Application Of Article 79 Of CISG

CISG had suffered lots of discussion and arguments in the process of drafting. With the purpose to impose restrictions on the use of ULIS, CISG has chosen the distinctive “impediment” instead of “circumstances” to describe an accident which may lead to exemption. What’s more, the International Trade Commission has rejected the proposal of adding an item for hardship. All seem to indicate the objective of CISG is to reduce to scope of exemption.However, comparing to PICC as well as PECL, CISG lost an article to apply to hardship. It could be intentional if CISG doesn’t accept the rule of hardship or article 79 or others have already stipulated that. The cryptic description and no clear interpretation, including the conceptual differences in approach to frustration of performance among the major legal systems such as “frustration of contract”, change of circumstances and “commercial impracticability”, all have brought lots of trouble in applying article 79, even threatening the process of international trade smoothly.Based on the original opinion that only an accident leading to non-performance belongs to an impediment, <UNCITRAL 2012 Digest of case law on the Model Law on International Commercial Arbitration> published by UNCITRAL mentions some countries or areas’ juridical practice have indicated that hardship is included in article 79. The Belgian Court of Cassation has indicated that “impediment” referred to in article 79(1) may include changed circumstances that have made a party’s performance a matter economic hardship, even if performance has not been rendered literally impossible; the court emphasized that, in order to qualify as an “impediment”, the change of circumstances ought not to have been reasonably foreseeable at the time of the conclusion of the contract and performing the contract must involve an extraordinary and disproportionate burden under the circumstances. Unfortunately the digest hasn’t give clear definition about the sphere of application.Since there is no direct article or interpretation about hardship, and the conceptual differences in approach to exemption among the major legal systems even between countries in one legal system. In order to make clear if hardship is included in the scope of application of Article 79, this thesis has 5 chapters. Chapter 1 briefly introduces the content of article 79 with the value as an exemption clause. Chapter 2 explains the differences between hardship, change of circumstances and force majeure, and analyses the reasons of the trouble in interpreting and applying Article 79. Article 3 focus on the comparison with PICC, PECL and relevant rules from the civil law, the common law and China. Chapter 4 will list some representative cases about hardship with applying CISG. The final conclusion will be summarized in the last chapter.