(A) Ziegel Prelim 21/4/98 9:31 am Page i NEW DEVELOPMENTS IN INTERNATIONAL COMMERCIAL AND CONSUMER LAW (A) Ziegel Prelim 21/4/98 9:31 am Page ii (A) Ziegel Prelim 21/4/98 9:31 am Page iii New Developments in International Commercial and Consumer Law Proceedings of the 8th Biennial Conference of the International Academy of Commercial and Consumer Law Edited by JACOB S. ZIEGEL Professor of Law Emeritus, University of Toronto Consulting Editor SHALOM LERNER Professor of Law, Bar Ilan University OXFORD 1998 (A) Ziegel Prelim 21/4/98 9:31 am Page iv Hart Publishing Oxford UK Distributed in the United States by Northwestern University Press 625 Colfax Evanston Illinois 60208–4210 USA Distributed in Australia and New Zealand by Federation Press Pty Ltd PO Box 45 Annandale, NSW 2038 Australia Distributed in Netherlands, Belgium and Luxembourg by Intersentia, Churchillaan 108 B2900 Schoten Antwerpen Belgium © The International Academy of Commercial and Consumer Law and the contributors severally 1998 Hart Publishing is a specialist legal publisher based in Oxford, England. 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(A) Ziegel Prelim 21/4/98 9:31 am Page v Contents Editor’s Preface xxiii Part I Basic International Commercial and Contract Law Developments 1 1 Usage and its Reception in Transnational Commercial Law 3 Roy Goode 2 Internationalization of Sales Law—Practice under the Convention on International Sale of Goods—A Primer for Attorneys and International Traders 37 Louis F. del Duca and Patrick del Duca 3 The Case Against Lex Mercatoria 87 Uriel Procaccia 4 Convergence of Contract Law Systems and the Unidroit Principles of International Commercial Contracts: A Search for the Nature of Contract 97 Donald B. King Part II Banking Law, Payment Systems and International Finance 105 5 Unauthorized Electronic Funds Transfers—Comparative Aspects 107 Benjamin Geva 6 Standby Rulemaking: A Glimpse at the Elements of Standardization and Harmonization of Banking Practice 135 James E. Byrne 7 International Demand Guarantees: The Interaction of the Uncitral Convention and the URDG Rules of the ICC 161 Rafael Illescas-Ortiz 8 Guarantees on First Demand: The Chilean Position 171 Richardo Sandoval Lopez Part III Secured Transactions in Movable Property 181 9 Modernizing the Secured Financing and Lease Financing Laws of Developing Nations, with Particular Focus on the West Bank and Gaza 183 R. C. C. Cuming (A) Ziegel Prelim 21/4/98 9:31 am Page vi vi Contents 10 The Registration of Company Charges Against Real Property Under Israeli Law 205 Shalom Lerner 11 The Case for Modernizing World Wide Secured Transactions in Movable Property 229 Harry C. Sigman Part IV Conflict of Laws 235 12 Territoriality and Choice of Law in the Supreme Court of Canada: Applications in Products Liability Claims 237 Catherine Walsh Part V International Trade Law 273 13 First Approach to Competition Law and Sanctioning of Disloyal Practices in Mercosur 275 Raúl Aníbal Etcheverry 14 State Contracts, State Interests and International Commercial Arbitration: A Third World Perspective 293 Patrick Osode 15 The New GATT Agreement on Government Procurement: Impressive Achievements but a Setback for Multilateralism 317 Arie Reich Part VI The Challenges of Adapting to Market Economies 345 16 The Development of Securities Regulation in Emerging African Capital Markets 347 S. K. Date-Bah 17 Process of Transition and Commercial Law in Central and Eastern Europe 367 Attila Harmathy 18 The Challenges of Adapting Law to Market Economies in Post-communist Central European Countries 383 Jerzy Rajski 19 Integrator Companies in Mexico: Lifesavers of Micro, Small and Medium-sized Industries 397 Elvia Arcelia Quintana Adriano Part VII Consumer Law Developments 409 20 Canadian Perspectives on the Challenges of Consumer Bankruptcies 411 Jacob S. Ziegel (A) Ziegel Prelim 21/4/98 9:31 am Page vii Contents vii 21 A European Concept of Consumer Rights:Some Reflections on Rethinking Community Consumer Law 431 Norbert Reich 22 Saying Nothing with Words 469 Anthony J. Duggan 23 Comparative Publicity in the Honduran Commercial Code and Consumer Protection Law 487 Dr Laureano F. Gutiérrez Falla Index 501 (A) Ziegel Prelim 21/4/98 9:31 am Page viii (A) Ziegel Prelim 21/4/98 9:31 am Page ix Detailed Contents Editor’s Preface xxiii PART I: BASIC INTERNATIONAL COMMERCIAL AND CONTRACT LAW DEVELOPMENTS 01 Usage and its Reception in Transnational Commercial Law RoyGoode 3 I. INTRODUCTION 3 (a) Terminology: Transnational Commercial Law and Lex Mercatoria 4 (b) The Elements of Transnational Commercial Law 5 (c) Hierarchy of Norms 6 (d) The Impetus for the Concept of Transnational Commercial Law 7 (e) The Influence of the Dispute Resolution Method on Substantive Rights 8 II. THE NATURE, ELEMENTS AND SCOPE OF INTERNATIONAL TRADE USAGE 9 (a) The Nature of Unwritten International Trade Usage 9 (b) The Normative Force of Unwritten International Trade Usage 10 (c) Scope 13 III. HOW UNCODIFIED USAGE IS ESTABLISHED 14 (a) The Nature of the Problem 14 (b) Usage as It Exists and Usage as the Merchants Would Like It to Be 15 (c) The Reception of Usage by a Court or Tribunal 17 (d) Determining the Relevant Sphere of Influence 17 IV. THE INTERRELATION OF INTERNATIONAL TRADE USAGE AND OTHER ELEMENTS OF TRANSNATIONAL COMMERCIAL LAW 18 (a) International Trade Usage and General Principles of Law 18 (b) Trade Usage and International Conventions 20 1. International Trade Conventions as Evidence of Existing Trade Usage 20 2. Effect of International Trade Convention on Existing Usage 26 (A) Ziegel Prelim 21/4/98 9:31 am Page x x Detailed Contents 3. The Expansion of the Scope of International Trade Conventions through International Trade Usage 26 (c) Trade Usage and Formulations by International Organisation 26 V. INTERNATIONAL TRADE USAGE AND THE CONFLICT OF LAWS 28 (a) The Antipathy Between the Lex Mercatoria and the Conflict of Laws 28 (b) The Application of Conflict of Laws Rules 28 (c) The Supplementation or Disregard of the Applicable Law 29 (d) The Lex Mercatoria as the Applicable Law 30 (e) The Reasons for Applying Anational Law 31 (f) Applying the Lex Mercatoria as “Rules of Law” 32 (g) Is the Lex Mercatoria Anational? 33 VI. INTERNATIONAL TRADE USAGE AND THE SEARCH FOR UNIFORMITY 35 02 Internationalization of Sales Law—Practice under the Convention on International Sale of Goods—A Primer for Attorneys and International Traders Louis F. Del Duca and Patrick Del Duca 37 I. MORE COURTS CONFRONT THE CISG 37 II. WHAT TO DO ABOUT SIGNIFICANT ISSUES WHICH THE CISG DOES NOT ADDRESS 40 (a) What Interest Rate on Late Payments? 40 (b) Other Issues which the CISG does not Address 43 III. UPDATE ON RECENT APPLICABILITY AND SCOPE CASES 45 (a) More on the “Four Bases for Applying the CISG” 45 (b) What is a “Contract for Sale of Goods”?—Transactions Included or Excluded by CISG 46 IV. WHEN THE CISG CREATES A CONTRACT 48 (a) Oral Contracts are Binding: No Statute of Frauds 48 (b) Offer and Acceptance Rules 52 (i) Status of the “Mail Box” Acceptance Rule 52 (ii) Unintentionally Irrevocable Offers 53 (iii) Battle of the Forms Lives On 53 V. SELECTED PERFORMANCE ISSUES 55 (a) Open Price Term 55 (b) Warranties 56 (c) Risk of Loss 58