Guidelines on Convention International Sale of Goods 1980- Part 1

The United Nations Convention on Contracts for the International Sale of Goods (CISG 1980) is widely acknowledged as one the most popular source of law to regulate the contracts of sale of goods between the parties whose places of business are in different nations.

Vietnam has recently become the 84th member of CISG and this convention will be taken into effect from the 1st January 2017. Therefore, this is the time to take an overlook at this vital Convention because it is predicted that the upcoming international contracts in Vietnam regarding to goods would mostly use CISG 1980 as a source of law.

In the first part, I am going to introduce about the very first provisions of this Convention. It is commonly known as the scope work.

What does the scope of work means?

The scope of work is a phrase that usually seen in commercial contract in general. It is a provision that stand for what kind of subjects this convention will regulate and what other subjects are not included in the regulated area.

First and foremost, Article 1 of this convention listed 2 cases that the CISG 1980 would be applied. The first case is that this convention would be taken as a source of law when the nations having the contracts are the members of this Convention. This is a quite clear provision that needs no further explanation. The second case is that when, according to the principles of private international law, the application of the law of a member of CISG 1980 is taken. This case is not very easy to understand. An illustration could be best provided for this case is that:
A party from country A signed a contract on selling goods to country B (A is a member of CISG while B is not). According to the principle of private international law, when the dispute between these two parties arises, the law of country A must be applied in order to solve the dispute. However, in this case, since country A is a member of CISG, the dispute settlement department will take the CISG 1980 as a regulating law for this contract instead of the law of country A.

As it is inferred, the member of CISG must always put this convention in use excluded some exceptions. The exception is that the member of CISG would not be bounded by this provision if those members announced they exclude the subparagraph 1 (b) of article 1 from their obligations. It means that when the a similar dispute as above example arises even if the principle of private international law leads to the application of the law of a member of CISG, the CISG would not be used in dispute settlement.

This issue has significant meanings to many practical situation. Some members of CISG such as the United States of America, Singapore, China...has put this provision aside. However, the approval to join CISG of Vietnam government did not exclude the validity of this provision. Therefore, this provision has its full effect to Vietnam.