Corporate and Business Law (Global) · Obligations of the seller and buyer, and provisions common to both

Remedies for Breach of Contract under the CISG

Updated 11 October 2026

Under the CISG, a party in breach exposes itself to remedies set by the Convention. The innocent party can usually claim damages, require performance, fix extra time, or, if the breach is fundamental, avoid the contract. A buyer may also reduce the price for non-conforming goods. The seller may be able to cure.

Understand Remedies for Breach under CISG

The CISG is the UN Convention on Contracts for the International Sale of Goods. It applies to qualifying international sales of goods between parties in contracting states, unless the parties exclude it. It gives each side a set of remedies if the other fails to perform.

The key idea is the fundamental breach. A breach is fundamental if it causes such detriment to the other party that they are substantially deprived of what they were entitled to expect under the contract. This is unless the breaching party did not foresee that result and a reasonable person in the same position would not have foreseen it. Anything less is a non-fundamental breach.

This split drives the remedies. For a breach, the innocent party can claim damages, and can usually require performance. That right is subject to Art 28 (a court need not order specific performance unless its own law would do so for similar contracts) and, for the buyer, to the limits in Art 46(2) and (3) on replacement and repair. Either party may also fix an additional period of reasonable length for the other's performance of an obligation (Arts 47 and 63). This is a Nachfrist period. Avoidance, which ends the contract for both sides, is available for a fundamental breach (Arts 49(1)(a) and 64(1)(a)). It is also available for non-delivery or non-payment after a Nachfrist period expires (Arts 49(1)(b) and 64(1)(b)). It can also arise in anticipatory breach and instalment cases (Arts 72 and 73), which are covered on other pages. Avoidance is a last resort, because the Convention favours keeping the contract alive.

The buyer has extra tools. The buyer can reduce the price where goods do not conform. The reduced price is the contract price multiplied by the value of the goods actually delivered over the value conforming goods would have had, both at the time of delivery. The buyer can demand repair or substitute goods. Replacement can only be demanded if the non-conformity is a fundamental breach, and repair only if it is reasonable in the circumstances. To rely on these remedies, the buyer must give notice of the lack of conformity within a reasonable time (Art 39). The seller has a right to cure (Art 48). After the delivery date, the seller can fix a defect or deliver missing goods only if it can do so without unreasonable delay and without causing the buyer unreasonable inconvenience or uncertainty of reimbursement of expenses. This right is subject to the buyer's right to avoid.

Damages under Article 74 equal the loss suffered, including lost profit, as a consequence of the breach. They cannot exceed the loss the breaching party foresaw, or ought to have foreseen, when the contract was made. The innocent party must also take reasonable steps to mitigate the loss.

Key formulas to remember

Fundamental breach (Art 25): Breach is fundamental if it substantially deprives the other party of what they expected, unless the breaching party did not foresee, and a reasonable person in the same position would not have foreseen, that result; Foreseeability is judged at the time the contract was made. The breaching party can rebut it by showing neither it nor a reasonable person would have foreseen the result.
Damages (Art 74): Damages = loss suffered, including lost profit, capped at the loss foreseeable when the contract was made; The innocent party must mitigate. Failing to mitigate reduces the damages.
Avoidance: Avoidance is available for fundamental breach (Arts 49(1)(a), 64(1)(a)), for non-delivery or non-payment after a Nachfrist period expires (Arts 49(1)(b), 64(1)(b)), and in anticipatory breach and instalment cases (Arts 72 and 73); A declaration of avoidance is effective only if notified to the other party. After avoidance and a reasonable cover purchase, damages under Art 75 = cover price − contract price, plus further damages under Art 74.
Price reduction (Art 50): New price = contract price × (value of goods actually delivered ÷ value conforming goods would have had), both values at the time of delivery; Buyer's remedy only. It does not need a fundamental breach, and it applies whether or not the price has been paid. The buyer must give notice of the lack of conformity within a reasonable time under Art 39, and in any case within 2 years of the goods being handed over (Art 39(2)), to rely on price reduction, repair or replacement. Any further loss not covered by the reduction may be claimed as damages, without double recovery. Not available if the seller remedies the failure under Art 37 or 48, or the buyer refuses to accept the seller's performance under those articles.
Substitute goods or repair: Substitute goods: only if the non-conformity is a fundamental breach (Art 46(2)). Repair: unless unreasonable in the circumstances (Art 46(3)); The buyer must request within a reasonable time of giving notice of the lack of conformity.
Specific performance: Either party may require the other to perform (Arts 46 and 62), unless it has chosen an inconsistent remedy such as avoidance. For the buyer, replacement needs a fundamental breach (Art 46(2)) and repair must be reasonable (Art 46(3)); Under Art 28, a court need not order specific performance unless its own law would do so for similar contracts of sale not governed by the CISG.
Extra time (Nachfrist): Either party may fix an additional period of reasonable length for the other's performance (Arts 47 and 63); The avoidance right after the period expires applies only to non-delivery or non-payment. Arts 47 and 63 do not require the notice to be in writing, though a written notice is easier to prove.

How to solve Remedies for Breach under CISG questions

Use this order for any scenario or objective question on CISG remedies.

1Confirm the CISG applies: an international sale of goods, parties in contracting states, and no exclusion by the contract.
2Identify the breach and who is in breach: late delivery, non-conforming goods, non-delivery, non-payment or refusal to take delivery.
3Decide whether the breach is fundamental: does it substantially deprive the innocent party of what they expected, unless the breaching party did not foresee, and a reasonable person would not have foreseen, that result?
4Match the remedy. Breach of an obligation: damages, performance, and a Nachfrist period for the other's performance. Fundamental breach: avoidance. Non-delivery or non-payment after a Nachfrist expires: avoidance. Anticipatory breach or instalment contracts: avoidance may be available (Arts 72 and 73, covered on other pages). Non-conformity: price reduction, repair, or replacement (replacement only if fundamental).
5Check conditions: notice given in time, a Nachfrist period used where needed, and whether the seller has a right to cure.
6For damages, apply Art 74: actual loss plus lost profit, limited by foreseeability, reduced for failure to mitigate. After avoidance and a reasonable cover purchase, apply Art 75: cover price minus contract price.
7State a clear conclusion in one sentence that names the remedy.

Quickest way: Fundamental or not? Then pick the remedy

When to use it: Use for Section A questions and for the five-question scenarios in Section B, where time is short.

Ask first: is the breach fundamental? Total failure to deliver or goods that are useless to the buyer usually is. A short delay or minor defect usually is not.
If fundamental, avoidance is available. If not, think damages, price reduction, repair or extra time.
If the answer options include avoidance for a minor breach, reject them unless a Nachfrist period has passed without performance of delivery or payment, or the facts show an anticipatory breach or instalment case.
Check the options for replacement goods. If the defect is minor, replacement is wrong.
Pick the option that matches the party: price reduction is the buyer's remedy only.

Common mistakes in Remedies for Breach under CISG

Saying any breach allows avoidance.
Students link breach with ending the contract, as in many domestic laws.
Fix: Avoidance needs a fundamental breach, non-delivery or non-payment after a Nachfrist period expires, or an anticipatory breach or instalment case under Arts 72 and 73.
Ignoring the foreseeability limit on damages.
Students stop at lost profit and do not check what the breaching party could have foreseen.
Fix: Under Art 74, damages cannot exceed the loss foreseen or foreseeable when the contract was made.
Allowing the buyer to demand replacement goods for any defect.
Replacement and repair are treated as the same remedy.
Fix: Replacement requires a fundamental breach. Repair is available unless unreasonable.
Forgetting to mitigate loss.
Students focus on the breaching party's liability only.
Fix: Add that the innocent party must take reasonable steps to reduce loss, or damages can be cut.
Giving the price reduction remedy to the seller.
The remedy list is learned as one pool.
Fix: Price reduction is only for the buyer, where goods do not conform.
Ignoring the seller's right to cure.
Students go straight to the buyer's remedies.
Fix: Check whether the seller can fix the defect or deliver missing goods without unreasonable delay and without causing the buyer unreasonable inconvenience or uncertainty of reimbursement of expenses.

Worked examples

Example 1

Aspen Ltd (country A) agrees to sell 500 machine parts to Birch Co (country B), both CISG contracting states. Aspen delivers on the agreed date, but 5% of the parts have a small cosmetic scratch that does not affect function. Birch wants to avoid the contract. Can it?

Show the solution

The CISG applies: international sale of goods, both states are contracting states.
The breach is non-conformity of some goods.
Is it fundamental? The scratch does not affect function. Birch is not substantially deprived of what it expected.
So the breach is not fundamental and avoidance is not available.
Birch can still claim damages for any loss, ask for repair, or reduce the price in proportion to the lower value of the goods.

Answer: No. The breach is not fundamental, so Birch cannot avoid the contract. It may claim damages, require repair, or reduce the price.

Example 2

Crest Ltd contracts to buy goods from Delta Co for ₹10,00,000, delivery on 1 March. Delta fails to deliver. Crest gives Delta 14 days' extra time. Delta still does not deliver. Crest avoids the contract and buys the same goods elsewhere for ₹11,20,000 at a reasonable price. What may Crest do, and what damages can it claim?

Show the solution

Non-delivery is a breach. Crest fixed an additional period of reasonable length (Nachfrist, Art 47). Art 47 does not require the notice to be in writing, though writing helps Crest prove it.
Delta did not deliver within the period. Crest may now avoid the contract for non-delivery, even if the breach was not fundamental.
Crest must notify Delta of the avoidance.
Art 75 applies only after avoidance. Crest made a substitute purchase in a reasonable manner and within a reasonable time after avoidance. Damages = price paid on cover minus contract price.
₹11,20,000 − ₹10,00,000 = ₹1,20,000.
Crest may also claim further foreseeable loss under Art 74. The reasonable cover purchase also shows it mitigated its loss.

Answer: Crest may avoid the contract after notice and claim damages of ₹1,20,000 under Art 75, plus any further foreseeable loss under Art 74.

Exam tips

Start every answer with the fundamental breach test. Most marks follow from it.
In Section A, watch the party: price reduction and replacement are buyer's remedies.
In scenario cases, look for a Nachfrist period. It is often the trigger for avoidance.
In written answers, use the order: breach, fundamental or not, remedy, conditions, conclusion.
For damages, give the figure and mention foreseeability and mitigation, as these are common mark points.

Practice questions from Obligations of the seller and buyer, and provisions common to both

Remedies for Breach under CISG: frequently asked questions

What is the difference between fundamental and non-fundamental breach under the CISG?

A fundamental breach substantially deprives the other party of what they expected under the contract, unless the breaching party did not foresee that result and a reasonable person in the same position would not have foreseen it. Anything less is non-fundamental. Avoidance is available for fundamental breach, or for non-delivery or non-payment after a Nachfrist period expires. Anticipatory breach and instalment cases (Arts 72 and 73) are covered on other pages.

How do you avoid a contract under the CISG?

You must show a fundamental breach, non-delivery or non-payment after an additional period you fixed has expired, or an anticipatory breach or instalment case under Arts 72 and 73. You then notify the other party that the contract is avoided. Avoidance releases both parties from their obligations, subject to damages.

What does Article 74 of the CISG say about damages?

Damages equal the loss suffered because of the breach, including lost profit. They cannot exceed the loss the breaching party foresaw, or ought to have foreseen, when the contract was made. The innocent party must also mitigate.

Can a seller cure a defect under the CISG?

In some cases, yes (Art 48). After the delivery date, the seller may fix a defect or deliver missing goods if it can do so without unreasonable delay and without causing the buyer unreasonable inconvenience or uncertainty of reimbursement of expenses. This is subject to the buyer's right to avoid, and the buyer keeps the right to claim damages for any loss.