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The Latest From USCIB

July 11, 2006


Business Endorses UN Convention on Electronic Contracting


The global business community has endorsed the recently concluded United Nations Convention on the Use of Electronic Communications in International Contracts.  The International Chamber of Commerce (ICC), part of USCIB’s global network, views the treaty as a useful reform to spur development of cross-border online commerce in the developed and developing world.


The convention, which is open for signature by UN member states until January 16, 2008, was a focus of the 39th session of the UN Commission on International Trade Law (UNCITRAL), held in New York from June 18 to July 7.


Electronically-negotiated contracts are as valid and binding as paper-based versions.


Speaking on behalf of ICC at a special event organized around the launch of the treaty, USCIB Executive Vice President Ronnie Goldberg called the convention “a sign of, and a vehicle for, the increasing legal recognition of electronic contracting, particularly in developing countries.”  She said the global business community hoped it would spur the development of cross-border e- commerce.


ICC participated in the drafting of the convention by furnishing expert input and sharing business experiences on electronic transactions. ICC also published its ICC eTerms 2004 as a self-regulatory complement to the convention.  ICC eTerms 2004 are a set of articles which parties can incorporate into the document that make it clear they intend to agree to a binding electronic contract.


The convention requires signatory countries to recognize the legal validity of electronic communications used in contracts, and also supports the principle of party autonomy in electronic contracting. It contains provisions dealing with issues that commonly arise in electronic agreements, such as location of the parties, information and form requirements, time and place of dispatch and receipt of electronic communications, invitations to make offers, and errors.


Speaking on the first day of the UNCITRAL session, Christopher Kuner, one of the leaders of the ICC expert group, said: "We welcome the enhanced legal certainty and support for party autonomy which the convention provides. It supplies the legal foundation for self-regulatory instruments, such as ICC eTerms 2004.  The other good news is that it allows for electronic communications to satisfy the requirements of other conventions, without the need for those conventions to be re-negotiated."


In addition, the UNCITRAL agreement allows electronic communications to satisfy the requirements of other international conventions. As a result, companies and traders around the globe will get important reassurance from the convention that electronically-negotiated contracts are as valid and binding as paper-based versions.


"This convention has a number of articles that strengthen the legal validity of electronic transactions, particularly in developing countries and will help boost e-commerce in those developing countries which ratify it," Mr. Kuner said.


Staff contact: Heather Shaw


Ms. Goldberg’s comments at the UNCITRAL event


More on USCIB’s Information Policy Committee


More on ICC’s eTerms 2004


UNCITRAL website