Rousing the Sleeping Dog: The Validity Exception to the Convention on Contracts for the International Sale of Goods

Since January 1, 1988, any contract for the sale of goods between a U.S. trader and a buyer or seller from one of a growing list of foreign countries may be subject to an international legal regime founded on the U.N. Convention on Contracts for the International Sale of Goods [CISG or Convention]. The CISG automatically governs all contracts falling within its scope unless the parties have agreed that another set of rules, such as the law of a domestic jurisdiction, shall govern their relationship instead of the CISG. Therefore, the provisions of the Convention generally displace article 2 of the Uniform Commercial Code in contracts for the international sale of goods. However, domestic rules remain applicable to some issues arising in such contracts.

The rules of contractual validity, for example, are excluded from the CISG's scope, and thus subject to the laws of the applicable domestic jurisdiction.