From a Status to a Transaction-Based Approach? Institutional Design in European Contract Law

Abstract

The Common European Sales Law (CESL) is a regime of European sales law intended to regulate cross-border transactions. It is currently under examination at the European Parliament. The scope of the regulation is to introduce a regime for cross-border transactions that individual Member States (MS) can further extend to domestic transactions (art. 13). Its aim is to promote harmonization by choice rather than by command. It constitutes an opt-in system that parties can adopt if they so agree (art. 8). In B-to-B transactions, it may primarily constitute an alternative to the CISG, which applies by default to the signatories. In the B-to-C context, it constitutes an alternative to national regimes designed primarily on the basis of European legislation, and integrated by the common regime of private international law (Rome I).

In this essay, the analysis of pre-contractual information in European contract law with special reference to the CESL will be used to substantiate a broader claim: the weakness of a status-based approach to European contract law (ECL) and the desirability to move to a transaction-based approach, which includes reference to supply chains. The intuition is that the determination of “if” and “how” disclosure should occur are considerations primarily dependent on the type of transaction parties engage: whether it be a standardized or a customized one. Only within this distinction might the status of the parties, whether consumers or traders, play a role.

Without engaging into a full examination of specific rules, this essay suggests that the pillars should be changed from status to transaction, and that the sales regime should be organized around transaction technologies. Such a change will not eliminate the differences between consumer and business contracts. Rather, it will revert the order: the status will become a potential sub-variable of the type of transaction.

Keywords: sales law, cross-border transactions, pre-contractual phase, harmonisation, supply chain