the SG
Para8rap48.32 ntroduction a>>licable la< in case o= international con=lict
Para8rap4 $.'2 The content o= the SG
9uestions : C4apter $
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Para8rap4 $.1 :!ntro5u6tion
We already sa< that arties involved in a legal con=lict have decided to taEe their caseto court@ the =irst Duestion that has to be anslied@ that givesrules that solve the con=lict immediately. We called this ste> 1 +. #nly i= there is no Treaty@onvention or Regulation available or the one that is available does not a>>ly@ & and i= necessary ste> +C and looE at nternational Private $a< among
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Para8rap4 $.2 : Foral reGuireents of t4e C!S(
Be=ore a court can checE >lication o= the SG.
Article 1 SG reads as =ollo>lies to contracts o= sale o= goods betarties laces o=
business are in di==erent States)
aC When the States are ontracting StatesK or
bC When the rules o= >rivate international la< lead to the a>>lication o= the la< o= a
ontracting State.
&. The =act that the >arties have their >laces o= business in di==erent States is to be
disregarded >ear either =rom the contract or =rom any dealings
betarties at any time be=ore or at the conclusion
o= the contract.
+. !either the nationality o= the >arties nor the civil or commercial character o= the >arties or
o= the contract is to be taEen into consideration in determining the a>>lication o= this
onvention.
As can be deduced =rom the =irst sentence o= >aragra>h 1 o= article 1 SG@ the SG only
a>>lies i=)
the laarties involved are acting in their trade or >ro=essionK and
the >arties involved are established in di==erent countriesK and
either o= the =ollo>lies)
the >arties are both established in contracting statesK or
- i= only one >arty is established in a contracting state - the rules o= nternational Private $a>lication o= the la< o= a contracting state.
We lies. n other ly. And i= the laloyment
contract@ the SG doesnMt a>>ly either.
&. The >arties involved are acting in their trade or >ro=ession
= one o= the >arties involved is a consumer@ the SG doesnMt a>>ly. #nly i= the >arties
involved are either com>anies or individuals acting as a >ro=essional buyer o= seller@ does the
SG a>>ly.
+. The >arties involved are established in di==erent countries
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= both >arties involved in the la>ly@ because then it is not an international contract.
. "ither o= the =ollo>lies)
the >arties are both established in contracting statesK
= the >arties involved in the la>lies. 'or the >ur>ose o= this subect >ly@ but only i= P$ leads us to the la< o= a contracting state. An eFam>le to eF>lain
this)
om>any established in Holland@ has sold 8: cars to com>any B@ established in the (nited
;ingdom. om>any B re=uses to >ay =or the cars@ claiming all o= them arties involved are established in di==erent countriesK this reDuirement is met
. "ither o= the =ollo>lies)
a. the >arties are both established in contracting statesK this situation does not a>>ly
b. - i= only one >arty is established in a contracting state - the rules o= nternational Private
$a< lead to the a>>lication o= the la< o= a contracting state.
Part o= nternational Private $a< that has to be a>>lied by courts o= la< lication o= the la< o= a contracting stateJ means Ia>>lying "# leads to the
a>>lication o= the la< o= a contracting stateJ. = that is true@ the SG a>>lies to this case.A>>lying "# arty that a==ects the characteristic >er=ormance. n case o= a contract o= sale
the seller a==ects the characteristic >er=ormance. n other >lication o= the la< o= a contracting state HollandC. There=ore the SG a>>lies to this
case.
Another eFam>le to illustrate ho< article 1 o= the SG should be a>>lied.
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om>any "@ established in "gy>t@ has sold &::: Eilograms o= co==ee to com>any '@
established in 'rance. om>any ' re=uses to >ay =or the co==ee@ claiming all o= it
and mouldy any ' be=ore a
'rench court o= lalies. 'rance is a
contracting stateK "gy>t is not a contracting state. !o choice is made as to the la< that
should be a>>lied. The court assesses the =olloro=essionK this reDuirement is met
+. The >arties involved are established in di==erent countriesK this reDuirement is met
. "ither o= the =ollo>lies)
a. the >arties are both established in contracting statesK this situation does not a>>ly
b. - i= only one >arty is established in a contracting state - the rules o= nternational Private
$a< lead to the a>>lication o= the la< o= a contracting state.
Part o= nternational Private $a< that has to be a>>lied by courts o= la< lication o= the la< o= a contracting stateJ means Ia>>lying "# leads to the
a>>lication o= the la< o= a contracting stateJ. = that is true@ the SG a>>lies to this case.
'irst checE@ can you a>>ly the "#)
Art 1 "#)
the "# is only a>>lied by courts o= la< that reside in a eber state of t4e European
CounitK
the con=lict betarties involved arises =rom 6ontra6tual obli8ations legal
relationshi> is based on an agreementCKthe partiesinvolved are living or established in 5ifferent 6ountries
"gy>t is not an " member state@ so no "#. Thus ste> +@ you have to use the national
rules o= the country o= the court that has urisdiction. So use the ""9 to decide ecial >rovisions in s>eci=ic situations art. * to 21 EE%C
1. Art. && ""9) urisdiction related to io=able propert)
&. Art. 14 to &1 ""9) urisdiction in case o= in5i=i5ual eploent 6ontra6ts+. Art. 18 to 1, ""9) urisdiction in case o= 6onsuer 6ontra6ts
. Art. 4-1 ""9) urisdiction in case o= insuran6e
NO spe6ial pro=ision appli6able- so 8o to@
. Art. 2 an5 $ para8rap4 1 EE%@ n the absence o= a choice o= =orum or a s>ecial
>rovision in s>eci=ic situationsK main rules
1. art. & ""9 >lace o= de=endant 'ranceC.
%
2. art. 8 ""9 >lace o= >er=ormance >aymentC "gy>tC.
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] >aragra>h. 1) contractual obligation >ro=essional >artiesC >lace o=
>er=ormance o= obligationC.
tMs u> to the >lainti== to choose bettian la< to see i= it re=ers you to a SG member state in this case 'ranceC@ i= the
national rules o= 'rance or "gy>t do lead to 'rance@ you can eventually use the SG. ' it
leads to "gy>tian la &C to re=er us to the national la< that a>>lies@ in order to =ind a solution to the
con=lict.
Article * SG gives >arties the o>tion o= eFcluding the a>>lication o= the SG in their
contract@ so that it doesnMt a>>ly@ even i= the reDuirement o= article 1 SG have been met.
Article * reads as =olloarties may eFclude the a>>lication o= this onvention or@
subect to article 1&@ derogate =rom or vary the e==ect o= any o= its >rovisions.I
Base5 on t4is arti6le- parties 6an also 5e6i5e to e6lu5e onl soe of t4e arti6les of
t4e C!S( in t4eir 6ontra6t- or 5eterine t4at t4e out6oe of t4e appli6ation of soe oft4e arti6les of t4e C!S( 7ill be 5ifferent t4an is state5 in t4e C!S(.
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Para8rap4 $.3 :!ntro5u6tion appli6able la7 in 6ase of international
6onfli6t
n >aragra>h 8.1 here o= a>>lication o= the SG. !o< rice and a Duantity. =an Lo==erM doesnMt include these three things 1 or & are missingC@ itMs not a legal o==er@ust an invitation to maEe o==ers.
- Based on article 18 SG an o==er by AC becomes e==ective tance@ unless)a. the o==er indicates@ either by stating a =iFed time =or acce>tance orotherriceK andor
>aymentK andor Duality o= the goodsK andor
Duantity o= the goodsK andor
the >lace o= deliveryK andor
the time o= deliveryK andor
the eFtent o= one >artyMs liability to the otherK andor
the settlement o= dis>utes@
are considered to alter the terms o= the o==er materially.- Based on article &+ SG the agreement is reached the moment the acce>tance
becomes e==ective@ in other
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$.'.2 T4e 6ontent of t4e a8reeent
Articles +1 to ++ SG
- Based on article +1 SG delivery by the seller is done by >lacing the goods at thebuyerMs dis>osal at the >lace lace o= business at the time o=
the conclusion o= the contractC@ unless >arties have agreed otheronsible =or trans>orting the goods@
the seller must choose a means o= trans>ortation that is a>>ro>riate in thecircumstances and according to the usual terms =or such trans>ortation
- Based on article ++ SG delivery has to be done eriod o= time.
$.'.3 Brea64 of 6ontra6t
1. obligations o= the sellerand claims made by the buer)
- Based on article +: SG the sellerhas the obligation to deliver the goods and the
documents relating to the goodsC and to trans=er the >ro>erty o= the goods in other to the obligations described in the contract and article +: and +8 SG.
- Based on article 8 SG the buer has several o>tionsclaims in case a sellerdoesnMt live u> to his obligations in other er=ormance art. * SGC eriod o= time art. ,
SGCK i= the seller doesnMt >er=orm eriod o= time@ he isin de=ault@ er=ormance and additional damage art. ,
SGC.
&. obligations o= the buerand claims made by the seller)
- Based on article 8+ SG the buerhas the obligation to >ay =or the goods.- Based on article 8+ and *: SG the buerhas the obligation to acce>t delivery o=
the goods.- (nless >arties have agreed otherayment has to be done at the sellerMs >lace
o= business art. 8, SGC.- Based on article *1 SG there is a breach o= contract by the bueri= he doesnMt live
u> to the obligations described in the contract and article 8+ and *: SG.- Based on article *1 SG the seller has several o>tionsclaims in case a buyer
doesnMt live u> to his obligations in other er=ormance art. *& SGC eriod o= time art. *+
SGCK i= the buyer doesnMt >er=orm eriod o= time@ he isin de=ault@
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laim damage as a substitute =or >er=ormance and additional damage art. ,
SGC.
$.'.' Effe6ts of terination of t4e 6ontra6t
Articles 41 to 4 SG
Terminating a contract means that =rom the moment o= nulli=ication there is no longer a validagreement betarties. As a result o= that@ both >arties no longer haveany obligations toay anymore. Hoossible that during the >eriod that there arties already >er=ormed >art o=Ctheir obligations as mentioned in the contract andor the SG. Those >artialC >er=ormanceshave to be undone@ a=ter the agreement is nulli=ied. That means that the buyer can demand arestitution o= his >ayment@ and the seller can the demand that the o o=C the good is
returned to him. Articles 41 to 4 SG deal ic.
- Based on article 41 SG termination o= the contract releases both >arties =rom theirobligations under the contractK it also gives a >arty er=ormed the contracteither art the right to claim restitution =rom the other >arty o= arty has su>>lied or >aid under the contract.
- Based on article 4 SG the seller ayment done by the buyer@ has to >ay interest to the buyer.
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9uestions : C4apter $A C!S(
9uestion 1A buyer =rom Suters in good sha>e and =ully o>erational@ so he
demands >ayment. The Sain member state o= the SGC. A=ter only * months S^rensen $td. loyment contract any sus>ects he has acce>ted
bribes =rom a com>any in hili. S^rensen $td. starts a laany established in Germany member stateC@ maEes an o==er to The7alaysian Trade om>any 7TC@ a com>any established in 7alaysia not a member stateC.The o==er involves the sale and deli