Standard Terms in International Commercial Law - The Example of Documentary Credits
NEW FEATURES OF CONTRACT LAW, R. Schulze, ed., Sellier ELP, 2007
14 Pages Posted: 26 Feb 2009
Date Written: February 19, 2007
This paper focuses on the role of standard terms in the context of international commercial law. Although in many ways not a altogether new feature of contract law, the abortive attempt by the European Commission to promote European-wide action in this area as part of its general initiative on a European Contract Law has provided a fresh impetus for examining this topic. The decision by the Commission to scale back its activities in this regard is welcome - but not because the cross-border development of standard contract terms is undesirable: for many years, standard contract terms for international commercial transactions have been developed at a transnational level with considerable success, and action confined to the territory of the Euro-pean Union (EU) would probably not have added much of value. However, that is not to say that the widespread use of standard terms in international commerce is without its own challenges, and national legal systems will have to cope with trying to ensure that such standard contract terms are given full effect, even when faced with the difficulty of reconciling such terms with principles and doctrines of domestic law. In order to illustrate that this can be done successfully, this paper will highlight one of the arrangements for international trade finance, documentary credits, based largely on a set of internationally-agreed standard terms. It considers the relevance of standard terms in International Commercial Law, followed by an overview of the rules regarding documentary credits. The role of standard terms in the general debate about the lex mercatoria raises interesting questions, which are briefly alluded to. A final section then comments on the EU's activities in this area.
Keywords: UCP, Documentary Credit, Standard Terms, International Commercial law, European Contract Law
JEL Classification: K12
Suggested Citation: Suggested Citation