Importance of the United Nations Convention on contracts for the international sale of goods

Most companies, large or small, and even entrepreneurs, purchase international supplies for their day-to-day operations. The globalization in which we live and the interrelation of businesses at an international level make it increasingly important to achieve minimum standards for the preparation of contracts, especially for contracts for the international sale of goods.

Historically, contracts for the international sale of goods, like all contracts, are governed by the will of the parties, they must have an object and price for the purchase and the parties must be capable of contracting. That said, as contracts for the international sale of goods are concluded in different countries and therefore with different legislations, it can be difficult to reach a satisfactory agreement between the parties in a timely manner. Therefore, the United Nations attempted to solve these problems through the United Nations Convention on Contracts for the International Sale of Goods, which was adopted on April 11, 1980, and entered into force on January 1, 1988.

The purpose of this legal body is to achieve uniformity in contracts for the international sale of goods, to have greater legal certainty between the contracting parties, and an agreed language that is acceptable within the international community. To achieve this objective, parameters are granted for the preparation of contracts for the international sale of goods under the guidelines previously approved by a group of countries, which to date amounts to 97 [1].

The United Nations Convention on Contracts for the International Sale of Goods tells us the provisions that have been approved by various countries and subsequently ratified. In this sense, it refers to a balanced purchase and sale contract concerning the following areas, among other topics that are of interest to the parties:

    • Seller obligations.
    • Buyer obligations.
    • Delivery of goods and documents.
    • Merchandise compliance.
    • Non-compliance clauses.
    • Payment of the price of the merchandise.
    • Compensation for damages.
    • Interests.

It should be noted that, whether or not a Company is from a country that is a State party to this Convention, the content of the agreement includes general regulations that can be used by the contracting parties in their negotiations. The use of this legal instrument prevents that, in the event of a conflict, the contracting parties are subject to general rules of private international law. For this reason, the Convention establishes acceptable agreed language but does not prevent the parties from reaching agreements outside of what is established, since the will of the parties prevails in every contract.

Likewise, the parties can decide whether or not they are a State party to the Convention, to submit to its conditions, and to achieve more fluid negotiations, under modern and internationally acceptable standards. In this sense, we must emphasize that the United Nations Convention on Contracts for the International Sale of Goods has been ratified in the following countries in the Central American region where Consortium Legal has a presence.

As you can see, Nicaragua is not a party to the Convention, but this does not mean that a Nicaraguan company is prevented from using the parameters of the convention for its contracts.

To conclude, it is always recommended that contracts be prepared and reviewed by lawyers specialized in the subject in question, to adjust the clauses to the reality of the companies and guide the client for a better result. In this sense, Consortium Legal has specialized lawyers at the regional level who will help make your negotiations a success. Please do not hesitate to contact us at contact@consortiumlegal.com to receive further assistance.