Business Law Syllabus Dispute Resolutions

8/13/2019 Business Law Syllabus Dispute Resolutions

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Rotterdam Business School

PArt 3

Business Law

RegularSyllabus

Dispute resolution


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Table of Contents

TABLE OF CONTENTS......................................................................................................................... 2

CHAPTE 1. !NTOD"CT!ON !NTO LA#........................................................................................11

PARAGRAPH1.1 - WHATS!T"R!AT#!A$$AW%................................................................................1&

PARAGRAPH1.& - $AW#'S(PRA!AT#!A$#RGA!SAT#!S) TH" "(...................................................1*

PARAGRAPH1.+ - "( $AW.................................................................................................................. &,

PARAGRAPH1. - !T"R!AT#!A$PRAT"$AW..................................................................................&/

0("ST#!S- HAPT"R1A !T"R!AT#!A$$AW..................................................................................+1

0("ST#!S- HAPT"R1B !T"R!AT#!A$$AW..................................................................................+&

CHAPTE 2. D!SP"TE ESOL"T!ON.............................................................................................. 3$

0("ST#!S2 HAPT"R& 3SP(T"R"S#$(T#!.................................................................................+*

CHAPTE 3. EE%............................................................................................................................... 3&

PARAGRAPH+.1 2 !TR#3(T#!.......................................................................................................+4

PARAGRAPH+.& 2 TH"S"PARAT#!#'P#W"RS.................................................................................+/

PARAGRAPH+.+ 2 TH"!AT#!A$5(3A$S6ST"7.............................................................................1

PARAGRAPH+. 2 PR!P$"S#'$TGAT#!......................................................................................+

PARAGRAPH+.8 2 5(RS3T#!.........................................................................................................8

PARAGRAPH+.* 2 "9"(T#!............................................................................................................4

PARAGRAPH+., 2 ARBTRAT#!........................................................................................................../

0("ST#!S2 HAPT"R +A ""9.........................................................................................................8:

0("ST#!S2 HAPT"R +B ""9.........................................................................................................8&

CHAPTE '. ECO............................................................................................................................... $$

PARAGRAPH.1 2!TR#3(T#!........................................................................................................8*

PARAGRAPH.& 2 !T"R!AT#!A$PRAT"$AW.................................................................................8,

PARAGRAPH.+ 2 APP$AB$"$AW!AS"#'!T"R!AT#!A$#!'$T...........................................84

PARAGRAPH. 2 7#ST7P#RTA!TART$"S#'TH" "#...............................................................8/

4.4.1Choice of law........................................................................................................................ 59

4.4.2General provisions in the absence of a choice of law...........................................................59

4.4.3Law applicable to consumer contracts..................................................................................59

4.4.4Law applicable to individual employment contract................................................................!

4.4.5Law applicable under certain circumstances........................................................................!

4.4.Law applicable under certain circumstances........................................................................!

PARAGRAPH.8 2 $AWAPP$AB$"!AS"S#'!T"R!AT#!A$T#RT................................................*&0("ST#!S2 HAPT"R A "#........................................................................................................*+

0("ST#!S2 HAPT"R B "#........................................................................................................*8

CHAPTE $. C!S(.............................................................................................................................. )*

PARAGRAPH8.1 2!TR#3(T#!........................................................................................................*/

PARAGRAPH8.& 2 '#R7A$R"0(R"7"!TS#'TH" SG....................................................................,:

PARAGRAPH8.+ 2!TR#3(T#!APP$AB$"$AW!AS"#'!T"R!AT#!A$#!'$T......................,

PARAGRAPH8. 2 TH"#!T"!T#' SG..........................................................................................,

5.4.1 Contract formation..............................................................................................................."4

5.4.2 #he content of the a$reement.............................................................................................."5

5.4.3 %reach of contract..............................................................................................................."5

5.4.4 &ffects of termination of the contract..................................................................................."

0("ST#!S2 HAPT"R 8A SG.......................................................................................................,,

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0("ST#!S2 HAPT"R 8B SG.......................................................................................................4:

CHAPTE ). TANSPOT AND !NCOTE+S..................................................................................*2

PARAGRAPH*.1 2!TR#3(T#!........................................................................................................4+

PARAGRAPH*.& 2T"R7S#'SA$"A!33"$"R6................................................................................4+

PARAGRAPH*.+ 2 #!T"!T#'T"R7S#'SA$"A!33"$"R6............................................................4+

PARAGRAPH*. 2 !#T"R7S............................................................................................................4+

PARAGRAPH*.8 2 TH"PASS!G#'TH"RS;......................................................................................4

PARAGRAPH*.* 2 G"!"RA$S"T(P#'TH"!#T"R7S......................................................................4

PARAGRAPH*., 2 !#T"R7S &:11...................................................................................................4*

PARAGRAPH*.4 2 7R..................................................................................................................... /:

.'.1 (ntroduction.......................................................................................................................... 9!

.'.2 #he parties involved in carria$e...........................................................................................9!

.'.3 #reaties on carria$e.............................................................................................................94

.'.4 #he C)* convention...........................................................................................................94

SEE B"S!NESS LA# BLOC, 2- #EE, '- !NTOD"CT!ON !NTO !NTENAT!ONAL P!/ATE

LA#0- STEP 1...................................................................................................................................... '.'.5 +urisdiction...........................................................................................................................9'

.'. ,pplicable law accordin$ to &C-........................................................................................9'

0("ST#!S2 HAPT"R*A TRA!SP#RTA!3!#T"R7S..................................................................1::

0("ST#!S2 HAPT"R*B TRA!SP#RTA!3!#T"R7S..................................................................1:+

CHAPTE &. CO+PAN LA#..........................................................................................................1&

PARAGRAPH,.1 2 !TR#3(T#! ....................................................................................................1:4

PARAGRAPH,.& 2 5(R3A$P"RS#!A$T6 ......................................................................................1:/

PARAGRAPH,.+ 2 7#ST#77#!T6P"S#'B(S!"SS'#R7S..........................................................11&

".3.1 /ole proprietor ship........................................................................................................112

".3.2 0rivate Limited liability company %.............................................................................113".3.3 Limited liable company ............................................................................................115

".3.4 ifferences between 0rivate Limited Liable Company % and 0ublic Limited Liable

Company ............................................................................................................................ 11

PARAGRAPH,. 2 #RGA!S#'A5(R3A$P"RS#!..........................................................................11,

0("ST#!S2 HAPT"R,A #7PA!6$AW.......................................................................................11/

(LOSSA........................................................................................................................................ 123

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BUSINESS LAW 2

IBMS Regular BLOCK 3Code: IBMBL209R1; ECTS: 1;Year of Study: 1

Cota!t "our# $er Wee%: 2 !ota!t &our#

Study load

Cota!t &our# 16

Self'#tudy &our# 10

E(a) 120 minutes

ROM

Both knowledge-driven nd !r"tise-driven edu"tionl methodologies

re em!hsi#ed in this module$

Cotr*+ut*o to IBMS ,rof*le-Co)$ete!*e#

%tudent is &le to understnd the ethi"l' normtive nd so"il issues

relted to the !ro(essionl !r"ti"e$

%tudent develo!s &si" wreness o( the universl humn rights nd

ethi"l s!e"ts o( interntionl &usiness nd the role o( !rin"i!linstitutions like the )* nd *+$

%tudent is &le to !!l, !rin"i!l interntionl lws nd regultions'

nd is (milir with the most im!ortnt interntionl trde greements$

%tudent will "uire &si" knowledge &out the !ro"edure to set u!

"om!n, nd understnd the di((eren"e &etween t,!es o( "om!nies$

.u+l* .e#!r*$tor/#0

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Business Lw IBMBL109R1

5rin"i!les nd dvn"ed )"onomi"s

5rin"i!les nd dvn"ed Mrketing

5rin"i!les nd dvn"ed Logisti"s

Lear*g Tra!%

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Business Lw is !rogrmme' "onsisting o( two modules' IBMBL109R1

nd IBMBL209R1$ Module IBMBL109R1 ,er 1' &lo"k 1 nd 24 (o"uses

on &si" !rin"i!les o( "ivil lw nd &si" !rin"i!les o( ownershi!' legl

o&ligtions deriving (rom "ontr"ts nd tort$ Module IBMBL209R1 ,er 1'

&lo"k 4' (o"uses on vrious s!e"ilist to!i"s relted to interntionl trde

nd &usiness' es!e"ill, with regrds to logisti"s nd mrketing$

Start*g Leel

%!e"ilist legl to!i"s relted to interntionl &usiness; knowledge o(

!rin"i!les o( interntionl &usiness lw reuired

Lear*g O+e!t*e#

*nderstnding the im!ortn"e o(4 legl reuirements (or n

orgni#tion' o!erting in n interntionl &usiness environment;

.nowing whi"h legl reuirements to tke into ""ount when

trding with &usinesses in di((erent "ountries; Being &le to !!l, the lws' treties nd "onventions deling with

"ertin legl to!i" relted to do doing &usiness in n interntionlenvironment;

7rwing "on"lusions (rom the !!li"tion o( lws' treties nd

"onventions' in order to &e &le to understnd how norgni#tions o!ertions to meet relevnt legl reuirements$

Being &le to determine whi"h legl remedies re t n

orgni#tions dis!osl when involved in n interntionl legl"on(li"t$

I#tru!t*o )et&od

2 hours !er week "entrl inter"tive le"ture' in

whi"h theor, nd nswers to uestions &out

smll4 "ses will &e dis"ussed$ %tudents re

en"ourged to !rti"i!te in "lss dis"ussions

nd ssignments$

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8ritten Multi!le hoi"e' o!en uestions' "ses$

5ossi&le ssignments4 during "ourses$

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A##*g)et:

8ill &e dis"ussed &, the te"her$ %tudents' who

!ss the ssignments' will ern !oints tht will

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&lo"k$

4*al e(a) ad re#*t:

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Re6u*red atteda!e

30=

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Business Lw &lo"k (o"uses on vrious s!e"ilist to!i"s relted to

interntionl &usiness' su"h s interntionl lw' "om!n, lw nd the

most relevnt interntionl !rivte lw rules ne"essr, (or !ro(essionls$

W S C SUB7ECTS

2899 ' 2892

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9 2 2 Itrodu!t*o Iterat*oal La1 %tud, introdu"tion intoInterntionl orgni#tions

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= A 2 Tra#$ort > INCOTERMS %tud, In"oterms ndrrige !rovided &,

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In ddition to the tet&ook other stud,ing mteril will &e !rovided &, thele"turer s listed in the !rogrm &ove

5re!rtions:

/t ll times students must !re!re themselves !rior to the le"ture nd

must &e &le to "ontri&ute the "lssroom dis"ussions$ %tudents who do

not !re!re themselves (or the le"tures m, &e e"luded (rom the

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Para8rap4 1.1 ; #4at is !nternational La7 A basi6 8ui5e to international Business La70- H. #e=ers LL+-latest e5ition.

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to any matter eFce>t to the eFtent that the agreement con=licts to its duties are di>lomatic@ economic andsometimesC military sanctions.

;inds o= treaties)Treaties can be divided into tendent on ho< many countries are involvedin the creation o= the treaty.- Bilateral) a treaty is called bilateral@ s betly to the inhabitants o= the countries they re>resent.So they include rules that)

Trait?s;6ontrats@ govern the relations4ips bet7een the 8o=ernents involved@mutual rights and obligations contract6li7eCK e.g. delivery o= >roducts

Trait?s;lois@ creating ne< general >ublicC la7sthat appl to t4e in4abitants of t4e6ountries o= member states law6li7eCK e.g. "uro>ean onvention on Human Rights

Trait?s;6onstitution@ establishment o= international or8anisations e.g. 8nitedations Charter

The second category o= rules is >art o= the la< that is in e==ect in a country that is a >arty tothe treaty. This category is directly e==ective@ erson@ legal entity or government able o= entering into legal relationshi>s.

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1. The government o= a country engages in negotiations >roved by the >arliaments o= thecountries involved@ so the governments arliament =ora>>roval. A>>roval can be given silently or eF>licitly. Silent a>>roval is given@ in caseno member o= the >arliament reDuests eF>licit a>>roval eriod o= time."F>licit a>>roval is given by the >arliament in case more than a certain amount o=>ositive votes is reached usually 8: N O 1 vote@ sometimes a higher >ercentage isreDuiredC.

+. A=ter a>>roval is given by the >arliament@ the treaty is rati=ied. This is an o==icialnoti=ication to the other country or countriesC involved in the treaty@ that the treaty hasbeen a>>roved and is there=ore binding. (sually this is done in an o==icial ceremony inresentatives o= the governments o= the countries@ involved in the treaty@ signa document containing the teFt o= the treaty.

. $astly an o==icial >roclamation usually done by >ublishing the treatyC is made to theinhabitants o= the countries involved@ a=ter roclamation.

ncor>oration into the national legal systemAs soon as a treaty enters into =orce@ it becomes >art o= the la< that is in e==ect in a certaincountry. Horecedence.

&. Trans=ormation system)The rules o= the treaty ean (nion. A document containing rulesC that is issued by the

(nited !ations or the ouncil o= "uro>e is usually called a onventionK documents issued by

the "uro>ean (nion generally are called Regulations. A onvention is@ in essence@ ust a

treaty. t is called onvention to maEe it clear that it is dra ean ommission.

!o other "uro>ean institution has the right to initiate legislation.

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The >ro>osal is submitted by the "uro>ean ommission to the ouncil o= ministers. Then the

"uro>ean Parliament is either asEed =or advice about the >ro>osal or@ in case the co-decision

>rocedure is a>>lied ean Parliament has to a>>rove the >ro>osal. = the Parliament doesnMt a>>rove in this

case@ the >ro>osal is reected. = the Parliament does a>>rove@ it is le=t to the ouncil o=

7inisters to =inally a>>rove or reect the >ro>osal.+

A5 urispru5en6e of !nternational Courts of usti6e@a. The im>ortance o= the uris>rudence created by the nternational ourt o= 5ustice o= the

(! is limited@ since the ourt only has the authority to rule i= the countries involved have

voluntarily submitted to the rulings o= the ourt. As a result this the court never rules over

really im>ortant matters.

b. The uris>rudence created by the "uro>ean ourt o= Human Rights is much more

im>ortant =or international legal relationshi>s. "ven though it is an intergovernmental

organi?ation@ the courtMs rulings are very im>ortant@ because the su>reme courts o= the

countries involved in the ouncil o= "uro>e regard the rulings as binding and u>hold them.

c. The rulings o= the "uro>ean ourt o= 5ustice are very im>ortant@ because they are based

on udicial >oartici>ating countries to the "uro>ean

nstitutions@ so a =ourth layer has been added to the national structure o= the udicial system

court o= =irst instance@ court o= a>>eal@ Su>reme ourtC.As a result o= this the rulings o= the

"uro>ean ourt o= 5ustice are binding ean ommunity and the details o= those >rocedures@


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address international issues not already subect either to treaty >rovisions or to bindingcustomary rules. Such general >rinci>les may arise either through civil la< or throughinternational las the most im>ortant >rinci>le o= international la< is that o= good=aith. t governs the creation and >er=ormance o= legal obligations and is the =oundation o=treaty larinci>les do not ust regulate national legal relationshi>s@ but alsohave an im>act on legal relationshi>s ect. These legal >rinci>les are)

1. Good =aith)The >rinci>le o= good =aith reDuires that every decision that is given by a civil court o= laectsC has to be reasonable and =air. This>rinci>le also governs the legal relationshi> betarties involved@ including >arties=rom di==erent countries. This means that those >arties have to act reasonably and =airlyto


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'or those ating country to do something against its artici>ating countries coo>erate rovides. The organi?ation itsel= has

only very limited >oerha>s be com>ared to a sort o=

international board room@ oating

countries./3ecisions artici>ating countries in such a art o= their ooartici>ating countries are more im>ortant than the interests o= the individual

countries. The >artici>ating countries create a treaty@ on the basis o= ating country to do something against its ean (nion is the best Enole o= a su>ranational international

organisation.

9Sovereign >ooo other countries =romreaching an agreement or establish a common >olicy. A veto can also mean that@ in case an agreement is

reached or a common >olicy is established@ that the country that eFercises its veto is not >art o= that agreement or>olicy.11As long it is


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ntergovernmental organi?ation Su>ranational organi?ation

su>ranational organi?ation

trans=er o= sovereignty

Sovereigncountry

ntergovernmental

organi?ation Sovereign country

T4e European "nion E"

The "uro>ean (nion is a uniDue economic and >olitical >artnershi> betean currency@ and is >rogressively building a single

"uro>e-le@ goods@ services@ and ca>ital move among 7ember

States as =reely as romotes human rights and democracy and has the most ambitious

emission reduction targets =or =ighting climate change in the ean (nion)1+

The "uro>ean (nion ean union re-emerged@ ho>ing to bind Germany into >an-

"uro>ean democratic institutions to the eFtent that it@ and any other allied "uro>ean

12htt>)euro>a.euabout-eubasic-in=ormationindeFen.htm13htt>)euro>a.euabout-eueu-historyindeFen.htm

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nation@ both eMs >ost rocess them in another. War had le=t "uro>e eFhausted@ ossibly unable to sto> Russia. n order to solve this siF neighbouring

countries agreed in The Treaty o= Paris to =orm an area o= =ree trade =or several Eey

resources including coal@ steel and iron ore@ chosen =or their Eey role in industry and the

military. This body ranationalM a level o= governance above the

nation stateC bodies) a ouncil o= 7inisters@ a ommon Assembly@ a High Authority and aourt o= 5ustice@ all to legislate@ develo> ideas and resolve dis>utes. t licitly stated the creation o= a =ederal "uro>e as their long term

goal.

T4e European E6onoi6 Counit

The success o= the "S led to the member nations signing tean

"conomic ommunity. This "" created a common marEet among the member nations@

ediments to the =lo< o= labour and goods. By 1/,: trade ean Parliament =rom 1/*&C to give advice@ a court ut the >olicy into a==ect. The 1/*8 Brussels Treaty

merged the commissions o= the ""@ "S and "uratom to create a oint and >ermanent

civil service.

De=elopent

#ver the ,:s and 4:s the membershi> o= the "" eF>anded@ alloain in 1/4*. The remit o= the

"" thus develo>ed@ and =oreign >olicy became an area =or consultation and grou>

action. #ther =unds and bodies ean

Act S"AC evolved the ""Ms role a ste> =urther. !o< "uro>ean Parliament members

o>ulation. BottlenecEs in the common marEet


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T4e +aastri64t Treat an5 t4e European "nion

#n 'ebruary ,th 1//& "uro>ean integration moved a ste> =urther ean (nion.

The change illarsJ) the "uro>ean ommunities@ giving more >ooing the eFisting bodies. This ean ouncilM@ and BritainMs

Baroness Ashton LHigh Re>resentative =or 'oreign A==airsM.

E" institutions

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The "uro>ean (nion "(C is not a =ederation liEe the (nited States. !or is it sim>ly an

organisation =or co-o>eration bet the "( its Lmember statesMC remain inde>endent sovereign

nations but they >ool their sovereignty in order to gain a strength and oeci=ic matters o= oint interest can be made democratically at "uro>ean level.

The "uro>ean (nion "(C is governed by se=en institutions. Article 1+ o= Treaty on

"uro>ean (nion lists them in the =olloean

ouncil@ the ouncil o= the "uro>ean (nion@ the "uro>ean ommission@ the ourt o=

5ustice o= the "uro>ean (nion@ the "uro>ean entral BanE and the ourt o= Auditors.

European Parliaent1

3irectly elected by "( voters every 8 years@ members o= the "uro>ean Parliament 7"PsC

re>resent the >eo>le. Parliament is one o= the "(Ms main laean laermission =or other im>ortant decisions@ such as alloean institutions in several >ointed@ its &, members 2 one =rom each "( country 2

cannot taEe u> o==ice until Parliament has a>>roved them. = the 7embers o= the "uro>ean

Parliament disa>>rove o= a nominee@ they can reect the entire slate. Parliament can also

call on the ommission to resign during its >eriod in o==ice. This is called a motion o=

censure.

14htt>)euro>a.euabout-euinstitutions-bodieseuro>ean->arliamentindeFen.htm

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Parliament Eee>s checE on the ommission by eFamining re>orts it >roduces and by

Duestioning ommissioners. ts committees >lay an im>ortant >art here. 7"Ps looE at

>etitions =rom citi?ens and sets u> committees o= inDuiry. When national leaders meet =or

"uro>ean ouncil summits@ Parliament gives its o>inion on the to>ics on the agenda.

Super=isin8 t4e bu58et

Parliament ado>ts the "(Ms annual budget ent@ and every year >asses udgement on the

ommissions handling o= the >revious years budget.

European Coun6il1$

"uro>ean ouncil meetings are essentially summits ean ouncil brings together the heads o= state or government o= every "(country@ the ommission President and the "uro>ean ouncil President@ olitical >riorities ouncil o= "uro>e2 notan "( body at all.

#4at 5oes it 5oort.

Ad A>>roving the "( budget)The money the "( can s>end every year is decided ointly by the ouncil and the"uro>ean Parliament.

Ad 8 'oreign and de=ence >olicy)!ational governments have inde>endent control in these areas@ but are aoint =oreign and de=ence >olicyEno


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The current President o= the "uro>ean ommission is 5osQ 7anuel Barroso


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the ommission re=ers the issue to the ourt o= 5ustice. The ourt can im>ose >enalties@

and its decisions are binding on "( countries and institutions.

Ad Re>resenting the "( internationally)

The ommission s>eaEs on behal= o= all "( countries in international bodies liEe the

World Trade #rganisation. t also negotiates international agreements =or the "( such as

the otonou Agreement on aid and trade bet>lied in the same er "( country. The ourt is hel>ed by eight

Ladvocates-generalM resent o>inions on the cases brought be=ore the

ourt. They must do so >ublicly and im>artially. "ach udge and advocate-general is

a>>ointed =or a term o= siF years@ utes bet)euro>a.euabout-euinstitutions-bodiescourt-usticeindeFen.htm19'or eF>lanation visit the )euro>a.euabout-euinstitutions-bodiescourt-usticeindeFen.htm20htt>)euro>a.euabout-euinstitutions-bodiescourt-auditorsindeFen.htm

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The "uro>ean ourt o= Auditors audits "( =inances. ts role is to im>rove "( =inancial

management and re>ort on the use o= >ublic =unds. t in 1/,8 and is based in

$uFembourg.

Purpose@

To ensure that "( taF>ayers get maFimum value =or their money@ the ourt o= Auditors

has the right to checE auditC any >erson or organisation handling "( =unds. The ourt

=reDuently carries out on-the-s>ot checEs. ts =indings are in re>orts submitted to

the ommission and "( national governments. The ourt o= Auditors has no legal >os@

#ne o= the ourts most im>ortant obs is to >resent the "uro>ean Parliament and theouncil ort on the >revious =inancial year the annual dischargeC.

Parliament eFamines the ourtMs re>ort thoroughly be=ore deciding >rove the ections in "( institutions@ member countries

and countries receiving "( aid. While the ourts ractice 4:N o= the income and eF>enditure is

managed by national authorities.

De6ision;a>in8@

The European Coun6il de=ines the general >olitical direction and >riorities o= the

"uro>ean (nion. With the entry into =orce o= the Treaty o= $isbon on 1 3ecember &::/@ it

became an institution. ts President is Herman an Rom>uy.

The "(s decision-maEing >rocess in general and the co-decision >rocedurein >articular

involve three main institutions)

the European Parliaent@ resents the "(Ms citi?ens and is directly elected

by themK

the Coun6il of t4e European "nion@ resents the individual member statesK

the European Coission@ hold the interests o= the (nion as a

ean (nion.

3e>ending on the issue on the agenda@ each country resented by the minister

res>onsible =or that subect =oreign a==airs@ =inance@ social a==airs@ trans>ort@ agriculture@

etc.C. The >residency o= the ouncil is held =or siF months by each 7ember State on a

rotational basis.

T4e Coun6il is responsible for 5e6ision;a>in8 an5 6o;or5ination

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The ouncil o= the "uro>ean (nion >asses laolicy@

based on guidelines set by the "uro>ean ouncil. The ouncil concludes@ on behal= o= the ommunity and the (nion@ international

agreements betean Parliament constitute the budgetary authority that

ado>ts the ommunityMs budget.

The acts o= the ouncil can taEe the =orm o= regulations@ directives@ decisions@ common

actions or common >ositions@ recommendations or o>inions. The ouncil can also ado>t

conclusions@ declarations or resolutions. When the ouncil acts as a legislator@ in >rinci>le

it is the "uro>ean ommission that maEes >ro>osals. These are eFamined rinci>le@ it is the ommission that >ro>oses ne< lat them. The ommission and the member states then im>lement them@

and the ommission ensures that the laro>erly taEen on board.

Tart to >lay) the ourt o= 5usticeu>holds the rule o=

"uro>ean laoonsibilities o= these institutions are laid dorime ministers o= all the "( countries@ and rati=ied by their >arliaments.

Para8rap4 1.3 ; E" la721

To clari=y this@ ean nstitutions

The institutions o= the "uro>ean ommunity can issue di==erent Einds o= legislation@

namely)

1. Regulations

&. 3irectives

+. 3ecisions

. Recommendations

21Also see htt>)euro>a.euabout-eubasic-in=ormationdecision-maEinglegal-actsindeFen.htm

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1. Regulations)

General rules that a>>ly uni=ormly throughout the "@ so they create a uni=orm set o= rules

=or all the member states and their inhabitantsC. These regulations are directly a>>licable@

so the >rovisions o= the regulations taEe e==ect in the legal systems o= the member states@

rovisions o= the regulation@ those national >rovisions have to be

abolished.

7ost regulations are created by the ouncil o= 7inisters@ sometimes in coo>eration ean ommission@ ean ommunity. n order to remove those limitations@ directives

establish an alternative rotecting those >ublic interests@ ean ommunity@

ace =or national governments to manoeuvre.3irectives are not general rules that a>>ly uni=ormly throughout the "@ they are not

directly a>>licable and they are not directly e==ective@ so civilians and legal entities cannot

invoEe them be=ore a national court o= laean

ommission or the national governments o= the member states to =ill in the =rameolicies or doctrines rotect businesses


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+. 3ecisions.

A decision is an individual act that is binding =or the member state or individualgrou> o=

individuals to ermitC@ so a decision is only

binding in an individual case. t is an eFecutive measure to eFecute an article o= the "

treaty or a regulation.

A decision can be =avourable to an individual or member state >ermission to do

somethingC or a burden a >rohibition to do somethingC.

. Recommendations.

A recommendation is ust an advice@ usually given to a member state. t is not binding@ so

i= a member state chooses to disregard it@ it canMt be =orced to acce>t the advice.

Para8rap4 1.' ; !nternational Pri=ate la7

When >osed to u>hold the la< - in mind that a udicial system is a

national >henomenon. n other ean ommunities "uro>ean ourt o= 5usticeC. With the

eFce>tion o= the "uro>ean ourt o= 5ustice@ these international courts do not have

su>ranational authority to rule over cases and their authority is largely based on the voluntary

submission by countries andor individuals. As ean (nion. The "uro>ean ourt o= 5ustice constitutes a =ourth layer

o= litigation@ in addition to the + layers that normally consist henomenaMs. Where the >arties do not

agree on arbitration@ dis>utes concerning international business transactions may be

submitted to ordinary courts =or resolution. This raises Duestions etent court@ the a>>licable la< and the en=orcement o= udgments in other states@ issues

=alling


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a>>lies to a given dis>ute. The rules ty>ically a>>ly ute has a U=oreignU

element such as a contract agreed by >arties located in di==erent countries.

The three branches o= con=lict o= lalied to resolve the dis>ute

'oreign udgements 2 the ability to recognise and en=orce a udgement =rom an

eFternal =orum rinci>le@ Private nternational $a< is >rimarily >art o= the national legal system. There are@

horanational regimes. This course =ocuses on the Private

nternational $a< regimes@ ed by the "uro>ean ommunity

institutions@ in the =orm o= conventions@ regulations@ directives and case lahasis is

on rules o= urisdiction@ a>>licable la< regarding international contracts and tort@ and

en=orcement o= national udgments in other countries.&

24htt>s)studiegids.leidenuniv.nlcoursesshoean-and-international->rivate-larohibits any com>any =rom reaching agreements anies to establish a cartel is a regulation directive decisionrecommendation@ becauseVVV%

9uestion '

a. What does Ldirectly a>>licableM mean%b. What does Ldirectly e==ectiveM mean%

9uestion $

a. Which are the institutions o= the "uro>ean ommunities%b. 3escribe brie=ly


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9uestions ; C4apter 1B !nternational La7

9uestion 1

What are the sources o= international larohibits the em>loyer =rom terminating the=iFed term contract unilaterally@ unless em>loyer and em>loyee agreed to this o>tionloyment. The 3irective >osed to beincor>orated into the national laloyment contract =or one year as a com>uter engineer. Holoyment contract a=ter * months on 1 5uly &::*@ as they arealloloyer@ rovision on this >oint beingnecessary in the em>loyment contract.

t is obvious that the BGB is in con=lict oint. t isalso clear that the German authorities did not incor>orate the 3irective into Germanla< in time. HellenbergMs contract could not have been terminated liEe this had3irective :1&+ been brought into the German legal system in time. Hellenbergstarts litigation against Porsche AG and the German State in the German court o= =irstresort@ the $abour ourt o= Stuttgart.

a. s 3irective :1&+ directly a>>licable@ according to the "-treaty%

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b. What issue has to be settled =irst be=ore Hellenberg can rely on the >rovisionso= 3irective :1&+ in a German court o= larecedence over the laossible =or Hellenberg to claim damages =rom the German State becauseo= the =act that they did not im>lement 3irective :1&+ in time% (se relevantcase la< in your ansrohibit clubs in the "uro>ean ?one =rom =ielding =oreign >layers

in national cham>ionshi>s layed in another country in the "uro>ean?one and have been trans=erred a=ter &4 'ebruary. A=ter that data it is still>ossible@ holayers =rom non-"uro>ean clubs to be trans=erred and to>lay.

7r $ehtonen is a 'inish basEetball >layer. At the end o= 1//81//* season heart in the =inalstage o= the Belgian cham>ionshi>s. 7r. $ehtonen concluded a contract o=em>loyment as a >ro=essional s>ortsman ril 1//*. A=ter that astors Braine layed by astors Braine >osing teams obected toastors Braine =ielding $ehtonen@ as he had been trans=erred a=ter &4 'ebruary@and they com>lained to the Belgian basEetball association that this ean ?one le o= =ree movement =or


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9uestion ).

a. A rule that aims to maEe the legislation in Holland@ concerning good lace environment@ similar to the German legislation@ is a regulation directive

decision recommendation@ becauseVVV%

b. A =orm o= legislation that =ines a s>eci=ic com>any =or maEing cartel

agreements =or trans>ort =ees is a regulation directive decision

recommendation@ becauseVVV%

c. A =orm o= legislation that >rescribes that national legislative measures have to

be taEen in order to ensure that medicinal >roducts =or human use are

>roduced@ >laced on the marEet@ distributed and utilised correctly


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C4apter 2. Dispute esolutionSee) htt>)catalog.=lat>t >resentation

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9uestions : C4apter 2 Dispute esolution

9uestion 1Please eF>lain the di==erence betartial and inde>endent.

9uestion 2Ho< is the inde>endence and im>artiality o= the 5udiciary guaranteed in Holland%

9uestion 3n &:1: and &:11 in Holland a laer@ rohibited. 7any >eo>le already had lodged in a

com>laint. n &::4@ the =ilm 'itna came out@ ortraits the slam as a very negativereligion. The Public Prosecutor decided not to start litigation. Houshed through and a laetence determine etence is determined. And also state e o=case this is and etent to handle this laress@ a >rinting o==ice situated in Belgium@ =or years. Theirrelationshi> has been very good. To >ublish the booEs on time@ both >arties have agreedthey ress has been slacE ost>one their >rinting several times. Seeing as ;luutation@ they this re>utation. #n the one hand they ress to deliver on time@ but noresult. ;luroceedings based on breach o= contract.

a. "F>lain lain the rules and >rocedure.d. What are the advantages and disadvantages o= this >rocedure%e. What i= Print"F>ress does not com>ly


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C4apter 3. EE%

Para8rap4 3.12 ntroduction

Para8rap4 3.22The se>aration o= >o


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Para8rap4 3.1 : !ntro5u6tion

(> until nohenomenon. n other ean ommunities "uro>ean ourt o= 5usticeC. With theeFce>tion o= the "uro>ean ourt o= 5ustice@ these international courts do not havesu>ranational authority to rule over cases and their authority is largely based on the voluntarysubmission by countries andor individuals. As ean (nion. The "uro>ean ourt o= 5ustice constitutes a =ourth layero= litigation@ in addition to the + layers that normally consist


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Para8rap4 3.2 : T4e separation of po7ers

Based on the idea o= the Trias Politica the se>aration o= >oortant >o


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According to the idea o= Trias Politica@ as develo>ed by 7ontesDuieu@ the + maor >ooletely se>arated and theyhave to balance each other a system o= LchecEs and balancesMC@ so that it is >racticallyim>ossible =or one institution to become the sole >ooarate and all the >oarate tasE. According to the original blue>rint =or the se>aration o=>o to the >arliament that is usually divided into a house o= re>resentatives and asenate@ to create the laarliament has a legislative tasE. t is u> to thegovernment@ at the national@ regional and local level@ to eFecute and im>lement the laarliament@ so the government >er=orms an eFecutive tasE. n case o= legalcon=lict bet to the udicial systemto a>>ly the la< and =ind a solution to the con=lict in its rulings.

The idea o= Trias Politica as described above has not been strictly im>lemented in everycountry. 'or eFam>le@ in the !etherlands the government and >arliament together createlaoointed by the government@ so the governments eFertin=luence over the udicial system.6et most democraticC countries have a system that is more or less in accordance


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Business La7 Sllabus Blo6> 2

Para8rap4 3.3 : T4e national u5i6ial sste

7ost legal rules are observed automatically. = this holding the la< ossible. t ractically im>ossible to en=orce every single rule i= the maority o=civilians and legal entities broEe the la< constantly.

n case the la< is broEen or con=licts arise betliance. This involves monitoring com>liance@ >enalties =ornon-com>liance and settlement o= dis>utes by the udicial system.

The udicial system is usually com>osed o= the =ollo


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nternational)

-----------------------------------------------------------------------------------------------------------------!ational)

1

Ho>ortunity to go to a court o= a>>eal.Sometimes a>>eal is >ossible@ but only to a limited eFtent or there are limitations as to theEinds o= cases in arties can a>>eal.

Since most countries have a legal system that is more or less com>osed as is shoreme ourt) deals arty or both >artiesC disagreesC >eal that ruling be=ore the su>reme court&8

As ossible =or >arties >eal itMs ruling be=ore an international court o= laean ommunities "uro>ean ourt o=5usticeC@ this court has the su>ranational authority to rule in cases ean ourt o= 5ustice constitutes a =ourth layer o= litigation.

25There is also a set o= rules to determine eal in a certain country are authori?ed to handle a certain lae o= thissubect.

Page '2o= 131

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)uro!en ourt o(

usti"e

ourt o(

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ourt o(

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ourt o(

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7istri"t

"ourt

7istri"t

"ourt

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Para8rap4 3.' : Prin6iples of liti8ation

n order to maEe sure that ustice is done in a s>eci=ic larinci>leso= litigation have to be observed by every court o= larinci>le ensures that the rinci>les nor does something that is against the larinci>le also ensures that the rinci>les nor does something that is against the laendent =rom the legislative and eFecutive >orinci>le ensures that no government organ can >ut >ressure on the udgesC tomaEe sure the udgesC arties involved in a larinci>le ensures that it is >ossible to checE arties involved should have access to every >iece o= relevant in=ormation

$. the hearin$ has to occur within a reasonable period of time

26These >rinci>les are based on article * o= the "uro>ean onvention on Human RightsK every country that is a

member state o= the ouncil o= "uro>e andor the "uro>ean (nion has to maEe sure that these >rinci>les areobserved by its national udicial systemK art * reads as =olloublic hearing endent and im>artial tribunalestablished by laronounced >ublicly by the >ress and >ublic may be eFcluded=rom all or >art o= the trial in the interest o= morals@ >ublic order or national security in a democraticsociety@ rotection o= the >rivate li=e o= the >arties so reDuire@ or theeFtent strictly necessary in the o>inion o= the court in s>ecial circumstances ublicity reudice the interests o= ustice.&. "veryone charged resumed innocent until >roved guilty according tolaen to the >ublic@ unless the la< itsel= commands that the doors are closed =or eFam>le incase a minor is on trial =or violating the laarties involved in a la>ortunity to obect tothe >artici>ation o= a s>eci=ic udge in a la>ears to be or is regarded as >reudicedbiased.29

n case the arguments >resented in the verdict cannot su>>ort the ruling@ a>>arently di==erent motives haveleaded the court to rule the rinci>le is EnoartemM@ artyM.

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this >rinci>le ensures that no one involved in a laeriod o=uncertainty about the outcome o= the laarts o= the >rocedureC has to beconcluded@ sometimes the la< ust says it has to be done eriodo= timeK


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Para8rap4 3.$ : uris5i6tion

t is u> to the >arties involved in a civil legal con=lict to decide arties donot live or reside in the same country andor other >arties =rom di==erent countries areinvolvedC@ that laly or the eFisting rules do not give a solution =or the s>eci=ic legal con=lict the court is

dealing ly national com>etency rules to determine ean ommunity "C toensure uni=ormity in the urisdiction o= courts that reside e to determine >lied i= the >artiesinvolved in the laean(nion. = one or more >arties are =rom outside the "(@ then national P$-rules o= the countrythat is been a>>ealed to need to be used to veri=y the authority o= the court.

Sco>e and content

The Brussels Regime covers legal dis>utes o= a civil or commercial nature article 1C. Thereare some eFce>tions limiting the sco>e o= thisK rinci>al matter o= a dis>ute is oneo= =amily latcyor insolvency@ social security@ or relates to arbitration@the case isnot subect to the rules. Article & >rescribes that a >erson legal or naturalC may only be sued

31n 3utch this la< is called LWet o> de RechterliEe organisatieM.32n 3utch this la< is called LWetboeE van BurgerliEe RechtsvorderingM.

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in the member state in erson can be domiciled in more than one statesimultaneously. Article >reserves the traditional rules =or de=endants ly and the national court hearing the case is le=t to determine urisdiction based on thetraditional rules otherublic registersK- Registration or validity o= intellectual >ro>erty rightsK- "n=orcement o= udgements.s the choice o= =orum valid and i= it is not about an issue o= art && ""9@ then thedesignated udge has eFclusive urisdiction based on art &+ ""9. This means that allother udges have to declare themselves unauthorised@ unless the contract states thatanother udge also has urisdiction.+

B. S>ecial >rovisions in s>eci=ic situations art. 4 to &1 ""9C

1. Art. 14 to &1 ""9) urisdiction in case o= individual em>loyment contracts!f t4e eploee is t4e plaintiff@

- The court o= la< o= the country loyer has his >lace o= residenceKor- The court o= la< o= the country loyee usually lainti==)- The court o= la< o= the country loyee has hisher residence has

urisdiction2. Art. 18 to 1, ""9) urisdiction in case o= consumer contracts= the consumer is the >lainti== the consumer can choose betlainti== he can choose bet)ec.euro>a.eucivilustice>ublicationsdocsguidelitigescivilstrans=rontaliersen.>d=@> +@ X 1.347r. S. van Hall@ >Contracten in de internationale handel?< Wolters-!oordho== 1edruE@ &::,@ >. +8-+*.

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- "tc.= the insurer is the >lainti== the court o= la< o= the country erson liveshas eFclusive urisdiction. Art. & and 8) n the absence o= a choice o= =orum+8or a s>ecial >rovision in s>eci=ic

SituationsK general rules1. Art. & ""9)The court o= la< o= the country lainti== to choose bet


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Para8rap4 3.) : Ee6ution

We would now advise you to read chapter 3, paragraph 3.# of A basic guide to

International Business Law, eeping in !ind the following"

7ost countries only allo< verdicts that are given by their national courts to be eFecuted on

their territory. So 2 =or eFam>le 2 in case a hinese seller is aa.eucivilustice>ublicationsdocsguidelitigescivilstrans=rontaliersen.>d=@> 1.

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Para8rap4 3.& : Arbitration

We would now advise you to read chapter 3, paragraph 3.$ of A basic guide toInternational Business Law, eeping in !ind the following"

(> until no< arties have both agreed on this either by >uttingan arbitration clause in their contract or creating a se>arate agreement on arbitrationC.

n case >arties have agreed on arbitration@ the o==icial courts are no longer authori?ed tohandle the case. n case one o= the >arties does bring the case be=ore an o==icial court@ thecourt only has urisdiction in case the other >arty a>>ears be=ore the court@ unless he is thereto state that the court has no urisdiction. The other >arty immediately has to invoEe thearbitration agreement@ stating that the court has no authority. = he doesnMt do that or he does

it too late in the >roceedingsC@ the o==icial court has the authority to handle the case.

n case no arbitration clause has been included in the contract and one o= the >arties doesbring the case be=ore an arbitrator@ the other >arty immediately has to claim the arbitrator hasno urisdiction. = he doesnMt do that or he does it too late in the >roceedingsC@ he is regardedas having silently agreed


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9uestions : C4apter 3A EE%

9uestion 1Albert@ a 'rench national@ lives in Germany. He is hired by a Polish com>any@ er=ormed his ob >ro>erly he sho late very

o=ten@ he le=t early every day@ he any loyment contract. !o choices are made as to the la< that should be a>>lied to the

contract or the court that should handle a laany to nulli=y the

em>loyment contract%

9uestion 2Anderson@ living in S>ain@ rinting >ress@ to be used in his o==ice in7adrid S>ainC. Anderson decides to buy a >rinting >ress =rom Bayer@ a com>any establishedin Berlin GermanyC. Anderson calls Bayer and asEs =or some in=ormation on the various>rinting >resses the com>any >roduces. #n 3ecember 1& &::4 Bayer sends Anderson ano==er. The o==er states that Anderson can buy their nets this o==er be=ore 3ecember & &::4. Anderson acce>ts the o==er on 3ecember&& &::4. !o choices are made as to the la< that should be a>>lied to the contract or thecourt that should handle a la>ose@ Bayer does not deliver the >rinting >ress in 7adrid@ as >arties had agreed.Anderson >ose@ Anderson ossible%

9uestion 3Henry 7cGuiness@ a Scottish national@ lives in S>ain. He is hired by a 'rench com>anyestablished in Paris 'ranceC@ any discoversthat Henry has not >er=ormed his ob >ro>erly he sho late or he doesnMt sho< u> at

allK he misses a>>ointments regularly and he doesnMt sho< any leadershi> DualitiesC. The'rench com>any loyment contract. !o choices are made as to thela< that should be a>>lied to the contract or the court that should handle a laacEagingmaterial@ to be installed in his =actory in Athens GreeceC. 5acEson decides to buy themachine =rom Svensson@ a com>any established in StocEholm Sany

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>roduces. #n 7ay & &::/ Svensson sends 5acEson an o==er. The o==er states that 5acEsoncan buy their nets this o==er be=ore 5une1& &::/. #n 5une * &::* 5acEson sends Svensson a letter in >lied to thecontract or the court that should handle a la>ose@ Svensson does not deliver the machine in Athens@ as >arties had agreed.5acEson >ose@ 5acEson ossible%

9uestion $a. om>any A@ established in taly@ and com>any B@ established in Poland@ reach an

agreement. om>any A any B ay the amount o= Y&:.:::@- =or the


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9uestions : C4apter 3B EE%

9uestion 1Peters decides to buy a ne< Eitchen =or his home in "nschede =rom ;Zchen "cE GmbH inGronau@ Germany. His neighbours tell him that it is much chea>er than Eitchens locallyavailable and the Eitchens in the brochure sent to him certainly looE very nice.The sales contract concluded and signed in Gronau@ states that German la< >ly tomatters related to this contract. The Eitchen is to be delivered on #ctober 1@ 1//4.(n=ortunately@ ;Zchen "cE is not able to maEe delivery in time. 3ue to logistical >roblems atthe >lant in Gronau@ the Eitchen is delivered on #ctober 8@ 1//4. t trans>ires that various>arts o= PetersM ne< Eitchen are damaged and ;Zchen "cEMs em>loyees are clearly to blame=or this damage. Since ;Zchen "cE is unany.

a. The legal advisor hired by Peters claims that the contract Peters and ;Zchen "cE

entered into is a ty>ical consumer contract according to relevant internationaltreaties@ and that there=ore Peters should turn to the court o= la< o= his choice. 3o youthinE this legal advisor is right% Give your reasons.

b. Su>>ose the contract entered into betartment in Brasschaat@ a >eace=ul Belgian toulation.Problems arise in relation to o o= the a>artment due to an error committed bythe Belgian notary. n the event o= PetersM commencing litigation against the BelgiannotaryMs o==ice@ bulbs to 'loricultures de la7aresma 'lorimar Soc. oo>. $mta. n Barcelona@ S>ain@ to be delivered eF lace o= business o= the >urchaser. Trans>ortation as agreed on by the >arties has beenarranged by an Tubergen. 3ocEs de Bourgogne@ a trans>orting com>any established inHolland@ is to be the trans>orter.The trucE has engine trouble and 3ocEs delivers the bulbs tay the >rice o= Y &8@::: agreed on by the >arties and re=uses to acce>tthe goods. an Tubergen claims com>ensation =rom 3ocEs =or the damage.

a. n the event o= a la


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7Zller@ a =ormer German s>orts hero living in Bentheim GermanyC@ sells his house there to

5ansen@ a soccer coach@ ay the >rice into an account 7Zller has


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Weller to >roceed s and Weller loses a great deal o=money. Weller is not a ha>>y man and blames both advisers =or the bad advice they gavehim. Weller decides to sue both Ancelotti and Westerhagen =or com>ensation =or his loss.Ancelotti is not a ha>>y man either as Weller re=uses to >ay the =ee agreed on in theircontract.

a. n the case o= Weller vs. Ancelotti)


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C4apter '. ECO

Para8rap4 '.12 ntroduction to nternational Private $a>licable la< in case o= international con=lict

Para8rap4 '.'2 7ost im>ortant articles o= "#

Para8rap4 '.$2 $a< a>>licable in case o= international tort

9uestions : C4apter '

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Para8rap4 '.1 :!ntro5u6tion

When >arties involved in a legal con=lict have decided to taEe their case to court@ the =irst

Duestion that has to be ans


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Para8rap4 '.2 : !nternational Pri=ate La7

Ste> 1)

n order to determine >ly in a s>eci=ic case@ lied@ that gives rulesthat solve the con=lict directly. !eFt >licable@ rovides us to determine >lied to the case.'irst >ly the SG@ since the SG re=ers to the "#onvention.

#e 7oul5 no7 a5=ise ou to rea5 64apter 1- !ntro5u6tion an5 para8rap4 1.1 of Abasi6 8ui5e to !nternational Business La7.

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Para8rap4 '.3 : Appli6able la7 in 6ase of international 6onfli6t

We ortant international

sources o= P$ available to determine >lied to a legalcon=lict bet>lied by courts o= la< that reside in a member state o= the"uro>ean ommunityK

&. the con=lict betarties involved arises =rom contractual obligations in other betarties involved are living or established in di==erent countries

Art. & "# determines that the "# has a universal e==ect@ lied@ then that has to be a>>lied. Thela< that has to be a>>lied is not limited to the la< o= one o= the ontracting States o= the"#.

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Para8rap4 '.' : +ost iportant arti6les of t4e ECO3*

'.'.1 C4oi6e of la7

hoice o= la< art. + "#C

- Parties are =ree to choose the la< they >lied to their contract

'.'.2 (eneral pro=isions in t4e absen6e of a 64oi6e of la7

General >rovisions in the absence o= a choice o= la< art. "#C= the >arties have not made an eF>licit choice o= a>>licable laro>er la< >lace o= habitual residence or >lace o= central administration o= the >arty>er=orming the contract@ >rinci>al >lace o= business or other >lace o= business o= the >artyres>onsible =or >er=orming the contractC. Hoeci=ic rules a>>ly in tort o= goods@ the a>>licable la< is determined

according to the >lace o= loading or unloading@ or the >rinci>al >lace o= business o=the consignor.+/

Where the contract concerns immovable >ro>erty@ the la< a>>licable by de=ault is that

o= the country in ro>erty is situatedK in other ro>erty or a right to use immovable >ro>erty@ thecontract is most closely connected to the country74ere t4e io=able propert issituate5K:1

n other cases) the la< o= the country to >liedK

- This is the country o= the >arty that a==ects the 64ara6teristi6 perforan6e

contract o= sale) characteristic >er=ormance is done by the seller

contract o= rent) characteristic >er=ormance is done by the landlord

contract o= distribution) characteristic >er=ormance is done by the distributor

em>loyment contract) characteristic >er=ormance is done by the em>loyee

contract o= agency) characteristic >er=ormance is done by the agent

=@ horovided bythese rules@ the la< o= that country >lied.

'.'.3 La7 appli6able to 6onsuer 6ontra6ts

$a< a>>licable to consumer contracts art. * "#C

38'ind the articles in the syllabus )euro>a.eulegislationsummariesustice=reedomsecurityudicialcoo>erationincivilmattersl++1:/en.htm40"Fam>le .* o= the teFtbooE is incorrectK since both >arties in the eFam>le live in Holland@ 3utch $a< a>>lies to

their contract. #nly i= one o= the >arties lives in another country@ =or eFam>le Germany@ the eFam>le


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The "# gives s>ecial >rovisions =or certain contracts. #ne o= those s>ecial >rovisions isart. * "#@ that a>>lies to consumer contracts.- n the absence o= a choice o= la>lied in case)aC The contract rovided by his o>ly o= goods or services to a >erson is coveredby s>ecial >rovisions@ according to the >rinci>le o= the >rotection o= the arty. (nlessthe >arties decide otherly to contracts o=

carriage or contracts =or the su>>ly o= services in a country other than that in


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- as long as the contract meets the =ormal reDuirements o= the la< chosen by the>arties or those o= the la< o= the country


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Para8rap4 '.$ : La7 appli6able in 6ases of international tort

The "# only a>>lies to international contracts@ not to international torts. n case o= aninternational tort@ one has to looE at other sources to determine >lied.

According to the 3utch Su>reme ourt the criterion to determine >liedto a case o= international tort is the la< o= the country ic the la< a>>licableto non-contractual obligationsC@ generally re=erred to as Rome . This Regulation determinesthe la< a>>licable to)- TortK- Product liabilityK the a>>licable la< is the la< o= the country o= the consumerC- (n=air com>etitionK- iolation o= >rivacy and rights relating to the >ersonalityK- iolation o= the environmentK- n=ringement o= co>yrights the a>>licable la< is the la< o= the country rotectedC.

This Regulation has come into e==ect in &::/. The Regulation determines the a>>licable la>licable la< in cases concerning =or eFam>le >roduct liability@un=air com>etition etc.

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9uestions : C4apter 'A ECO

9uestion 1Anderson@ living in S>ain@ rinting >ress@ to be used in his =actory in7adrid S>ainC. Anderson decides to buy a >rinting >ress =rom Bayer@ a com>any establishedin Berlin GermanyC. Anderson calls Bayer and asEs =or some in=ormation on the various>rinting >resses the com>any >roduces. #n 3ecember 1& &::4 Bayer sends Anderson ano==er. The o==er states that Anderson can buy their nets this o==er be=ore 3ecember & &::4. Anderson acce>ts the o==er on 3ecember&& &::4. When the >rinting >ress arrives & rinting >ress doesnMt =unction >ro>erly. Anderdon lied to the contract.What la< should be a>>lied to this contract%

9uestion 2Albert@ a 'rench national@ lives in S>ain. He is hired by a Polish com>any@ er=ormed his ob >ro>erly he sho late very

o=ten@ he le=t early every day@ he any loyment contract. !o choice is made as to the la< that should be a>>lied to the contract.

What la< should be a>>lied to this contract%

9uestion 3At a marEet sDuare in Hamburg GermanyC@ 7r. 7artine?@ a S>anish national lastic. The tree is

manu=actured and sold by ole $td.@ a com>any established in the (nited ;ingdom. This

British seller had >ut an advertisement in a German nea>er@ inviting >eo>le to come to

the marEet sDuare in Hamburg on that >articular day to buy a tree =rom ole $td. When he

arrives home@ 7artine? discovers the tree is broEen and there are several >arts missing.

7arine? lied to the contract.


9uestion '5ames 5acEson@ living in Greece@ lastic >acEagingmaterial@ to be installed in his =actory in Athens GreeceC. 5acEson decides to buy themachine =rom Svensson@ a com>any established in StocEholm S


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Henry 7cGuiness@ a Scottish national@ lives in Holland. He is hired by a 'rench com>any

established in Paris 'ranceC@ any discovers

that Henry has not >er=ormed his ob >ro>erly he sho late or he doesnMt sho< u> at

allK he misses a>>ointments regularly and he doesnMt sho< any leadershi> DualitiesC. The

'rench com>any loyment contract. !o choice is made as to the la>lied to the contract.


9uestion )A buyer =rom Belgium and a seller =rom Holland are involved in a con=lict about the eFecution

o= their sales contract. The Belgian buyer claims that the 8: cars he ordered have not been

delivered to him@ so he re=uses to >ay. The seller claims that he did deliver the cars and hedemands >ayment. The >arties involved have not made a choice as to the la< that should be

a>>lied to their contract.


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9uestions : C4apter 'B ECO

9uestion 1Be? runs a loys Tomasi@

Po??obon and !erobuto@ three eF>erienced talian ice-cream maEers =rom 7ilan@ taly@ =rom

5une to Se>tember every year. The >ayment =or their services consists o= a salary in cash

and a =ree >lace to live during their months in the !etherlands. This is laid doloyment contract that loyerMs trade organi?ation that are a>>licable to all >ersonnel tember &::1 Be? dismissed all three men =rom their obs and directed that

they leave his ice-cream >arlour immediately. Tomasi@ Po??obon and !erobuto are noayment o= their salaries =or August and Se>tember &::/ in =ront o= an talian court

o= la>lies to the em>loyment contracts o= Tomasi@ Po??obon and !erobuto%

b. n vie< o= the nationality o= all >arties@ loyees have

agreed to talian la< being a>>lied to their em>loyment contracts. Hoensation as 3utch la< does. n the case

in Duestion@ ossible =or the talian em>loyees to claim com>ensation

according to the 3utch ivil ode@ even though >arties agreed to talian la< being

a>>lied%

9uestion 27c3onald@


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a. s the choice o= "nglish la< as the la< a>>licable to this em>loyment contract made

by the tarties valid and binding =or both >arties%

b. Su>>ose "nglish la< is the la< a>>licable to this contract. Also su>>ose that the

annulling o= the individual em>loyment contract does not meet the =ormal

reDuirements under "nglish laloyment contract =ormally valid

or not%

c. Su>>ose the em>loyment contract is governed 2 in accordance ossible that the contract might indeed be =ormally valid%

9uestion 'an Bemmel B.. is a com>any established in Holland that both manu=actures shoes and

acts as a any established in the (;@ at a >rice o= Y&:.:::. Both >arties

agree in a tele>hone conversation@ that in the event o= any legal >roblems arising a (; court

o= la<


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a. What la< a>>lies to the contract o= sale bet>lies to the trans>ort contract bet


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C4apter $. C!S(

Para8rap4 $.12 ntroduction

Para8rap4 $.22 'ormal reDuirements o= the SG

Para8rap48.32 ntroduction a>>licable la< in case o= international con=lict

Para8rap4 $.'2 The content o= the SG

9uestions : C4apter $

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Para8rap4 $.1 :!ntro5u6tion

We already sa< that arties involved in a legal con=lict have decided to taEe their caseto court@ the =irst Duestion that has to be anslied@ that givesrules that solve the con=lict immediately. We called this ste> 1 +. #nly i= there is no Treaty@onvention or Regulation available or the one that is available does not a>>ly@ & and i= necessary ste> +C and looE at nternational Private $a< among


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Para8rap4 $.2 : Foral reGuireents of t4e C!S(

Be=ore a court can checE >lication o= the SG.

Article 1 SG reads as =ollo>lies to contracts o= sale o= goods betarties laces o=

business are in di==erent States)

aC When the States are ontracting StatesK or

bC When the rules o= >rivate international la< lead to the a>>lication o= the la< o= a

ontracting State.

&. The =act that the >arties have their >laces o= business in di==erent States is to be

disregarded >ear either =rom the contract or =rom any dealings

betarties at any time be=ore or at the conclusion

o= the contract.

+. !either the nationality o= the >arties nor the civil or commercial character o= the >arties or

o= the contract is to be taEen into consideration in determining the a>>lication o= this

onvention.

As can be deduced =rom the =irst sentence o= >aragra>h 1 o= article 1 SG@ the SG only

a>>lies i=)

the laarties involved are acting in their trade or >ro=essionK and

the >arties involved are established in di==erent countriesK and

either o= the =ollo>lies)

the >arties are both established in contracting statesK or

- i= only one >arty is established in a contracting state - the rules o= nternational Private $a>lication o= the la< o= a contracting state.

We lies. n other ly. And i= the laloyment

contract@ the SG doesnMt a>>ly either.

&. The >arties involved are acting in their trade or >ro=ession

= one o= the >arties involved is a consumer@ the SG doesnMt a>>ly. #nly i= the >arties

involved are either com>anies or individuals acting as a >ro=essional buyer o= seller@ does the

SG a>>ly.

+. The >arties involved are established in di==erent countries

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= both >arties involved in the la>ly@ because then it is not an international contract.

. "ither o= the =ollo>lies)

the >arties are both established in contracting statesK

= the >arties involved in the la>lies. 'or the >ur>ose o= this subect >ly@ but only i= P$ leads us to the la< o= a contracting state. An eFam>le to eF>lain

this)

om>any established in Holland@ has sold 8: cars to com>any B@ established in the (nited

;ingdom. om>any B re=uses to >ay =or the cars@ claiming all o= them arties involved are established in di==erent countriesK this reDuirement is met


a. the >arties are both established in contracting statesK this situation does not a>>ly

b. - i= only one >arty is established in a contracting state - the rules o= nternational Private

$a< lead to the a>>lication o= the la< o= a contracting state.

Part o= nternational Private $a< that has to be a>>lied by courts o= la< lication o= the la< o= a contracting stateJ means Ia>>lying "# leads to the

a>>lication o= the la< o= a contracting stateJ. = that is true@ the SG a>>lies to this case.A>>lying "# arty that a==ects the characteristic >er=ormance. n case o= a contract o= sale

the seller a==ects the characteristic >er=ormance. n other >lication o= the la< o= a contracting state HollandC. There=ore the SG a>>lies to this

case.

Another eFam>le to illustrate ho< article 1 o= the SG should be a>>lied.

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om>any "@ established in "gy>t@ has sold &::: Eilograms o= co==ee to com>any '@

established in 'rance. om>any ' re=uses to >ay =or the co==ee@ claiming all o= it

and mouldy any ' be=ore a

'rench court o= lalies. 'rance is a

contracting stateK "gy>t is not a contracting state. !o choice is made as to the la< that

should be a>>lied. The court assesses the =olloro=essionK this reDuirement is met

+. The >arties involved are established in di==erent countriesK this reDuirement is met


a. the >arties are both established in contracting statesK this situation does not a>>ly

b. - i= only one >arty is established in a contracting state - the rules o= nternational Private

$a< lead to the a>>lication o= the la< o= a contracting state.

Part o= nternational Private $a< that has to be a>>lied by courts o= la< lication o= the la< o= a contracting stateJ means Ia>>lying "# leads to the

a>>lication o= the la< o= a contracting stateJ. = that is true@ the SG a>>lies to this case.

'irst checE@ can you a>>ly the "#)

Art 1 "#)

the "# is only a>>lied by courts o= la< that reside in a eber state of t4e European

CounitK

the con=lict betarties involved arises =rom 6ontra6tual obli8ations legal

relationshi> is based on an agreementCKthe partiesinvolved are living or established in 5ifferent 6ountries

"gy>t is not an " member state@ so no "#. Thus ste> +@ you have to use the national

rules o= the country o= the court that has urisdiction. So use the ""9 to decide ecial >rovisions in s>eci=ic situations art. * to 21 EE%C

1. Art. && ""9) urisdiction related to io=able propert)

&. Art. 14 to &1 ""9) urisdiction in case o= in5i=i5ual eploent 6ontra6ts+. Art. 18 to 1, ""9) urisdiction in case o= 6onsuer 6ontra6ts

. Art. 4-1 ""9) urisdiction in case o= insuran6e

NO spe6ial pro=ision appli6able- so 8o to@

. Art. 2 an5 $ para8rap4 1 EE%@ n the absence o= a choice o= =orum or a s>ecial

>rovision in s>eci=ic situationsK main rules

1. art. & ""9 >lace o= de=endant 'ranceC.

%

2. art. 8 ""9 >lace o= >er=ormance >aymentC "gy>tC.

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] >aragra>h. 1) contractual obligation >ro=essional >artiesC >lace o=

>er=ormance o= obligationC.

tMs u> to the >lainti== to choose bettian la< to see i= it re=ers you to a SG member state in this case 'ranceC@ i= the

national rules o= 'rance or "gy>t do lead to 'rance@ you can eventually use the SG. ' it

leads to "gy>tian la &C to re=er us to the national la< that a>>lies@ in order to =ind a solution to the

con=lict.

Article * SG gives >arties the o>tion o= eFcluding the a>>lication o= the SG in their

contract@ so that it doesnMt a>>ly@ even i= the reDuirement o= article 1 SG have been met.

Article * reads as =olloarties may eFclude the a>>lication o= this onvention or@

subect to article 1&@ derogate =rom or vary the e==ect o= any o= its >rovisions.I

Base5 on t4is arti6le- parties 6an also 5e6i5e to e6lu5e onl soe of t4e arti6les of

t4e C!S( in t4eir 6ontra6t- or 5eterine t4at t4e out6oe of t4e appli6ation of soe oft4e arti6les of t4e C!S( 7ill be 5ifferent t4an is state5 in t4e C!S(.

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Para8rap4 $.3 :!ntro5u6tion appli6able la7 in 6ase of international

6onfli6t

n >aragra>h 8.1 here o= a>>lication o= the SG. !o< rice and a Duantity. =an Lo==erM doesnMt include these three things 1 or & are missingC@ itMs not a legal o==er@ust an invitation to maEe o==ers.

- Based on article 18 SG an o==er by AC becomes e==ective tance@ unless)a. the o==er indicates@ either by stating a =iFed time =or acce>tance orotherriceK andor

>aymentK andor Duality o= the goodsK andor

Duantity o= the goodsK andor

the >lace o= deliveryK andor

the time o= deliveryK andor

the eFtent o= one >artyMs liability to the otherK andor

the settlement o= dis>utes@

are considered to alter the terms o= the o==er materially.- Based on article &+ SG the agreement is reached the moment the acce>tance

becomes e==ective@ in other


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$.'.2 T4e 6ontent of t4e a8reeent

Articles +1 to ++ SG

- Based on article +1 SG delivery by the seller is done by >lacing the goods at thebuyerMs dis>osal at the >lace lace o= business at the time o=

the conclusion o= the contractC@ unless >arties have agreed otheronsible =or trans>orting the goods@

the seller must choose a means o= trans>ortation that is a>>ro>riate in thecircumstances and according to the usual terms =or such trans>ortation

- Based on article ++ SG delivery has to be done eriod o= time.

$.'.3 Brea64 of 6ontra6t

1. obligations o= the sellerand claims made by the buer)

- Based on article +: SG the sellerhas the obligation to deliver the goods and the

documents relating to the goodsC and to trans=er the >ro>erty o= the goods in other to the obligations described in the contract and article +: and +8 SG.

- Based on article 8 SG the buer has several o>tionsclaims in case a sellerdoesnMt live u> to his obligations in other er=ormance art. * SGC eriod o= time art. ,

SGCK i= the seller doesnMt >er=orm eriod o= time@ he isin de=ault@ er=ormance and additional damage art. ,

SGC.

&. obligations o= the buerand claims made by the seller)

- Based on article 8+ SG the buerhas the obligation to >ay =or the goods.- Based on article 8+ and *: SG the buerhas the obligation to acce>t delivery o=

the goods.- (nless >arties have agreed otherayment has to be done at the sellerMs >lace

o= business art. 8, SGC.- Based on article *1 SG there is a breach o= contract by the bueri= he doesnMt live

u> to the obligations described in the contract and article 8+ and *: SG.- Based on article *1 SG the seller has several o>tionsclaims in case a buyer

doesnMt live u> to his obligations in other er=ormance art. *& SGC eriod o= time art. *+

SGCK i= the buyer doesnMt >er=orm eriod o= time@ he isin de=ault@


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laim damage as a substitute =or >er=ormance and additional damage art. ,

SGC.

$.'.' Effe6ts of terination of t4e 6ontra6t

Articles 41 to 4 SG

Terminating a contract means that =rom the moment o= nulli=ication there is no longer a validagreement betarties. As a result o= that@ both >arties no longer haveany obligations toay anymore. Hoossible that during the >eriod that there arties already >er=ormed >art o=Ctheir obligations as mentioned in the contract andor the SG. Those >artialC >er=ormanceshave to be undone@ a=ter the agreement is nulli=ied. That means that the buyer can demand arestitution o= his >ayment@ and the seller can the demand that the o o=C the good is

returned to him. Articles 41 to 4 SG deal ic.

- Based on article 41 SG termination o= the contract releases both >arties =rom theirobligations under the contractK it also gives a >arty er=ormed the contracteither art the right to claim restitution =rom the other >arty o= arty has su>>lied or >aid under the contract.

- Based on article 4 SG the seller ayment done by the buyer@ has to >ay interest to the buyer.

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9uestions : C4apter $A C!S(

9uestion 1A buyer =rom Suters in good sha>e and =ully o>erational@ so he

demands >ayment. The Sain member state o= the SGC. A=ter only * months S^rensen $td. loyment contract any sus>ects he has acce>ted

bribes =rom a com>any in hili. S^rensen $td. starts a laany established in Germany member stateC@ maEes an o==er to The7alaysian Trade om>any 7TC@ a com>any established in 7alaysia not a member stateC.The o==er involves the sale and deli

Business Law Syllabus Dispute Resolutions

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Transcript of Business Law Syllabus Dispute Resolutions