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

Hartwell Ltd, in a Contracting State, contracts with Ilmora Ltd, in another Contracting State, to supply and install a production line. The materials Hartwell must supply are a minor part of the price, and the preponderant part of its obligations is the supply of labour and services. Does the CISG govern the contract?

The CISG does not govern the contract because the preponderant part of the supplier's obligations is labour and services rather than supplying goods. Contracts for goods where the materials are substantial are covered, but not those dominated by services.

  1. AYes, because the contract involves goods that cross a border
  2. BNo, because the preponderant part of the seller's obligations consists of labour or servicesCorrect
  3. CYes, but only as to the equipment and never as to any term

Explanation

The CISG does not apply to contracts where the preponderant part of the supplier's obligations is labour or other services. Here services dominate, so the Convention is excluded. Crossing a border alone is not enough.

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