Sunday 29 January 2023

Dr Luca Castellani (left) and Elham Ali Hassan

CISG ‘offers balanced legal framework for sellers and buyers’

MANAMA, November 16, 2022

The United Nations Convention on Contracts for the International Sale of Goods (CISG) was hailed as a modern treaty that provides a balanced legal framework to sellers and buyers, and that is specifically designed for long-distance transactions, at a seminar in Bahrain. 
The seminar was held under the patronage of Nawaf bin Mohammed Al-Maawda, Minister of Justice, Islamic Affairs and Endowments by the Bahrain Bar Society, in cooperation with the Economic Development Board of Bahrain and the United Nations Commission on International Trade Law (UNCITRAL).
It was attended by Issa Al Mannai, the Undersecretary for Justice and Islamic Affairs deputising for the Minister of Minister of Justice, Islamic Affairs and Endowments. 
The CISG is a treaty that provides a uniform legal framework for the formation and performance of contracts for sale of goods across borders. It is the most broadly adopted uniform contract law treaty, with 95 states party to it, including the US, China, Japan, and 25 EU member states, Egypt, Lebanon, and Iraq. 
Bahrain adopted the CISG in 2013 and the treaty is in force in the Kingdom since October 1, 2014. Bahrain is the first Gulf Cooperation Council (GCC) member that has adopted the CISG, and other GCC member States are considering its adoption.
Dr Luca Castellani of the UNCITRAL Secretariat provided an overview of the content of the CISG. He explained that the CISG is a modern treaty that provides a balanced legal framework to sellers and buyers, and that is specifically designed for long-distance transactions. 
He explained that the CISG aims to preserve the economic value of the contract, which is particularly important in cross-border transactions given the higher transaction costs.
Dr Castellani added that the CISG allows parties to the sales contract to tailor its provisions to their needs, or even, if so wished, to exclude its application. At the same time, the CISG offered an effective safety net for all those cases where the parties did not choose the law applicable to the contract, or could not fully negotiate their contractual terms. 
He explained that the CISG gave useful guidance also in case of disruption due to unforeseen events such as the Covid-19 pandemic, by clarifying the duties of the parties and allocating risks. 
Dr Castellani recalled that the CISG is complemented by the United Nations Convention on the Use of Electronic Communications in International Contracts, another treaty prepared by UNCITRAL. Bahrain adopted this Convention as part of its legal framework for the digital trade agenda, which is particularly modern and complete. 
Dr Castellani stressed that the CISG is indispensable for any country actively involved in cross-border trade, and could be particularly useful to promote economic exchanges in the GCC in line with the current policies of economic diversification and integration. 
For that reason, he invited Bahraini judges, lawyers and practitioners to take advantage of the large amount of materials available on the CISG, which include more than 5,000 judicial decisions, and to apply the CISG whenever convenient.  
Elham Ali Hassan, Principal Partner of Elham Ali Hassan & Associates Law was the other speaker at the seminar. Hassan compared the provisions of the convention to the corresponding provisions under Bahraini law. -TradeArabia News Service


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