The Role of Transnational Commercial Law in Today’s Globalised World

At international commercial Law stage, the globalisation theory has transformed the business of national laws to the emergence of multilateral and global laws, which intended to unify the rules in the international transactions.

Therefore, the concept of transnational commercial law embraces the internationalisation of the law of merchants.[1] It may be noted that the Lex mercatoria or law of merchants has been produced as a consequence of the absolute need to codify the rules and usages in order to confine the conflict of laws in an international level.[2]

In order to analyse the feasible impacts of globalisation process in international commercial law, firstly it is essential to evaluate the notion of sovereignty, in which it should be indicated that the manifestation of various instruments in commercial law caused to diminish the law enforcement by state sovereignty and the erosion of national boundaries across the world. [3]In this regard, a significant decrease of sovereignty causes to enhance the freedom of parties in order to move beyond the traditional theory about the sovereignty concept.[4]

It is simply observed that there is no doubt under the impact of globalisation in the notion of the Lex mercatoria in which national markets linked to the large trade systems in order to highly elevate the international transactions across national boundaries. [5] According to emphasise on the globalisation process in international commercial law, the United Nations Convention on Contracts for the International Sale of Goods (CISG) was approved by the majority of countries, therefore it is quite evident that the CISG is undoubtedly distinguished as a proper tool of the globalised nations to uniform the sale of goods. In addition, the UNIDROIT Principles for the International Commercial Contract is an independent intergovernmental organisation, which aimed to harmonise the unification of private law. [6]

Therefore, the role of nation states is less important in creation of transnational commercial law, where the international arbitration is emerged as a widely alternative to resolve the cross-border disputes in an international commercial level. [7]Indeed, the arbitrators usually opt to use the applicable law to compare to the court judges, while in notion, the arbitrators may prefer to use the UNIDROIT principle as an adequate law in arbitration. [8]In fact, the development of international commercial arbitration leads to produce the different dispute resolution mechanism in international law in order to develop the economies and accelerate the investigation of the cases.

According to aforementioned instruments, all of the documents made extensively in order to detract the costs of procedure and confine the conflict of different laws, then obviously the high profits are achievable in international trade market.

Further, it may be possibly viewed that the globalisation phenomenon has somehow disappeared the state sovereignty towards the transnational commercial law, where a law partially or impartially is removed from any domestic legal systems and made by international business communities relatively. It can be consequently followed that the globalisation perspective is increasingly interconnected to the transnational commercial law, which indeed tends to potentially enlarge the universal jurisdictions to assist to some extend alleviation of the cross-border interactions between individuals and companies.

Coordinated by Dr. Mahnaz Mehrinfar & Roza Einifar

[1] Goode, R. (1997). “Usage and its Reception in Transnational Commercial Law” 46 International and Comparative Law Quarterly. p.1-28, p5.

[2] Cuniberti, G. (2014). “Three Theories of Lex Mercatoria”, 52 Columbia Journal of Transnational Law, pp. 369-434, p.384.

[3] Berger, K.P.op.cit., p.5.

[4] Ibid.

[5] Goode R. op. cit., p.540.

[6] Kronke, H. (2005). “UN Sales Convention, the UNIDROIT Contract Principles and the Way Beyond”, 25 Journal of Law and Commerce, pp. 451-465,p.455.

[7] Gopalan, S(2003) . “New Trends in the Making of International Commercial Law”, 23 Journal of Law and Commerce, pp. 2-53, p.2.

[8] Piers, M., and Erauw, J.(2012 ) .“Application of the UNIDROIT Principles on International Commercial Contracts in Arbitration. 8(3)  Journal of Private International Law, pp. 1-32 ,p.1.