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

Quill Co (buyer) in a CISG state fails to pay the price for goods that Rask Ltd (seller) has delivered in conformity with the contract. Rask wishes to claim interest. Which statement is correct under the CISG?

Rask may claim interest on the unpaid price in addition to any other damages. The CISG gives the seller an entitlement to interest on sums in arrears without needing an express contract term, and this does not prevent a separate damages claim.

  1. ARask may claim interest on the unpaid sum, in addition to any other damagesCorrect
  2. BRask may claim interest only if the contract expressly provides for it
  3. CRask may not claim interest because the Convention only allows recovery of the price

Explanation

The CISG states that if a party fails to pay the price or any other sum that is in arrears, the other party is entitled to interest on it, without prejudice to any claim for damages. The right does not depend on an express contract term. The rate is not fixed by the Convention, but entitlement to interest exists.

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