CISG Advisory Council Opinion No 1

Electronic Communications Under the CISG

To be cited as: CISG-AC Opinion no 1, Electronic Communications under CISG, 15 August 2003. Rapporteur: Professor Christina Ramberg, Gothenburg, Sweden.

Adopted by the CISG-AC with no dissent.

Reproduction of this opinion is authorized

Peter Schlechtriem, Chair
Eric E. Bergsten, Michael Joachim Bonell, Alejandro M. Garro Roy M. Goode, Sergei N. Lebedev, Pilar Perales Viscasillas, Jan Ramberg, Ingeborg Schwenzer, Hiroo Sono, Claude Witz, Members

Loukas A. Mistelis, Secretary

INDEX TO DIFFERENT ARTICLES COMMENTED ON

CISG Art. 11

 A contract of sale need not be concluded in or evidenced by writing and is not subject to any other requirement as to form. It may be proved by any means, including witnesses.

OPINION

A contract may be concluded or evidenced by electronic communications. communications.

COMMENT

11.1. The purpose of CISG Art. 11 is to ensure that there are no form requirements of writing connected to the formation of contracts. The issue of electronic communications beyond telegram and telex was not considered during the drafting of the CISG in the 1970s. By not prescribing any form in this article, CISG enables the parties to conclude contracts electronically.

See also UNCITRAL Model Law on Electronic Commerce Art. 5.

CISG Art. 13

 For the purpose of this Convention 'writing' includes telegram and telex.

 OPINION

The term "writing" in CISG also includes any electronic communication retrievable in perceivable form.

COMMENT

13.1. CISG Arts. 11, 12, 13, 21, 29 and 96 contain the term "writing". In the traditional paper world this term was uncomplicated and referred to documents written on paper [or other durable medium] by pencil, pen, etc. The problem is now whether electronic documents other than telegram and telex may also constitute "writing". The prerequisite of "writing" is fulfilled as long as the electronic communication is able to fulfil the same functions as a paper message. These functions are the possibility to save (retrieve) the message and to understand (perceive) it.

13.2. The parties may agree on what type of written form they intend to use (CISG Art. 6). They may, for instance, agree that they only accept paper letters sent by a particular courier service. Unless the parties have limited the notion of writing, there should be a presumption that electronic communications are included in the term "writing". This presumption could be strengthened or weakened in accordance to the parties' prior conduct or common usages (CISG Art. 9(1) and (2).

13.3. This Opinion does not deal with reservations made by States in accordance with CISG Art. 96 nor does it impose any restrictions on States that have made such a reservation.

See also UNCITRAL Model Law on Electronic Commerce Art. 6.

CISG Art. 15

 15(1) An offer becomes effective when it reaches the offeree.

(2) An offer, even if it is irrevocable, may be withdrawn if the withdrawal reaches the offeree before or at the same time as the offer.

OPINION

The term "reaches" corresponds to the point in time when an electronic communication has entered the offeree's server.

An offer, even if it is irrevocable, can be withdrawn if the withdrawal enters the offeree's server before or at the same time as the offer reaches the offeree. A prerequisite for withdrawal by electronic communication is that the offeree has consented, expressly or impliedly, to receive electronic of that type, in that format and to that address.

COMMENT

15.1. An offer is not effective until it reaches the offeree (CISG Art. 15(1) and may be withdrawn if the withdrawal reaches the offeree before or at the same time as the offer (CISG Art. 15(2)). In traditional means of communication this rule enables the offeror to withdraw his offer by a faster means of communication. He may, for instance, send an offer by letter through ordinary mail (snail mail) and then later withdraw it by sending a fax that reaches the offeree before the letter. The problem in relation to electronic means of communication is that there are rarely any practical means of faster communication than electronic messages sent by e-mail or communicated over websites or other EDI-arrangements. Thus a question of practical importance arises when the offer is sent by a traditional letter written on a paper and sent by traditional mail while the withdrawal is sent electronically.

15.2. The difficulty from a conceptual point of view is that the addressee of an electronicwithdrawal does not have to be physically present at the place where the message arrives. The place of the message is a functional concept rather than a physical one. The message could be located on any server in the world, including the sender's - the important question is whether the addressee can retrieve it. The following are the most important situations that are likely to be considered in relation to the term "reaches" in the context of electronic communications. communications:

15.3. Situation "A". From a pragmatic point of view it is clear that the addressee of an electronic communications withdrawal may read it as soon as it is located on his server. He may have problems reaching his server due to internal problems in his network system. This is normally within his "sphere of influence". Irrespective of how harsh it may be for the offeree that messages have arrived to his server but cannot be read by him due to internal problems, it is not appropriate to put the risk on the offeror for the offeree's technical problems. The offeree may reduce the risk by choosing appropriate internet service providers or designing an adequate technical infrastructure to make sure that the internal communication functions satisfactorily. The sender of an electronic communication ought not to assume this risk.

15.4. Situation "B". It is not sufficient that a withdrawal has entered the offeree's server. The offeree must also have expressed somehow that he is willing to receive electronic communications. The offeree's willingness to accept electronic communications must be taken into account in determining whether an electronic communication withdrawal has "reached" the offeror. The consent of the offeree may be evident CISG Art. 8, governing the interpretation of the conduct of the parties. CISG Art. 9(1) may also be relevant if the parties have established a practice in their business. CISG Art. 9(2) may apply in connections to trade usages which the parties knew or ought to have known and which in international trade are widely known to, and regularly observed by, parties to contracts of the type involved in the particular trade concerned.

15.5. Situation "C". A related problem is when the e-mail address is not correctly stated in the message containing a withdrawal. Such messages may enter the addressee's server - but never reach the addressee personally, so that it cannot be accessed by the addressee. An example is when the correct email address is "Thomas@companyx.com" but the sender writes "Tomas@companyx.com." This wrongly spelled e-mail may sometimes enter Thomas' server, but gets stuck in the server, since the server cannot find Tomas without the 'h'. For such situations the risk is on the sender, since Thomas has not indicated his willingness to receive electronic messages incorrectly addressed. Sometimes an electronic communication with an incorrect address is forwarded by the postmaster to the correct address. If the forwarded communication reaches the addressee's server in time, the withdrawal is effective. The addressee has in such a situation informed the postmaster that e-mails incorrectly addressed in a certain way should be forwarded to him, and by doing so he has expressed his general willingness to receive also electronic messages incorrectly addressed.

15.6. Situation "D". Another problem in relation to "reaches" is whether the offeree is able to process and understand the electronic communication. Due to incompatible computer programs, the text appearing at the offeree's computer may be incomprehensible. The situation is rather close to the problem of a message being written in a language that the offeree is unable to understand. The question at issue here is whether an electronic withdrawal that cannot be accurately processed by the offeree has "reached" the offeree when it has entered his server. The crucial issue is to what extent the offeree has indicated that he is willing to receive that type of electronic communications. It is not sufficient that the offeree has agreed to generally receive electronic communications. He must have consented to receiving electronic messages of that type, in that format, and to that address. Here again, CISG Art. 8 will be relevant for the interpretation of the conduct of parties, CISG Art. 9(1) will be relevant for any practices established between the parties, while CISG 9(2) may indicate, as a matter of trade usage, whether the offeror has impliedly or expressly agreed to receive electronic messages of a certain type.

CISG Art. 16(1)

 (1) Until a contract is concluded an offer may be revoked if the revocation reaches the offeree before he has dispatched an acceptance.

OPINION

In case of electronic communications the term "reaches" corresponds to the point in time when an electronic communication has entered the offeree's server. An offer may be revoked if the revocation enters the offeree's server before the offeree has dispatched an acceptance. A prerequisite is that the offeree has consented, expressly or impliedly, to receiving electronic communications of that type, in that format, and to that address.

In electronic communications the term "dispatch" corresponds to the point in time when the acceptance has left the offeree's server. The offeror may revoke the offer by sending a revocation that enters the offeree's server before the offeree's acceptance leaves the offeree's server. A prerequisite is that the offeror has consented, expressly or impliedly, to receiving electronic communications of that type, in that format and to that address.

COMMENT

16.1. This provision enables the offeror to revoke an offer until the offeree has dispatched his acceptance. The revocation must have entered the offeree's server before the offeree has dispatched his acceptance.

16.2. For restrictions on the effectiveness of "reaches", see comments in Article 15. For the concept of "dispatch" see the black letter text under Article 21(2), below.

See also UNCITRAL Model Law on Electronic Commerce Art. 15.

CISG Art. 17

An offer, even if it is irrevocable, is terminated when a rejection reaches the offeror.

OPINION

The term "reaches" corresponds to the point in time when an electronic message has entered the offeror's server. An offer is terminated when a rejection enters the offeror's server. A prerequisite is that the offeror has consented expressly or impliedly to receiving electronic communications of that type, in that format, and to that address.

COMMENT

17.1. An offer is terminated when rejection reaches the offeror. In electronic environments the exact time of "reaches the offeror" can be determined. The offeree can no longer create a contract by dispatching an indication of assent. If the offeree changes his mind after having dispatched a rejection of the offer and wishes to conclude a contract, the indication of assent must enter the offeror's server before the rejection enters the offeror's server

17.2. For restrictions on the effectiveness of "reaches" see comments in Article 15.
See also UNCITRAL Model Law on Electronic Commerce Art. 15.

CISG Art. 18(2)

 (2) An acceptance of an offer becomes effective at the moment the indication of assent reaches the offeror. An acceptance is not effective if the indication of assent does not reach the offeror within the time he has fixed, or, if no time is fixed, within a reasonable time, due to account being taken of the circumstances of the transaction, including the rapidity of the means of communication employed by the offeror. An oral offer must be accepted immediately unless the circumstances indicate otherwise.

OPINION

An acceptance becomes effective when an electronic indication of assent has entered the offeror's server, provided that the offeror has consented, expressly or impliedly, to receiving electronic communications of that type, in that format, and to that address.

The term "oral" includes electronically transmitted sound in real time and electronic communications in real time. An offer that is transmitted electronically in real time communication must be accepted immediately unless the circumstances indicate otherwise provided that the addressee consented expressly or impliedly to receiving communications of that type, in that format, and to that address.

COMMENT

18.1. The underlying purpose of this article is to ensure that the offeror has an opportunity to read the indication of assent if he so chooses. It is not required that the offeror actually have read the indication of assent, but rather that such indication of assent become accessible for reading (the distinction between "reach the mind" and "reach the desk" or "reach the legal entity"). Accordingly, when an indication of assent has entered the offeror's sphere of control, it must be assumed to have reached the offeror.

18.2. The proposition that an indication of assent only needs to be accessible and not actually read is designed to facilitate evidence. It is possible (more or less easily, but at least conceptually) to prove when a message becomes accessible; it is very difficult to prove when someone actually addressed his mind to it.

18.3. For restrictions on the effectiveness of "reaches" see comments in Article 15.

18.4. The requirement that an oral offer must be accepted immediately indicates that oral offers are only binding during the immediate negotiations. When negotiations are carried out in real time, whether by sound or by typed letters, the situation is similar to oral negotiations and the presumption is that the offers must be accepted on the spot, in immediate connection to the negotiations and in real time. The relevant factor is that the other party is aware of the offer and has a possibility to respond immediately. An offer that is communicated electronically in real time not by sound but in writing by typed letters must also be accepted immediately unless the circumstances indicate otherwise. Offers in chat rooms and other types of real time communication must be accepted immediately.

See also UNCITRAL Model Law on Electronic Commerce Art. 15

CISG Art 19(2)

 (2) However, a reply to an offer which purports to be an acceptance but contains additional or different terms which do not materially alter the terms of the offer constitutes an acceptance, unless the offeror, without undue delay, objects orally to the discrepancy or dispatches a notice to that effect. If he does not so object, the terms of the contract are the terms of the offer with the modifications contained in the acceptance.

OPINION

The term "oral" includes electronically transmitted sound provided that the addressee expressly or impliedly has consented to receiving electronic communication of that type, in that format, and to that address.

The term "notice" includes electronic communications provided that the addressee expressly or impliedly has consented to receiving electronic messages of that type, in that format, and to that address.

COMMENT

19.1. The purpose of this article is to make a message that does not constitute an acceptance effective as an acceptance unless the offeror provides a quick notice that the purported acceptance is not an acceptance. Such information by the offeror could be conveyed by electronic sound or by other electronic messages.

19.2. For restrictions on the effectiveness of "reaches" see comments in Article 15.

See also UNCITRAL Model Law on Electronic Commerce Art. 5

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