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Posted: July 7th, 2022
The question is:
“One of the most important aspects of cross border trade and commerce requiring certainty and predictability must be on giving global legal force and effect to the parties’ choice of governing law and choice of a specific court to resolve any resulting disputes, along with recognition and enforcement of the resulting court judgments. Without this certainty in transnational litigation, parties face significant risks. However, the harmonization efforts in these areas have consistently failed and the position internationally remains uncertain and unpredictable. This is why arbitration has become the main choice of international dispute resolution for parties contracting across national borders.
” Critically discuss and evaluate the accuracy of this statement, ensuring that your reasoning is supported by reference to appropriate primary and secondary legal material/resources and focuses clearly on evaluation of the impact of the various harmonization efforts in these areas.
See comments in sidebar for specific examples of these general comments.
I stopped commenting after the first couple of pages because the same mistakes were cropping up again and again.
In terms of the essay content it has no purpose. It is rambling and discursive but makes no points at all, certainly no interesting or important points. See my comments about what an introduction should contain.
Addressing the Question: You don’t at all. This is too general in content to address any question. However, look at the key words in the question. It is concerning the requirements of CERTAINTY and PREDICTABILITY and the attempts of HARMONISATION to achieve these.
So, we have three key terms and you mention certainty four times and predictability and harmonisation not once.
I would write this essay arguing that harmonisation has largely failed because it is a disputed concept on which people cannot even agree. However, I would then argue, it can never be achieved because states are determined to retain sovereignty over their laws.
Now, I have an argument (the opposite or a different view can of course be taken). I can start to build a structure that addresses the key concepts of the question:
What is harmonisation
How much harmonisation has there actually been (eg things like CISG and UNIDROIT)
Has harmonisation been successful in certainty and predictability of law
Is harmonisation the best way to go
From there I can start to address sub-arguments relevant to the main argument and my thesis. These will address the question.
SOURCES: This is very weak and, after the lack of an argument or point of view is the biggest weakness and the cause of the weakness of the essay. Basically you need to reference every single legal fact or assertion you make outside your central argument.
You have 31 footnotes and one page of sources. Nowhere near enough. I just checked one of my LL.M 5,000 word essays and it had 124 footnotes and five pages of sources.
Then there is the quality of the sources. Again, referring to my work, all of my sources were primary sources (cases and statutes) or good secondary sources (journal articles). You have one primary source (a single case) and of your 13 cited ‘journals’ only about half were proper, peer-reviewed academic journals. The rest were published only online and under the auspices of various institutes but were not journal articles in the proper sense.
International Commercial Law
Over the years, the Hague has made several unsuccessful attempts to develop international convection and judgments concerning internationa trade dispute cases. The intense interaction between the jurisdiction laws and the choice of law within the legal system has assisted in solving several conflicts, although the existing differences have been irreconcilable. Lack of harmonization between conflict laws, especially those over the international commercial transactions, had been a significant problem, which has caused uncertainty and unpredictability of the cross-border trade. Lack of certainty, and predictability, has, however, affected the choice of governing law and choice of a specific court to resolve any resulting disputes, along with recognition and enforcement of the resulting court judgment. Due to the lack of harmonization in-laws, the court has decided to use Arbitration to solve international law disputes. The article discusses how lack of harmonization has brought about uncertainty, unpredictability, and Arbitration in solving international disputes.
According to Article III, the International Trade Court of the United States is the Supreme Court determining a court established for dealing with international trade cases, the judicial power. Judges of the inferior and the Supreme Courts receive compensation, which is not affected by the office’s continuation. However, the international trade court consists of nine judges appointed by the president through advice and direction from the senate. The Court of International Trade has a wide range of powers, including powers of the United States district courts over equity and laws. The public and private transnational and international trade disputes are solved in the ad hoc arbitrary tribunals, tribunals, and international trade. The transnational litigation entails aspects such as the cross border evidentiary issues, law choice, and justice enforcement. Other areas of concern in transnational litigation include the service of process, jurisdiction, choice of forum, damages, appellate review, and taking witness evidence abroad. Over the years, international commercial laws have received several concerns, such as litigation transcending the national border, uncertainty in making court judgments, and unpredictabilities. Dealing with transnational litigation has been an issue, considering most cases have been dealt with in domestic courts and using domestic laws. Most litigants have complained and ask for justice, especially in dealing with transnational cases. The primary concern has been the need to treat transnational cases as distinct and unique cases that require special laws compared to domestic cases. The litigant, however, advocates for the use of harmonization and unification of laws to reduce the uncertainties, and unpredictabilities of the court instead of losing control and meaning of lawmaking. Some of the most common international trade regimes include the North American Free Trade Agreement (NAFTA) and the World Trade Organization (WTO).
The transnational litigation’s prominent role is to protect clients from several claims that originate from international trade, reducing and preventing several risks that may threaten an organization of a country’s business. However, the international litigation team assists in addressing or dealing with cross-border litigation, such as implementing global defensive policies, devising, implementing offensive policies, and coordination. The transnational litigation has assisted deal with the top international trade cases over the years across the world. An example is the high-profile case of Chevron Corporation versus Ecuador. The transnational litigation deal with other issues, such as cases of tort and contract disputes, technological issues, intellectual property cases, global media management, international Arbitration, multi-jurisdictional environmental, and global strategy proficiency. The transnational litigation is familiar with several other areas, such as global fact investigation, U.K. commonwealth litigation, multinational trademark, intellectual disputes, international supply chain litigation, corporate separateness, and asset recovery. The transnational litigation groups help represent clients in various companies and industries, such as the food industry, transportation industry, procession, and manufacturing industry. Transnational litigation lawyers, however, represent clients in arbitral tribunals alongside some conflicts, for instance, the resolved case of NML capital ltd and the Daimer AG. Despite the efforts from transnational litigations, other methods have been proposed to solve the rising cases of unpredictability and uncertainties. Several government organizations have come with various legal frameworks that assist in reducing and dealing with cross-border trade cases, mainly through promoting uniformity of laws, through a process known as harmonization, which has been proposed and is still criticized for not being effective.
The harmonization process is an essential process when it comes to the adoption of international convection. The term harmonization means making things similar, which is a tool, which assists in making international laws similar and assists in creating a healthy relationship that prevents conflicts or cross-border trade issues. Harmonization enhances transnational litigation, especially on cross-border business transactions. According to UNIDROIT/ALI, conflicts and distress, such as international legal conflicts, can be solved by minimizing issues and differences that cause uncertainties in the legal system. According to UNIDROID, harmonization would promote similar rules, which can apply in any cross-border trade despite where the conflicting parties are.
Harmonization assists in dealing with conflict by preventing litigation costs and doing away with quarks in the procedural system. Also, harmonization has a wide range of benefits, including the elimination of inefficient and dormant laws. Elimination of inefficient rules enables the legal system to develop better and advanced rules that promote uniformity and provide solutions to cross-border trade issues.
Despite the benefits of harmonization, not all countries advocate for the harmonization of international trade laws. According to most authors and critics, the adoption of uniform laws and harmonization comes with a higher cost of legal risks. However, the arguments against the harmonization of laws are weaker than the benefits that the process has on dealing with both conflicts. The leading cause of lack of harmonization has been the underlying risks, forcing most cross-border businesses to create their transactional relationships and the effort to make tradeoffs between certainty and flexibility. Most of the time, the harmonization process assists in developing several transactional rules that may affect individualized negotiations, which is the primary way of reducing legal risks between the conflicting parties. Various countries have commonalities regarding international laws, such as Europe and the united states. Harmonization promotes certainty, preventing conflicts from taking place, promoting balance, consistency, and promoting harmony between trading countries. International laws are application can be done either through voluntarism or objectivism. Voluntarily involves applying international laws based on the state, while objectivism is applying international laws based on legal instruments and the hierarchy of the existing laws.
The efforts from the international institute for the unification of private laws (UNIDROIT), the contract for the international sale of goods(CISG), and the principle of international commercial contracts(PICC) have raised some debates, primarily where the bodies advocate for the development of a new set of rules that would promote harmonization. Modernization of the international laws to reduce legal uncertainties and unpredictabilities of the legal system. According to the united states, harmonization is essential and can be done without the interference of the current structure. Apart from the united states supporting the international contract law framework, other countries have opposed, stating that there are other ways of harmonizing international contract laws apart from a framework. According to opposers, the development of a new legal structure or instrument would be feasible. The new instrument might affect the adoption of the CISG and the application of PICC. Most countries. The development of a harmonization framework is considered to bring more harm, especially the costly nature of negotiating the treaty and the length. The CISG and the PICC have worked effortlessly in promoting harmonization through the existing legal instruments, which has somehow been successful.
According to most countries, the national laws have not been enough when dealing with international transactions due to limitations of the laws. Also, the framework has been affected by the divergence of the national laws, which causes some problems such as the supremacy of laws and stress. It compromises the values and soundness of the national laws.
The lex mercatoria doctrine, which was proposed after second world war two, relied on Arbitration as the primary and the main form of handling disputes arising from contracting parties who are investors in foreign countries. Transnational Arbitration, however, has assisted in preventing the application of national laws, and where harmonization has failed to provide uniformity of laws. Supporters of lex mercatoria, especially the modern law, advocate for the provision of adaptability and flexibility to deal with the uncertainty arising from the unpredictability in handling disputes that arise from cross-border trade. Transnational Arbitration, however, takes place in institutions, such as the American Arbitration Association(AAA), the international chamber of commerce(ICC), the London court of international Arbitration (LCIA), and the arbitration institute of the Stockholm chamber of commerce(SCC)or the Adhoc.
An international trade custom is a standard form of contract and trade conditions formed by many international agencies. Examples include the United Nations Economic Commission (UNEC), the International Law Association (ILA), and the International Chamber of Commerce (ICC). International agencies apply various laws that help deal with trade issues such as improving security and ensuring justice and equality are served in contract terms. The primary goal of international trade customs is to ensure a balanced economy, promote negotiation, and promote current and modern international trade. Furthermore, it also governs the parties’ Willis’ autonomy and its limits in enforcing laws that assist in bringing equality among the contracting parties. However, the contracting parties are provided with some freedoms, such as the right to laws that govern the contracts and principles that provide several limitations of the contract. The decision arbitral tribunal is a source of international trade laws consisting of the arbitration clause. It is also an agreement provided in case of a dispute between two contracting parties.
The arbitration clause has been harmonized in the international treaties, especially the international chamber of commerce(ICC), and in the model clause of Arbitration. Arbitration provides the contracting parties with the right to report and submit any disputable conflicts that may arise. The arbitration tribunal is either permanent or Adhoc. Some of the ordinary arbitration tribunals mainly used include the court of Arbitration of the International Chamber of Commerce, the International Trade Association’s Arbitral Tribunal, and the Arbitration Commission of the Socialist Nations. However, the arbitral tribunal helps apply the arbitration process, a convenient, flexible method that promotes freedom. The arbitration tribunal applies the justice process similar to the judge’s system. During the proceedings, the arbitrator must identify the law applicable to the issue and deal with the issue through the working laws of international trade.
The role of Arbitration as the Primary Choice of International Dispute Resolution
Arbitration has become the primary choice of international dispute resolution for parties contracting across national borders, mainly due to the failed nature of harmonization in preventing unpredictability and uncertainty. Arbitration is a method that is considered adequate for dealing with significant transaction conflicts, although other alternative methods are still used, such as mediation or the use of legal form. Arbitration is a dispute resolving method that promotes flexibility, and neutrality, which Is internationally enforceable compared to other methods.
Arbitration is a way of resolving disputes through a third party, where for successful dispute resolution, Arbitration, ADR, and court proceedings work in handy, especially in resolving international disputes. Choices are, however, made based on the circumstance and laws applicable to the issue. International contracts go through several potential disputes, such as the sale of commodity disputes, the distributorship, and intermediary disputes, procurement disputes, maritime disputes, disputes with customs authority, disputes with pre-shipment inspection agencies, disputes involving banks, employment contract disputes, a dispute involving state, and state-owned industries.
Sales of Commodity and goods dispute: This is a type of dispute that originates from various business processes, such as the quality of the goods, the condition of goods at delivery, the transportation, timing, and the price of the commodity. However, the type of dispute arises when there is a letter of credit, the ambiguity of the contract, the lack of following the insurance and custom procedures, and the customs authorities’ international standards. Additionally, to avoid the type of disputes, the buyers and sellers or rather the contracting parties should follow several laws and adhere to international commercial terms (incoterms), which consist of several international trade rules applied by international traders.
Construction engineering and infrastructural dispute: This is a type of dispute that arises when the construction work performed does not comply with the contractual agreements and requirements. Some of the construction engineering work includes the construction of bridges, dams, highways, and tunnels. Often, a dispute arises when the work is not collected on time or when the government authorities apply new rules and regulations. The most common type of dispute in the field is the dispute that originates from a failure to apply the Federation of Consulting Engineers (FIDIC), which consists of construction standards for big international projects.
Procurement dispute: Procurement dispute is a type of dispute, especially concerning the bidding process, where most of the time, the bidding process is unfair, or the rules of bidding are violated. Another case of procurement dispute is failure to follow the contractual terms.
Intellectual property dispute: Most international trad business es involves intellectual properties, such as issues like trademark, patent, licensing, and technical assistance, lack of knowledge concerning the restrictions of use of intellectual property rights, the type of compensation that should be awarded for breach, the termination process of the license may cause several issues, royalties due, and lack of product development license cover. Most of the time, issues that arise from intellectual properties are solved through Arbitration.
Dispute with custom authorities: This type of dispute is prevalent, especially when conducting cross-border businesses, such as importation and exportation. Some of the man issues or disputes include the valuation issue and classification issues, which leads to other issues, such as the non-tariff barrier, quota, and inspection restrictions. Dispute of reasonable valuation can arise if the products do not follow the WTO agreement on customs valuation. Also, customs officials may decline the prices offered compared to the quality of goods, also known as under-invoicing. Dispute with the customs authorities requires one to pay customs duties to be made accessible released, although sometimes Arbitration is used to solve the case.
Disputes involving states or state-owned entities: This is a type of dispute that arises when a government entity decides to purchase goods abroad. An issue may arise if the contracting parties do not verify whether the contract can be solved through Arbitration. The method for settling disputes should be agreed on and issue verified to avoid conflict on how to resolve cases when issues arise, for instance, in a construction project.
Disputes involving banks: The disputes involving banks are central and common types of disputes, especially the documentary credit dispute, which arises when documentation does not follow the ICC requirements.
Commercial dispute Resolving: International trade and commercial despite can be resolved through several methods such as contract negotiation, exemption, and adaptation clause, use of non-jurisdiction methods to settle disputes, such as Arbitration, alternative dispute resolution, and use of courts. Contract negotiation is a common type of dispute resolution method, where a contract that is clear and drafted is not prone to disputes compared to a contract that is not signed or drafted. In case of a conflict, the parties are expected to negotiate in good faith and reach a mutual agreement. A qualified lawyer or in-house counsel mainly conducts the negotiation method.
According to lawyers and experts, contracts should never be signed or written in a hurry or when the parties are under pressure to reach an agreement. On the other hand, the exemption and adaptation clause is a conflict that rises after the parties fail to pre-suppose the conditions and requirement off a force majeure, which assists in addressing hardship issues and impossibilities, frustration re-purposing, and failure to follow the act of God laws. Wors such as the International Chamber of Commerce (ICC) and the force Majeure should be incorporated into the contract.
The non-jurisdiction methods for settling disputes have primarily used Arbitration as the primary and preferred method for international trade and commercial disputes. Arbitration is considered more accessible and practical to apply Arbitration in a foreign country. To get assistance or services, the parties must first agree to the method and submit an agreement signed when the conflict arises. The agreement, however, consists of names of the institution, which must be written correctly, the name of the arbitral institution.
The main factor that makes the arbitration process reliable and effective is using different languages in the arbitration rules. The method assists in solving cases concerned with commodity disputes, construction disputes, and maritime cases. For example, the London-based Grain and Feed Trade Association is an arbitration service that deals with all cases concerning sales. Before selecting the arbitration institution, the parties should make sure the institution complies with economic issues and has excellent trade expertise. The arbitration institution has increased tremendously due to international cases’ increased nature and the rise of commercial disputes, especially sales and distribution disputes. Not all arbitration institutions deal with all trade matters, and some specialize in some issues, such as maritime disputes or intellectual property disputes. The arbitral institutions offer services, such as supervision of the arbitral process, which comes at a fee, covering another arbitral process due to the arbitral institution’s expenses. The arbitral institution offers much assistance, although various arbitral institutions offer different and unique arbitral processes, such as rules and guidelines to be followed by the conflicting parties. Other arbitration institutions assist the parties in appointing arbitrators that would assist in settling disputes if they arise. On the other side, arbitration institutions administer arbitration proceeding s between various conflicting nationals, supervises the whole proceedings, and notifying the parties concerning several arbitral awards.
Another type of Arbitration where the parties can follow or use their rules and procedures the Adhoc Arbitration. Ad hoc arbitration is a type of Arbitration that is is also known as the do-it-yourself type of service. Since the parties do not use the institution’s rules and principles, the parties must adhere to and follow the latter’s rules and the arbitration re-numeration basis.
Benefits of hamonization over Arbitration.
Arbitration assists in solving international trade disputes and assist in the court’s decision-making process when making judgement on procedural courts concerning international trade disputes. Most parties opt for the Adhoc administration compared to institutionalized Arbitration because the administration mode is cheaper. There is no appointment of arbitrators or services such as supervision. However, the ad hoc arbitration’s success depends on the parties’ efforts and discipline compared to the rules and principles designed to be followed by the institutionalized Arbitration. The ad hoc arbitration parties can opt to ask for assistance from the authority of the chamber of commerce in solving several disputes. However, assistance calls for apportionment of arbitrators and arbitral tribunal courts’ commerce to solve hand.
However, the arbitration clause is necessary for parties involved in an international bu;siness into the bilateral treaty, the international convection, or applying the conflict of law. An arbitral clause or an agreement should be in written form, where the information depends upon the parties’ will and the intention to resolve the issue. However, the arbitration agreement should be in writing despite the availability of the oral agreement. Parties or exchanges should sign it in emails or other methods such as faxes. However, the parties need to include the contract’s arbitration clause instead of settling disputes or considering when a conflict arises.
Several laws are applicable in the arbitration procedure, the Lex Arbitral, mandatory supervision by the arbitration institutions, consolidation laws, where the court allows consolidation o more than one proceeding into one, and statute of limitation. The statute of limitation considers the language used in the arbitral tribunal. The language should be the country’s language where Arbitration is held and a translator for the other parties. Also, the limitation applies to the extent of court intervention, registration of award, and extent of the court intervention in a case where disrupting tactics and assistance are sometimes considered.
The court can intervene in two circumstances, when the losing party wants to appeal for the award against the party or when the winning partydecides to apply arbitral awards against the losing party. However, in the case of a foreign award, the interaction convection, for instance, the new York international convection, offers several limitations that decline recognition or the parties’ agreement. . The last ward of the arbitral tribunal can be used to end the dispute, or sometimes the award may be having some errors, such as computational and clerical errors. In other instances, the award offered may be unclear and does not consider the date or the interest when granting the interest. Furthermore, the reward can be recorded s by consent, which means that the terms in the award are consented to and settled in a document provided y the court. The parties have the right to withdraw claims in case of an agreement. Hence the arbitral tribunal offers the withdrawal.
Despite the use of Arbitration in solving transactions commerce disputes, harmonization of the international laws has taken wing and assisted in preventing unpredictability and uncertainty. One of the cases that shows the achievement of harmonization is the Capetown convention. Los, the Hague convention has achieved harmonization through addressing insecurities among trade intermediaries. The decentralized form of lawmaking has made the lex Mercator an international commercial law, which has been contributed by the rising issue of international transactions in the twenty-first century, such as issues concerning secured credit, security of systems for movable assets, and transfer of movable goods. The issues have, however, been corrected by the harmonization of commercial laws. Harmonization is a flexible framework and promotes uniformity of legislation, which assists in achieving high levels of supernational governance. Harmonization has been used purposely in creating special regimes for international transactions, which is done without changing any national laws and developing a common market through uniformity of national laws that control domestic transactions. Despite the problems caused by the differences in national law, harmonization remains the top method of reducing uncertainty and unpredictability of international commercial laws.
Despite being the best option, not everyone is contented when most claim that the process of harmonization is irrelevant and unnecessary. The process reduces legal risks at a cost, which is worthy and preferable, especially in dealing with extenuating situations. Harmonization and unification of laws are some of the practical processes in reducing uncertainty and unpredictability.
The conflict in civil laws and conflict laws has shown several differences between international trade laws, where the American courts have tried to develop harmonization to reduce and prevent cross border issues, for instance, the approach developed by the unites states and Europe. However, most countries have denied applying the international trade contract rules and promoting uniformity developed by the CISG and PICC. Lack of harmonization increases the rate of uncertainties and unpredictability in the legal systems, making it challenging to solve cross-border trade issues. Instead, America’s courts use Arbitration as the only and main primary form of conflict resolution, especially concerning international business transactions. Unidroit, an international government institution, and other organizations advocate for modernization and harmonizing international laws to promote uniformity and limit or prevent differences. On the other hand, the UNCITRAL has played a hand in assisting the American government in maintaining, promoting uniform laws, and dealing with all cases involving conflict between parties concerning international contract law. International trade or commerce disputes had been a significant issue, primarily due to the rising cases of intellectual properties, maritime disputes, and other types of disputes common in cross-border business. Both commercial and uniform laws have been in the front line in dealing with international cases, most cases or transaction, which has affected most parties. The uniform laws help unify laws between various countries, mainly when conflict arises, and the laws differ widely. Furthermore, conflicting laws are addressed through some methods, such as the arbitration method, which is a primary method used in solving disputes compared to other methods, such as mediation and negotiations. Besides, international trade conflicts are taken to the arbitrary tribunal courts or the international trade courts, which help resolve the dispute and assist the parties in coming up with an agreement.
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