Application Of Lex Mercatoria In The International Commercial Arbitration

As the increasing tendency of globalization, the communications between different countries become more and more closely, and the speed of development of international trade especially rapid. But during this process there will be some disputes and differences inevitably, following by the resolution of disputes. Considering their own interests, some countries resort to law, and more of them adopt the arbitration way to resolve the problems. But can Lex Mercatoria be used in international commercial arbitration? This text will discuss the application of substantive law in international commercial arbitration, and do some sum-up with the concept, nature, appearance, development, prospective and the application of Lex Mercatoria, and among them the application is the key point.This text consists of four chapters:Chapter I summarizes the Lex Mercatoria. Talking about the Lex Mercatoria(Lex Mercatoria,law merchant), it is difficult to definite exactly. And the scholars have their own opinion, so the there are different translations. Here we adopt the translation"Lex Mercatoria". Professor Shendaming and Fengdatong think Lex Mercatoria is the commercial tradition which grown up in the MID age. Professor Schmitthoff's Clive M. divides Lex Mercatoria into"old"and"new". The"old"refers to a complete set of international unwritten law widely used among international businessmen who shuttle between ports and bazaars in civilized countries where trade exists. While the"new"is enacted elaborately by a legislature, represent in the form of international pact, demonstration law and documents issued by ICC, etc. This text concludes the following definition of Lex Mercatoria according to scholars'definitions of different countries:"Lex Mercatoria is the autonomous law system, growing up spontaneously for the need of international arbitration practice, with international business relations as its regulating object, and multinational nature independent of any domestic law system.Chapter II expounds nomological basis of the application of Lex Mercatoria in international commercial arbitration. With regard to the application of Lex Mercatoria, there are a lot of assentors, but objectors also exist. Making a comprehensive view to the theory practice of judicature about the application of Lex Mercatoria, there are three types of them: one is to allow apply Lex Mercatoria and give no consideration to domestic law; the other is to use combining Lex Mercatoria and domestic law together; another is to restrict the application of Lex Mercatoria, but now this kind of way is inclining to flexible in practice. Although it is different for different countries in the practice of legislature, the general trend is towards accepting and admitting the Lex Mercatoria. And the author of the text also advocates applying it actively, and taking it as the substantive law to resolve the disputes. All above is determined by the character of Lex Mercatoria itself. Lex Mercatoria is the inevitable requirement of international commercial arbitration development, and it also show prominent priority comparing with domestic law and conflict law, mainly in two aspects: firstly, it makes the resolution of international commercial disputes more"fair and right"; secondly, it makes the acceptance and enforcement of international commercial disputes more easily.Chapter III puts emphasize on the application of Lex Mercatoria in international commercial arbitration and the limit to its use. There are two kinds of application ways: to apply when the parties choose it; or applied by arbitrator directly if the parties have not chosen it. Between the two ways, the former is the dominating one, because it reflects fully the parties'willingness. Although the Lex Mercatoria is applied frequently, it is still limited in the application process. First of all, it is limited by domestic compelling law. Compelling law incarnates a country's fundamental interest and basic social order. The parties can reach an agreement to be governed by Lex Mercatoria at their own willingness, but they cannot completely exclude the control of basic principle of domestic compelling law to contractual relations. Secondly, it is limited by system of reservation of public order. On this point there are two kinds of viewpoints, i.e., supporting and objecting. The reason for objecting application of Lex Mercatoria is: Lex Mercatoria has no relation with sovereignty, while the existing basis of system of reservation of public order is to exclude the application of foreign law. In view of this, the text takes the point of supporting the application of system of reservation of public order, the reason for this is: Lex Mercatoria formed spontaneously in the area having no interest conflict with the country, however, its possible harm to public order cannot be excluded absolutely. Because of different history, culture, economy and society, the"tradition"which is reasonable and legal at one place and time, may be unacceptable completely at another place and time.Chapter IV illustrates the trend of application in international commercial arbitration and its prospect, and at the end, the author put forward some advices regarding to the situation of our country. In recent years, as the accelerating of world economic globalization, in order to make the global economy and legal order stable relatively, some international organizations who bend themselves to coordination and unification of law draft a great deal of international pact, traditions and demonstration law, thus, the trend of unification of international commercial legislation is more and more evident. As the theory of Lex Mercatoria becomes more mature and perfect gradually, and it's dynamic in the international commercial arbitration, people begin to pay attention to the research on application of Lex Mercatoria. Only Lex Mercatoria has formed a independent department or system, can it adjust international economic and trade relations really and effectively, and show its charming in international commercial arbitration. Our country has made great efforts in the legislation of arbitration law, and success obtained is obvious to all. But compared with countries whose Lex Mercatoria is relatively developed, the scopes involved in our country's Lex Mercatoria is comparatively narrow. Here we suggest that we should accept Lex Mercatoria with an attitude of tolerance, and begin to apply it boldly in some areas where Lex Mercatoria is comparatively mature. First of all, we should stipulate specifically on the application of Lex Mercatoria in our arbitration legislation. Secondly, the court can give arbitration proper supervision, and do not intervene excessively with the arrangement made by the parties for the disputes, including the parties choose to apply Lex Mercatoria Finally, suggest apply comparatively mature l Lex Mercatoria in dealing with international business disputes, such as CISG pact.