Commercial law
Introduction
Lecture 1
• The main theme of this course is international commercial transaction.
• When a commercial problem arises there must be a solution
• It covers aspects of costs and risks.
• There are trade terms
• What jurisdiction or law applies?
• The exam entails a case in which we have t solve using the reader.
• Focus
Key concepts:
- delivery
- cost
- risk
- title
- control
- payment
^
• In balancing the conflicting interests of the parties involved
• In providing them with legal certainty
• In linking different legal aspects of the international commercial transaction
Basic/ simple sale of goods:
Seller -> goods -> buyer
Buyer -> payment -> seller
• Features:
• Open market situation
• Seller and buyer and goods are all in the same place
• Immediate inspection of goods possible
• Simultaneous exchange of goods and payment
• Risk and title pass with handing over of goods
• Problems:
• What if parties are not in the same place?
• What if goods must come overseas?
,Sale and transport”
Seller -> goods -> carrier -> buyer
Buyer -> payment -> seller
• Features:
• Transport is integrated in commercial transaction
• Third party service provider ex carrier takes care of transport in return for freight
• Seller and buyer do not have to be in the same place
• Risk passes when goods are taken over by carrier dependent on the type of contract
• Problems:
• Who bears the risk of transport damage?
• No simultaneous exchange of goods and payment
• Who shall perform first? Seller or buyer?
• How to control the goods during transport?
Sale, transport and b/l
Seller -> goods -> carrier -> buyer
Buyer -> payment -> seller
Carrier bill of lading -> depends
- Usually, the bill of lading names the seller the shipper and buyer the consignee
- If its to bearer = the consignee
- If its to order without a name = the shipper
- If its to order with consignee name = the bill of lading can be endorsed by either
The carrier issues the bill of lading to the seller in return for a certain document depending on
the contract.
• Features:
• Transport is integrated in commercial transaction
• Third party service provider takes care of transport in return for freight
• Use of docs of title
• Control over goods through b/l
• Payment in return for b/l possible
• Problems:
• Who bears the risk of transport damage?
• What if carrier is not liable?
Sale, transport and b/l and insurance
,Seller -> goods -> carrier -> buyer
Buyer -> payment -> seller
Carrier makes bill of lading -> seller and buyer
Goods are insured depending on contract who?
• Features:
• Integration of insurance into commercial transaction
• Third party service provider, insurer, covers the risk of cargo damage in return for premium
• Insurance certificate to order or bearer can pass with b/l in return for payment
• Problems:
• How to ensure simultaneous exchange of docs, control over goods and payment?
Sale, transport and b/l and insurance and CAD
Seller -> goods -> carrier -> buyer
Buyer -> payment -> seller
Carrier makes bill of lading -> seller and buyer
Goods are insured depending on contract who?
Payment handled by third party bank!
Seller presents required documents in return for payment. The payment process occurs
through a third party bank.
• Features:
• Integration of banks into commercial transaction
• Third party services provider, bank, facilitates documentary payment of sale price
• Cash against docs in return for a fee
• Problems:
• What if seller wishes to ensure payment of the purchase price?
• What if buyer needs a loan to finance commercial transaction?
• The bank will want to ensure repayment of the loan by demanding collateral.
Sale, transport and b/l and insurance and l/c
Seller -> goods -> carrier -> buyer
Buyer -> payment -> seller
Carrier makes bill of lading -> seller and buyer
Goods are insured depending on contract who?
Payment handled by third party bank!
, • Features:
• Integration of banks in commercial transaction
• Bank of buyer facilitates commercial transaction by opening letter of credit in favor of seller
in return for interests on the loan and fees
• Documentary sales such as cad and l/c allow goods to be bought, sold, delivered and paid
during transit.
• This allows a string of sales contracts in relation to commodities, often on standard terms
Layers of complexity:
• International trade
• Flow of goods and money across borders
• B2B and B2C
• For profit
• Private law relations
• Network of contracts
Specific layers of complexity:
• Sale of goods
• Agency
• Transport of goods
• Documents
• Payment procedures
• Insurance
• Export and import
Sale of goods:
• Contract of sale
• Trade terms
• Incoterms 2020
• B2B
• B2C
• Commodities
• Freedom of contract
• Internationality
• Goods description
• Conformity
• Delivery
• Rejection
• Passing of risk and ownership
• Allocation of costs
Introduction
Lecture 1
• The main theme of this course is international commercial transaction.
• When a commercial problem arises there must be a solution
• It covers aspects of costs and risks.
• There are trade terms
• What jurisdiction or law applies?
• The exam entails a case in which we have t solve using the reader.
• Focus
Key concepts:
- delivery
- cost
- risk
- title
- control
- payment
^
• In balancing the conflicting interests of the parties involved
• In providing them with legal certainty
• In linking different legal aspects of the international commercial transaction
Basic/ simple sale of goods:
Seller -> goods -> buyer
Buyer -> payment -> seller
• Features:
• Open market situation
• Seller and buyer and goods are all in the same place
• Immediate inspection of goods possible
• Simultaneous exchange of goods and payment
• Risk and title pass with handing over of goods
• Problems:
• What if parties are not in the same place?
• What if goods must come overseas?
,Sale and transport”
Seller -> goods -> carrier -> buyer
Buyer -> payment -> seller
• Features:
• Transport is integrated in commercial transaction
• Third party service provider ex carrier takes care of transport in return for freight
• Seller and buyer do not have to be in the same place
• Risk passes when goods are taken over by carrier dependent on the type of contract
• Problems:
• Who bears the risk of transport damage?
• No simultaneous exchange of goods and payment
• Who shall perform first? Seller or buyer?
• How to control the goods during transport?
Sale, transport and b/l
Seller -> goods -> carrier -> buyer
Buyer -> payment -> seller
Carrier bill of lading -> depends
- Usually, the bill of lading names the seller the shipper and buyer the consignee
- If its to bearer = the consignee
- If its to order without a name = the shipper
- If its to order with consignee name = the bill of lading can be endorsed by either
The carrier issues the bill of lading to the seller in return for a certain document depending on
the contract.
• Features:
• Transport is integrated in commercial transaction
• Third party service provider takes care of transport in return for freight
• Use of docs of title
• Control over goods through b/l
• Payment in return for b/l possible
• Problems:
• Who bears the risk of transport damage?
• What if carrier is not liable?
Sale, transport and b/l and insurance
,Seller -> goods -> carrier -> buyer
Buyer -> payment -> seller
Carrier makes bill of lading -> seller and buyer
Goods are insured depending on contract who?
• Features:
• Integration of insurance into commercial transaction
• Third party service provider, insurer, covers the risk of cargo damage in return for premium
• Insurance certificate to order or bearer can pass with b/l in return for payment
• Problems:
• How to ensure simultaneous exchange of docs, control over goods and payment?
Sale, transport and b/l and insurance and CAD
Seller -> goods -> carrier -> buyer
Buyer -> payment -> seller
Carrier makes bill of lading -> seller and buyer
Goods are insured depending on contract who?
Payment handled by third party bank!
Seller presents required documents in return for payment. The payment process occurs
through a third party bank.
• Features:
• Integration of banks into commercial transaction
• Third party services provider, bank, facilitates documentary payment of sale price
• Cash against docs in return for a fee
• Problems:
• What if seller wishes to ensure payment of the purchase price?
• What if buyer needs a loan to finance commercial transaction?
• The bank will want to ensure repayment of the loan by demanding collateral.
Sale, transport and b/l and insurance and l/c
Seller -> goods -> carrier -> buyer
Buyer -> payment -> seller
Carrier makes bill of lading -> seller and buyer
Goods are insured depending on contract who?
Payment handled by third party bank!
, • Features:
• Integration of banks in commercial transaction
• Bank of buyer facilitates commercial transaction by opening letter of credit in favor of seller
in return for interests on the loan and fees
• Documentary sales such as cad and l/c allow goods to be bought, sold, delivered and paid
during transit.
• This allows a string of sales contracts in relation to commodities, often on standard terms
Layers of complexity:
• International trade
• Flow of goods and money across borders
• B2B and B2C
• For profit
• Private law relations
• Network of contracts
Specific layers of complexity:
• Sale of goods
• Agency
• Transport of goods
• Documents
• Payment procedures
• Insurance
• Export and import
Sale of goods:
• Contract of sale
• Trade terms
• Incoterms 2020
• B2B
• B2C
• Commodities
• Freedom of contract
• Internationality
• Goods description
• Conformity
• Delivery
• Rejection
• Passing of risk and ownership
• Allocation of costs
