Communication from the Commission to the European Parliament and the Council - A more coherent European contract law - An action plan
Date: 2003-02-12
Institutions: European Commission
Subjects: EU action, EU law, application of EU law, contract, single market

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I

(Information)

COMMISSION

COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT
AND THE COUNCIL

A MORE COHERENT EUROPEAN CONTRACT LAW

AN ACTION PLAN

(2003/C 63/01)

Summary

The Commission communication on European contract law of July 2001 launched a process of
consultation and discussion about the way in which problems resulting from divergences between
national contract laws in the EU should be dealt with at European level. The present action plan maintains
the consultative character of this process and presents the Commission’s conclusions. It confirms the
outcome of that process, i.e. that there is no need to abandon the current sector-specific approach. It also
summarises the problems identified during the consultation process, which concern the need for uniform
application of Community contract law as well as the smooth functioning of the internal market.

This action plan suggests a mix of non-regulatory and regulatory measures in order to solve those
problems. In addition to appropriate sector-specific interventions, this includes measures:

— to increase the coherence of the Community acquis in the area of contract law,

— to promote the elaboration of EU-wide general contract terms, and

— to examine further whether problems in the European contract law area may require non-sector-

specific solutions such as an optional instrument.

In addition to continuing to put forward sector-specific proposals where these are required,
the
Commission will seek to increase, where necessary and possible, coherence between instruments, which
are part of the Community contract law acquis, both in their drafting and in their implementation and
application. Proposals will, where appropriate, take into account a common frame of reference, which
the Commission intends to elaborate via research and with the help of all interested parties. This common
frame of reference should provide for best solutions in terms of common terminology and rules, i.e. the
definition of fundamental concepts and abstract terms like ‘contract’ or ‘damage’ and of the rules that
apply, for example, in the case of non-performance of contracts. A review of the current European
contract law acquis could remedy identified inconsistencies, increase the quality of drafting, simplify and
clarify existing provisions, adapt existing legislation to economic and commercial developments which
were not foreseen at the time of adoption and fill gaps in Community legislation which have led to
problems in its application. The second objective of the common frame of reference is to form the basis
for further reflection on an optional instrument in the area of European contract law.

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In order to promote the elaboration by interested parties of EU-wide general contract terms, the
Commission intends to facilitate the exchange of information on existing and planned initiatives both at
a European level and within the Member States. Furthermore, the Commission intends to publish
guidelines, which will clarify to interested parties the limits which apply.

Finally, the Commission expects comments as to whether some problems may require non-sector-specific
solutions, such as an optional instrument in the area of European contract law. The Commission intends
to launch a reflection on the opportuneness, the possible legal form, the contents and the legal basis for
possible solutions.

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CONTENTS

1.

2.

3.

Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Description of the present process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Identified problem areas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

3.1.

Uniform application of Community law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

3.2.

Implications for the internal market . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

4.

Suggested approach: a mix of non-regulatory and regulatory measures . . . . . . . . . . . . . . . . . . . . . . . . . . . .

4.1.

To improve the quality of the Community acquis in the area of contract law . . . . . . . . . . . . . . . . . . . . . . .

4.2.

To promote the elaboration of EU-wide standard contract terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

4.3.

Further reflection on the opportuneness of non-sector specific measures such as an optional instrument
in the area of European contract law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

5.

Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

ANNEX . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

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4

4

5

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1.

2.

3.

4.

5.

1.

INTRODUCTION

In July 2001, the Commission published its communi-
cation on European contract law (1). The communication
was the first consultation document issued by the Euro-
pean Commission that envisaged a more fundamental
discussion about the way in which problems resulting
from divergences between contract laws in the EU should
be dealt with at European level. Its follow-up is the
subject of this action plan.

The communication launched a process of consultation
and discussion. The Commission is aware of its long-
term nature and intends to maintain its consultative
character. Only through continuous involvement of all
Community institutions and all stakeholders can it be
ensured that the final outcome of this process will meet
the practical needs of all economic operators involved
and finally be accepted by all concerned. For this reason,
the Commission has decided to submit the present action
plan as a basis for further consultation.

In particular, this action plan seeks to obtain feedback
on a suggested mix of non-regulatory and regulatory
measures, i.e. to increase coherence of the Community
acquis in the area of contract law,
to promote the
elaboration of EU-wide standard contract terms and to
examine whether non-sector specific measures such as an
optional instrument may be required to solve problems
in the area of European contract
it
constitutes a further step in the ongoing process of
discussion on the developments in European contract
law.

law. As such,

Member States. In particular, the communication asked
whether the proper functioning of the internal market
might be hindered by problems in relation to the
conclusion, interpretation and application of cross-border
contracts. It was also interested in whether different
national contract laws discouraged or increased the costs
of cross-border transactions and sought views on whether
the existing approach of sectoral harmonisation of con-
tract law could lead to possible inconsistencies at Com-
munity level, or to problems of non-uniform implemen-
tation of Community law and application of national
transposition measures.

6.

The Commission was also interested in receiving views
on what form solutions should take. In order to assist in
defining possible solutions, the communication included
a non-exhaustive list of possible options, set out in
options I to IV.

7. None of the contributions indicated that the sectoral
approach as such leads to problems or that it should be
abandoned. All contributors nevertheless reacted to the
various options. Only a small minority favoured option I
which suggested leaving the solution of identified prob-
lems to the market. There was considerable support for
option II, i.e. to develop, via joint research, common
principles of European contract law. An overwhelming
majority supported option III, which proposed the
improvement of existing Community law in the area of
contract law. A majority was, at least at this stage, against
option IV, which aimed at a new instrument on European
contract law. However, an important number of contribu-
tors suggested that further thought might be given to this
in the light of future developments in pursuance of
options II and III.

2.

DESCRIPTION OF THE PRESENT PROCESS

The communication on European contract law launched
a consultation procedure that yielded numerous contri-
butions from governments and stakeholders, including
businesses, legal practitioners, academics and consumer
organisations. The flow of incoming mail has continued
since the process was started. Up to now, the Commission
has received 181 responses to the communication.

8.

The communication was intended to broaden the debate
on European contract law and to allow the Commission
to gather information on the need for more far reaching
Community action in the area of contract law. The
Commission sought information as to whether problems
resulted from divergences in contract law across the

The Commission has put strong emphasis on trans-
the consultation procedure.
parency at all stages of
With the consent of the authors,
it published their
contributions on the Commission’s website (Responses to
the Commission’s communication on European contract
law (2)). The Internet was also used as a forum to publish
a summary that analysed these responses (Summary of the
responses to the communication on European Contract
Law (3)). This summary attracted a lot of interest (4) and
an updated version is annexed to this action plan.
This interest together with the abundance of scholarly
publications are evidence that the ideas expressed in the
communication fell on fertile ground and provide the
Commission with a mandate to pursue its work in this
field. The outcome of this consultation provides a basis
for this action plan.

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9.

The European Parliament adopted the ‘resolution on the
approximation of the civil and commercial law of the
Member States’ (5) on 15 November 2001. The resolution,
addressed to the Commission, requests a detailed action
plan with short-term, medium-term and long-term
measures within a fixed timetable.

10. The Council adopted a report on the need to approximate
Member States’ legislation in civil matters (6) on 16 Nov-
ember 2001 where, in particular, it considered it necess-
ary to ask the Commission to submit, as a follow-up to
the consultation exercise, any appropriate observations
and recommendations, if necessary in the form of a Green
or White Paper, before the end of 2002.

11.

In its opinion adopted on 17 July 2002 (7), the European
Economic and Social Committee emphasised the need to
look for solutions in this area on a global scale. However,
as long as such solutions were not possible, it considered
preferable the creation of a uniform, general European
contract law, for example, by means of a regulation. This
regulation could, in the medium-term, be chosen by the
parties (opt-in solution) and, in the long-term, become a
common instrument, which the parties could still waive
if they wished to apply a specific national law (opt-out
solution).

12. The EU has set itself the objective of developing an area
of freedom, security and justice, for example by initiatives
in the field of judicial cooperation in civil matters. The
suggested measures described in this action plan insert
themselves,
In
particular, they run in parallel with the Green Paper on
the conversion of the Rome Convention of 1980 (8) on
the law applicable to contractual obligations into a
Community instrument and its modernisation (9).

inter alia, within the same objective.

13. This Green Paper and the present action plan complement
each other. The rules of private international law included
in the Rome Convention or any potential future Com-
munity instrument are of considerable importance as
they determine the applicable law. In particular, they are
closely related to one measure suggested in this action
to examine whether non-sector-specific
plan,
measures such as an optional instrument may be required
and feasible. If such instruments were to be implemented,
they could be expected to contain substantive law rules
for certain contracts. The role of private international law
rules remains of great importance to the extent that they
will determine the application of such instruments if
chosen as the law governing the contract.

i.e.

3.

IDENTIFIED PROBLEM AREAS

14. Many of the contributions to the consultation launched
by the Commission communication on European con-
tract law point to concrete and practical problems. Others
observe, in a more general manner, that divergences
between national contract laws do indeed create problems
both for the uniform application of Community law and
for the smooth functioning of
the internal market.
Inconsistency within Community legislation itself was
also criticised by many contributors, some of them giving
concrete examples. However, none of the contributions
indicated that the sectoral approach as such leads to
problems or that it should be abandoned.

15. What follows is a brief typology of the problems ident-
ified. It is not intended to reflect every single point that
was raised in all of the contributions (for more detailed
information, the reader is directed to consult the Annex
to this action plan or the individual contributions), nor
can it be presumed that the reactions received in response
to the Commission’s communication give a complete
picture of all the problems which may exist. Nevertheless,
this brief recital of specific problems may be useful to
give the reader a general idea of the challenges that are to
be faced and to stimulate debate.

3.1. Uniform application of Community law

16. Different types of problems have been mentioned. As a
category of inconsistencies that is intrinsic to Community
legislation in the field of contracts, it was mentioned that
similar situations are treated differently without relevant
justification for such different treatment. The problem of
divergent requirements and consequences in some of the
directives applying to the same commercial situation was
emphasised. Examples included the different modalities
in Directives on
concerning the right of withdrawal
doorstep selling (10), timeshare (11), distance selling (12)
and distance selling of financial services (13), in particular,
the divergent duration and methods of calculation of the
withdrawal periods. Other examples concerned inconsist-
regarding information requirements
ent approaches
between the Directive on electronic commerce (14) and
the two Directives on distance selling or divergent
information requirements in different consumer protec-
tion directives as far as contract law is concerned.

17. Another category of inconsistencies mentioned con-
cerned cases where in specific circumstances several
Community acts can be applicable which produce con-
flicting results. One example mentioned concerns the

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limitation of liability in the Package Travel Directive (15)
in connection with the Convention for the Unification of
Certain Rules for International Carriage by Air (16) on the
one hand and the Regulation on air carrier liability in the
event of accidents (17) on the other hand (18). Another
example concerns the situation of parallel application of
the Doorstep Selling Directive and the Timeshare Direc-
tive as confirmed by the European Court of Justice Travel
Vac case (19).

18. Another criticism concerned the coexistence of

two
different legislative approaches in one and the same
directive. This could lead to inconsistencies within the
system of the directive itself. An example mentioned
concerned the differentiation between the approaches to
the applicable law on marketing and contracts in the
Directive on electronic commerce. The inconsistency
within the system of
the Directive could also have
consequences for the national implementation law. An
example, which was mentioned, is the coexistence in the
Commercial agents Directive (20) of both the concept of
‘indemnity’ and the concept of ‘compensation’, where a
Member State in its implementation had not opted for
one concept but taken over both. According to the
relevant contributions,
legal
certainty in commercial and legal practice. Other criti-
cisms mentioned by many contributors were formulated
in the context of the use of abstract legal terms in
Directives. These include fundamental terms like ‘con-
tract’,
‘damage’ or more specific terms like ‘equitable
remuneration’, ‘fraudulent use’ or ‘durable medium’.

this leads to a lack of

19. One part of this more general problem is that these terms
are often either not defined or too broadly defined (21).
The absence of common definitions or existence of
overly broad definitions in directives leave a very large
implementation discretion to the national
legislators.
Whereas it is true that the national implementation laws
would still be in conformity with the relevant Directive,
they would nevertheless lead to inconsistencies in their
application to similar cases.

20.

In other cases abstract terms are defined in some Direc-
tives, while they are not defined in others. For example
is defined in the Product liability
the term ‘damage’
Directive (22) for the purposes of this Directive, while it is
not defined in either the Commercial agents Directive or
the Package travel Directive. The term ‘durable medium’
is defined in the Directive on distance selling of financial
services, but not in the general Distance selling Directive.

21. One problem, which was raised in the consultation, is
whether in such a case the given definition in one
directive can also be used for the interpretation of other

directives, i.e. whether the relevant abstract term can be
interpreted in the light of the whole acquis communautaire
or at least of the part, which is more broadly concerned.
This methodological approach was also used by the
Advocate-General in Simone Leitner/TUI Deutschland (23).
However in this specific case, the European Court of
Justice interpreted the general term ‘damage’ only in the
light of the Package travel Directive and did not follow its
Advocate General. It is true that this decision cannot
necessarily be generalised. However, if the interpretation
of an abstract term in the light of the specific directive is
the guiding principle, then such an interpretation can
lead to fragmentation of national legislation. For example,
Member States which have referred to an existing national
legal concept with a general definition in their implemen-
tation laws might have to adapt this existing definition in
order to implement the specific meaning of this abstract
term in the light of the relevant directive.

22. A general observation concerning fragmentation of
national contract
laws, which was made by several
contributions, was that the national legislator is faced
with a dilemma. Either the implementation of directives
with a limited scope entails a much larger adaptation of
the national legal system than what is actually foreseen
by the Community measure in question, or the implemen-
tation is restricted to the pure transposition of the
directive in question. In some cases this might create
inconsistencies in the national legal system.

23. Another category of problems concerned inconsistencies
implementations as a
in the application of national
consequence of the introduction, by directives, of con-
cepts, which are alien to the existing national
legis-
lation (24). It was mentioned that when implementing a
directive, some national legislators maintain the existing
national legislation in parallel, thereby creating a situation
which leads to legal uncertainty, for example the coexist-
ence of two laws on unfair contract terms in one Member
State. Some legislators also created uncertainty through
their implementation of dispositions in directives that are
based on unfamiliar concepts, for example the term
‘compensation’ in the Commercial agents Directive when
it was implemented in one Member State’s law.

24. The principle of minimum harmonisation in consumer
protection legislation was criticised as not achieving the
uniformity of solutions for similar situations that the
internal market would require. Examples mentioned
concerned the difference, from one Member State to
another, in cooling-off periods in the context of Doorstep
selling, Timeshare and Distance selling Directives, finan-
cial thresholds of implementation laws of the Doorstep

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selling Directive or divergent concepts in the implemen-
tation of the annex to the Unfair contract terms Direc-
tive (25). For example, it was criticised that the latter is
partly implemented as a binding ‘black list’ of unfair
contract terms and partly implemented as an indicative
‘grey list’ (26).

30. This is particularly important for SMEs since the legal
assistance costs are proportionately higher for them. As
a result, SMEs will either be dissuaded from cross-border
activities altogether or will be put at a clear competitive
disadvantage compared to domestic operators (29).

3.2.

Implications for the internal market

25. The barriers described in the present chapter cover
obstacles and disincentives to cross-border transactions
deriving directly or indirectly from divergent national
contract laws or from the legal complexity of these
divergences, which are liable to prohibit,
impede or
otherwise render less advantageous such transactions.

26. Before addressing the specific problems for the func-
tioning of the internal market, it is important to mention
the general distinction between problems resulting from
mandatory rules and non-mandatory rules. Some con-
tributors stress that the main problems in the contract
law area result from provisions which restrict contractual
freedom.

27.

It has already been pointed out (27) that a large number
of problems for cross-border contracts could be avoided,
at least for one party to the contract, by choosing the
appropriate applicable law. Alternatively the parties could
also negotiate complex contracts which cover all potential
legal questions. However,
it has been emphasised that
this approach does not help as regards mandatory rules
of the law which has not been chosen as applicable, but
which nevertheless apply.
Indeed, a large number of
contributions during the consultation mention the diver-
gence of national mandatory contract law provisions as a
particular problem, which is accentuated by the growth
of e-commerce.

28. However, it has also been underlined in a number of
contributions, especially by export-oriented industries,
that the choice of applicable law is not always commer-
cially realistic or desirable.

29. Firstly, it does not help the contracting party, which does
not have sufficient economic bargaining power to impose
its choice of law in the negotiations. It has also been
pointed out that taking advice on the unknown applicable
law will involve considerable legal costs and commercial
risks for this party to the contract (28) without necessarily
giving the most economically favourable solution.

laws are in most cases not

31. Secondly, it has been highlighted in the consultation that
this situation is even more dissuasive for consumers.
the laws
Their national
applicable to the contract. This may be because the law
of the trader is chosen as the applicable law under
standard terms or because it is objectively determined as
the applicable law under Article 4 of the Rome Conven-
tion. Article 5 of the Rome Convention does not help the
consumer in a significant way because it does not apply
in the case of an active consumer who wants to take
advantage of the opportunities offered by the internal
market. Given the consumer’s typical lack of knowledge
of foreign law, the latter will be in greater need of
legal advice prior to the conclusion of the cross-border
contract.

32. Finally, the distinction between mandatory and non-
mandatory provisions might be theoretically clear, but is
in practice much less evident. Many contracts in practice
do not waive existing suppletive legal provisions by
inserting specifically negotiated clauses in the respective
contract dealing with the problem in question or some
do not even choose the applicable law. The existence of
these gaps is not due to the fact that the contractual
parties might not have seen the relevant problem or did
not want to choose their own law as the applicable law
to the contract. It is more due to a balanced decision
between the clarity resulting from negotiating new clauses
covering these gaps on the one hand and the transaction
costs for such a negotiation on the other hand. In such
cases, contractual parties might reasonably decide that
the negotiation effort is simply not worth the economic
advantage or the commercial risk of loosing the customer
and hope that the potential problem will not appear. As
such,
the
the relevant non-mandatory provisions of
applicable law have become de facto ‘mandatory’.

33.

It was indicated during the consultation that this applies,
in particular, to general and very fundamental
legal
rules on for instance the conclusion of a contract, the
assessment of its validity, the notion and consequences
of non-performance or partial or incorrect performance
of contractual obligations.

34. This leads immediately to the first category of specific
problems mentioned in the consultation. Many contri-

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butions criticised the divergence of rules on fundamental
issues of contract law which create problems and entail
higher transaction costs. Examples concern diverging
rules on representation of foreign companies and the
consequences for the validity/recognition of documents.
Contributions indicated that the only way to obtain legal
certainty is to take local
for
example, the validity of documents and the power to
bind another, which is seen as being an expensive and
inconvenient solution for an everyday management act.

legal advice to ensure,

35. Other examples concern divergent requirements for the
formation of contracts which create obstacles. This
concerns especially requirements of form, such as the
requirement for certain contracts to be concluded before
a notary or the necessity of authentication of documents
which is mandatory for certain contracts and necessitates
higher costs for businesses and consumers. This concerns
also the requirement for certain contracts to be in writing
or in a certain language (30).

36. Another category of problems mentioned by many
contributions concerned the divergence of rules on the
inclusion and application of standard contract terms. In
some jurisdictions, it is sufficient merely to make refer-
ence to standard terms, whereas in others they must be
attached to the contract or signed separately. In some
Member States such as Italy (Article 1341 codice civile),
certain clauses must be individually initialled to become
valid. Such rules may apply independently of the choice
of law made by the contracting parties.

37. Between Member States, there are considerable differences
as to which contract terms are considered inadmissible
(and therefore invalid) by the courts. In some Member
States such as Germany or the Nordic countries, courts
exert strict control over the fairness of contractual terms
even in business-to-business contracts. Other Member
States provide for a limited control by way of interpret-
ation or only allow specific contract clauses to be struck
down in commercial contracts.

38. This creates uncertainty for businesses that use standard
terms; it also hampers the use of ready made standard
contracts that were actually created to facilitate cross-
border transactions and intended for use in any legal
system. It is indeed necessary to use different standard
contracts in different Member States, which in turn makes
it impossible to use the same business model for the
whole European market.

39. This leads to another category of frequently mentioned
problems concerning the divergence of national rules as

regards clauses excluding or limiting contractual liability
in specific contracts or standard contract terms and their
recognition by the law courts in another Member State.
Examples mention the full responsibility of suppliers for
hidden defects (vices cachés) under French case-law, and the
mandatory impossibility, under Czech law, of restricting
contractual liability for future damages. In this context,
contributions mention also different national mandatory
rules on limitation periods. Export-oriented industries
indicated that
the resulting unrestricted liability for
suppliers could lead to very high commercial risks, which
discourage or impede the conclusion of cross-border
transactions.

40.

liability, contributions
In the context of contractual
highlighted also that being unaware of
the specific
requirements of the relevant applicable contract law
often leads to unanticipated costs. Examples include the
obligation for merchants to serve a prompt notice of
default in respect of defective goods under the German
Commercial Code (§ 377) in order to preserve their right
of redress and the bref délai under Article 1648 of the
French Civil Code.

41. Numerous contributions concerned problems as regards
to the divergent national rules on contract law on the one
hand and on the rules on transfer of property and
securities concerning movable goods on the other
hand (31). The national rules on the transition of property
differ and therefore the moment of transition of property
is different. Furthermore, this can also depend on the
nature of the contract which, again, is different in national
legal systems. It must be borne in mind that the possibility
of a choice of law only concerns contractual rules, and
not rules applicable to rights in rem, e.g. transition of
property, where the applicable law is the lex rei sitae.
Many businesses are not aware of this limitation. It has
been pointed out that Community law (32) addresses part
of the problem by providing for the validity of retention
of title clauses, but it does not go beyond this.

42. Reservation of title is regulated differently from jurisdic-
tion to jurisdiction and the effectiveness of relevant
contract clauses varies accordingly. This applies even
more to possible extensions where the reservation of title
also covers, for example, a claim for the purchase price
which arises upon a resale of the sold goods by the
buyer (33) or over products made from the sold goods (34).
These extensions can also cover future claims or not only
the purchase price of the specific goods delivered under a
particular contract of sale, but all the buyer’s outstanding
indebtedness (35).

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43. The divergence of rules often entails that, in the case of
the sale of goods with reservation of title, the ‘security’
foreseen in the contract disappears at the moment when
the good in question is brought across the border. It is
generally observed that divergence of rules on securities
creates a great risk for operators on the market. As a
consequence for the supply side, the seller is forced to
look to other forms of securities which are, such as bank
guarantees, substantially more expensive and realistically
speaking, unobtainable from the outset for SMEs. The
result for the demand side is that trade credit provided by
the seller to the buyer will be higher priced since the
seller’s risk is to a considerable degree increased or
decreased depending upon the availability of proprietary
security and its legal effectiveness. This risk can only be
partially alleviated by costly legal opinions.

that

It has been pointed out

44. Similar problems have been mentioned in the financial
services sector for granting trans-border credit, which is
only possible if the corresponding securities are guaran-
teed.
the analysis of
the validity of the cross-border transfer of securities
necessitates costly in-depth legal expertise, which discour-
ages from or impedes such cross-border transactions. In
addition, it was mentioned that such analysis is rather
time-consuming which, in cases of cross-border trans-
actions to provide finance for re-capitalisation in order to
prevent insolvency, might be a critical factor which
prevents the whole operation.

45. Above all, some security instruments for movable goods
are simply not known in other Member States and vanish
if the secured goods are transferred across borders. An
example given concerns the transfer of movable goods
under the contractual agreement of a Sicherungsübereig-
nung from Germany to Austria. These differences also
adversely affect the possibility of entering into cross-
border leasing contracts.

46. Contributions also indicated differences in national con-
tract laws concerning credit assignments. The difference
in rules on factoring was mentioned as a problem because
the assignment of receivables is an important instrument
for the financing of export transactions. In particular,
some Member States restrict the assignment of future
receivables or the bulk assignment of receivables, while
others take a much more liberal stand in these matters.
As a consequence, the factoring industry meets serious
obstacles in some Member States, but is favoured by laws
of others; this could lead to distortions of competition.
Similar differences exist with regard to the validity of
clauses contained in sales or service contracts that
prohibit the assignment of claims arising from those

contracts. Contributions emphasise that factoring com-
panies are prevented from offering their services outside
the Member State of their establishment by using one and
the same type of contract throughout the whole of the
Community. In any case, they would have to undertake a
very careful analysis of different national laws.

47.

In the area of financial services, contributions stated that
firms are unable to offer, or are deterred from offering,
financial services across borders because products are
designed in accordance with local legal requirements, or
because the imposition of differing requirements under
other jurisdictions would give rise to excessive costs or
unacceptable legal uncertainty. If, in spite of this, firms
decide to sell across borders, they have to cope with
considerable competitive disadvantages compared to
local service providers. Choice of law in business-to-
this
business
problem.

transactions only partially alleviates

48. The same problems occur particularly with insurance
contracts. Contributions indicate that the diversity of
national regulations governing life insurance contracts,
risks and compulsory
non-life insurance for mass
insurance constitutes a check to the development of
cross-border insurance transactions. The attractiveness of
certain contract schemes at national level may disappear
in cross-border situations where they have to comply
with different regulatory requirements. Choice of law
clauses may alleviate the problem in non-life insurance of
large risks. However, they are not admissible in the other
cases. The wording of a single policy that could be
marketed on the same terms in different European
markets has proved impossible in practice.

49.

In the field of cabotage transport, i.e. road transport
services carried out within a Member State by a carrier
established in another Member State, it was indicated that
some host Member States (36) exclude the choice of
law and insist upon the application of their national
provisions. As a consequence, the resulting divergence of
liability regimes not only leads to high insurance costs,
which generally increase the cost of cabotage transport,
but may also lead to distortions of competition.

50.

In the field of consumer protection, many businesses
complain about the great diversity in national regimes,
which creates obstacles for cross-border business to
consumer transactions. This is mainly imputed to the fact
that Community directives in that field are based on the
principle of minimum harmonisation, so as to allow
Member States to maintain rules that are more favourable

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to consumers than those foreseen in Community law.
While Community law has led to some degree of
convergence, it is still difficult for businesses to develop
distribution strategies that can be applied throughout the
internal market, because the rules adopted by Member
States going beyond the minimum harmonisation pre-
scribed by Community law are necessarily divergent. In
addition to this, consumer protection rules, even if they
go beyond the minimum harmonisation level are often
mandatory and sometimes even extended to business to
business relationships.

intermediate step towards improving the quality of the
Community acquis in the area of contract law. It will
require research as well as extensive input from all
interested parties. The former will be done within the
context of the Sixth Framework Programme for research
and technological development and will therefore depend
on the timing of the respective call for proposals. In any
case, it is envisaged to obtain the results of the research
within three years of its launch.

51. The abovementioned problems have been identified by
the stakeholders and interested parties who participated
in the consultation following the communication on
European contract law. The Commission sets out, in the
following section, suggestions for a mix of non-regulatory
and regulatory approaches in order to tackle some of
these problems. These suggestions have to be seen in the
light of the limited contributions received during the
consultation.

54. The improvement of the existing and future acquis is a
key action. The Commission will continue its efforts to
improve the existing acquis (38) and expects that the
common frame of reference, when available and as far as
relevant, will be instrumental in this respect. Reflection
on an optional instrument will start with the present
action plan and be carried out in parallel to the whole
process. The results of the Commission’s examination
could only be expected some time after the finalisation of
the common frame of reference.

4.

SUGGESTED APPROACH: A MIX OF NON-REGULAT-
ORY AND REGULATORY MEASURES

52.

In some cases,
the Community Treaty may already
provide the legal base to solve the problems identified,
although the present action plan does not take a position
the barriers identified with
on the compatibility of
Community law. For other cases, non-regulatory as
well as regulatory solutions may be required. As the
Commission recalled in its recent action plan ‘Simplifying
and improving the regulatory environment’, there are, in
addition to regulatory instruments (regulations, directives,
recommendations) other tools available, which, in specific
circumstances, can be used to achieve the objectives of
the Treaty while simplifying lawmaking activities and
legislation itself (coregulation, self-regulation, voluntary
sectoral agreements, open coordination method, financial
information campaign) (37). The Com-
interventions,
mission is aware that this mix of non-regulatory and
regulatory measures will not solve all problems described.
However, they will provide a solution to a number of
problems.

4.1. To improve the quality of the Community

acquis in the area of contract law

55. As indicated above, one of the conclusions drawn from
the consultation thus far is that it is possible for the EU
to continue a sector-specific approach. However, the
consultations have also emphasised the need to increase
coherence of the existing acquis in the contract law area
and avoid unnecessary inconsistencies in new acquis. This
is why the Commission intends to take a number of
measures aimed at increasing coherence of the Com-
munity acquis in the contract
law area, notably by
improving the quality of the legislation.

53. The solutions suggested cannot all be implemented within
the same time frame. In a number of sectors initiatives
have already or will soon be taken to update current
directives or propose new ones.The measures to promote
standard contract terms can be launched within a year.
The creation of a common frame of reference is an

56. The objective is to achieve an European contract law
acquis which has a high degree of consistency in its
drafting as well as implementation and application.
However, if differences between provisions in directives
can be explained by differences in the problems which
those directives seek to solve, intervention is not necess-
ary. Differences in terms and concepts that cannot be
explained by differences in the problems being addressed
should be eliminated.

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57. An improved Community acquis should enhance the
uniform application of Community law as well as facili-
tate the smooth functioning of cross-border transactions
and, thereby, the completion of the internal market. For
example, it should avoid similar situations being treated
differently without relevant justification for such different
treatment. It should also avoid conflicting results and
should define abstract legal terms in a consistent manner
allowing the use of the same abstract term with the same
meaning for the purposes of several directives. As such,
it should indirectly remedy the fragmentation of national
contract laws and promote their consistent application.
Such an acquis would respond to the need for uniform
application of Community law, as stated by the European
Court of Justice (39).

58. The Commission will seek, where possible, a high degree
law area. When the
of consistency in the contract
common frame of reference is available, the Commission
would, wherever possible and adequate, make use of it
and include corresponding provisions in its legislative
proposals.

the rules which apply,

62. a) As indicated above, the objectives of the common
frame of reference are threefold. First,
the Com-
mission may use this common frame of reference in
the area of contract law when the existing acquis is
reviewed and new measures proposed.
It should
provide for best solutions in terms of common
terminology and rules, i.e. the definition of funda-
mental concepts and abstract terms such as ‘contract’
or ‘damage’ and of
for
example,
in the case of the non-performance of
contracts. In this context contractual freedom should
be the guiding principle; restrictions should only be
foreseen where this could be justified with good
reasons. The intention is to obtain, as far as possible,
a coherent acquis in the area of European contract
law based on common basic rules and terminology.
The second objective is that it could become an
instrument in achieving a higher degree of conver-
gence between the contract laws of the EU Member
States and possibly appropriate third countries.
Thirdly, the Commission will base its reflections on
whether non-sector-specific measures such as an
optional
instrument may be required to solve
problems in the area of European contract law on
the common frame of reference.

4.1.1. A common frame of reference

59. A common frame of reference, establishing common
principles and terminology in the area of European
contract law is seen by the Commission as an important
step towards the improvement of the contract law acquis.
This common frame of reference will be a publicly
accessible document which should help the Community
institutions in ensuring greater coherence of existing and
future acquis in the area of European contract
law.
This frame of reference should meet the needs and
expectations of the economic operators in an internal
market which envisages becoming the world’s most
dynamic economy (40).

60.

If the common frame of reference is widely accepted as
the model in European contract law which best corre-
sponds to the needs of the economic operators, it can be
reference
expected also to be taken as a point of
by national
legislatures inside the EU and possibly in
appropriate third countries whenever they seek to lay
down new contract law rules or amend existing ones.
Thus the frame of reference might diminish divergences
between contract laws in the EU.

61. The following considerations are intended to give an
the content areas to be

indication of its objectives,
covered and the organisational aspects.

63. b) In order

to ensure that

the common frame of
reference meets the needs of the economic operators
in regulatory approaches to
and offers a model
contract law,
the Commission intends to finance
extensive research in this area. The areas to be
covered by the research activities and their contents
follow from these objectives. The research activities
should concentrate on the fields covered by the
present action plan as well as the communication
on European contract law (41).

Although the details of
the common frame of
reference will be decided on the basis of the research
and input
it can be
from economic operators,
expected to contain the following elements.

— It should deal essentially with contract law,
above all the relevant cross-border types of
contract such as contracts of sale and service
contracts.

— General rules on the conclusion, validity and
interpretation of contracts as well as perform-
ance, non-performance and remedies should be
covered as well as rules on credit securities
on movable goods and the law of unjust
enrichment.

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Several basic sources should principally be con-
sidered.

— Advantage should be taken of existing national
legal orders in order to find possible common
denominators, to develop common principles
and, where appropriate, to identify best sol-
utions.

— It is particularly important to take into account
the case-law of national courts, especially the
highest courts, and established contractual
practice.

— The existing Community acquis and relevant
binding international instruments, above all the
UN Convention on the International Sale of
Goods (CISG) (42), should be analysed.

64.

It is not the task of the present action plan to elaborate
the principles or terminology, which will constitute
the contents of the common frame of reference. In
any case, the objectives of the common frame of
reference determine its content. The first objective is
to allow the existing acquis to be improved and
simplified and to ensure the coherence of the future
acquis. This means that the common frame of reference
should provide for common solutions where problems
of the acquis are identified. This could concern, for
instance, problems of consistency or the use of abstract
terms in Community law without definition, which
may represent a legal concept for which there are
different rules in each national body of law. Further-
more, it should allow the identification of common
terminology for particular fundamental concepts or
best solutions for typical problems in order for the
future acquis to be proposed. Finally, the common
frame of reference should also form the basis for
further reflection on an optional instrument in the
area of European contract law. In this context, it might
constitute an attempt to formulate relevant principles
and rules.

65.

The research activities should provide for an assess-
ment of the economic implications of the results for
the economic operators, i.e. industry, retail business,
legal practitioners and consumers. The Commission
intends in any case to consult widely with stakeholders
and other interested parties on the draft common
frame of reference in order to ensure that it meets the
needs of economic operators.

66. c) As far as the organisational aspects are concerned, it
should be emphasised that it is not the Commission’s

67.

68.

intention to ‘reinvent the wheel’ in terms of research
activities. On the contrary, it is remarkable that never
before in the area of European contract law has
there been such a concentration of ongoing research
activities. It is essential that these research activities
are continued and exploited to the full. Therefore, the
main goal is to combine and coordinate the ongoing
research in order to place it within a common
framework following several broad approaches.

Only where ongoing research does not cover all the
areas concerned, would it be desirable that new
research activities fill these gaps. Furthermore, the
abovementioned areas to be covered do not preclude
ongoing research projects from going beyond these
areas as they might have necessary links with other
areas, like property law or tort law.

Research activities in the abovementioned area could
be supported by the sixth framework programme for
(FP6) (43).
research and technological development
Within its ‘integrating’ programme, priority 7 ‘Citizens
and governance in a knowledge-based society’ presents
the analytical and intellectual context for such an
endeavour. It is envisaged that research activities in
the domain of European contract law will be part of
one of the first calls for proposals to be published
within this priority. Given the nature of the issues at
stake, the implementation could use one of the new
instruments provided in FP6,
in order to further
structure and integrate the research efforts in this
domain.

4.1.2. High quality and consistency of the Community acquis

in the area of contract law

69. As stated in the Better regulation action plan (44), the
Commission feels that it is essential to maintain high
standards as regards quality and consistency throughout
the entire legislative process.

70. This measure therefore fits in the overall EU institutions’
strategy, which aims at simplifying the regulatory
environment and enhancing the quality of Community
legislation. The Lisbon European Council gave a mandate
to the Commission (45), which was confirmed at the
Stockholm, Laeken and Barcelona summits (46), to present
a coordinated strategy for further action to simplify the
regulatory environment. Since 2001, the Commission
has been engaged in a wide consultation process with the
other institutions and Member States with which it shares

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responsibility for the quality of Community legislation,
and an important debate was launched, aimed at improv-
ing the quality, effectiveness and simplicity of regulatory
acts and at better consulting and involving civil society in
the EU decision-making process.

74.

In order to ensure coherence in the legislative framework
for financial services, the Commission indicated that it
will launch a three-strand policy to secure increased levels
of convergence in respect of consumer and investor
protection rules.
Its third strand foresees a review of
national rules relating to retail financial services con-
tract (52). As it has also been stressed in the consultation,
contracts play a crucial role in financial services —
particularly banking and insurance. Indeed, in these areas
the services consist often of a series of
terms and
conditions which are expressed in a contract. Over time,
Member States have developed rules, which affect the
terms and conditions which may or may not be included
in an insurance contract or another financial services
contract. To the extent that these rules differ they might
affect the products which are offered across borders.
Further convergence of such measures may be needed in
order to balance the need for greater uniformity of
national rules with the need to maintain product inno-
vation and choice (53). Improving the quality of the acquis
and making it more coherent (54) as far as contract law is
concerned is therefore a key initiative in this context, and
it would constitute a follow-up action to the Better
regulation action plan.

75. This measure gathers overall support from other EU
institutions as well as civil society. Both the Council and
the European Parliament have emphasised the need
for coherence,
improvement and consolidation of the
existing acquis communautaire. The consultation launched
by the Commission shows that this measure is also
almost unanimously supported by all contributors, and
particularly by industry and by legal practitioners. The
Commission considers therefore that ensuring coherence
and consistency of the existing and future acquis is a
priority that needs to be tackled rapidly.

76.

In order to solve this problem,
the consistency of
Community legislation has to be ensured in the light of
identified problem areas. This means notably:

— remedying identified inconsistencies in Community

contract law,

— reviewing the quality of drafting,

— simplifying and clarifying existing legislation,

— adapting existing legislation to economic, commer-
cial and other developments which were not fore-
seen at the time of adoption,

71.

In this context, the White Paper on Governance adopted
in July 2001 (47), together with the Better regulation
action plan, represents a dynamic expression of the
political will to reform the regulatory environment. The
White Paper on Governance stresses the need for the
European Union to ‘pay constant attention to improving
the quality, effectiveness and simplicity of regulatory
acts’ (48). The Better regulation plan, aims inter alia at
improving the quality of legislation proposals. It mentions
that ‘the aim of simplifying and improving the regulatory
environment is to ensure that Community legislation is
more attuned to the problems posed, to the challenge of
enlargement and to technical and local conditions. By
being written in a less complicated style, it should be
easier to implement for the Member States and operators
concerned and easier for everyone to read and understand.
The ultimate goal
is to ensure a high level of legal
certainty across the EU, even after enlargement, enable
economic and social operators to be more dynamic and
thus to help strengthen the Community’s credibility in
the eyes of its citizens’ (49).

72. Already, in its communication on European contract law,
the Commission indicated that ‘improving the quality of
legislation already in place implies first modernising
existing instruments. The Commission intends to build
on action already undertaken consolidating, codifying
and recasting existing instruments centred on trans-
parency and clarity. Quality of drafting could also be
reviewed; presentation and terminology could become
more coherent. Apart from those changes regarding the
presentation of legal texts, efforts should be systematically
focused on simplifying and clarifying the content of
existing legislation. Finally, the Commission will evaluate
the effects of Community legislation and will amend
existing acts if necessary’ (50).

73.

In its communication on consumer policy strategy for
2002 to 2006 (51), the Commission emphasised the need
for greater convergence in EU consumer law, which
would notably imply a review of existing consumer
contract law, in order to remove existing inconsistencies,
to fill in gaps and to simplify legislation.

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— filling gaps in Community legislation which have

led to problems in its application.

terms and conditions they want. This is particularly
important in case the parties want to conclude a contract
with special features or which needs to cover a complex
situation.

77. Consolidation (55), codification (56) and recasting (57) of
existing instruments, focused on transparency and clarity,
will have to be considered where appropriate.

78. Such action would not go beyond the harmonised areas,
but deal with areas already, at least partially, covered by
Community legislation. However,
it would not only
concern the existing acquis, but also the future measures
in order to ensure the coherence of the acquis as a whole.

79. The Commission intends to implement the abovemen-
tioned actions and to submit other proposals where a
sectoral need for harmonisation arises. It is envisaged for
the implementation of these actions that where possible
and adequate, the common frame of reference will be
used as a tool for greater convergence. So the common
frame of reference could, for example, make definitions
or fundamental rules available, which could be used to
improve the existing acquis and be integrated in the future
acquis.

80.

In its Better regulation action plan, the Commission
had suggested ensuring that substantial modifications
introduced by the European Parliament and the Council
to Commission proposals during the first reading do not
change the quality of the legislative act itself and that it is
essential to maintain high standards as regards quality
and consistency throughout the entire legislative pro-
cess (58). As a consequence for the area of European
contract
the common frame of reference as a
guideline should not only be used by the Commission in
the preparation of its proposals, but should also prove
useful to the Council and the European Parliament in case
they propose amendments.

law,

82. Nevertheless, in a large majority of cases, and in particular
for fairly straightforward and often repeated transactions,
parties often are interested in using standard contract
terms. The use of standard contract terms spares the
parties the costs of negotiating a contract.

83. Such standard terms are often formulated by one of
in particular, where a single
the contracting parties,
contracting party possesses sufficient bargaining power
to impose its contract terms, either as a seller or a service
provider or as a purchaser of goods or services. In other
cases such standard contract terms are developed by a
group of contracting parties, representing either one side
in contract negotiations or, more rarely both sides, or
they may be developed by a third party.

84. Although standard contract terms and conditions are
used very broadly, most of them have been developed by
parties from a single Member State. Such contract terms
may therefore be less adapted to the particular needs of
cross-border transactions. The Commission is aware,
however, of initiatives in which standard contract terms
have been developed specifically for international trans-
actions (59). These contract terms are increasingly being
used also for contracts concluded inside single Member
States.

85. This demonstrates the usefulness of standard terms
developed for use in various Member States and,
in
particular, in cross-border transactions. The Commission
believes that if such general terms and conditions were
developed more widely, they could solve some of the
alleged problems and disincentives reported. This is why
the Commission intends to promote the establishment of
such terms and conditions in the following ways:

4.2. To promote the elaboration of EU-wide stan-

dard contract terms

(a)

Facilitating the exchange of information on initiat-
ives.

81. The principle of contractual

freedom, which is the
centrepiece of contract law in all Member States, enables
contracting parties to conclude the contract which most
suits their particular needs. This freedom is restricted by
certain compulsory contract law provisions or require-
ments resulting from other laws. However, compulsory
provisions are limited and parties to a contract do enjoy
a significant degree of freedom in negotiating the contract

86. As a first step in promoting the development of EU-wide
standard terms and conditions, it is important to establish
a list of existing initiatives both at a European level and
within the Member States. Once such a list is made
available, parties interested in developing standard terms
and conditions could obtain information on similar
initiatives in other sectors or in the same sectors in other
Member States. Thus they could learn from the mistakes

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of others and benefit from their successes (‘best practices’),
while they could also obtain names and addresses of their
counterparts in other Member States who could be
interested in a joint effort to create EU wide standard
terms and conditions.

87. Thus the Commission intends to setup a website, where
companies, persons and organisations can, on their own
responsibility (60), list information on existing or planned
initiatives in this area. The Commission will invite all
such companies, persons and organisations to post the
relevant information on this website. The Commission
intends to evaluate the usefulness of the site with users
18 months after its launch, and may take appropriate
steps.

(b) Offering guidelines on the use of standard terms and

conditions

cross-border contracts in the internal market. Conse-
quently, parties would not need to cover every detail in
contracts specifically drafted or negotiated for this pur-
pose, but could simply refer to this instrument as
the applicable law. It would provide both parties, the
economically stronger and weaker, with an acceptable
and adequate solution without insisting on the necessity
to apply one party’s national law, thereby also facilitating
negotiations.

91. Over time economic operators would become familiar
with these rules in the same way they may be familiar
with their national contract laws existing at this moment.
This would be important for all parties to a contract,
including in particular SMEs and consumers, and in
facilitating their active participation in the internal mar-
ket. Thus such an instrument would facilitate considerably
the cross-border exchange of goods and services.

88. The Commission’s general support for the elaboration of
standard terms and conditions on an EU-wide scale,
rather than on a Member State per Member State basis
should not be interpreted as a blanket approval of such
terms and conditions, however. Indeed, standard terms
and conditions should not violate EU rules, nor run
counter to EU policies. This is why the Commission
intends to publish guidelines, the purpose of which is to
remind interested companies, persons and organisations
that certain legal and other limits apply. Thus it is obvious
that the standard terms and conditions should be in
conformity with the Unfair contract terms Directive,
where it applies. The guidelines will also remind parties
that limits for such initiatives result from the EU compe-
tition rules. Moreover,
it is important to ensure that
standard contract terms and conditions are jointly elabor-
ated by representatives from all relevant groups including
large, small and medium sized industry, traders, con-
sumers and legal professionals.

92. The Commission will examine whether non-sector-
specific-measures such as an optional instrument may be
required to solve problems in the area of European
contract law. It intends to launch a reflection on the
opportuneness, the possible form, the contents and the
legal basis for possible action of such measures. As to its
form one could think of EU wide contract law rules in
the form of a regulation or a recommendation, which
would exist
in parallel with, rather than instead of
national contract laws. This new instrument would exist
in all Community languages. It could either apply to all
contracts, which concern cross-border transactions or
only to those which parties decide to subject to it through
a choice of law clause. The latter would give parties the
greatest degree of contractual freedom. They would only
choose the new instrument if it suited their economic or
legal needs better than the national
law which would
have been determined by private international law rules
as the law applicable to the contract.

4.3. Further reflection on the opportuneness of
non-sector
an
optional instrument in the area of European
contract law

specific measures

such as

89. During the consultation, there were calls to continue
reflections on the opportuneness of non-sector-specific
measures in the area of European contract law.

93.

It is the opinion of the Commission that contractual
freedom should be one of the guiding principles of such
a contract law instrument. Restrictions on this freedom
should only be envisaged where this could be justified for
good reasons. Therefore it should be possible for the
specific rules of such a new instrument, once it has been
chosen by the contracting parties as the applicable law to
their contract, to be adapted by the parties according to
their needs (61).

90. Some arguments have been made in favour of an optional
instrument, which would provide parties to a contract
with a modern body of rules particularly adapted to

94. Only a limited number of rules within this body of rules,
for example rules aiming to protect the consumer, should
the new instrument applies to the
be mandatory,

if

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contract. The reflection would have to include, inter alia,
the question whether the optional instrument (if it were
a binding instrument) could exclude the application of
conflicting mandatory national provisions for areas which
are covered thereby. Such an instrument would, accord-
ingly, ensure freedom of contract in two ways: firstly,
when the parties choose this instrument as the applicable
law and secondly, as they are able, as a matter of principle,
to modify the respective rules.

95.

It is clear that in reflecting on a non-sector-specific
instrument, the Commission will take into account the
common frame of reference. The content of the common
frame of reference should then normally serve as a basis
instrument.
for the development of the new optional
Whether the new instrument would cover the whole
scope of the common frame of reference or only parts
thereof, or whether it would cover only general contract
law rules or also specific contracts, is at present left open.

instrument

96. The Commission would welcome comments on the scope
in relation to the CISG.
of an optional
The optional
i.e.
covering also cross-border contracts of sale between
businesses, and thereby include the area covered by the
CISG. It could also exclude this area and leave it to the
application of the CISG.

instrument could be comprehensive,

97. As with all measures mentioned in this action plan it is
the purpose of this action plan to invite comments
from Community institutions and stakeholders on the
suggestions.

5.

CONCLUSION

98. The purpose of this action plan is to receive feedback on
the suggested mix of non-regulatory and regulatory
measures as well as input for the further reflection on an
optional instrument in the area of European contract law.
It also intends to continue the open, wide-ranging and
launched by the communication on
detailed debate,
European contract law with the participation of the
institutions of the European Community as well as the
general public, including businesses, consumer associ-
ations, academics and legal practitioners.

99. All parties that wish to contribute to the debate are
requested to send their contribution by 16 May 2003.
These contributions should be sent, if possible in elec-
to European-Contract-Law@cec.eu.int, or
tronic form,

otherwise in writing to the European Commission, B-
1049 Brussels. Each contribution should be marked
‘Action plan on European contract law’. In order to
stimulate a real debate on the issue, the Commission has
published this action plan on the Commission’s Europa
website under:

http://europa.eu.int/comm/consumers/policy/
developments/contract–law/index–en.html

Incoming contributions will be published on the same
website, unless senders request confidentiality.

(1) Communication from the Commission to the European Parlia-
ment and the Council on European contract law, (COM(2001)
398 final, 11.7.2001) (OJ C 255, 13.9.2001, p. 1).

(2) http://europa.eu.int/comm/consumers/policy/developments/

contract–law/index–en.html

(3) See footnote 2.
(4) According to the statistics,

the press release ‘Feedback on
Commission’s European contract law initiative now published’
(IP/02/496, 3.4.2002) was in third place out of all April 2002
Commission press releases counting the hits on the Europa
homepage.

(5) COM(2001) 398 final, C5-0471/2001 — 2001/2187(COS) (OJ
C 140 E, 13.6.2002, p. 538); see also: www.europarl.eu.int/
plenary/default–en.htm

(6) http://register.consilium.eu.int/pdf/en/01/st12/12735en1.pdf
(7) Opinion of the European Economic and Social Committee on
the communication to the Council and the European Parliament
on European contract law, Ecosoc INT/117 European contract
law (OJ C 241, 7.10.2002, p. 1).

(8) Convention on the law applicable to contractual obligations
opened for signature in Rome on 19 June 1980 (80/934/EEC
(OJ L 266, 9.10.1980, p. 1); consolidated version in OJ C 27,
26.1.1998, p. 34).
(9) COM(2002) 654 final.
(10) Council Directive 85/577/EEC of 20 December 1985 to protect
the consumer in respect of contracts negotiated away from
business premises (OJ L 372, 31.12.1985, p. 31).

(11) Directive 94/47/EC of the European Parliament and of

the
Council of 26 October 1994 on the protection of purchasers in
respect of certain aspects of contracts relating to the purchase of
the right to use immovable properties on a timeshare basis (OJ
L 280, 29.10.1994, p. 83).

(12) Directive 97/7/EC of the European Parliament and of the Council
of 20 May 1997 on the protection of consumers in respect of
distance contracts (OJ L 144, 4.6.1997, p. 19).

(13) Directive 2002/65/EC of 23 September 2002 on distance
marketing of consumer financial services, (OJ L 271, 9.10.2002,
p. 16).

(14) Directive 2000/31/EC of the European Parliament and of the
Council of 8 June 2000 on certain legal aspects of information
society services, in particular electronic commerce, in the internal
market — ‘Directive on electronic commerce’
(OJ L 178,
17.7.2000, p. 1).

(15) Council Directive 90/314/EEC of 13 June 1990 on package
travel, package holidays and package tours (OJ L 158, 23.6.1990,
p. 59).

(16) Convention for the Unification of Certain Rules for International
Carriage by Air (‘the Montreal Convention’) (OJ L 194, 18.7.2001,
p. 39).

(17) Council Regulation (EC) No 2027/97 of 9 October 1997 on air
carrier liability in the event of accidents (OJ L 285, 17.10.1997,
p. 1).

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( 18)

It should be noted that Regulation No 2027/97 has been
amended by Regulation (EC) No 889/2002 of the European
Parliament and of the Council of 13 May 2002 (OJ L 140,
30.5.2002 p.2). One objective of
the latter Regulation is,
according to its recital 6: ‘to amend Council Regulation (EC) No
2027/97 of 9 October 1997 on air carrier liability in the event
of accidents in order to align it with the provisions of the
Montreal Convention, thereby creating a uniform system of
liability for international air transport’. Recital 8 states that, ‘In
the internal aviation market, the distinction between national
and international transport has been eliminated and it is therefore
appropriate to have the same level and nature of liability in both
international and national transport within the Community’.

( 19) Case C-423/97 TravelVac and Manuel

José Antelm Sanchis

[1999] ECR I –2195.

( 20) Council Directive 86/653/EEC of 18 December 1986 on the
coordination of the laws of the Member States relating to self-
employed commercial agents (OJ L 382, 31.12.1986, p. 17).

( 21) This was also highlighted as a significant problem by the
final report of the High-Level Consultative Group (‘Mandelkern
Group’, set up by the ministers responsible for the civil service in
November 2000 report submitted on 13th November 2001) on
Better Regulation, p. 70.

( 22) Council Directive 85/374/EEC of 25 July 1985 on the approxi-
mation of the laws, regulations and administrative provisions of
the Member States concerning liability for defective products (OJ
L 210, 7.8.1985, p. 29).

( 23) Case C-168/00 Simone Leitner v TUI Deutschland, [2002] ECR I-

2631.

( 24) This problem had already been identified by the final report of

the Mandelkern Group on Better Regulation, p. 67.

( 25) Council Directive 93/13/EEC of 5 April 1993 on unfair terms in

consumer contracts (OJ L 95, 21.4.1993, p. 29).

( 26) Some Member States have not

transposed the Annex into
national law at all, but included it in their preparatory work; see
European Court of Justice judgment of 7 May 2002, Commission
v Sweden C-478/99 [2002] ECR I-4147.

( 27) See Commission communication on European contract law,

point 28.

( 28) This was emphasised for the area of services, in the report from
the Commission on the state of the internal market for services,
p. 36, 42.

( 29) Cf. the report from the Commission on the state of the internal

market for services, p. 8.

( 30) As regards language barriers in the area of services resulting
directly or indirectly from different regulatory environments cf.
the report from the Commission on the state of the internal
market for services, p. 44.

( 31)

In view of these concerns, the Commission has launched a study
into these matters (2002/ OJ S 154-122573), 9.8.2002.

( 32) Directive 2000/35/EC of the European Parliament and of the
Council of 29 June 2000 on combating late payment
in
commercial transactions (OJ L 200, 8.8.2000, p. 35).

( 33) Contributions indicate that these clauses seem to be effective

only in France and Germany.

( 34) Contributions indicate that these clauses seem to be effective

only in Germany.

( 35) Contributions indicate that these ‘all-monies’ clauses seem to be

effective only in the UK and Germany.

(36) Cf. Article 4 of Council Regulation (EC) No 12/98 of 11 Decem-
ber 1998 laying down the conditions under which non-resident
carriers may operate national road passenger transport services
within a Member State (OJ L 4, 8.1.1998, p. 10) and cf. Council
Regulation (EC) No 3118/93 of 25 October 1993 laying down
the conditions under which non-resident carriers may operate
national road haulage services within a Member State (OJ L 279,
12.11.1993, p. 1).

(37) Communication from the Commission — Action plan ‘Simplify-
ing and improving the regulatory environment’, 5.6.2002
(COM(2002) 278 final, p. 3).

(38) Cf. for example the communication from the Commission to the
European Parliament, the Council, the Economic and Social
Committee and the Committee of the Regions – Consumer
policy strategy 2002 to 2006 (COM(2002) 208 final), p. 7 (OJ
C 137, 8.6.2002).

(39) See already Commission communication on European contract
law, point 34 and the references to the relevant case-law of the
European Court of Justice.

(40) Cf. the Presidency Conclusions of the Lisbon European Council,

23 and 24 March 2000.

(41) The European Parliament and the Council have, however, called
for research to be undertaken also in the fields of tort law and
property law in order to determine whether the differences in
Member States’ legislation in these areas constitute obstacles to
the proper functioning of
in practice.
Following these demands, the Commission has published a
tender for a study covering these fields (2002/ OJ S 154-
122573), 9.8.2002).

the internal market

(42) United Nations Convention on Contracts for the International

Sale of Goods of 11 April 1980.

(43) Decision 1513/2002/Community of the European Parliament
and of the Council of 27 June 2002 concerning the sixth
framework programme of the European Community for research,
technological development and demonstration activities, con-
tributing to the creation of the European Research Area and to
innovation (OJ L 232, 29.8.2002, p. 1).

(44) Communication from the Commission — Action plan ‘Simplify-

ing and improving the regulatory environment’, p. 15.

(45) Presidency conclusion, Lisbon European Council 23 and

24 March 2000 (SN(2000) 100, p. 6).

(46) Presidency conclusion, Stockholm European Council 23 and
24 March 2001 (SN(2001) 100, p. 5); Presidency conclusion,
European Council Meeting in Laeken 14 and 15 December 2001
(SN(2001) 300, p. 1); Presidency conclusion, Barcelona European
Council 15 and 16 March 2002 (SN(2002) 100, p. 7).

(47) European Governance — a White Paper (COM(2001) 428 final).

(48) See footnotes 19 and 20.
(49) Communication from the Commission — Action plan ‘Simplify-

ing and improving the regulatory environment’, p. 3.

(50) See footnotes 19 and 21.
(51) Communication from the Commission to the European Parlia-
ment, the Council, the Economic and Social Committee and the
Committee of the Regions — Consumer policy strategy 2002 to
2006, p. 7.

(52) Communication from the Commission to the European Parlia-
ment and to the Council ‘e-commerce and financial services’
(COM(2001) 66 final, p. 10).

(53) Communication from the Commission to the European Parlia-
ment and to the Council — E-commerce and financial services,
p. 13.

(54) The final report of the Mandelkern Group on Better Regulation
(p. 42) recognises this as one of the main objectives of legally
effective consolidation.

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( 55) Consolidation means grouping together in a single non-binding
text the current provisions of a given regulatory instrument,
which are divided between the first legal act and subsequent
amending acts.

( 56) Codification means the adoption of a new legal instrument which
brings together in a single text, but without changing the
substance, a previous instrument and its successive amendments,
with the new instrument replacing the old one and repealing it.
An interinstitutional agreement on codification was concluded
on 20 December 1994.

( 57) Recasting means adopting a single legal act, which makes the
required substantive changes, codifies them with provisions
remaining unchanged from the previous act, and repeals the
previous act. The interinstitutional agreement adopted on
17 April 2002 (SEC(2001) 1364) for more structured use of the

recasting technique for legal acts will make it easier to apply this
method.

(58) Communication from the Commission — Action plan ‘Simplify-

ing and improving the regulatory environment’, p. 15.

(59) For example, Orgalime, a European trade association in the
metalworking, mechanical and electrical engineering sector has
developed general conditions, model forms and guides to provide
practical assistance for companies when they draw up different
types of contracts which are commonly used in international
trade in the sectors covered.

(60) Publication of this information on a Commission website does
not mean that the Commission accepts any responsibility for the
contents.

(61) Cf. Article 6 of the CISG.

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ANNEX

REACTIONS TO THE COMMUNICATION ON EUROPEAN CONTRACT LAW

1.

INTRODUCTION

Following the publication of the communication on European contract law, the Council and the European Parliament
reacted to the communication in November 2001. Moreover, the Commission has received contributions from, at
present, 160 stakeholders (see Appendices). This interest of the Community institutions and stakeholders shows the
importance of the debate launched by the communication.

As regards the geographical origin of the contributions it is noticeable that the highest number of contributions have
come from Germany and the United Kingdom. No or few contributions have been received from some Member
States. A considerable number of international stakeholders have also contributed to the consultation. The academic
and business communities have sent the largest number of contributions, but legal practitioners have also contributed
to a considerable extent.

The Commission received by far the overwhelming majority of contributions after the date originally envisaged for
the end of the consultation period. All contributions received up to 31 January 2002 have been included in this
document and the Commission will also take account of further contributions in the future.

The analysis of the contributions received thus far is divided into three parts. In part 2 of this paper there is an
analysis of the reactions of the European institutions. In parts 3 and 4 of this paper there is an analysis of the
reactions of all other contributors, divided into their views on existing problems (part 3) and possible solutions
(part 4). Part 5 summarises the Commission’s next steps.

This synthesis aims to present the Commission services’ understanding of the contributions received during the
consultations. It may not reflect everything that has been said in these contributions. In the interests of transparency,
the responses sent by electronic mail have been published on the Internet site of the Commission in so far as the
contributors have given their consent to publication. However, the list of contributors in Appendix I excludes those
contributors who have specifically requested confidentiality.

The Commission’s Internet site on European contract law is at the following address:

http://europa.eu.int/comm/consumers/policy/developments/contract–law/index–en.html

2. REACTIONS OF THE EUROPEAN INSTITUTIONS

The Commission communication was submitted to the Internal Market/Consumer Affairs Council on 27 September
2001. The Justice and Home Affairs Council took the opportunity of the Council report on the need to approximate
Member States’
to the Commission’s
communication. On the previous day the European Parliament had adopted a resolution on the Commission
communication.

legislation in civil matters, adopted on 16 November 2001, to react

2.1. The Council report

The Council report is fairly balanced. Its introduction clarifies how the Council interprets the mandate given by the
European Council of Tampere. While referring to the European Parliament resolutions, the Commission communi-
cation and academic work, the Council emphasises the central role of contract law. The Council also mentions, with
careful formulation, family law as a possible subject for a discussion on the approximation of national private laws.

In the following chapter the Council briefly mentions, similarly to the Commission communication, the other
instruments, i.e. harmonised private international law rules and international instruments on harmonised substantive
law. It is worth mentioning that the Council emphasises, again like the Commission communication, the limits of
these approaches. Another interesting point in this context is that Member States that have not yet ratified relevant
agreements are encouraged to do so. This is particularly important for the Vienna Convention on the International
Sale of Goods (CISG), which has not yet been ratified by the United Kingdom, Ireland or Portugal.

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This chapter also refers to the programme of measures for the implementation of the principle of mutual recognition
of decisions in civil and commercial matters adopted by the Council. Moreover and for the first time the Council
indicates that the necessary degree of confidence could be attained in the future if the convergence of substantive
laws is enhanced.

The following part of the Council report constitutes, together with the conclusions, the central part of the report.
The part emphasises repeatedly the need for greater coherence and improvement of the existing acquis communautaire.
In this context it is also briefly mentioned that the results of harmonisation achieved through directives are sometimes
regarded as insufficient, in particular because of the significant variations between national implementing measures.
The Council also mentions, like the Commission communication, the problem of the lack of uniform definitions for
general terms and concepts in Community law, which can cause different results in commercial and legal practice.

The Council mentions a number of the most important Community instruments in the area of private law and
recognises that these instruments have created a ius commune in the relevant areas of national law.

Besides the demand for increased coherence in Community law, the Council report would seem to favour a more
horizontal approach to harmonisation, aiming at the creation of a European common core of private law if a need
for harmonisation is revealed. Finally, the Council expresses the wish to examine whether the differences in the areas
of non-contractual liability and property law constitute barriers to the proper functioning of the internal market.
This is the second area of law where the Council report goes beyond the scope of the Commission’s communication.

The fourth part of the Council report deals with family law and does not need to be summarised in detail here as
family law is outside of the scope of the Commission’s communication.

The conclusions of the Council report are addressed to the Commission and include what the Commission, according
to the Council, should do in the follow-up to its communication.

The most important conclusion is the request to the Commission to communicate the results of the consultation
launched by its communication and its recommendations, if necessary in the form of a Green or White Paper, to the
Community institutions and the public by the end of the year 2002. As far as the contents of this future Green or
White Paper are concerned, the Council invites the Commission to examine at least some specific points. It should
identify the Community acts to be reviewed and the reasons for such a review. Furthermore it should point to the
areas of law where the diversity of national legislation undermines the proper functioning of the internal market and
the uniform application of Community law. The Commission recommendations should also cover the possibility of
adopting a more horizontal approach for new legislative initiatives and their impact on the consistency of private
law. Another suggestion from the Council concerns regular coordination between Member States in the area of
private law during the transposition of directives, an approach which is already partially practised. The last point
refers to the working methods to be implemented to achieve greater approximation of national laws and to prevent
inconsistencies.

In addition to the Green or White Paper, the Council would also like the Commission to launch a study in the areas
of non-contractual liability and property law in order to find out whether the differences in Member States’ legislation
constitute obstacles to the functioning of the internal market.

2.2. The European Parliament resolution

The European Parliament specifically mentions two groups for which the internal market has, to a large extent, not
yet brought desirable advantages: small and medium-sized enterprises and consumers. The resolution also emphasises
the aim of equitably balancing the interests of undertakings and consumers as well as the burden placed on
consumers and legal representatives. The European Parliament resolution, in agreement with the Council report and
Commission communication, stresses the limits of private international law such as the Rome Convention and
internationally harmonised substantive law such as the CISG.

The European Parliament criticises the restriction of the scope of the Commission communication to contract law. It
also mentions, similarly to the request of the Council for a study, the areas of non-contractual liability and property
law as relevant.

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After having listed the main Community instruments in the area of private law the European Parliament states that
the relevant directives are not well coordinated and their implementation poses problems in relation to national
private laws. It therefore emphasises that the different rules should be applied more consistently.

The European Parliament underlines explicitly the need to pursue the harmonisation of contract law with the aim of
facilitating cross-border transactions in the internal market.

The core of the European Parliament resolution is the request, addressed to the Commission, for a detailed action
plan. The steps of this action plan can be regrouped in three phases: short, medium and long-term measures.

By the end of 2004, a database should be created in all Community languages which contains national legislation
and case-law in the area of contract law. On this basis, comparative law research and cooperation are to be promoted
with the aim of working towards common legal concepts and solutions and a common terminology for all national
legal systems, i.e. option II of the Commission communication. The European Parliament wants to be regularly
informed about the progress of the work and will provide its opinion on it. Parallel to this work on option II,
option III is also to be pursued and the Commission is requested to put forward legislative proposals aimed at the
consolidation of existing Community law. At the end of the first phase the Commission is to consider whether
further provisions relevant to the internal market are essential, paying particular attention to the growing area of
electronic commerce. In relation to these provisions, the European Parliament suggests the instrument of a regulation,
while for specific areas of consumer protection law it still prefers the instrument of a directive.

From 2005 on, a comparative analysis of common legal concepts and solutions should be published. At the same
time the Commission is to promote the dissemination of Community law and the results of option II in academic
training and among legal practitioners. All Community institutions should apply the common legal concepts,
solutions and terminology consistently when involved in the legislative process.

Thirdly, Community legislation implementing the common legal principles and terminology for cross-border and
purely national contracts should leave intact the possibility of a different governing law. The practical effects of this
legislation are to be evaluated from 2008 on. The results of this evaluation could possibly lead to the establishment
and adoption of a body of rules on contract law from 2010 on. The European Parliament would prefer a regulation
available for use on an optional basis under private international law. The European Parliament stresses the use of
Article 95 as a legal basis.

3. RESPONSES WITHIN THE COMMISSION CONSULTATION PROCESS — NEED FOR FURTHER-REACHING

COMMUNITY ACTION IN THE AREA OF CONTRACT LAW

3.1.

Implications for the internal market

3.1.1. Responses from governments

The governmental bodies dealing in their responses with the implications for the internal market of diversities of
contract law affirm that there are problems, or at least that there may be. However, only a minority of contributions
mention specific problems; this is obviously in some cases due to the fact that national governments have summarised
the results of their national consultations.

The Portuguese Government states that information costs resulting from different national contract laws are an
obstacle to cross-border transactions. These differences also make it difficult to pursue cross-border litigation. For
reasons of legal certainty, namely in order to avoid doubts and legal gaps in the area of e-commerce, it also identifies
a need for harmonisation in the field of consumer contract law. In this context the Austrian Government reports
it was not so much consumers as business which pleaded for full
from its national consultations that
harmonisation of consumer contract law, as opposed to minimum harmonisation, thereby avoiding divergent
national implementation. Concerns relating to minimum harmonisation in consumer law are also reported by the
Belgian Ministry of Economic Affairs and by the Finnish Government from its consultations. The latter also suggests
that there are concrete problems in the area of insurance law and that differences between mandatory rules reduce
the willingness of individual companies to participate in cross-border activities. While it considers the latter to be
minor in comparison with other problems, it emphasises the more serious nature of problems in the areas of, for
example, damages and property law. The Belgian Ministry of Finance suggests that contract law harmonisation would

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allow the uniform classification of contracts for tax purposes and thereby avoid distortions of competition in the
internal market caused by the application of different tax regimes. A concern of the Belgian Banking and Finance
Commission is lack of harmonisation of rules affecting the contractual relationship between financial intermediaries
and their clients, which constitutes an obstacle to the internal market. The German Länder suggest that the complexity
of the current legal situation and the problem of the applicable law cause substantial obstacles.

The Government of the United Kingdom accepts that the internal market may not be functioning perfectly because
of the type of barriers identified in the Commission communication, but considers that the extent of any such
problems will vary from sector to sector. Pointing to the different legal regimes in Scotland and in England and
Wales, it does not consider that the coexistence of different national contract laws is in itself necessarily inimical to
the functioning of an internal market. The British Financial Services Authority could not identify any specific
problems. However, it accepts that the coexistence of national contract laws may, at least in theory, constitute a
potential obstacle to the functioning of the internal market, especially if other barriers are broken down by, for
example, the introduction of the euro. The Danish Government reports from its national consultations that the
preponderant proportion of consultation responses from industrial organisations states that there is no immediate
basis for establishing the existence of any noticeable difficulties to the development of the internal market. A large
number of areas have developed standard customs, international or common European standard contracts. These
industries see no urgent need to promote the development of new standard contracts. However, the results of the
Danish consultations also show that SMEs may encounter particular difficulties in the internal market as a
consequence of differences in the contract laws of the Member States, mostly because of the risk of ignorance of the
foreign rules or the costs of clarifying the uncertainties. Moreover, SMEs often have to accept their co-contractor’s
standard terms and the law of the latter as the applicable law due to their weaker negotiating power. Danish
consumer associations are reported not to be aware of particular problems having the effect of preventing consumer
cross-border commerce. However, they have pointed out that European contract law should be kept abreast of
developments, for example concerning problems in connection with the formation and execution of consumer
agreements in the internal market. Some of the Danish consultation responses point to the need for harmonisation
within a more limited area such as the formation and validity of contracts because of major differences between
national legal systems concerning formal requirements for the formation of contracts, including the assistance of a
public notary. Finally a few responses state that, not least as a consequence of IT developments, some contractual
harmonisation may be needed in particular industries, such as the field of financial services. On the basis of this, the
Danish Government has not been able to confirm that the different national contract law rules hinder the satisfactory
development of the internal market.

The Polish Government states that the existence of different systems of civil law in the EU does not constitute a
substantial obstacle to the functioning of the internal market. However, it also emphasises that unification of contract
law would lower the transaction costs of business. Furthermore it mentions that cross-border transactions are
severely obstructed by diversities in the procedures to be followed in concluding a contract as well as in the
assessment of its validity.

The EEA-EFTA States report that national contract laws may directly or indirectly obstruct the proper functioning of
the internal market as they result in increased transaction costs, especially given the influence of new technologies in
facilitating the conclusion of cross-border contracts, the introduction of the euro and other factors. More particularly
they raise the issue of differences in mandatory rules, which may have a negative impact.

3.1.2. Responses from business

According to some contributors from the manufacturing industry, differences in national legislation do not
represent a significant obstacle to cross-border transactions because in most cases private international law, the
Convention on the International Sale of Goods (CISG) and existing Community law provide satisfactory solutions.
Some business associations emphasise that diversities in national law lead to distortions of competition, e.g. through
higher information costs, and a lack of legal certainty, especially with regard to different liability regimes. Liability
for latent defects under French law has been named as one problem. Problems have been observed for SMEs in the
services sector because of the great diversities in national legislation on services. Sometimes difficulties persist after
the harmonisation of the law, for instance on commercial agents. That makes recourse to legal advice occasionally
necessary. Particular problems are associated with the diversity of laws on the limitation of liability and laws on
security interests. In cross-border transactions business perceives significant problems with liability for and the

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enforceability of standard terms and the requirements for the incorporation of standard terms in contracts under
foreign law, in particular Italian law. Ignorance of the fact that the law of the contract does not necessarily govern
the proprietary aspects of transactions in some Member States causes additional problems. Furthermore, diversity in
rules applicable to the transfer of title to and security in goods adversely affects the possibility of entering into cross-
border leasing agreements. Pre-contractual differences cause great difficulties for EU business

While contributors from the retail trade name the uneven transposition of the Doorstep selling Directive 85/577/
EEC as an obstacle to cross-border direct selling, almost all associations concerned with financial services indicate
problems concerning cross-border trade due to different contractual requirements and the different approaches in
the Member States. Variations in the implementation and application of directives and differing national contractual
requirements are mentioned many times as a deterrent to cross-border trade. It is sometimes impossible to know
when a contract has been concluded, how certain clauses will be implemented or which clauses will be disapplied as
a result of statutory provisions or implied terms. Businesses are discouraged from cross-border transactions more by
differences in the details of different consumer protection regimes than by diversity in the overall level of protection
afforded. Assessment of different levels of protection involves high legal costs. Different time periods under different
directives and the implementation of the directive on commercial agents pose problems as does, for instance, the
implementation of the Directive on cross-border payments. For the insurance sector in particular the diversity of
national regulations is perceived as an obstacle to cross-border activities.

Among other business organisations, some associations have observed barriers to cross-border trade due to
uncertainty about mandatory rules and divergences in rules on agency and the formation of contract, necessitating
different procedures in different Member States. The effect of differences between the various laws in deterring parties
from transactions is felt in particular in SME-to-consumer relations. The different rules for the formation of contracts
and the impossibility of applying uniform standard contracts is a problem that produces huge transaction costs to
which in particular SMEs are vulnerable.

3.1.3. Responses from consumer organisations

According to consumers’ organisations, disparities in national contract law create great uncertainties for consumers
because they do not have enough information on the applicable law, e.g. the increases in interest rates charged on
loans in Germany, which do not occur in France. This leads to increased transaction costs or even deterrence from
cross-border transactions. One contributor adds that the differing contract laws are just one factor and that the
practical means of obtaining advice and mechanisms for resolving disputes involve more important difficulties.

3.1.4. Responses from legal practitioners

Some contributors from the United Kingdom do not see the lack of harmonisation of contract laws as an obstacle to
the development of an integrated financial market.

Concerns that the functioning of the internal market may be hampered by the existence of different national systems
of contract law are seen as less substantial than assumed, as different systems often produced similar results.

Some contributors refer to the United States of America, where no unified system exists but where the Uniform
Commercial Code serves merely as a model for certain aspects of the law of obligations, and the United Kingdom,
where Scottish civil law coexists with English common law.

Language barriers, cultural differences, distance, habits and judicial attitudes are seen as more significant than the
diversity of laws. It is suggested that divergences in civil procedure should be addressed as a priority.

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However, some practitioners accept that consumers and SMEs, not being appropriately advised by in-house lawyers,
unlike larger market operators, may encounter difficulties. On the one hand parties always have the choice of the
governing law of the contract, but very often the more powerful party will impose the law of its domicile. Larger
market operators will always find ways to cope with any problem by sophisticated contractual arrangements, even if
lawyers need to know not only the relevant Community law but also how the directive in question has been
implemented in the Member State concerned.

As regards additional information costs and the cost of additional legal advice, these are not seen as substantially
higher in cases with a foreign connection than in other cases. However, the cost for expert opinions may exceed the
sum at stake in consumer contracts. On the other hand, the implementation of a new law may give rise to greater
costs incurred for legal advice than the present diversity of laws.

Those contributors who state that they have encountered difficulties report that these have arisen in particular from

— lack of knowledge of the other legal system in general, including rules on dispute settlement,

— confusion about who had authority to sign a given document,

— diversity in mandatory laws,

— requirements of authentification by a notary,

— provisions on form,

— reservation of title clauses,

— provisions on assignment of debt,

— indemnities and warranties.

3.1.5. Responses from academic lawyers

Those academics who address the question of implications for the internal market generally assert that the multiplicity
of national laws does give rise to problems. Generally private international law is seen as an inadequate, inappropriate
or incomplete solution, though there are differences of emphasis.

Specific examples of problematic areas include motor insurance and cabotage transport insurance, retention of title
clauses and other security interests, factoring, standard terms, doorstep selling and funds transfers between banks.
The failure of the Community to harmonise substantive insurance law has meant that insurance companies are
unable to offer ‘small risks’ coverage in all Member States on the basis of one and the same policy. One company,
after much research, found it impossible to formulate a single insurance contract capable of being sold with cars
throughout the European Union because of irreconcilable mandatory rules. Security interests in movable property
created in one jurisdiction may not be recognised in a second jurisdiction, for instance if the property is moved
across the border between the two jurisdictions. Very different liability regimes with regard to transport operations
result in unnecessarily high insurance premiums. It is practically impossible to use land in another EU State as
security for a loan. Uniform standard terms and economies of scale may be hindered, which for instance affects the
costs of international bank transfers. Factoring companies cannot use one and the same type of contract throughout
the Community.

It has been noted that in electronic contracting any participant’s ability to use a product depends on whether others
use it. Such ‘networked’ markets may get locked into old technical standards, which may not keep pace with the law.
Technological advances may permit the automated search for contract opportunities, using standard form contracts.
If contract terms are not standardised when the technical standards are developed, it may be difficult or impossible
to incorporate new terms at a later date.

Problems relating to more general rules of contract law, such as those governing the formation of contracts and
assignment, have also been noted, and particular concern has been expressed about remedies for breach.

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Academics indicate problems deterring or preventing transactions, increasing transaction costs, distorting competition
and reducing legal certainty. Problems can affect all phases of business activity: planning, negotiating and concluding
contracts, performing obligations and litigating. SMEs and consumers are particularly affected. One contributor
suggests that problems arise from the formal multiplicity of laws rather than from substantive differences in law,
because of the need to investigate the foreign law.

Some academics draw a distinction between rules that constrain the parties, including in effect rules on the formation
of contracts, and those which do not. However, it is said that information costs and risks arise both from differences
in mandatory law and from differences in non-mandatory law. It is said that the United States experience indicates
that legal diversity cannot be a decisive barrier, but even so legal diversity is the overriding obstacle to trade. Another
argument is that the United States system has led to a per capita ratio of lawyers eight times higher than in Europe.

3.2. Uniformity of application of Community law

3.2.1. Responses from governments

The Portuguese Government notes that the fact that Community rules are often dispersed among different
instruments makes it more difficult to interpret and apply them. It also confirms that Community instruments and
concepts are ambiguous. The contributions of the Belgian Banking and Finance Commission and the French
Government also state that there are inconsistencies within the acquis. The former mentions as an example the
directives on investment services and e-commerce. The Finnish Government mentions varying interpretations and
disparities in Community law and in national
implementation measures. Referring to the latter the Finnish
Government specifically mentions that the discretion in implementing directives makes operators doubt whether
there has been correct implementation. The German Länder also criticise the consistency of the acquis, quoting as an
example the modalities of the information obligations and rights of withdrawal in the consumer contract law
directives.

The Government of the United Kingdom is not aware of any contradictions in Community law and states that any
problems of that nature should continue to be addressed on a case-by-case basis.

3.2.2. Responses from business

According to some contributors from the financial services sector, problems arise from diversities in the
implementation of directives and the different applicable laws and jurisdictions can prove to be a very real hindrance
to cross-border trade. Two associations from the media, representing among others persons who create copyrighted
materials, mention a specific example of problems regarding the definition of terms: ‘equitable remuneration’ is, they
say, a meaningless term in the British legislation implementing the directive on rental, lending and other rights
relating to copyright. In other business sectors it is said that divergent implementation of directives in the Member
States generally causes distortions of competition, e.g. in the context of consumer protection, especially if the
implementing measure exceed the fixed minimum level of protection. Some associations said they had not
encountered any problems in buying goods or services from other countries of the European Union.

3.2.3. Responses from consumer organisations

The well-known problems relating to inconsistencies among directives are exacerbated by implementing measures
adopted by Member States, variations in the application of Community law, including its application to new
technologies, and interpretation, especially because of the overlap between European law and existing domestic
legislation.

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3.2.4. Responses from legal practitioners

Legal practitioners commenting on the issue of the application of Community law agree that the current approach
in Community legislation of regulating only particular aspects of contract law gives rise to a lack of transparency and
consistency. Inconsistencies among directives include inconsistencies as to the recognition of general principles such
as the principle of good faith. Examples of problems include the general lack of a definition of the term ‘contract’
and the different time periods in provisions on withdrawal from contracts. Moreover, there is the problem of uneven
implementation and interpretation of directives by Member States.

3.2.5. Responses from academic lawyers

The quality of Community legislation was criticised. Existing directives include inconsistencies as to whether
particular terms are defined, as to the contents of the definitions of the subjects affected (including ‘consumer’ and
‘seller’) and as to the cooling-off periods allowed. The scope of the directive on guarantees for consumer goods is, in
particular, said to be unclear. One explanation for such difficulties is the lack of a common private law vocabulary.

A number of commentators mention problems relating to the implementation of directives in national law. Particular
examples related to database protection, doorstep selling, package holidays, distance selling and the Directive on
unfair terms. Furthermore, the directives on unfair terms, product liability, consumer guarantees, late payment of
money debts and e-commerce raise the difficult problem of whether their scope should be extended at national level.

It is suggested that the vertical approach of subject-specific Community legislation has led to distortions in national
legal systems and a lack of coordination among directives. It is said that directives threaten the coherence of national
legal systems by introducing new concepts, because of the lack of consistency among directives themselves and
because the European Court of Justice cannot maintain the internal coherence of all the national legal systems of the
EU simultaneously.

4. RESPONSES WITHIN THE COMMISSION CONSULTATION PROCESS — OPTIONS

4.1. Option I

4.1.1. Responses from governments

In so far as governmental contributors have given their views on option I, the large majority are opposed to it.

Of the contributors who reject option I, France considers it to be incompatible with the smooth functioning of the
internal market. The Italian Government raises the danger of the further fragmentation of contract law and the
German Länder cite the need for clarity and transparency for economic operators. The United Kingdom’s Financial
Services Authority states that it cannot be sure that option I will adequately address the issues raised, which will
depend on the scale of the problem.

The Government of the United Kingdom, however, sees considerable scope for the market to develop solutions to
potential problems. The Belgian Banking and Finance Commission mentions one successful example of self-regulation
(pre-contractual information on home-loans). It is in favour of support from the Commission for self-regulation as
its first choice and intervention by the Community legislator as its second choice if self-regulation fails.

4.1.2. Responses from business

Of contributors from the manufacturing industry one association rejects option I while two others state that the
market should be left to regulate itself as far as possible where industry has achieved a high degree of self-regulation
by developing fair conditions of trade. Some contributors from the financial services sector consider option I to be
an unrealistic one while one contributor states that market forces will provide a powerful incentive for countries to
ensure that their national law is appropriate to international commercial needs and Community intervention in the

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area of contract law would involve unjustifiable adjustment costs. Broad support was expressed from the media
sector, essentially on the part of those whose business depends on copyrighted material created by others, for pure
self-regulation. For some contributors from other business sectors, fully or partly market-based solutions, including
codes of conduct combined with effective self-regulation, seem to be the strategy most likely to be successful.

4.1.3. Responses from consumer organisations

Except for one organisation, which prefers option I, the contributors agree that contract law cannot be left to the
markets because statutory invention is needed to protect the weaker party.

4.1.4. Responses from legal practitioners

The large majority of legal practitioners think that the harmonisation of European contract law will not be achieved
simply by reliance on the markets. There is the danger that the legal system of the home country of the contracting
party with the most extensive economic resources will be applied. The Law Society of England and Wales indicates
that it would prefer there to be no action in respect of certain particular types of transactions.

4.1.5. Responses from academic lawyers

The vast majority of academic opinion is opposed to option I, with contributors pointing to ‘practical experience’ as
showing the inadequacy of such an approach. The Pavia Group states that commercial customs have too fragmented
a character to fulfil the requirements of the internal market.

Generally private international law is seen as an inadequate, inappropriate or incomplete solution, though there are
differences of emphasis. The Study Group on a European Civil Code and the Lando Commission point out that
private international
in particular, no solution in the event of the unwitting conclusion of contracts.
Contributors argue that practitioners’ conflicts of interests with their clients and the lack of accurate, complete and
freely available information prevent the market from solving existing problems.

law is,

However, it is suggested that dynamic competitive processes could produce voluntary harmonisation, and that this
is more likely for facilitative than for interventionist law. The only strong support for option I among academics
came from the Society of Public Teachers of Law of the United Kingdom and Ireland, which advocated option I in
the context of commercial contracts.

4.2. Option II

4.2.1. Responses from governments

There is substantial support among governmental contributors for option II, although many see it as not sufficient
on its own or as complementary to either option III or option IV.

The EU is seen as having a potential role in coordinating academic work or sponsoring and supporting the private
initiatives of the markets and of legal practitioners. Italy supports option II, but only as a guideline for Community
legislation. The Government of the United Kingdom says that the Commission could even lead initiatives itself in
sectors where there is a clear need but no market solution under development. The Danish Government supports
work developing existing standard contracts further and any initiative to encourage the industrial and professional
bodies involved to draw up well balanced standard contracts that take greater account of the interests of the weaker
contractual party or to take other initiatives capable of motivating particularly SMEs to take more part in cross-
border transactions. It also supports the development of non-binding common contract law principles for use in
standard contracts. Finally, in order to prevent the disincentive resulting from a lack of knowledge of national
contract law regimes keeping in particular consumers and SMEs from taking part in cross-border transactions, it
suggests promoting the possibilities for undertakings to retrieve information on the national legal systems.

The Austrian Government expresses its opposition to the ‘institutionalisation’ of research in the form of a ‘European
Law Institute’.

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4.2.2. Responses from business

Some contributors from the manufacturing industry are in favour of the promotion of uniform European
principles of contract law in order to strengthen European integration. Some suggest that priority should be given to
the simplification of national and Community legislation and removing unnecessary layers of regulation. General
principles and guidelines may serve as models for business contracts. Voluntary application would lead to greater
acceptance, as has already happened in the case of the Vienna Convention on Contracts for the International Sales of
Goods (CISG).

Support is given by contributors from the retail trade sector to the development of soft law and the improvement
of the quality of existing Community legislation, provided that the new legislation includes maximum standards and
does away with the minimum clauses which currently allow Member States to go further than required by
Community legislation.

Support is given by some undertakings from the financial services sector to further investigation in relation to the
development of common principles. The creation of a provisional code of principles has been suggested. Generally
contributors from the media oppose option II. Many contributors from other business sectors are in favour of
promoting research in order to elaborate common principles as a first step towards harmonisation. It is also said that
the development of guidelines, codes of conduct or standard contracts by the European institutions is not the best
approach, especially if such instruments are likely to become binding and represent a limitation on freedom of
contract. It is said that such instruments should be promoted only by economic operators.

4.2.3. Responses from consumer organisations

Consumer organisations take the view that voluntary guidelines are not sufficient and might not be appropriate to
deal with consumer concerns because consumer law is regulatory law. Therefore the practical usefulness of voluntary
guidelines is questionable. Two contributors propose the elaboration of a set of common principles of consumer
law, which could later, within the framework of option IV, be transformed into binding EU law.

4.2.4. Responses from legal practitioners

Some contributors consider comparative studies on contract law a prerequisite for any initiative and feel that the
functioning of the internal market could be further improved by pursuing option II. The approach of ‘soft’
harmonisation by the promotion of the development of common principles as guidelines for legislators and the
courts, whilst respecting the different traditions of existing legal systems, could over time eventually lead to a ‘model
law’. It is suggested that such principles should include property law and tort law.

Other contributors are concerned that non-binding instruments such as common principles and standardised
contracts would only be of academic interest and in all probability would not receive wide acceptance in the market
and would not be consistently implemented. Furthermore, harmonisation leading to similar but not identical laws
would not provide a good solution.

4.2.5. Responses from academic lawyers

Contributors express broad support for option II, and the vast majority of opinion, where expressed, is in favour of
further research, the elaboration of common principles or a restatement and the promotion of such work by the
Commission. One contributor suggests that there should be institutional arrangements for the revision of restatements
from time to time. A number of contributors stress the importance of the elaboration of common principles, and of
option II generally, as preparatory work for the pursuit of option IV. A small number of contributors express
concerns. These include the concern that merely relying on option II would compromise transparency. Moreover,
the practical usefulness of common principles was questioned, especially on the basis that common principles require
a common denominator and therefore contain too many gaps.

Sources to be used for future work on common principles include economic analysis, the acquis communautaire,
national rules, international rules and the existing work of academic groups, especially the Lando Commission and
the Pavia Group.

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Support is expressed for the idea that common principles, once adopted, could be used as a resource for the
approximation of national laws both by legislators and by the courts and as a resource to give structure to European
legislation. Some contributors suggest that model laws should be promulgated, following United States practice, but
some reservations have been expressed. It is noted that common principles could be incorporated into contracts by
the parties, including in a public procurement context, although again reservations have been expressed. It is also
noted that comparative legal work could be a useful source of information for market operators.

Comparative law is said to facilitate the improvement of national laws by means of the competition of legal systems
and by freeing legal thought from dogmatism. There are calls for the promotion of a common legal culture, a
common law curriculum, a common legal literature, a common legal terminology and a common legal dialogue,
including by way of the creation of specific institutions such as a European Law Institute and a European Law
Academy. Some support is also given to promoting the development of standard contracts, whose acceptance would
depend on their substantive quality.

4.3. Option III

4.3.1. Responses from governments

Governmental responses are generally in favour of option III. The Italian, Portuguese and Polish Governments see
option III as a potential step towards option IV.

The French Government calls for greater precision in the drafting of Community law, avoidance of overlapping
legislative instruments (this point is also made by the Austrian Government) and effective review mechanisms in
Community instruments. The Austrian Government advocates using the same model in different instruments if
possible and cites the right of withdrawal in consumer contract law directives as an example of where this could be
done. It also advocates the simplification of drafting and exceptions to general rules. Finally it raises the possibility of
a transition from minimum to full harmonisation and states that the country of origin principle does not constitute
a solution. The Finnish Government specifically states that in the consumer contract law area the Community should
fill legislative gaps, make the rules easier to understand and reduce the variety in interpretation by supplementing
and consolidating the existing legislation. It emphasises that the aim should be a high level of consumer protection.
The Portuguese Government mentions as a problem concepts that are difficult to transpose into national law or have
different meanings in different Member States. The Government of the United Kingdom sees considerable value in
option III, advocating simplifying existing and improving future legislation as well as addressing inconsistencies
between existing directives and differences in national
implementation. It explicitly does not rule out further
harmonisation of consumer contract law directives that provide only minimum harmonisation. The Danish
Government suggests concentrating on laying down some overall principles rather than very detailed rules in the
individual fields in order to reduce inconsistencies at national and Community level. According to the EEA-EFTA
States, existing directives should be updated and adjusted when necessary. However, in general they prefer minimum
harmonisation directives.

4.3.2. Responses from business

Most contributors from the manufacturing industry express support for option III, while one contributor states
that industry is reluctant to have to deal with new mandatory rules reducing freedom of contract, which would not
be justified from a business point of view. Generally contributors from the financial services sector state that the
improvement of the quality of legislation already in place will support the drive towards an internal market. There is
a diversity of opinion in the media sector on option III. Some contributors support comprehensive legislative
improvement consisting in the removal of inconsistencies while others think that analysis of existing directives must
be conducted on a case-by-case basis and improvement should be achieved by legislation targeting discrete areas of
law rather than complete harmonisation. Generally contributors from other business sectors are in favour of the
improvement, the coordination and the synchronisation of legislation already in place.

4.3.3. Responses from consumer organisations

Existing EU consumer protection legislation should be improved. Improvements should include clarifying its scope
of application by giving, for example, a uniform definition of ‘consumer’ and by harmonising information duties,
remedies and the right to withdraw from a contract across the different Community instruments. The level of

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harmonisation should also be increased. One contributor notes that, consistency and coherence aside, there should
always be room for new consumer protection rules dealing with specific problems.

4.3.4. Responses from legal practitioners

Almost all contributors express their support for option III, although a few consider that a mere review would, for
instance, not be sufficient to render the application of diverse rules of mandatory national law unnecessary. The
review of existing legislation should build on experiences with the SLIM and BEST initiatives.

4.3.5. Responses from academic lawyers

There is overwhelming support among academics for the improvement of existing Community legislation, some
contributors ascribing it priority.

Reasons suggested in favour of the improvement of existing Community legislation include the excessive vagueness
and confusion of existing terminology and the possibility of greater coherence, transparency and simplicity in
Community law. Another reason is the possibility of progress towards the systematic arrangement of Community
contract law, the improvement of its consistency and the filling of gaps. The mandatory contract law rules of the EU
could also be updated.

The majority of academic opinion, where expressed, is however to the effect that improving Community legislation
will not address the core problems of European contract law or will be at best a short-term solution. Even so, the
development of a concept for the improvement of future Community law-making is suggested as a long-term
strategy.

Particular suggestions include the revision of definitions and the harmonisation of the contents of the various
directives, including cancellation periods for contracts and the legal consequences of cancellation. Further suggestions
include the transformation of directives into regulations and the development of a European Consumer Code,
covering all existing directives, and possibly other codes for public procurement law and intellectual property
licensing law. Suggestions also include the filling of gaps relating to the passing of property and risk in consumer
goods, producing a blacklist of prohibited contract terms and the extension of rules on unfair terms to non-standard
terms and of rules on consumer goods to consumer services. Further suggestions include stricter sanctions for breach
of informational duties and greater consumer protection in the event of supplier insolvency.

4.4. Option IV

4.4.1. Responses from governments

Governmental opinion on option IV is not as homogeneous as governmental opinion on the other options.

The Italian Government is of the opinion that horizontal harmonisation should be pursued in particular areas and
mentions as an example consumer contract law. It states that the legislation should combine mandatory rules and
non-mandatory rules and should allow for the possibility of the choice of a different governing law. The Portuguese
Government does not consider option IV to be a realistic short-term objective, but thinks that it is an objective that
could be pursued once option II has been effected. It suggests continuing and intensifying academic studies in this
area. Option IV should be constituted by rules which are applicable if the parties do not otherwise agree. Mandatory
rules should only exist in special cases. The Portuguese Government does not consider either a directive or a
recommendation to be a suitable instrument as both lead to differences in national law. The Belgian Ministries of
Finance and Economic Affairs are favourably disposed towards option IV. The Austrian Government explicitly does
not oppose option IV, but emphasises that it would be a long-term and difficult exercise. It stresses that the
Community institutions should not be against such an option. It suggests the use of instruments that apply if the
parties agree on their application. Similarly, the German Länder consider option IV to be the appropriate instrument
for the medium or long term, provided that a need for it is demonstrated. They stress that the present acquis
communautaire would have to be fully integrated and a high level of consumer protection would need to be
guaranteed. However, they do not consider that the Community has, at present, a legal basis for this, but state that in
the framework of the preparation for the next IGC, in 2004, the question of such competence would need to be
examined. The point on Community competence is also stressed by the Polish Government, which could however
consider option IV as an idea for the prospective development of European law. The Austrian Government
emphasises the need to examine the question of competence.

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The EEA-EFTA States are sceptical towards the development of a new set of binding comprehensive principles of
contract law, but consider the development of a set of non-binding model principles to be most welcome. The
Finnish Government, while not in favour of comprehensive legislation across the broad spectrum of contract law,
sees some scope for possible minimum harmonisation in insurance law. The idea that insurance law might be a
potential candidate for harmonisation is also emphasised by the Austrian Government. The French Government
opposes, at the present stage, a true European contract law replacing internal laws, but has not expressed an opinion
on a set of provisions that leave national rules intact (whether opt-in or opt-out). The British Financial Services
Authority considers option IV to be premature. They see it as extremely difficult to pursue option IV in the face of
the principles of subsidiarity and proportionality. This would especially concern the automatic application of rules
which could not be excluded. They consider that the adoption even of purely optional and fallback models would
require further analysis of the weaknesses of the current system. However, they accept that a case may be made out
for this in due course. The Danish Government considers general harmonisation to be a very large and difficult
project which should in the light of the subsidiarity and proportionality principles only be considered if there is clear
evidence that divergent national rules hinder the satisfactory development of the internal market, that such problems
cannot be solved by other means and that the advantages of such harmonisation clearly outweigh the disadvantages.
If such evidence can be given, the Danish Government would favour a recommendation setting up non-binding
contract law principles which the Member States are encouraged to observe in their legislation as well as a
recommendation or regulation containing contract rules by which the parties can agree to let their contract be
governed.

The Government of the United Kingdom is opposed to option IV in any of its forms and considers it to be
disproportionate and likely to cut across the principle of subsidiarity. In its opinion, Community legislation should
focus on specifically identified problems on a case-by-case basis.

4.4.2. Responses from business

Generally option IV is rejected by the manufacturing industry. One association points out that the creation of a
civil code can only be a long term aim and would have to be developed step by step by means of the voluntary
approximation of national
laws so that business is not suddenly confronted with massive adjustment costs.
Furthermore, it is said that all EU action should be justified and that EU legislation should be tested on the basis of
impact assessment, cost-benefit analysis, proportionality and its potential for the creation of employment or
unemployment. Most of the contributors from the media do not see any need for intervention by the Commission
by way of a new instrument. Some associations are opposed to any fixed contract conditions for business contracts
because at the present time there is no need for the creation of a European civil code.

To many contributors from the financial services sector option IV seems to be suitable as a long-term objective and
there are various suggestions as to the appropriate approach: a general legislative framework, a directive or a civil
code consisting of mainly non-mandatory and partly mandatory rules. An opt-in system has been suggested. Some
support is expressed for new comprehensive legislation from other business sectors, but only where concrete
problems have been identified and as an opt-out solution like the CISG or the UCC (United States Uniform
Commercial Code).

4.4.3. Responses from consumer organisations

The contributors differ on the necessity and justifiability of option IV. Opponents allege a lack of evidence of
detriment sufficient to justify EU action — in any case, distortions of competition cannot be suggested. Supporters
want option IV to be pursued, but have different ideas as to the best variation on option IV. According to one
contributor, European contract law should not be introduced by a regulation, since the Member States should be
given space to manœuvre. Another wants option IV to be restricted to certain essential aspects. One organisation
states that European consumer law should be limited to minimum harmonisation because European consumer law
is only intended to bolster consumer confidence, whereas national consumer law is intended to protect the weaker
party. Similarly another contributor suggests that European contract law should include more stringent European
consumer protection rules. Finally it is said that European consumer law could facilitate the proper functioning of
the internal market by encouraging consumers to make increased volumes of cross-border purchases.

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4.4.4. Responses from legal practitioners

Only six of 27 contributors totally reject the suggestion of a European civil code. In particular, English legal
practitioners fear that the global significance of English common law would suffer. To them it would be
disproportionate, in the very least, to impose a mandatory European contract law on Member States. One contributor
claims that a mandatory scheme would risk undermining the existing ‘export’ of English common law, which
provides contracting parties worldwide with greater legal certainty than do legal systems in the civil law tradition.
For instance, there are standard terms prepared by the International Swaps Derivatives Association using English law.
The Law Society of Scotland, however, while describing option III as its ‘preferred option’, states that option III
should not be pursued to the exclusion of options II and IV.

Others view a uniform and comprehensive European civil code as the best solution to the problems identified.
However, there is no common opinion as to whether such an objective could best be achieved by a recommendation,
a directive or, as directives are often wrongly implemented, a regulation. However, there is a tendency towards a
preference for an opt-in system, a set of transnational rules which, at the discretion of Member States, might also be
chosen by parties to purely domestic contracts. It is suggested that the first phase should be the unification of legal
terminology. National principles on public law contracts, property law, family law and civil procedure which are
linked to contract law should be taken into account.

4.4.5. Responses from academic lawyers

The majority view of academics is favourable to option IV, although it is seen as a long-term strategy or, by some, as
something for the distant future and there is also outright opposition. It is also stressed that the success of a European
contract law would depend on its substantive quality. Indicators of substantive quality include whether the rules are
simple, clear, accessible, practical and comprehensive, take account of modern socioeconomic circumstances and are
not excessively abstract. It is said that European contract law must not be a pale compromise between different
national laws, but that the best and most just rules must be selected. It is even suggested that positivistic legal
analysis, without regard for the social and economic impact of legal constructions, is useless. For default rules one
crucial indicator is how closely they reflect what the parties would have agreed.

It is variously suggested that there should be progressive or phased implementation, for instance by adopting an opt-
in approach before ultimately replacing national laws, and that there is a need for a test period. It is urged that some
Member States could adopt European contract law before others, though one academic opposes this. One contributor
suggests that the political case for pan-European codification should be tested against the background of a potential
legislative text.

Many academics are in favour of ultimately replacing national law with a uniform European contract law or European
civil code, although a considerable number prefer an opt-in or opt-out solution, in particular for non-binding or
facilitative rules. It was noted that in English law it is possible for parties to opt into the 1964 Uniform Law on the
International Sale of Goods, but that there has not been a single case where contracting parties have done so. Reasons
for not replacing national law include the idea that European codification would lead to rigidity or stagnation in the
law and the idea that the long-term parallel existence of European and national contract laws would combine the
advantages of centralised and decentralised rule-making and avoid the disadvantages.

There is a strong preference for using a directly binding instrument such as a regulation or an ad hoc treaty, rather
than a directive or recommendation. This is because the proper functioning of the internal market requires the
harmonisation not merely of general principles but, in fact, of the rules that direct the activities of businesses and the
courts. It is noted that if uncertainty is to be removed as to the legal situation in other states then the legal provisions
will have to be identical from State to State and that legislating by directive would add a complication and inefficiency
in the process of legal advice and drafting.

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4.5. Other options; scope of the communication

4.5.1. Responses from governments

The German Bundesrat, while supporting options II and III and on a long-term basis option IV, even so considers that
selective harmonisation measures would be useful if necessary.

The German Länder and the Austrian Government oppose the inclusion of family law and the law of succession. The
Belgian Ministry of Finance also opposes the inclusion of rules on family law and immovable goods. The German
Länder oppose the inclusion of property law. The Austrian Government raises the possibility of the inclusion of the
law of tort. The French Government advocates a narrow understanding of contract law, namely excluding tort law
and property law.

The Finnish Government, while suggesting that the need for new Community rules on insurance law should be
investigated (see option IV), suggests that, at the very least, the rules of private international law applicable to
insurance contracts should be reassessed in the near future.

The Danish Government suggests that the Commission should first focus on well-functioning international rules of
jurisdiction and applicable law. It is furthermore in favour of a more detailed study as to whether general
harmonisation of contract law or parts thereof can advantageously be effected in a wider international framework,
such as that of the United Nations. It quotes the example of the CISG.

The Austrian Government and the Danish Government stress that in all future work the principle of freedom of
contract should be the general rule and restrictions to it the exception.

4.5.2. Responses from business

Contributors from the manufacturing industry see there as being a special need for harmonisation of limitation
periods and rules on limitation of liability. Furthermore, it is not felt justified to limit work on private law to contract
law. If the aim is to facilitate cross-border transactions then contract law cannot be looked at in isolation from
property law. There are some suggestions related to the inclusion of areas such as information requirements, tax law
and company law in the harmonisation process from contributors from the financial services sector. As an
alternative instrument, one suggestion from the media sector is for there to be a system for consumer law similar to
that of Incoterms in contract law. The Commission could also provide a platform by setting up a Web-site where
information on contract law and a comparison of standard contractual clauses could be set up, in the opinion of
contributors from other business sectors.

4.5.3. Responses from consumer organisations

One contributor states that the Rome Convention on mandatory rules should be clarified by requiring the application
of the law of the consumer’s state, regardless of the domicile of the business.

4.5.4. Responses from academic lawyers

Alternative instruments suggested for the adoption of European contract law are: principles capable of being moulded
more freely than ordinary legislation, so as to remain accessible, while still commanding the authority of a binding
legal source; an ad hoc treaty; model laws as used in the United States. Further techniques include altering private
international law to allow the adoption of common principles as an ‘autonomous partial legal order’. It is noted that
a legal system for cross-border contracts could be copied unilaterally in domestic law.

There are suggestions for the inclusion of mandatory and non-mandatory rules and for the codification of consumer
law and its combination with European contract law in one instrument. It is suggested that there should be a
distinction between consumer and commercial contracts, SMEs perhaps receiving special treatment, or between
mandatory and non-mandatory rules, some contributors suggesting a further distinction between mandatory
informational duties and mandatory outcome-related rules. It is suggested that as a political compromise there might
be a range of permissible levels of protection by mandatory rules, or strictly defined options for the national
legislator, combined with an opt-in system for non-mandatory rules. One contributor suggests that only mandatory
rules should be harmonised.

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Some suggestions are to the effect that rules should be formulated in particularly problematic areas first, such as the
formation of contracts and security rights in movables. Other academics suggest that there should ultimately be a
European Civil Code or the unification of ‘patrimonial law’, one commentator noting that subject-specific codes
could lead to problems of coordination in national law. Contributors suggest including rules on the entire law of
obligations, including not just contract and tort (delict) but also restitution (unjust enrichment), and rules on
property, including assignment, intellectual property and intangible property generally as well as security interests,
the latter as a priority, and trusts. In addition to these areas and consumer law, family law, labour law, company law,
public procurement and insolvency have also been mentioned. One contributor suggested that the Community
should not take action in areas where international conventions on substantive private law, such as the CMR and the
COTIF, have been ratified by all Member States.

Calls for greater international coordination include the suggestion that the Commission should liaise with UN
agencies such as UNCITRAL and Unidroit and that those Member States not having ratified the Convention on the
International Sale of Goods should do so. However, the Pavia Group criticises that Convention for failing to take
account of related transactions and for leaving many gaps.

Other suggestions relate to the harmonisation of the law of civil procedure and the improvement of private
international law.

5. NEXT STEPS

The Commission has not yet drawn its conclusions. It intends to present its observations and recommendations, if
appropriate in the form of a Green or White Paper, by the end of 2002. In this document the Commission intends:

— to identify areas in which the diversity of national legislation in the field of contract law may undermine the

proper functioning of the internal market and the uniform application of Community law,

— to describe in more detail the option(s) for action in the area of contract law which have the Commission’s
preference in the light of the results of the consultation. In this context, the improvement of existing
Community legislation will be pursued and the Commission intends to honour the requests to put forward
legislative proposals to consolidate existing Community law in a number of areas,

— to develop an action plan for the chronological implementation of the Commission’s policy conclusions.

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Appendix I

LIST OF ALL CONTRIBUTING STAKEHOLDERS

The following list of contributors does not give the names of those contributors who have specifically requested
confidentiality. The contributors are listed by category according to the classification system used by the Commission
services in analysing the contributions. The order in which the names of the contributors appear does not bear any
relation to the order in which the contributions have been received, nor does it bear any relation to any supposed
judgement as to the relative importance of the contributions.

1.

GOVERNMENTS

1.1.

Bayerisches Staatsministerium der Justiz, Wilfried Krames, Regierungsdirektor, München

1.2.

EFTA, European Free Trade Association, Einar Tamimi, Brussels

1.3.

Finnish Ministry of Justice

1.4.

Polish Government

1.5.

Bundesrat (resolution)

1.6.

Government of the United Kingdom

1.7.

Italian Government, Ministero Affari Esteri

1.8.

Portuguese Government

1.9.

Belgian Ministry of Finance (*)

1.10.

Belgian Ministry of Economic Affairs (*)

1.11.

Belgian Banking and Finance Commission (*)

1.12.

British Financial Services Authority

1.13.

Swedish Consumer Agency and Consumer Ombudsman

1.14.

Austrian Government

1.15.

French Government

1.16.

Finnish Consumer Ombudsman and Consumer Agency

1.17.

Danish Government

2. BUSINESS

2.1.

Manufacturing industry

2.1.1.

Bundesverband der Deutschen Industrie, Abteilung Recht, Wettbewerbspolitik und Versicherung, Berlin

2.1.2.

Chambre de Métiers, Paris

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2.1.3.

Deutscher Industrie und Handelskammertag, Brussels

2.1.4.

VDMA Verband Deutscher Maschinen- und Anlagenbau, Holger Kunze, Brussels

2.1.5.

Zentralverband Deutsches Baugewerbe, Rechtsanwalt Elmar Esser, Berlin

2.1.6.

Orgalime

2.2.

Retail

2.2.1.

[Confidentiality requested]

2.2.2.

FEDSA, Federation of European Direct Selling Associations, Brussels

2.3.

Financial services

2.3.1.

Barclays plc, Bill Eldridge, EU Adviser’s Office, London

2.3.2.

Bundesverband Deutscher Banken, eV, Wulf Hartmann, Berlin

2.3.3.

Bundesverband der Deutschen Volks- und Raiffeisenbanken, Bundesverband der Öffentlichen Banken
Deutschlands, Deutscher Sparkassen- und Giroverband eV

Dr Danco, Berlin

2.3.4.

Comité Européen des Assurances, Bruxelles

2.3.5.

London Investment Banking Association, Timothy Baker, Director, London

2.3.6.

Servizi Interbancari SpA, Sandro Molinari, Dr. hon. c. Cav., Presidente

2.3.7.

Zurich Financial Services (UKISA), Adrian Baskerville, Director, Legal Services, London

2.3.8.

Eurofinas (European Federation of Finance House Associations)

2.3.9.

Euronext SA (*)

2.3.10. Nasdaq Europe SA (*)

2.3.11. Association of European Cooperative and Mutual Insurers

2.3.12.

European Mortgage Federation

2.4.

Media

2.4.1.

Advertising Association, Phil Murphy, London

2.4.2.

European Publishers Council, Angela Mills, Executive Director, Oxford

2.4.3.

Federation of European Publishers, Anne Bergmann-Tahon, Deputy Director, Brussels

2.4.4.

Motion Picture Association, Laurence Djolakian, European Office, Brussels

2.4.5.

Neuromedia Intenational, Lyon

2.4.6.

Pyramide Europe, Gwen Thomas, General Manager, London

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2.4.7.

UK Publishers Association

2.4.8.

[Confidentiality requested]

2.4.9.

British Copyright Council, London

2.4.10.

British Music Rights

2.4.11.

ENPA, European Newspaper Publishers’ Association, Brussels

2.5.

Other

2.5.1.

Business Software Alliance, Brussels

2.5.2.

Electricity Association, Jeff Woodhams, Head of Procurement Group, London

2.5.3.

EuroCommerce, Brussels

2.5.4.

International Chamber of Commerce, Ayesha Hassan, Senior Policy Manager, Electronic Commerce,
Telecommunication and IT, Paris

2.5.5.

MEDEF, Mouvement des Entreprises de France, Jacques Creyssel, Paris

2.5.6.

NECP, New Engineering Contract Panel of the Institution of Civil Engineers, Nigel Shaw, London

2.5.7.

UEAPME, European Association for Craft, Trades and Small and Medium-Sized Enterprises, Brussels

2.5.8. Wirtschaftskammer Österreich, Abteilungsleiter Univ. Doz. Dr. Hanspeter Hanreich, Wien

2.5.9.

Bundesverband der Freien Berufe (BFB), Berlin

2.5.10.

Stockholm Chamber of Commerce

2.5.11.

International Chamber of Shipping and EC Shipowners’ Associations

2.5.12.

Confederation of Business and Industry

2.5.13. Union of Industrial and Employers’ Confederations of Europe

2.5.14.

European Federation of Leasing Company Associations

2.5.15.

Swedish IT Law Observatory (**)

2.5.16.

[Confidentiality requested]

2.5.17.

Leaseurope, Brussels

2.5.18.

FEDMA, Federation of European Direct Marketing, Brussels

3.

CONSUMERS’ ASSOCIATIONS

3.1.

BEUC, The European Consumers’ Organisation, Legal Department, Brussels

3.2.

Consumers’ Association, Alison Lindley, Principal Lawyer, London

3.3.

European Consumer Law Group, Brussels

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3.4.

Union Fédérale des Consommateurs

3.5.

Belgian Consumers’ Council (*)

4.

LEGAL PRACTITIONERS

4.1.

Bar Council of England and Wales, Evanna Fruithof, Director, Brussels

4.2.

Paolo Bernardini, Dr Giudice presso il Tribunale civile di Lucca

4.3.

Heiko Büsing, Rechtsreferendar, Göttingen

4.4.

Bundesnotarkammer Deutschland, Dr Jens Fleischhauer, Geschäftsführer, Köln

4.5.

BRAK, Bundesrechtsanwaltskammer Deutschland, Büro Brüssel

4.6.

CentreBar, Prof. Arnold Vahrenwald, Munich

4.7.

CMS Cameron McKenna and CMS Bureau Francis Lefebvre, Nathalie Biesel-Wood, Brussels

4.8.

Nicolas Charbit, lawyer

4.9.

Combar, Commercial Bar Asssociation, William Blair, London

4.10.

Conférence des Notariats de l’Union Européenne, Brussels

4.11.

Deutscher Anwaltverein, Ausschuss für internationalen Rechtsverkehr, Prof. Dr Hans-Jürgen Hellwig,
Frankfurt am Main

4.12.

Deutscher Notarverein, Berlin

4.13.

Herbert Gassner, Dr, Landesgericht Eisenstadt

4.14.

Harvey McGregor QC, barrister, England

4.15.

Eric Gummers, Amhurst Brown Colombotti, solicitors, London

4.16.

Adrian Jack, barrister, Enterprise Chambers, London

4.17.

Achim Kampf, Leiter Euro Info Centre, Mannheim and Joachim Förster, Bereichsstellenleiter Recht, Euro
Info Centre, Mannheim

4.18.

Landesnotarkammer Bayern, Dr Bracker, Praesident, Munich

4.19.

Lovells Boesebeck Droste, London

4.20.

Österreichischer Rechtsanwaltskammertag, Dr Klaus Hoffmann, Präsident, Vienna

4.21.

Observatorio Juridico Transfronterio Iuris Muga, Colegio de Abogados de Gipuzkoa, San Sebastian

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4.22.
4.22a.

The Law Society of England and Wales, Hilary Siddle, Chair, Law Reform Board, London

4.23.

Österreichische Notariatskammer

4.24.

Sveriges Advokatsamfund

4.25.

Consiglio dell’Ordine degli Avvocati di Torino

4.26.

Consiglio dell’Ordine degli Avvocati di Milano

4.27.

The Law Society of Scotland

5.

ACADEMICS

5.1.

Academia dei Giusprivatisti Europei, Prof. Giuseppe Gandolfi, Prof. José Luis de los Mozos, Pavia

5.2.

Rainer Bakker, Professor Dr iur., Fachhochschule Konstanz

5.3.
5.3a.

Christian von Bar, Prof. Dr iur., Direktor des Instituts für Internationales Privatrecht und Rechtsvergleichung,
Universität Osnabrück

5.4.
5.4a.

Prof. Dr Basedow, Direktor des Max-Planck-Institutes für Ausländisches und Internationales Privatrecht,
Hamburg

5.5.

Sergio Cámara Lapuente, Prof. Dr, Departamento de Derecho, University of La Rioja

5.6.

Georges Th. Daskarolis, Professeur, Demokritos University, Thrace, Greece

5.7.

Christina Duevang Tvarnø, ass. prof. Phd, MSc in Business Administration and Commercial Law,
Copenhagen Business School

5.8.

Faculty of Law, University of Uppsala, Sweden

5.9.

Marcel Fontaine, professeur, Directeur du Centre de droit des obligations, Université catholique de Louvain

5.10.

Andreas Furrer, Prof. Dr, Forschungsstelle für Internationalisiertes und Europäisiertes Privatrecht, Universität
Luzern, Lucerne

5.11.

Gabriel García Cantero, Catedrático de Derecho Civil, Emérito de la Universidad de Zaragoza

5.12.

María Paz García Rubio, Dr, Catedrática de Derecho Civil & Javier Lete, Dr, Profesor Titular de Derecho
Civil, University of Santiago de Compostela

5.13.

Silvia Gaspar Lera, Profesora de Derecho Civil, Universidad de Zaragoza

5.14.

Walter van Gerven, Professor em., University of Leuven and University of Maastricht

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5.15.

Alain Ghozi, Professeur à l’Université Panthéon-Assas, Paris II

5.16.

Sir Roy Goode QC, Emeritus Professor of Law, University of Oxford

5.17.

Dr Aristide N. Hatzis, Lecturer, University of Athens

5.18.

Iannarelli Antonio, Prof. Ordinario di diritto agrario, Università di Bari & Nicola Scannicchio, Prof.
Straordinario di diritto privato, Università di Bari

5.19.

Jane Kaufmann Winn, Professor, Dedman Law School, Southern Methodist University, Dallas

5.20.

Christoph Krampe, Prof. Dr, Lehrstuhl für Zivilrecht, Antike Rechtsgeschichte und Roemisches Recht,
Ruhr-Universität Bochum

5.21.

Carlos Lalana del Castillo, Universidad de Zaragoza

5.22.
5.22a.

Stefan Leible, Priv. Doz. Dr, Lehrstuhl für Zivilrecht, Universität Bayreuth

5.23.

Carlos Martinez de Aguirre, Catedrátido de Derecho Civil, Universidad de Zaragoza

5.24.

Polish academics advising Polish Government: Andrzej Całus, Marian Kepin´ ski, Jerzy Rajski and Stanisław
Sołtysin´ ski

5.25.

Project Group: Restatement of European Insurance Contract Law, Chairman Prof. Dr Fritz Reichert-
Facilides LL.M., Universität Innsbruck

5.26.

Peter G. Stein, Queens College, Cambridge, Emeritus Professor of Civil Law in the University of Cambridge
and Vice-President of the Academy of European Private Lawyers

5.27.

Anna Quinones Escámez, Pompeu Fabra University, Barcelona

5.28.

Norbert Reich, Prof. Dr Dr h.c., Rector, Riga Graduate School of Law

5.29.
5.29a.

Oliver Remien, Priv. Doz. Dr, Max-Planck-Institut Hamburg, Universität Würzburg

5.30.

Pietro Rescigno, prof. ord. f.r. dell’Università ‘La Sapienza’ di Roma

5.31.

Christoph U. Schmid, European University Institute, Florence

5.32.

Martin Schmidt-Kessel, Universität Freiburg

5.33.

Hans Schulte-Noelke, Professor, Dr iur., Universität Bielefeld

5.34.

Reiner Schulze, Professor, Dr Dr h.c. Centrum für Europäisches Privatrecht an der Universität Münster &
Hans Schulte-Noelke, Professor, Dr, Universität Bielefeld

5.35.

José Antonio Serrano García, Professor Titular de Derecho Civil en la Universidad de Zaragoza

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5.36.
5.36a.

5.37.

Jan M. Smits, Professor of European Private Law, Maastricht University

Society of Public Teachers of Law of Great Britain and Northern Ireland, J. R. Bradgate, University of
Sheffield

5.38.

Hans-Jürgen Sonnenberger, Dr Dr h.c., Universität München

5.39.

Ansgar Staudinger, Dr, Universität Münster

5.40.

Stockholm School of Economics, Prof. Dr iur. Christina Hultmark Ramberg

5.41.

Joint response of the Commission of European Contract Law and the Study Group on a European Civil
Code, Professor Dr Dr h.c. mult. Ole Lando and Christian v. Bar, Professor, Dr, Universität Osnabrück

5.42.

Issac Tena Piazuelo, Professor de la Facultad de Derecho, Universidad de Zaragoza

5.43.

Mitsutaka Tsunoda, Prof., University of the Ryukyus, Nishihara Okinawa, Japan

5.44.
5.44a.

Thomas Wilhelmsson, Professor of Civil and Commercial Law, University of Helsinki, member of the
Lando Commission

5.45.

Alexander Wittwer, European Insitute of Public Administration, Luxembourg and Heinz Barta, Institut für
Zivilrecht, Universität Innsbruck

5.46.

Manfred Wolf, Prof. Dr, Johann Wolfgang Goethe-Universität, Frankfurt am Main

5.47.

Zboralska Grazyna, LL.M. and Bernard Lukanko, LL.M., Europa-Universität Viadrina, Frankfurt/Oder

5.48.

Professor Dr M. W. Hesselink, Faculteit der Rechtsgeleerdheid, Amsterdam

5.49.

University of Lund, Faculty of Law

5.50.

Prof. Dr LL.M. Josef Drexl, University of Munich

5.51.

Geraint Howells, University of Sheffield

5.52.

Professor Massimo Bianca

5.53.

Prof. Ugo Mattei, University of Torino and UC Hastings

5.54.

Prof. Hans-Peter Schwintowski

5.55.

Prof. Dr Roger Van den Bergh, University of Rotterdam

5.56.

Hugh Collins, London School of Economics

5.57.

Professors Grundman and Kerber, Universities of Erlangen-Nürnberg and Marburg

5.58.

U. Drobnig, Hamburg

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5.59.

Du Laing, Leuven

5.60.

Jean Sace, ULB

5.61.

University of Stockholm, Faculty of Law

5.62.

Prof. Jean-Baptiste Racine and DEA students of the University of Nice

5.63.

Kim Østergaard, research fellow, Copenhagen Business School, Law Department

5.64.

Prof. Dr iur. Holger Fleischer, Dipl. Kfm., LL.M., Göttingen

5.65.

Prof. Dr iur. Peter Mankowski, Lehrstuhl für Bürgerliches Recht, Internationales Privat- und Prozessrecht
und Rechtsvergleichung an der Universität Hamburg

5.66.

Ulrich Magnus, University of Hamburg

5.67.

Hans-W. Micklitz, Professor an der Universität Bamberg, Inhaber des Lehstuhls für Privatrecht, insbes.
Handels-, Gesllschafts- und Wirtschaftsrechts, Jean Monnet Lehrstuhl für Europäisches Wirtschaftsrecht

5.68.

Stefano Troiano

5.69.

Fernando Martínez Sanz

5.70.

Prof. Dr Wulf-Henning Roth, LL.M. (Harvard), Direktor des Instituts für Internationales Privatrecht und
Rechtsvergleichung und des Zentrums für Europäisches Wirtschaftsrecht der Universität Bonn

5.71.

Filali Osman, University of Lyon (II)

5.72.

Antonio Lordi, Dottore di Ricerca in Diritto Privato dell’Economia

5.72.

Prof. Nicola Scannicchio, University of Bari

5.73.

UMR Régulation des activités économiques, University of Paris (I) Panthéon-Sorbonne

5.74.

ERA-Forum, Academy of European Law, Trier, submission of Hans J. Sonnenberger

5.75.

ERA-Forum, Academy of European Law, Trier, submission of Jean-Baptiste Racine

5.76.

ERA-Forum, Academy of European Law, Trier, submission of Gerhard Wagner

5.77.

ERA-Forum, Academy of European Law, Trier, submission of Klaus-Heiner Lehne

5.77.

ERA-Forum, Academy of European Law, Trier, submission of Sergio Camara Lapuente

5.78.

ERA-Forum, Academy of European Law, Trier, panel discussion summarised by Angelika Fuchs

5.79.

ERA-Forum, Academy of European Law, Trier, submission of Richard Crowe

5.80.

Prof. Jules Stuyck

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5.81.

Prof. Andreas Schwartze

5.82.

Prof. Hugh Beale

5.83.

Prof. Mauro Bussani

5.84.

Prof. Gerrit de Geest

5.85.

Prof. Bernard Tilleman

5.86.

Prof. Christian Kirchner

(*)

Included in the position from the Belgian Ministry of Justice, which is a synthesis of the various contributions received and not
a position of the Belgian Government as such.

(**) The response from the Swedish IT Law Observatory has been treated as a business response because most of the members of

the observatory are representatives of the IT business.

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Appendix 2

STATISTICAL ANALYSIS OF CONTRIBUTIONS

Government

Business (****)

Consumers’
Organisations

Legal
Practitioners

Academics (**)

Total

Austria

Belgium

Denmark

Finland

France

Germany

Greece

Ireland

Italy

Luxembourg

Netherlands

Portugal

Spain

Sweden

United Kingdom

International, including

EU total

Non-EU

Total

1

1 (*)

1

2

1

2

0

0

1

0

0

1

0

1

2

0

13

2

15

1

0

0

0

2

8

0

0

1

0

0

0

1

2

11

21

47

0

47

0

0

0

0

1

0

0

0

0

0

0

0

0

0

1

2

4

0

4

3

0

0

0

1

7

0

0

3

0

0

0

1

1

7 (***)

4

27

0

27

1

2

2

1

4

30

2

0

9

0

8

0

10

4

6

4

83

5

81

6

3 (*)

3

3

9

47

2

0

14

0

8

1

12

8

27

31

174

7

181

(*)

(**)

The Belgian Government’s contribution was a synthesis, put together by the Ministry of Justice, of the opinions of the
Ministries of Finance and Economic Affairs, the Belgian Banking and Finance Commission, Euronext SA, Nasdaq Europe SA
and the Belgian Consumers’ Council. For the purposes of these statistics, this contribution is treated as a single governmental
contribution. However, it is not a position of the Belgian Government as such.
The attribution of academic responses to nationalities was based, except in the case of international groups, on the location
of the universities concerned. Where individuals from institutions in more than one country collaborated, the contribution is
listed as international. Where two separate submissions were received from a single individual, these have been counted as
one combined contribution. The submission of the Society of Public Teachers of Law of the United Kingdom and Ireland is
treated as a British submission.

(***) The two submissions from the Law Society of England and Wales have been treated as one submission.
(****) The response from the Swedish IT Law Observatory has been treated as a business response because most of the members of

the Observatory are representatives of IT business.