What is the International Sales Law and Arbitration
February 15, 2022
Author : Ashley Simons

International trade is an essential contributor to the GDP of any country in the world. It helps to expand the domestic trade to international levels. International trade is a way to make resources accessible through international markets that may not be available in the country. It makes the market more competitive hence competitive prices result in low prices of goods domestically. Also, international trade makes a wider variety of goods and services available in the market and promotes more production and supports newer and more employment opportunities.

Have you ever wondered how such large scale trade
functions on an International scale? and what laws
are essential for many such large scale trade to
happen so smoothly? What are the laws that make it
possible? And how has trade changed due to such

The first and most important part of international trade is the Vienna sales convention. Also known as the United Nations Convention on Contracts for International Sales and Goods (CISG). It is a treaty signed by all the countries worldwide involved in international commerce. It lays down the regulations and laws for trading goods and services internationally. It was held on April 11th 1980, in Vienna, and a total of 85 countries approved and declared CSIG to be a part of their respective domestic and international trade policies.

The CSIG does not affect domestic trade but supports peaceful trade among various nations. It gives out provisions to govern the interests and rights of the contracting parties. The Vienna State Convention applies to international trade of goods if the buyer and seller have their business habitats in different countries. It applies to both the parties in the contract and rules out any domestic trade policies to apply to either.

why is international trade necessary

Vienna Convention for The Law of Treaties in the United Kingdom

The UK and Northern Ireland signed the Vienna Convention on April 20th, 1970, and ratified it on June 25th, 1971. These dates are marked in history; however, the ratification and the alleged revocation of the CISG by the U.K. has been a matter of political debate for a long time. The Vienna Convention for The Law of Treaties (VCLT) lays out exceptional circumstances in which the treaty can be denounced when both parties cannot bring it to an agreement. Withdrawal Agreement between the U.K. and E.U. (a multinational firm) has developed the VLTC agreement. But it does imply that the Vienna Convention is in action. CISG is a very strong guide to international trade laws, and it works as a guide for all international trade agreements.

Other International Trade Regulations in the U.K. Are:

  1. The Customs Convention concerning the International Transport of Goods applies to the transport of goods done between one more international border, and the goods are transported by road. It falls under the Cover of TIR Carnets 1975.
  2. The Convention for the merger of certain regulations for International Transport by Air 1999 is also called the Montreal Convention. This policy holds airlines accountable for the damages incurred to the baggage or cargo of the passengers.

Yearly imports and commodities in the U.K. in 2021
have expanded by 8.4% and 4.9% individually
compared to 2020, but both remain lower than 2018

Standard Terms Used in Commercial Contracts in the U.K.

  • Standard forms of sales contracts are revised and published by the trade associations. The International Chamber of Commerce or ICC is one such association that monitors the international trade of goods and services. They protect the obligations and interests of the trading parties for fair trading and the free flow of capital.
  • UNIDROIT Principles of International Commercial Contracts provides rules and statutes governing general contract law. The UNIDROIT rules include development, validity, legality, remedies and other such requirements of a trade contract.
  • Uniform Customs and Practice for Documentary Credits (UCP) lays down the rules and regulations for business insurance and letter of credit for multinational businesses.
  • Uniform Rules for Demand Guarantees includes all the rules and regulations regarding the obligations of the trading party for guarantee or demand bonds. The ICC develops it.

These laws and statutes are necessary for fair trading and to protect the interests of the trading parties. It allows the smooth flow of goods and capital. International trade happens between many countries, and such laws help monitor that all involved parties comply with the tax regulations of their target countries. If at any point in time you need help to understand the above laws and statutes, feel free to avail our Law Assignment Help in the UK.

The U.K. is one of the most crucial countries in the international trade sector. The contribution of international trade to its GDP is around 5.5% in the year 2020 alone. The U.K. has signed trade treaties with 69 countries globally, and the E.U. This country is the fifth-largest importer and the eleventh largest exporter globally. They mainly trade in cars, telecommunication equipment, mechanical power generators, and motor vehicles.

The advantage of arbitral awards is that it can be
implemented in around 150 nations worldwide. At
the same time, a decision by a Dutch court must be
authorised outside the E.U., assuming there is an
arrangement on the requirement of decisions
between the Netherlands and another country.

What are the two types of International Arbitration?

Arbitration refers to the alternative form of settlement outside of court. Under adjudication, the involved parties resolve business disputes outside the judiciary courts. It involves an arbitrator or a neutral party or a panel that listens to both sides' appeal and solution regarding the dispute. International arbitration law is useful in resolving disputes outside of domestic borders due to certain clauses in the contract that are different in both countries.

How is Arbitration Better than Legislation?

  1. Arbitration is more plaintive compared to the legislation. The legislation abides by the civil court regulations that follow commercial regulation books, whereas arbitrary laws are less in number and are easier to comprehend. In arbitration, there are no set regulations for the outcome, and the involved parties can decide the outcome as per their demands.
  2. It provides better quality and faster settlement as the civil courts in different countries are already overloaded with pre-existing cases. Arbitration provides a better quality outcome than a domestic court as it follows the best interest of both parties.
  3. The time and the money required for arbitration is very low compared to legal cases. It provides solutions similar to the legal court proceedings but costs way less.
  4. Arbitrators tend to possess more varied and in-depth knowledge of business settlements than a court judge. They are professionals from the commerce sector and help resolve the issue easily and more efficiently for the involved parties.

The final verdict or the arbitrator's award is generally permanent and irrevocable as the proceeding is done heeding to both parties' requests and best interests. International Commercial arbitrations are more effective and ensure 100% confidentiality to the parties.

Did you know that arbitration dates back hundreds
of years? It is still in effect from the crudest society
types to present-day civilization. For instance,
business arbitration was developed during Marco
Polo's time in 1200 and among the Phoenician and
Greek dealers during 300 B.C.

Arbitrary is a more time-efficient and effective way of resolving disputes other than legislative proceedings. Courts are the ultimate body of jurisdiction and are widely trusted by all the sectors of businesses, but at the same time, they are time-consuming and expensive. Knowledgeable professionals do arbitrary settlements with extensive knowledge and understanding of the field. It takes less proceeding and less budget to reach the verdict favouring both parties. As commerce is a fast-moving sector, taking out time from their respective trades is a waste of time and money. So many businesses turn to arbitration rather than civil litigation.

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About the Author

Ashley Simons

Started as a law professional, Ashley often took out time to help her juniors and peers with their queries and academic needs. She has seen students excel under her guidance. Ashley joined the team at My Assignment Services as a law assignment writing expert after completing her postgraduation. Her area of expertise covers business law, contract law, employment law, criminal law, and tort law. Ashley practiced law for 5 years as a freelance lawyer before becoming an academic advisor.


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