Skip to content

ACCA Applied Skills · Corporate and Business Law (Global) · Introduction to the UN Convention on Contracts for the International Sale of Goods and ICC Incoterms

Alpha Ltd, based in Country X, agrees to sell industrial machinery to Beta Inc, based in Country Y, for use in Beta's factory. Both countries are Contracting States to the UN Convention on Contracts for the International Sale of Goods (CISG) and the contract does not mention the CISG. Which statement is correct?

The CISG applies automatically because the buyer and seller have their places of business in different Contracting States. The parties need not mention it, and there is no minimum value or delivery method requirement. Only an express exclusion by the parties would prevent it applying.

  1. AThe CISG applies automatically because the parties have their places of business in different Contracting StatesCorrect
  2. BThe CISG does not apply because the contract does not expressly refer to it
  3. CThe CISG applies only if the machinery is delivered by sea
  4. DThe CISG applies only if the contract price exceeds a minimum value set by the Convention

Explanation

The CISG applies to contracts for the sale of goods between parties whose places of business are in different Contracting States. No express reference is needed, and the Convention sets no minimum value or transport requirement. The parties would have to opt out expressly to avoid it.

Did you get it right without looking?

One question tells you little. A timed set on Introduction to the UN Convention on Contracts for the International Sale of Goods and ICC Incoterms shows your real accuracy, how long you take and where you lose marks.

Practise Introduction to the UN Convention on Contracts for the International Sale of Goods and ICC IncotermsFree diagnostic mock

More Introduction to the UN Convention on Contracts for the International Sale of Goods and ICC Incoterms questions