(Un-)noticed CISG Misconceptions: Application in #UAE

There are many unnoticed misconceptions and misinterpretations of the CISG, some are apparent, while others require subtle interpretation.

One of the evident, but unnoticed (mis-)applications is to apply the CISG to parties from the United Arab Emirates. Although the UAE- especially Dubai and Abu Dhabi- is emerging as an international trade, finance, and arbitration hub, the UAE is not a party to the CISG (yet). As such, the CISG may be applied to a party from the UAE as per Art. 1(1)(b), if the conditions are met. However, some judgments indicate that this issue seems to have been overlooked at times.

In a 2011 US district court decision, the court held that "... [b]ecause the United States, where Southeast has its place of business, and U.A.E., where Al Hewar has its place of business, are both States party to the Convention." In a series of cases -the latest appeal case being that of 2023- the Dutch court in 2022 held essentially similarly- although somewhat subtly. More subtly, the French court in 2001 held that the CISG applied because the contract was for "sales" as per CISG Art. 3(2) rather than analyzing the applicability (or not) as per CISG Art 1(1)(b). On the other hand, in a recent 2024 decision of the Swiss Supreme Court, the court accurately mentioned the applicability of the CISG as part of Swiss law as per Art. 1(1)(b).

As Memorial Day is around the corner and signifies the start of the summer season in the #US, wishing everyone a wonderful summer around the globe!