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BEUC Study on Optional Instrument; BEUC’s 10 reservations; and EU Justice ministers discuss CESL

December 20, 2011 By: Admin Category: European Sales Law

EuSoCo partner Geraint Howells has co authored a study for BEUC. This study and the 10 reservations from BEUC can be found on the BEUC website or from the links below

See: BEUC Study: “Optional Soft Law Instrument on ECL” (Howells, Micklitz, Reich, Nov 2011)

See BEUC’s  European contract law: 28th regime – BEUC’s 10 reservations (Nov 2011)

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14 Dec. 2011: Justice ministers meeting in Brussels discussed the proposed Common European Sales Law.

Proposals for a common sales law to encourage cross-border trade appear to have been dismissed by EU justice and home affairs ministers meeting in Brussels on 14 December amid concerns that they will heap more bureaucratic costs on small businesses. The proposals were set for discussion rather than agreement.

Ministers have expressed reservations following the end of the Polish presidency (which organised an unprecedented number of preparatory meetings to prioritise the fast-track progress on the CESL) and the handing over of the file to the Danes, who will hold the rotating EU presidency starting in January. “A number of member states are sceptical about the need for the scheme, its legal basis and its feasibility. The proposal will need to go back to the Commission for further consideration,” said a source to EuroActiv.  The Commission’s own statistics in its Consumer Market Scoreboard show that major reasons for a lack of cross-border trade are practical: 62% of consumers cite fear of fraud, 49% concern about deliveries. He said a sales law “would not address any of these”.

The Council meeting also aimed to “review the overall economic situation in Europe in view of the latest developments. It will revert to the question of promoting growth in Europe, with particular attention to prioritising growth-enhancing initiatives, reducing the overall regulatory burden as regards SMEs and micro-enterprises, delivering the single market act and completing the digital agenda”. One potentially growth-enhancing initiative which would help to reduce the overall regulatory burden on small businesses, which would improve the functioning of the single market and which would improve the law on the supply of digital content would be the adoption of a Regulation on a Common European Sales Law.

Link: European Commission Proposal for a regulation on a Common European Sales Law

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JUSTICE AND HOME AFFAIRS COUNCIL

Brussels, 13 and 14 December 2011

Common European Sales Law

The Council is expected to take note of the state-of-play of negotiations on the proposal for a Common European Sales Law on the basis of a presidency paper (18353/11). The Commission proposal of the regulation was submitted in October 2011 (15429/11). Following the first exchanges of views, the Polish presidency concludes that among the aspects of the proposal that require thorough discussion are the personal, material and territorial scope of the proposal, the complexity of linking the proposal with the different national legal systems, the modalities and consequences of choosing the instrument, the consequences of an invalid choice, the consumer protection rules relating to the choice and the reporting obligations of member states, including the envisaged online database of judgments. On the methodology of negotiations, the presidency paper suggests to deal with the legal basis for the instrument when at least some of the content-specific issues have been settled and the merits of the economic impact of the proposal has been sufficiently evaluated.

The regulation as proposed by the Commission would give businesses and consumers coming from different countries an alternative to doing business under the rules of one or the other country which both parties might not be familiar with. The two contracting parties could agree to voluntarily choose an alternative second set of rules for their cross-border sales contracts identical in each of the member states and co-existing with the regular national sales laws. The goal of the proposal is to enhance growth and trade in the internal market by decreasing business costs related to diverging national contract laws and consumers’ reluctance to shop crossborder.

The guiding principles are freedom of contract and a high level of consumer protection. The proposal assumes that this alternative set of rules would stimulate more cross-border business. The alternative sales law would be available to contracts on the sales of goods and supply of digital content, as well as directly related services. It would be open to business-to-consumer contracts as well as those business-to-business contracts where at least one party is a small or medium-sized enterprise (SME). It is important to underline that both parties to a cross-border contract would need to agree to use this alternative, European sales law regime.

The new rules would cover most issues of contract law that are considered of practical relevance during the life-cycle of a cross-border contract, including rights and obligations of the parties and the remedies for non-performance, pre-contractual information duties, the right of withdrawal and its consequences, interpretation and the contents and effects of a contract. In order to ensure effective and uniform application, the proposal envisages as future supporting measures the development of “European model contract terms” and the creation of a publicly accessible database of relevant judicial decisions.

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For some further updates: See blog entries from the Uni of Edinburgh at : http://www.law.ed.ac.uk/epln/

House of Commons debate on subsidiarity and the Proposed Common European Sales Law 11 December 2011 22:34 The House of Commons debated the question of the Common European Sales Law on 7 December and adopted the Draft Reasoned Opinion. The debate can be read at http://www.publications.parliament.uk/pa/cm201011/cmhansrd/cm111207/debtext/111207-0001.htm#11120739000005 at cols 313-325.

The 28th regime arrives The “28th regime” has been the name given to the idea of an optional contract law outside the laws of the EU Member States which would be available for parties to choose as the law governing their contract. It was never a very accurate name as it ignored the fact that a single Member State, such as the United Kingdom, might have two or more systems of contract law. (This will have to chance as Croatia is set to become the 28th Member State in 2012)  The idea of an extra, free-floating regime has been replaced in the Proposal for a Regulation on a Common European Sales Law (CESL) by the idea of inserting second optional regimes in the form of the CESL into the laws of all the Member States.

Link to a new Encyclopedia of European Private Law: Oxford University Press has announced the forthcoming publication of an English language version of the new Max Planck Encyclopedia of European Private Law. See http://ukcatalogue.oup.com/product/9780199578955.do The editors are Reinhard Zimmermann, Jürgen Basedow, Klaus J. Hopt and Andreas Stier.  The encyclopedia will be arranged alphabetically (avoiding some interesting questions of structure but gives rise to some apparent idiosyncracies and overlaps, and will consist of about 500 entries. This makes for too long a list to reproduce here but the first few entries will give the flavour. The authors are mainly German or Austrian, many of them with a well-established international reputation. The book has already appeared in German. The fact that it will now be published in English is rather impressive.

Roundtable at the Maastricht University Brussels Campus (12.12.11) December 2011 22:52 I was at an interesting meeting in Brussels last Friday. It was at the Brussels offshoot of Maastricht University and it was a discussion on the proposed Common European Sales Law. The sub-title was “Have the right choices been made?” The programme can be accessed at http://mepli.blogspot.com/2011/11/9-december-round-table-on-common.html .

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