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Common EU sales law to be introduced

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This week the European Commission has proposed a common European sales law to assist with trading between member states within the EU.

The new law will create a common regime of contract law for all member states which will be optional. Therefore companies can decide whether they wish to use the new regime or continue using their national contract laws.

The common sales law has been proposed as a way of improving economic conditions within the EU. It is thought that not enough businesses are reaping the benefits of trading with customers within the common market. There are 500million people within the EU but only 9.3% of businesses sell across EU borders.

Compared to trade between states in the USA it is a lot more expensive and prohibitive under the current system for member states to trade with each other. If a business wishes to trade with other member states it would currently have to consider up to 26 different national contract laws.

Despite the possible benefits there have been many criticisms of the proposals particularly from the UK. Justice Minister Kenneth Clarke earlier this year raised concerns that the new regime would involve the European Commission being tied up with trying to implement the system at a time of great crises for the EU. He also said that the new law would result in “years of litigation as the new law gets tested”.

The EU’s Justice Commissioner, Viviane Reding however feels it is certainly at least worth trying. She said: “What do we have to lose? What’s the worst that can happen? That no-one thinks it is worthwhile, and that no-one utilises it. So what’s the risk in trying?”

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Written by Andrew Hodges

October 19, 2011 at 9:20 am

Posted in Comment, LinkedIn, New Law

Tagged with ,

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