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A Single European Contract Law?

27 July 2011 #Dispute Resolution


The single European currency may be undergoing a difficult period, but the European Commission is nevertheless pressing ahead with its plans for the formation of a single European contract law aimed at supporting trade across countries within the European single market. 

At the moment, each country has its own laws governing the formation and enforcement of commercial and consumer contracts, and this of course creates challenges for any businesses wishing to trade with other European partners.  The enforcement of judgments within the European Union is now reasonably straightforward, as is the service of legal proceedings, and many disputes handled by us involve parties in other European countries.  However the European Commission`s vision is for a single contract law governing transactions throughout the European Union. 

At a speech given in June 2011 to mark the end of a lengthy consultation process, the EU Justice Commissioner and Vice President of the European Commission, Viviane Redding, signalled the commitment of the European Community to adopting a European-wide contract law and identified the following as key issues:-

  • The law would have to be voluntary and optional.  This means that it could be chosen by business and consumers and serve as a basis for their transaction.  However it is not at this stage intended to replace existing National contract law which would exist alongside it. 
  • The optional nature of such EU contract law would need to be clear and transparent.  The idea is that consumers in particular would be given the express option of agreeing or not agreeing to the contract being governed by European contract law. 
  • The law would be adapted, in the way in which other legal systems have not yet developed, to deal with what the Commission described as the "reality of our modern information society".  
  • It would be aimed at being particularly attractive for small and medium-sized companies seeking to carry out cross-border transactions. 
  • No decision has yet been reached on whether European contract law could also be applied to parties doing business within one country, but the Commissioner seems keen on this as well.

Following the Commissioner`s speech on 3 June, the European Parliament, by an overwhelming majority, approved the development of European contract law at a vote on 8 June 2011 and has now authorised the Justice Commissioner to progress the development of European contract law in consultation with Member States.

Watch this space!

Clarkslegal, specialist Dispute Resolution lawyers in London, Reading and throughout the Thames Valley.
For further information about this or any other Dispute Resolution matter please contact Clarkslegal's dispute resolution team by email at disputeresolution@clarkslegal.com by telephone 020 7539 8000 (London office), 0118 958 5321 (Reading office) or by completing the form on this page.

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Antony Morris

Antony Morris
Partner

E: amorris@clarkslegal.com
T: 0118 960 4646
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