Buying and Selling Products Abroad

October 04, 2010, 02:09 PM

Many business people and their attorneys are familiar with the Uniform Commercial Code in effect throughout the United States (except Louisiana). However, they often fail to grasp the reality that the UCC will not govern their international purchases and sales. On the contrary, when goods are shipped between a seller and buyer in different countries, there are several possibilities as to which body of law will apply: the law of the seller’s country; the law of the buyer’s country; a third country where the contract or any material portion is to be performed; or perhaps a fourth country whose law is invoked by the parties in their contractual documents. Increasingly, however, a fifth possibility is now the greater probability: i.e., the United Nations Convention on Contracts for the International Sale of Goods (the “Sales Convention”). At present, the United States and 75 other countries have adopted the Sales Convention, meaning that sales occurring between parties located in two or more of these “contracting states” will be governed by the Sales Convention absent special circumstances or an agreement to the contrary. —Charles V. McPhillips