International Business Transactions

INTERNATIONAL BUSINESS TRANSACTIONS

I. Introduction

Timeline of International Commercial Law

Turn of 12th cent. Maritime laws recorded in tablets in Mediterranean

late 1600s King’s courts in UK claim jurisdiction over commercial law

1874 Unsuccessful attempt at codified private intl law in the Netherlands

1892 South American Conference on Private International Law

1893 First Hague Conference on Private International Law

1926 UNIDROIT established by League of Nations

• Uniform laws on sale of goods and commercial contracts in 1964, 1994

1966 UNCITRAL established by UN General Assembly

• Created CISG in 1980, effective 1988

1975 Inter-American Conference on Private International Law (CIDIP)

• Transaction lawyer must identify, eliminate or reduce risks that occur due to:

o Communication

o Transportation o Regulation

o fluctuation

• Types of protection from risk:

o Institutional (national and international laws)

• US has 43 Friendship, Commerce & Navigation (FCN) Treaties; bilateral investment treaties

• in TOPCO case, recourse to international law in contract provided protection

o Purchased (OPIC or Export-Import Bank insurance; Letter of credit)

• Revere Copper case

o Negotiated (e.g. choice of law clause in contract)

II. Export-Import Transaction

A. Export-Import Contract

• Typical stages:

1. Seller delivers goods to carrier

2. Carrier gives seller bill of lading

3. S delivers bill of lading to Buyer

4. B pays S

5. B gives Carrier bill of lading

6. C delivers goods to B

• Documents in sales transaction:

o Sales contract – lists goods, price, estimated freight, insurance and customs clearance charges

o Letter of credit – lists documents seller must present to draw on account

o Commercial invoice – lists price-delivery term, goods (description & quantity) destination, price, all fees

o Bill of lading

o Insurance Policy or certificate

o Draft – prepared by seller, check written to seller which draws on letter of credit...