COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL COMMITTEE AND THE COMMITTEE OF THE REGIONS A COMMON EUROPEAN SALES LAW TO FACILITATE CROSS-BORDER TRANSACTIONS IN THE SINGLE MARKET
Date: 2011-10-11
Institutions: European Commission
Subjects: approximation of laws, commercial contract, consumer protection, contract, goods and services, intra-EU trade, law of obligations, purchase, sale, single market

EUROPEAN COMMISSION 

Brussels, 11.10.2011 
COM(2011) 636 final 

COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN 
PARLIAMENT, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL 
COMMITTEE AND THE COMMITTEE OF THE REGIONS 

A COMMON EUROPEAN SALES LAW TO FACILITATE CROSS-BORDER 
TRANSACTIONS IN THE SINGLE MARKET 

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1. 

CONTEXT  

One  of  the  European  Union’s  most  significant  achievements  is  the  single  market  of  500 
million  consumers.  Its  fundamental  freedoms  entitle  businesses  and  citizens  to  move  and 
interact  freely  in  a  borderless  Union.  The  steady  lowering  of  barriers  between  EU  Member 
States  has  brought  numerous  benefits  to  citizens,  such  as  the  freedom  to  travel,  study  and 
work  abroad.  Citizens  in  their  capacity  as  consumers  have  enjoyed  a  number  of  economic 
benefits such as lower air fares and mobile telephone roaming charges and the possibility to 
access  a  larger  variety  of  products.  Traders  have  been  able  to  expand  their  activity  across 
borders,  by  importing  or  exporting  goods,  providing  services  or  establishing  themselves 
abroad. Thus they benefit from the economies of scale and the greater business opportunities 
that the single market offers.  

Despite  these  impressive  successes,  barriers  between  the  EU  Member  States  still  remain. 
They do not always allow citizens and businesses to take full advantage of the single market 
and  more  specifically  cross-border  trade.  Many  of  these  barriers  result  from  differences 
between  national  legal  systems.  Among  the  main  barriers  that  hinder  cross-border  trade  are 
differences between the contract law systems of the EU’s 27 Member States.  

All economic transactions are based on contracts. This is why differences in the rules on how 
a contract is concluded or terminated, how the delivery of a faulty product has to be remedied 
or what interest has to be paid in the case of a late payment are felt in the daily life of both 
traders  and  consumers.  For  traders,  these  differences  generate  additional  complexity  and 
costs,  notably  when  they  want  to  export  their  products  and  services  to  several  other  EU 
Member States. For consumers, these differences make it more difficult to shop in countries 
other than their own, a situation which is particularly felt in the context of online purchases. 

• 

Difficulties for traders due to the existence of different contract laws 

The existence of contract law related barriers may have a negative impact on businesses who 
are considering trading cross border and may dissuade them from entering new markets. Once 
a  trader  decides  to  sell  products  to  consumers  or  businesses  in  other  Member  States,  he 
becomes  exposed  to  a  complex  legal  environment  characterised  by  the  variety  of  contract 
laws that exist in the EU. One of the initial steps is to find out which law is applicable to the 
contract.  If  a  foreign  law  applies,  the  trader  has  to  become  familiar  with  its  requirements, 
obtain legal advice and possibly adapt the contract to that foreign law. When trading online, 
the trader also may have to adapt his web-site to reflect mandatory requirements that apply in 
the country of destination. Traders rank the difficulty in finding out the provisions of a foreign 
contract  law  first  among  the  obstacles  to  business-to-consumer  transactions  and  third  for 
business-to-business transactions1.  

Overcoming these hurdles means incurring transaction costs. These have the greatest impact 
on small and medium-sized enterprises (SMEs), in particular on micro and small enterprises, 

1 

Eurobarometer 321 on European contract law in business-to-consumer transactions, p. 23 and Eurobarometer 320 on European 
contract law in business-to-business transactions, p. 15. This situation is different in the United States of America. In spite of the 
existence of different contract law systems in the 50 States a trader established in Maryland, for example, can sell his products 
easily to a consumer based in Alaska, as under US law in such a situation the trader only needs to take account of the contract law 
rules  applicable  in  Maryland  and  does  not  need  to  worry  about  the  contract  law  of  Alaska.  In  addition,  the  US  Uniform 
Commercial Code has brought about strong convergence between the contract law systems of the different States. For US traders, 
the economic area of the 50 States is thus much more an internal market in contract law terms than the 27 Member States of the 
European Union are for EU traders. 

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because the cost to enter multiple foreign markets is particularly high when compared to their 
turnover. The transaction costs to export to one other Member State could amount up to 7% of 
a micro retailer's annual turnover. To export to four Member States this cost could rise to 26% 
of  its  annual  turnover.2  Traders  who  are  dissuaded  from  cross-border  transactions  due  to 
contract law obstacles forgo at least €26 billion in in tra-EU trade every year.3 

• 

Difficulties for consumers due to the existence of different contract laws 

44 % of consumers say that uncertainty about their rights discourages them from buying from 
other EU countries.4 While a third of consumers would consider buying online from another 
EU country if uniform European rules would apply5, only 7 % currently do.6 Their uncertainty 
is often linked to concerns about what they can do if something goes wrong and uncertainty 
about  the  nature  of  their  rights  if  they  buy  from  another  country.  On  the  other  hand, 
consumers who are confident and proactively search for products across the EU, in particular 
online, are often refused sales or delivery by the trader. At least 3 million consumers had this 
experience  over  a  one  year  period.  In  practice,  attempts  to  purchase  products  online  more 
often  fail  than  succeed7  in  a  cross-border  context  and  often  end-up  with  a  disappointing 
message such as “this product is not available for your country of residence.”  

The Commission's ambition is to remove the remaining barriers to cross-border trade, helping 
traders  in  their  transactions  and  making  cross-border  shopping  easier  for  consumers.  It  has 
been demonstrated that bilateral trade between countries which have a legal system based on a 
common origin, such as common law or the Nordic legal tradition, is 40% higher than trade 
between  two  countries  without  this  commonality.8  With  this  in  mind,  the  European 
Commission  included  a  legal  instrument  on  European  contract  law  in  its  Work  Programme 
2011,9 as specifically drawn to the attention of the European Parliament in a letter addressed 
by President Jose Manuel Barroso to the President of the European Parliament, Jerzy Buzek.10 
The need to tackle barriers posed by differences in contract law is specifically recognised in 
the  Europe  2020  Strategy11  and  a  number  of  other  strategic  documents  for  the  EU.  They 
include the Action Plan for Implementing the Stockholm Programme;12 the Digital Agenda for 
Europe13 which provides for an optional contract law instrument as one of its key actions to 

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Estimate  based  on  business  responses  to  the  SME  Panel  Survey  on  the  Impacts  of  European  contract  law,  available  at: 
http://ec.europa.eu/justice/contract/files/report_sme_panel_survey_en.pdf and Eurostat structural business statistics. 
Eurobarometer 320, European contract law in business-to-business transactions, pp. 24 and 25. 
Eurobarometer 299a, Attitudes towards cross-border trade and consumer protection, p. 10. 
Eurobarometer 299a, p. 14. 
Eurobarometer 299, Consumer attitudes towards cross-border trade and consumer protection, p. 13. 
SEC(2010)385, Third edition of the Consumer Markets Scoreboard, p. 9. A study where mystery shoppers tried to perform almost 
11,000 test transactions showed that 61 % of the attempts to purchase cross-border products would have failed. In 50 % of the 
cases traders refused to serve the consumer's country. 
A.Turrini and T. Van Ypersele, Traders, courts and the border effect puzzle, Regional Science and Urban Economics, 40, 2010, 
p. 82. 
COM(2010) 623 final, 31.3.2010, p. 7.  
See http://europa.eu/rapid/pressReleasesAction.do?reference=MEMO/10/393&format=HTML&aged=0&language=EN&guiLanguage=en. 
Communication from the Commission, Europe 2020, A strategy for smart, sustainable and inclusive growth, COM(2010) 2020 
final, 3.3.2010, p. 21. See also Annual Growth Survey, Annex I, progress report on Europe 2020, COM(2011) 11 - A1/2, p. 5. 
Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee 
and  the  Committee  of  the  Regions,  Delivering  an  area  of  freedom,  security  and  justice  for  Europe's  citizens,  Action  Plan 
Implementing the Stockholm Programme, COM(2010) 171 final, 20.4.2010, p. 5 and p. 24.  
Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee 
and the Committee of the Regions, A Digital Agenda for Europe, COM(2010) 245 final, 26.8.2010, p. 13 and p. 37. 

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promote  the  digital  economy;  the  Small  Business  Act  Review14  which  aims  to  tackle  the 
obstacles, including those related to contract law, that hamper SMEs’ potential to grow; and 
the  Single  Market  Act15  which  advances  the  idea  of  a  legal  instrument  that  would  facilitate 
cross-border  transactions.  In  addition  the  Annual  Growth  Survey  which  opened  the  first 
European  Semester  underlined  the  potential  of  a  legal  instrument  on  European  contract  law 
for stimulating growth and trade in the single market.16 The Polish Presidency of the Council 
of Ministers has made the further work on European contract law a priority for the second half 
of 201117.  

1.1. 

The current legal framework 

The  current  legal  framework  in  the  EU  is  characterised  by  differences  in  contract  laws 
between the Member States. EU legislation contains a number of common rules often tackling 
specific problems, but as can be seen from Annex I, these harmonised rules do not touch most 
areas  of  contract  law,  and  where  they  apply,  more  often  than  not  they  still  leave  Member 
States with substantial flexibility to apply different rules. In Europe’s single market, there is 
no  single  set  of  uniform  and  comprehensive  contract  law  rules  which  could  be  used  by 
businesses and consumers in cross-border trade.  

• 

Conflict of law rules 

In order to improve legal certainty in cross-border transactions, the EU put in place uniform 
conflict of law rules. The Rome I Regulation on the law applicable to contractual obligations 
allows  contracting  parties  to  choose  which  law  applies  to  their  contract  and  to  determine 
which law applies in the absence of such a choice.18 However, due to their nature, conflict of 
law rules cannot remove the differences between substantive contract law. They only lead to 
the determination of the substantive national law which applies to a cross-border transaction 
when several different national laws could potentially apply.  

Furthermore,  in  cross-border  business-to-consumer  transactions,  Article  6(2)  of  the  Rome  I 
Regulation  also  requires  traders  which  direct  their  activity  to  the  consumer's  country  of 
residence  –  this  could  happen,  for  example  by  opening  a  website  in  the  language  of  this 
country, by offering to sell in the consumers currency or by using a top level domain name 
other than the one in the trader's country – to comply with the mandatory level of consumer 
protection in the consumer’s country of residence. The trader may either apply the consumer's 
national  law  in  its  entirety  or  choose  another  law,  in  practice  most  likely  its  own  law. 
However,  even  in  the  latter  case  the  trader  still  needs  to  ensure  compliance  with  the 
mandatory  consumer  protection  provisions  stemming  from  the  consumer's  national  law, 
whenever  they  provide  a  higher  level  of  protection.  As  a  result,  the  trader’s  standard  terms 
and conditions may have to be amended to the requirements of different countries. 

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Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee 
and the Committee of the Regions, Review of the 'Small Business Act' for Europe, COM(2011) 78 final, 23.2.2011, p. 11 and p. 
13. 
Communication  from  the  Commission  to  the  European  Parliament,  the  Council,  the  Economic  and  Social  Committee  and  the 
Committee  of  the  Regions,  Single Market  Act,  Twelve  levers  to  boost  growth  and  strengthen  confidence,  Working  together  to 
create new growth, COM(2011) 206 final, 13.4.2011, p. 14 and p. 19.  
Communication  from  the  Commission  to  the  European  Parliament,  the  Council,  the  Economic  and  Social  Committee  and  the 
Committee  of  the  Regions,  Annual  Growth  Survey:  advancing  the  EU's  comprehensive  response  to  the  crisis,  COM(2011)11 
final, 12.1.2010. 
See http://pl2011.eu/sites/default/files/users/shared/o_prezydencja/programme_of_the_polish_presidency_of_the_council_of_the_eu.pdf. 
Regulation (EC) of the European Parliament and of the Council No 593/2008 of 17 June 2008 on the law applicable to contractual 
obligations, OJ L 177/6 4.7.2008.  

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• 

Substantive law rules 

The  EU  has  taken  some  important  steps  to  reduce  the  differences  between  the  substantive 
laws, in particular in relation to consumer law, through the harmonisation measures that have 
been adopted. However, these harmonisation measures fall short of covering the whole life-
cycle  of  a  contract,  and  thus  do  not  remove  the  need  for  a  trader  to  take  account  of  the 
contract law systems of his country of destination. In addition, these harmonisation measures 
are limited mainly to business-to-consumer transactions. 

For business-to-consumer (B2C) contracts, the EU legal framework has led to a significant 
increase in protection to the advantage of consumers. However, notwithstanding the progress 
made in the recently adopted Consumer Rights Directive in aligning national laws, it is clear 
that in the field of consumer and contract law, there are political limits as to how far the 'full 
harmonisation' approach can be taken. This is reflected in the fact that the Directives relating 
to  unfair  contract  terms  and  sales  remedies19  which  allow  Member  States  to  build  upon  the 
core harmonised rights to various degrees have been retained by the European Parliament and 
the Council. 

For business-to-business (B2B) contracts, the substantive rules the EU has adopted are even 
more  limited  in  scope  than  for  B2C  contracts,  covering  a  few  specific  issues  in  the  area  of 
contract law. For example the Directive on combating late payments20 harmonises the rules on 
the  default  interest  rate  in  cases  of  late  payment,  but  allows  Member  States  to  apply  more 
stringent  rules.  At  the  international  level,  a  set  of  rules  of  a  broader  scope  for  B2B 
transactions was introduced by the 1980 UN Convention on the International Sales of Goods 
(the  Vienna  Convention).  However,  the  Vienna  Convention  was  not  ratified  by  all  Member 
States  and  is  not  applicable  in  the  UK,  Ireland,  Portugal  and  Malta.  It  does  not  cover  the 
whole  life-cycle  of  a  contract  comprehensively  and  (in  the  absence  of  a  compulsory 
jurisdiction  within  the  UN  system  comparable  to  the  one  offered  by  the  European  Court  of 
Justice for the EU’s single market) contains no mechanism ensuring its uniform application as 
different national courts may interpret it differently. Only a relatively small number of traders 
use the Vienna Convention.21 

1.2. 

The need for action at European Union level 

The  EU  has  been  working  on  European  contract  law  for  a  decade.  With  its  2001 
Communication on European contract law,22 the Commission launched a process of extensive 
public consultation on the problems arising from differences between Member States' contract 
laws. As a follow-up, the Commission issued an Action Plan in 2003,23 proposing to improve 
the  quality  and  coherence  of  European  contract  law  by  establishing  a  Common  Frame  of 
Reference  containing  common  principles,  terminology  and  model  rules  to  be  used  by  the 
Union legislator when making or amending legislation.  

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Directive 1999/44/EC of the European Parliament and of the Council of 25 May 1999 on certain aspects of the sale of consumer 
goods and associated guarantees, O J L 171/12, 7.7.1999. 
Directive  2011/7/EU  of  the  European  Parliament  and  of  the  Council  of  16  February  2011  on  combating  late  payment  in 
commercial transactions (recast), O J L 48/1, 23.2.2011. 
Eurobarometer  No  320  on  European  contract  law  in  business-to-business  transactions,  p.57:  only  9%  of  respondents  said  they 
frequently applied international instruments, including the Vienna Convention and the UNIDROIT Principles.  
Communication from the Commission to the Council and the European Parliament on European Contract Law, COM(2001) 398,  
11.7.2001. 
Communication from the Commission to the European Parliament and the Council, A more coherent European Contract Law: an 
Action Plan, COM(2003) 68, 12.2.2003. 

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The Commission subsequently financed the work of an international academic network which 
carried out the preparatory legal research. This research work was finalised at the end of 2008 
and led to the publication of the Draft Common Frame of Reference24 as an academic text.25 
In parallel to this, analytical work was also carried out by the Association Henri Capitant des 
Amis de la Culture Juridique Française and the Société de Legislation Comparée drafting the 
Principes Contractuels Communs.26 

On 1 July 2010, the Commission launched, for a period of six months, a public consultation 
(Green Paper) on different ways to make contract law more  coherent  in the  EU. The Green 
Paper put forward a range of different policy options. They included a ‘toolbox’ setting out 
coherent definitions, principles and model rules on topics related to contract law, a Regulation 
which would replace all national contract laws with a single European law, or the idea of an 
optional instrument in the EU which would be available as an alternative to existing national 
laws  for  parties  to  choose.  The  Commission  received  320  replies27  to  this  consultation. 
Several  stakeholders  saw  value  in  a  ‘toolbox’,  while  Option  4  (an  optional  instrument  of 
European  contract  law)  received  support  either  independently  or  in  combination  with  a 
‘toolbox’,  provided  that  it  fulfilled  certain  conditions,  namely  a  high-level  of  consumer 
protection and clarity and user-friendliness of the provisions.  
Prior  to  this,  by  Decision  of  26  April  2010,28  the  Commission  set  up  an  expert  group  on 
European contract law, which comprised of former judges, legal practitioners, and academics 
from  across  Europe.  On  the  basis  of  the  research  done  so  far,  the  Group  was  tasked  with 
developing  a  Feasibility  Study  on  a  possible  future  European  contract  law  instrument 
covering the main aspects which arise in practice in cross-border transactions. To ensure close 
interaction  between  the  work  of  the  Expert  Group  and  the  needs  identified  by  consumers, 
businesses  (notably  SMEs)  and  the  legal  profession,  a  key  stakeholder  group  (so-called 
‘Sounding  Board’)  was  set  up  by  the  Commission  which  gave  practical  input  to  the  Expert 
Group on the user-friendliness of the rules developed for the Feasibility Study. The Feasibility 
Study was published on 3 May 2011 – as a ‘toolbox’ to inspire the further  work  of the EU 
institutions  –  which  led  to  valuable  input  from  stakeholders  and  legal  experts.  Of  the  120 
contributions  received  from  interested  parties,  the  majority  of  comments  broadly  grouped 
around three main issues concerning the proposal: its user-friendliness, the balance between 
business and consumer interests and legal certainty. The Commission took on board many of 
the suggestions which further improved and strengthened the proposal. The Commission also 
asked stakeholders whether digital content ought to be included in the proposal – the majority 
of respondents replied positively. 

The  European  Parliament  has  for  many  years  strongly  supported  the  work  on  European 
contract  law.29  In  June  2011,  in  response  to  the  Commission’s  Green  Paper,  the  Parliament 

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Von  Bar,  C.,  Clive,  E.  and  Schulte-Nölke,  H.  (eds.),  Principles,  Definitions  and  Model  Rules  of  European  Private  Law.  Draft 
Common Frame of Reference, Munich, Sellier, 2009. 
The research work was financed by the Commission’s 6th Research Framework Programme, but is not an official Commission 
document. 
Fauvarque-Cosson, B. and Mazeaud, D. (eds.), European Contract Law, Materials for a Common Frame of Reference: 
Terminology, Guiding Principles, Model Rules, Munich, Sellier, 2008. 
The replies were submitted by  most  Member States,  a  large number of business organisations, several consumer organisations, 
many associations of legal practitioners and a considerable number of academics.  
O J L 105/109, 27.4.2010. 
Resolution  of  26  May  1989  on  action  to  bring  into  line  the  private  law  of  the  Member  States,  OJ  C  158,  26.6.1989,  p.  400; 
resolution of 6 May 1994 on the harmonisation of certain sectors on the private law of the Member States, OJ C 205, 25.7.1994, 
p. 518; resolution of 15 November 2001 on the approximation of the civil and commercial law of the Member States, OJ C 140 E, 
13.6.2002, p. 538; resolution of 2 September 2003 on the Communication from the Commission to the European Parliament and 
the Council – A more coherent European contract law - An action plan, OJ C 76 E, 25.3.2004, p. 95; resolution of 23 March 2006 

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voted  with  a  four-fifths  majority  in  support  of  optional  EU-wide  contract  rules  that  would 
ease cross-border transactions (Option 4 of the Green Paper).30 The European Economic and 
Social Committee has also adopted an Opinion in favour of an optional advanced new regime 
on contract law31. 

2. 

AN OPTIONAL COMMON EUROPEAN SALES LAW  

2.1. 

Functioning of the Common European Sales Law 

Following  the  extensive  consultation  with  stakeholders,  and  on  the  basis  of  an  impact 
assessment, the Commission has decided to bring forward a proposal for a Regulation of the 
European Parliament and of the Council on a Common European Sales Law. This proposal is 
meant as a contribution to enhancing growth and trade in the internal market on the basis of 
freedom  of  contract  and  a  high  level  of  consumer  protection,  in  line  with  the  principles  of 
subsidiarity  and  proportionality.  The  proposal  integrates  the  ‘toolbox’  developed  by  the 
Expert Group on European contract law and the ‘Sounding Board’ of stakeholders, taking into 
account the input received on it by stakeholders and experts. 

The Commission proposal for a Common European Sales Law foresees a comprehensive set 
of uniform contract law rules covering the whole life-cycle of a contract, which would form 
part  of  the  national  law  of  each  Member  State  as  a  'second  regime'  of  contract  law.  This 
‘second regime’ is carefully targeted to those contracts that are most relevant to cross-border 
trade,  and  where  the  need  for  a  solution  to  the  barriers  that  have  been  identified  is  most 
apparent. It is characterised by the following features: 

A contract law regime common to all Member States: The Common European Sales Law will 
be  a  'second  regime'  of  contract  law  that  is  identical  in  every  Member  State.  It  will  be 
common for the whole of the EU. 

An  optional  regime:  Choice  of  the  Common  European  Sales  Law  will  be  voluntary.  In  line 
with the principle of freedom of contract, a trader is free to choose to offer a contract under 
this  regime  (opt-in  system)  or  to  remain  with  the  existing  national  contract  law.  Neither 
businesses  nor  consumers  are  obliged  to  conclude  a  contract  on  the  basis  of  the  Common 
European Sales Law. 

Focus on 'sales' contracts: The Common European Sales Law will introduce a self-standing 
and complete set of rules for sales transactions. This will in particular but not exclusively be 
useful  for  the  online  supply  of  goods.  It  could  also  be  used  by  traders  selling  goods  and 
directly related services offered by the trader, for instance installation of kitchen equipment. 
As  goods  account  for  the  major  share  of  intra-EU  trade,32  tackling  the  obstacles  to  sales 
transactions  will  have  a  positive  impact  on  the  overall  intra-EU  trade.  In  order  to  take  into 
account the increasing importance of the digital economy, and to ensure that the new regime 

on European contract law and the revision of the acquis: the way forward, OJ C 292 E, 1.12.2006, p. 109-112; resolution of 7 
September 2006 on European contract law, OJ C 305 E, 14.12.2006, p. 247-248; resolution of 12 December 2007 on European 
contract law, OJ C323E, 18.12.2008, p. 364 -365 and the resolution of 3 September 2008 on the common frame of reference for 
European contract law, OJ C 295E, 4.12.2009, p. 31-32.  
Resolution of June 2011 on policy options for progress towards a European contract law for consumers and businesses, Procedure 
2011/2013 (INI). 
OJ C 84/1, 17.3.2011. 
According to Eurostat Statistics in Focus 37/2010 and the Eurostat External and Intra-EU Trade Yearbook of 2009, the intra-EU 
trade volume in goods was 4 times the volume of trade in services in 2008.  

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is 'future-proof', digital content contracts will also fall within the scope of the new rules. This 
means that the Common European Sales Law could also be used, for example when buying 
music, films, software or applications that are downloaded from the internet. These products 
would be covered irrespective of whether they are stored on a tangible medium such as a CD 
or a DVD.  

Limited to cross-border contracts: The scope of the Common European Sales Law is focussed 
on  cross-border  situations  where  the  problems  of  additional  transactions  costs  and  legal 
complexity  arise.  The  Common  European  Sales  Law  is  therefore  targeted  to  where  it  is 
needed and is not available as a general substitute to existing national contract law. It is left to 
the  discretion  of  Member  States  whether  to  give  the  regime  a  wider  application.  Member 
States  thus  have  the  choice  to  make  the  Common  European  Sales  Law  also  available  for 
domestic contracts – which could further reduce transaction costs for businesses active on the 
single  market.  Focus  on  B2C  contracts  and  B2B  contracts  where  at  least  one  party  is  an 
SME: The scope of the Common European Sales Law is focussed on aspects which pose real 
problems  in  cross-border  transactions,  i.e.  business-to-consumer  relations  and  business-to-
business relations where at least one of the parties is an SME. Contracts concluded between 
private  individuals  (C2C)  and  contracts  between  traders  where  neither  of  the  parties  is  an 
SME are not included, as there is at the moment no demonstrable need for EU-wide action for 
these  types  of  cross-border  contracts.  The  Common  European  Sales  Law  leaves  Member 
States  the  option  to  decide  to  make  the  Common  European  Sales  Law  also  available  for 
contracts concluded between traders neither of which is an SME. The Commission will keep 
the  matter  under  review  in  the  coming  years  to  see  whether  additional  legislative  solutions 
may be required as regards C2C and B2B contracts.  

Identical set of consumer protection rules: The Regulation will establish for all the areas of 
contract  law  the  same  common  level  of  consumer  protection.  As  both  a  political  and  legal 
imperative,  this  harmonisation  is  carried  out  on  the  basis  of  a  high  level  of  consumer 
protection. It will lead to a harmonised regime that will ensure that a consumer is protected 
and safe whenever the Common European Sales Law is used. 

A comprehensive set of contract law rules: The Common European Sales Law includes rules 
that cover issues of contract law that are of practical relevance during the life-cycle of a cross-
border contract. These issues fall within the areas of the rights and obligations of the parties 
and the remedies for non-performance, pre-contractual information duties, the conclusion of a 
contract  (including  formal  requirements),  the  right  of  withdrawal  and  its  consequences, 
avoidance  resulting  from  a  mistake,  fraud  or  unfair  exploitation,  interpretation,  the  contents 
and  effects  of  a  contract,  the  assessment  and  consequences  of  unfairness  of  contract  terms, 
restitution  after  avoidance  and  termination  as  well  as  prescription.  It  settles  the  sanctions 
available in case of the breach of the obligations and duties arising under its application. On 
the other hand, certain topics that are either very important for national laws or less relevant 
for  cross-border  contracts  –  such  as  rules  on  legal  capacity,  illegality/immorality  or 
representation  and  the  plurality  of  debtors  and  creditors  –  will  not  be  addressed  by  the 
Common  European  Sales  Law.  These  topics  continue  to  be  governed  by  the  rules  of  the 
national law that is applicable under the Rome I Regulation.  

With an international  dimension: The proposal also has an international vocation in that, in 
order to be applicable, it is sufficient that only one party is established in a Member State of 
the EU. Traders could use the same set of contract terms when dealing with other traders from 
within and from outside the EU. European consumers could enjoy more product choice with 
the  guaranteed  level  of  high protection  offered  by  the  Common  European  Sales  Law  where 

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traders  from  third  countries  are  willing  to  sell  their  products  in  the  internal  market  on  this 
basis.  This  international  vocation  enables  the  Common  European  Sales  Law  to  become  a 
standard setter for international transactions in the area of sales contracts. 

2.2. 

Effectiveness of the Common European Sales Law  

The  Commission’s  approach  tackles  the  problems  that  differences  in  contract  law  pose  for 
consumers and traders in the manner most respectful of the principles of proportionality and 
subsidiarity,  when  compared  to  other  possible  solutions  analysed.  An  optional  Common 
European Sales Law will be more effective than soft law solutions, such as a simple ‘toolbox’ 
(which,  as  a  non-binding  instrument,  would  not  be  able  to  give  traders  or  consumers  legal 
certainty for their transactions), because it will create a single and uniform set of contract law 
rules  that  will  be  directly  available  for  businesses  and  consumers.  At  the  same  time,  the 
combination  of  the  characteristics  outlined  above,  in  particular,  the  fact  that  the  Common 
European Sales Law represents an optional but identical set of rules applying only in cross-
border  cases  means  that  it  can  lower  barriers  to  cross-border  trade  without  interfering  with 
deeply  embedded  national  approaches  and  traditions.  For  instance,  it  will  allow  Member 
States  to  maintain  different  consumer  protection  levels  in  their  already  existing  domestic 
contract law in accordance with the EU acquis. The Common European Sales Law will be an 
optional  addition  to  existing  contract  law  rules  without  replacing  them.  Thus  the  legislative 
measure  will  only  go  as  far  as  necessary  to  create  further  opportunities  for  traders  and 
consumers in the single market. In addition, there is greater scope to agree on a set of identical 
rules  based  on  a  high  level  of  protection  as  included  in  the  Common  European  Sales  Law, 
precisely  because  of  the  voluntary  nature  of  the  regime.  A  business  can  opt  for  the  system, 
because it wishes to be associated with the high level of protection provided, but there is no 
obligation for it to do so.  

• 

Advantages for business 

When a trader chooses the Common European Sales Law, it would be the only contract law 
rules that would apply in the area covered by its scope. Therefore, the trader would have to 
consider only one set of rules – those of the Common European Sales Law. It would no longer 
be necessary to consider other national mandatory provisions as they would normally have to 
when concluding a contract with a consumer from another Member State. It would be sellers 
who would in practice take the initiative in opting to use the Common European Sales Law. 
Buyers would then have to give explicit consent before this type of contract could be used.  

The  Common  European  Sales  Law  will  ensure  that  businesses  can  substantially  cut  their 
transaction costs. In practice, a business seeking to expand into new markets would need to 
familiarise  itself  with  just  one  contract  law  system  in  addition  to  the  one  with  which  it  is 
already  familiar.  Once  chosen,  it  represents  a  saving  compared  to  the  26  national  contract 
laws they would otherwise have to research to trade throughout the EU. Traders can therefore 
benefit  from  this  simpler  common  legal  environment  and  have  more  confidence  to  expand 
into  new  markets.  When  selling  to  consumers  in  other  countries,  traders  can  use  their 
adherence to the Common European Sales Law as a mark of quality.  

For  B2B  contracts,  use  of  the  Common  European  Sales  Law  would  add  value  by  easing 
negotiations of the applicable law for SMEs. It could be easier to agree on a neutral law that is 
equally accessible for both parties in their own language. Having familiarised themselves with 
the  Common  European  Sales  Law  once,  traders  would  no  longer  incur  costs  whenever  it 
applies. As the problem of costs particularly affects SMEs, the Common European Sales Law 

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is thus targeted at those B2B contracts where at least one of the parties is an SME. To ensure 
that  maximum  benefit  can  be  reaped  by  SMEs  the  Commission  would  encourage  Member 
States,  via  appropriate  channels,  to  inform  traders  about  the  Common  European  Sales  Law 
and  its  benefits.  In  addition,  every  Member  State  is  given  the  choice  to  make  the  Common 
European Sales Law also available for B2B contracts where neither of the parties is an SME, 
where a Member State considers this to be appropriate. 

• 

Advantages for consumers 

The Common European Sales Law has been designed to provide consumers with a high level 
of protection, and is the same in all Member States so that it can be seen as a mark of quality 
that  can  be  trusted  by  consumers  when  buying  across  borders.  One  of  the  best  examples  of 
this is the fact that the Common European Sales Law  will offer consumers a free choice of 
remedies if a faulty product is delivered. It therefore provides consumers with the possibility 
to terminate the contract immediately. Currently such a free choice does not exist for the large 
majority  of  consumers  across  the  EU33.  This  high  level  of  consumer  protection  will  give 
consumers the confidence and incentive to buy products in other EU countries. 

In  the  interests  of  transparency,  the  proposal  will  guarantee  that  a  consumer  is  always 
informed, and consents to the fact that the contract is concluded on the basis of the Common 
European  Sales  Law.  This  information  must  be  provided  by  the  trader  to  a  consumer 
alongside a summary of the core rights protected by way of a standardised information notice. 
This notice will help consumers understand their core rights and thereby tackle the uncertainty 
that dissuades many consumers from shopping cross-border. As the information notice will be 
presented in a clear and concise format, as well as being provided in all official languages of 
the EU, it will help consumers who do not read the terms and conditions of their contracts, 
because of their length and complexity. 

The  greater  availability  of  cross-border  offers  will  benefit  consumers  in  markets  which  are 
presently  by-passed  by  traders  because  of  contract  law  complexities  or  because,  for 
businesses, the  small  size of the  market does not justify incurring  high transaction costs  for 
entry. These consumers will benefit as more competition in the internal market will provide 
more choice of products and the prospect of lower prices.  

2.3. 

Relationship with the acquis 

The proposal represents a complementary approach to that found in the existing acquis in the 
field of consumer protection. In the first instance, it incorporates and is consistent with those 
measures,  albeit  that  it  is  not  limited  by  minimum  levels  of  protection  that  have  been  set. 
Secondly,  given  its  limitation  to  cross-border  contracts,  it  is  not  a  replacement  for  the 
generally  applicable  acquis.  There  will  therefore  be  a  continuing  need  to  develop  consumer 
protection  standards  using  the  traditional  harmonisation  approach  used  in  this  area.  In  this 
respect,  it  can  be  expected  that  over  time  the  two  approaches  will  develop  in  tandem,  and 
inspire one another. 

The proposal is in line with other EU policies. For example it envisages that traders consider 
using  alternative  dispute  resolution  as  an  efficient,  quick  and  inexpensive  way  of  resolving 

33 

A free choice of remedies, as included in the Common Sales Law, does not exist in Austria, Belgium, Bulgaria, Cyprus, Czech 
Republic, Denmark, Estonia, Finland, Germany, Hungary, Italy, Malta, the Netherlands, Poland, Romania, Slovakia, Spain and 
Sweden.  In  fact,  only  five  Member  States  offer  the  same  result  as  in  the  Common  Sales  Law  (France,  Greece,  Lithuania, 
Luxembourg, Portugal) whilst a few others adopted an intermediate approach (Ireland, Latvia, Slovenia, U.K). 

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disputes without going to court. Furthermore, those who do wish to go to court for amounts 
not exceeding €2000, are able to access the Europ ean Small Claims Procedure which has been 
established to facilitate cross-border recovery of debts. 

The  proposal  also  provides  support  for  future  initiatives  which  aim  at  reducing  barriers  to 
trade in the single market, whether through harmonisation Directives or by other appropriate 
measures. It contains some specific, sales-related rules for contracts for the supply of digital 
content  which  could  in  the  future  provide  a  basis  for  a  more  comprehensive  policy  and 
measures  on  consumer  protection  in  the  digital  market.  By  2018,  the  provisions  of  the 
Regulation  itself  will  be  reviewed  taking  into  account,  amongst  others,  the  need  to  further 
extend  the  scope  in  relation  to  B2B  contracts,  market  and  technological  developments  in 
respect of digital content and future developments of Union acquis.  

The  Commission  will  also  continue  to  examine  broader  aspects  of  consumer  law,  such  as 
whether  to  update  or  extend  consumer-related  rules,  for  instance  when  revising  the  Unfair 
Commercial  Practices  Directive  and  the  Misleading  Advertising  Directive.  In  addition,  the 
Commission  will  also  continue  reflecting  on  B2B  commercial  practices,  including  in  their 
contractual dimension.  

2.4. 

Flanking measures 

In  order  to  ensure  the  effective  application  and  the  uniform  interpretation  of  the  Common 
European Sales Law, the proposal envisages future supporting measures.  

Following suggestions made by the European Parliament, businesses, legal practitioners and 
consumer organisations, the Commission will work closely with all relevant stakeholders to 
help  develop  ‘European  model  contract  terms’  for  specialist  areas  of  trade  or  sectors  of 
activity.  A  model  contract  which  has  standard  terms  and  conditions  and  is  available  in  all 
official  languages  of  the  European  Union  could  be  helpful  for  traders  wishing  to  conclude 
cross-border  contracts  for  which  the  Common  European  Sales  Law  is  chosen.  The 
Commission  will,  within  3  months  of  the  entry  into  force  of  the  Common  European  Sales 
Law,  start  this  process  by  setting  up  a  Group  of  Experts  which  represents  in  particular,  the 
interests of the users of the Common European Sales Law. Stakeholders could contribute the 
necessary  knowledge  and  expertise  about  commercial  practices  and  draw  up  standard  terms 
and  conditions  in  their  sector  while  applying  lessons  from  their  first  hand  practical 
experiences with the use of the Common European Sales Law. 

In order to ensure the uniform interpretation and application of the Common European Sales 
Law,  the  proposal  also  envisages  the  establishment  of  a  publicly  accessible  database  of 
European  and  national  judicial  decisions  which  have  a  bearing  on  the  interpretation  of  the 
provisions  of  this  instrument.  Member  States  will  be  asked  to  notify  such  judgments  to  the 
Commission without delay. 

In  order  to  facilitate  a  common  understanding  of  the  provisions  of  the  Common  European 
Sales Law, the Commission will organise training sessions for legal practitioners who use the 
Common European Sales Law34. 

34 

Commission  Communication  on  Building  Trust  in  EU–wide  Justice:  a  New  Dimension  to  European  Judicial  Training,  COM 
(2011) 551 final.  

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3. CONCLUSION 

The Common European Sales Law is a concrete solution for a tangible problem for businesses 
and consumers: costs and legal uncertainty when buying or selling cross-border in Europe’s 
internal  market.  It  is  also  an  innovative  approach  because,  in  line  with  the  principle  of 
proportionality,  it  preserves  Member  States’  legal  traditions  and  cultures  whilst  giving  the 
choice  to  businesses  to  use  it.  Consumers  benefit,  not  only  because  of  the  confidence  it 
provides through its high level of protection, but also because its use will lead to lower prices 
and more product choice. For traders, it cuts red tape and transaction costs, thus contributing 
to more cross-border trade and growth of the European economy.  

The Commission will work closely with the European Parliament and the Council and with 
national Parliaments to ensure a swift agreement on the Common European Sales Law in time 
for  the  20th  anniversary  of  the  Single  Market.  The  Commission  will  also  continue  to  work 
closely with stakeholders, and notably with the users of the Common European Sales Law (in 
particular  SMEs  and  consumers)  as  well  as  with  the  legal  profession  to  achieve  a  broad 
acceptance of the Common European Sales Law across the European Union because, in view 
of its optional nature, the success of the Common European Sales Law will in the end depend 
on whether and to which extent it will be chosen for transactions in the internal market. 

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ANNEX I 

EU Legal Framework in the area of the proposal on a Common European Sales Law 

Business-to-consumer contracts 

Business-to-business contracts 

Contract law area 

Pre-contractual 
information and 
negotiation 

Consumer 
rights 
Directive 

Other 
relevant 
EU 
consumer 
legislation 

E-commerce 
Directive 

E-
commerce 
Directive 

Directive 
on 
combating 
late 
payments 

Vienna 
Convention on 
the 
international 
sale of goods 

YES 

YES 

YES 

YES 

NO 

NO with a few 
exceptions 

Conclusion of contract  NO 

NO 

YES partially  NO 

Rights to withdraw 

YES 

Defects in consent 

Interpretation 

NO 

NO  

NO 

NO 

NO 

YES 

NO 

NO (with 
one 
exception) 

NO 

NO 

NO 

NO 

NO 

NO 

NO 

YES 

NO 

NO 

YES 

Contents and effects  

NO 

NO 

NO 

NO 

NO 

NO with a few 
exceptions 

Unfair contract terms 

NO 

YES 

NO 

NO 

YES 
partially 

NO 

Obligations and 
remedies of the parties 
to a sales contract 

Delivery and Passing of 
Risk 

Obligations and 
remedies of the parties 
to a related service 
contract 

Damages, Stipulated 
payments for non-
performance and 
interest 

NO 

YES 

NO 

NO 

NO 

YES 

YES 

NO 

NO 

NO 

NO 

YES 

NO 

NO 

NO 

NO 

NO 

NO 

NO 

NO 

NO 

NO 

YES 

YES 

Restitution 

Prescription 

NO 

NO 

NO 

NO 

EN 

NO 

NO 

13 

NO 

NO 

NO 

NO 

YES 

NO 

   EN