This document provides an overview of key concepts related to contracts and offers under the United Nations Convention on Contracts for the International Sale of Goods (CISG). It discusses what constitutes a valid offer, including requirements that the offer be definite, addressed to specific offerees, and able to be revoked or made firm. It also examines what qualifies as an acceptance of an offer, the timing of acceptance, and how modifications to an offer impact contract formation. The document concludes by covering parties' general performance standards and available remedies in the event of a breach, such as avoidance of the contract or a request for specific performance.

2. CONTRACTS ARE THE BUILDING
BLOCKS OF BUSINESS LAW
• THE AGREEMENT
• CONSIDERATION
• CAPACITY
• LEGALITY

3. THE OFFER
• AN OFFER IS A PROPOSAL ADDRESSED TO SPECIFIC PERSONS INDICATINGAN INTENTION BY THE OFFEROR
TO BE BOUND TO THE SALE OR PURCHASE OF PARTICULAR GOODS FOR A PRICE
• SHOULD THERE BE SOME DOUBT WHETHER THE COMMUNICATION IS AN OFFEROR NOT, CISG DIRECTS
THE COURT TO ASCERTAIN IF THE OFFEROR COMMUNICATED AN INTENTIONTO BE BOUND
• THIS CAN BE DETERMINED FROM THE GENERAL RULES OF INTERPRETATIONIN ARTICLE 8 OF THAT
CONVENTION – THAT IS, BY LOOKING AT THE OFFEROR’S PROPOSAL WITHIN ITS FULL CONTEXT,
INCLUDING ANY NEGOTIATIONS, ANY PRACTICES BETWEEN THE PARTIES, AND USAGES, AND ANY
SUBSEQUENT CONDUCT

4. DEFINITE
OFFER
ARTICLE 14 OF CISG
REQUIRES AN OFFER
TO BE DEFINITE

5. WHEN IS AN OFFER DEFINITE?
• UNDER ARTICLE 14 A “PROPOSAL” IS SUFFICIENTLY DEFINITE IF IT INDICATES THE GOODS AND EXPRESSLY
OR IMPLICITLY FIXES OR MAKES PROVISION FOR DETERMINING THE QUANTITY AND THE PRICE
• IN OTHER WORDS, AN OFFER MUST DESCRIBE THE GOODS WITH SUFFICIENT CLARITY THAT THE PARTIES
KNOW WHAT IS BEING OFFERED FOR SALE, AND IT MUST ALSO STATE THEQUANTITY AND PRICE
• WITH REGARD TO THE “PRICE,” ARTICLE 14 OF THE CISG MUST BE READIN CONJUNCTION WITH ARTICLE
55 – THE CISG SUGGESTS THAT IT IS THE DUTY OF THE OFFEROR TO COMMUNICATE THE MEANS FOR
FIXING A PRICE

6. SPECIFIC OFFEREES
•FOR A PROPOSAL TO BE AN OFFER, IT MUST BE ADDRESSED TO “ONE OR MORE SPECIFIC
PERSONS”
•PROPOSALS MADE TO THE PUBLIC ARE ORDINARILY INTENDED TO BE NOTHING MORE
THAN INVITATIONS TO NEGOTIATE
•CISG ADOPTS THE RULE THAT PUBLIC OFFERS ARE ONLY INVITATIONS TO NEGOTIATE
“UNLESS THE CONTRARY IS CLEARLY INDICATED”

7. EFFECTIVENESS OF OFFERS, REVOCATION
• AN OFFER BECOMES EFFECTIVE ONLY AFTER IT REACHES THEOFFEREE – THE OFFERS, INCLUDING OFFERS THAT PROMISE THAT THEY
ARE IRREVOCABLE – CAN BE WITHDRAWN BEFORE THEY REACH THE OFFEREE
• OFFERS THAT DO NOT STATE THAT THEY ARE IRREVOCABLE CAN BE REVOKED AT ANY TIME BEFORE THE OFFEREE DISPATCHES AN
ACCEPTANCE – THIS RULE IS BASED ON THE FAMOUS ENGLISH COMMON LAW MAILBOX RULE WHICH LIMITS THE ABILITY OF THE
OFFEROR TO CANCEL AN OFFER WHERE THE OFFEREE HAS REASONABLY RELIED ON IT
• AT COMMON LAW, THE ACCEPTANCE HAD TO BE RETURNED USING THE SAMEMEDIUM IN WHICH THE OFFER WAS ORIGINALLY SENT
(E.G., A MAILED OFFER HAD TO BE ACCEPTED BY MAIL). UNDER THE CISG THE ACCEPTANCE CAN BE SENT BY ANY MEANS

8. FIRM OFFERS
• UNDER TRADITIONAL ANGLO-AMERICAN COMMON LAW RULES, THE DOCTRINE OF CONSIDERATION PREVENTS AN OFFEROR FROM
MAKING AN OFFER IRREVOCABLE – AN OPTION CONTRACT (I.E., ONE IN WHICH THE OFFEREE PAYS THE OFFEROR FOR THE PROMISED
TO KEEP THE OFFER OPEN) HAS TO BE USED.
• THE DOCTRINE OF CONSIDERATION DOES NOT APPLY TO CISG ANDFIRM OFFERS (I.E., ONES WHERE THE OFFEROR PROMISES TO
KEEP THE OFFER OPENED FOR A FIXED PERIOD) ARE ENFORCEABLE.
• MOST COMMON LAW COUNTRIES HAVE MODIFIED THE TRADITIONAL RULE, ALLOWING OFFEREES TO ENFORCE FIRM OFFERS MADE
BY MERCHANTS IF THEY ARE MADE IN WRITING, ARE SIGNED BY THE OFFEROR, AND ARE EFFECTIVE FOR ONLY A LIMITED TIME
PERIOD (UCC §2-205)
• CISG GOES FURTHER THAN THIS – THE PROMISE OF IRREVOCABILITY DOES NOT HAVE TO BE SIGNED, DOES NOT HAVE TO BE IN
WRITING, AND THERE IS NO TIME LIMITATION– A FIRM OFFER IS ENFORCEABLE IF THE OFFEROR MAKES THE OFFER A REVOCABLE OR
THE OFFEREE CAN REASONABLY RELY ON CONDUCT IT IMPLIES THAT THE OFFER IS FIRM.

9. ACCEPTANCE OF THE
OFFER
• A CONTRACT COMES INTO EXISTENCE AT THE POINT IN TIME AN OFFER IS
ACCEPTED
• ACCEPTANCE IS A STATEMENT OR CONDUCT BY THEOFFEREE
INDICATING ASSENT THAT IS COMMUNICATED TO THEOFFEROR
• THE FORM OR MODE IN WHICH AN OFFEREE EXPRESSES ASSENT IS
UNLIMITED; THE OFFEREE MUST COMMUNICATE ASSENT TO THE OFFEROR

10. SILENCE
• SILENCE OR INACTIVITY DOES NOT, IN AND OF ITSELF CONSTITUTE
ACCEPTANCE
• EXAMPLE: IF A SELLER SENDS A BUYER AND OFFER THAT SAYS “I
KNOW THAT THIS IS SUCH A GOOD DEAL THAT I WILL ASSUME THAT
YOU HAVE ACCEPTED UNLESS I HEAR OTHERWISE” – THE FACT THAT
THE BUYER DOES NOT RESPOND DOES NOT CREATE A CONTRACT
• A DIFFERENT RESULT WILL OCCUR IF THE SELLER SENDS THE BUYER
AN INVITATION TO NEGOTIATE THAT SAYS “AND UNLESS YOU HEAR
OTHERWISE FROM ME WITHIN THREE DAYS AFTER I RECEIVE YOUR
ORDER I WILL DELIVER THE WIDGETS YOU NEED AT $100 EACH” IN
THIS TYPE OF THE CASE THE SELLER’S SILENCE CONSTITUTES
ACCEPTANCE

11. TIME OF ACCEPTANCE
• ACCEPTANCE MUST BE RECEIVED BY THE OFFEROR WITHIN THE TIME PERIOD SPECIFIED IN THE OFFER
• IF NO TIME PERIOD IS GIVEN, ACCEPTANCE MUST BE RECEIVED WITHIN AREASONABLE TIME
• IF THE OFFER IS ORAL, THE ACCEPTANCE MUST BE MADE IMMEDIATELY, UNLESS THE CIRCUMSTANCES
INDICATE OTHERWISE
• IN DEVISING THE ACCEPTANCE RULE FOR CISG, THE DRAFTERS OPTED FORTHE RECEIPT THEORY USED IN
CIVIL LAW COUNTRIES
• IN COMMON LAW COUNTRIES, THE DISPATCH OR MAILBOX THEORY IS USED– THE DIFFERENCE BETWEEN
THESE TWO RELATES TO THE ALLOCATION OF RISK WHEN AN ACCEPTANCE IS LOST OR DELAYED.

12. EXAMPLE
• BUYER SENDS SELLER AN ACCEPTANCE THROUGH THE MAIL AND THE ACCEPTANCE IS LOST.
• IF THE DISPATCH THEORY WERE APPLIED, THE CONTRACT WOULD HAVE COME INTO EXISTENCE AT THE
TIME THE ACCEPTANCE WAS MAILED, AND THE SELLER WOULD BE REQUIREDTO PERFORM.
• UNDER THE RECEIPT RULES ADOPTED BY CISG, HOWEVER, NO CONTRACT WOULD EXIST, AND THE BUYER
WOULD BE LEFT EMPTY-HANDED
• THE REASON THE DRAFTERS CHOSE THE RECEIPT RULES WAS A PERCEPTIONTHAT IT MORE FAIRLY
ALLOCATES RESPONSIBILITY FOR LOSS OR DELAY.

13. ACCEPTANCE BY
PERFORMANCE OF AN
ACT
• IF AN ACT IS REQUESTED BY THE OFFEROR
AS ACCEPTANCE OF THE OFFER IT IS
EFFECTIVE AT THE MOMENT THE ACT IS
PERFORMED
• THE OFFER, TRADE USAGE, OR THE
PRACTICE OF THE PARTIES MUST MAKE IT
CLEAR THAT THE OFFEREE IS NOT
REQUIRED TO NOTIFY THE OFFEROR

14. WITHDRAWAL/REJECTION
•BECAUSE AN ACCEPTANCE IS NORMALLY NOT EFFECTIVE UNTIL THE OFFEROR RECEIVES
IT, AND OFFEREE MAY WITHDRAW HIS ACCEPTANCE ANY TIME BEFORE OR
SIMULTANEOUSLY WITH RECEIPT
•A REJECTION BECOMES EFFECTIVE WHEN IT REACHES THE OFFEROR– IF AN OFFEREE
WERE TO DISPATCH BOTH A REJECTION AND AN ACCEPTANCE AT THE SAME TIME, THE
ONE THAT REACHED THE OFFEROR FIRST WOULD BE THE ONE GIVEN EFFECT

15. ACCEPTANCE WITH MODIFICATIONS
• SELLER SENDS AN OFFER TO BUYER – THE BUYER RESPONDS WITH AN ACCEPTANCE THAT MODIFIES SOME OF
THE TERMS IN THE ORIGINAL OFFER – IS THERE A CONTRACT?
• THIS SCENARIO – COMMONLY CALLED THE BATTLE OF THE FORMS– OCCURS WHEN MERCHANTS USE
PREPRINTED FORMS BOTH TO MAKE OFFERS AND SEND BACK ACCEPTANCES
• THE TYPE-IN DESCRIPTIONS COMMONLY MATCH UP; IT IS THE “FINE PRINT” ON THE BACK OF THE FORMS,
HOWEVER THAT CONTAINS DIFFERENCES
• UNDER CISG, IF INCONSISTENCIES ARE “MATERIAL” THE WOULD-BE ACCEPTANCE IS A COUNTER OFFER
• TERMS THAT ARE NOT MATERIAL ARE CONSIDERED TO BE PROPOSALS FOR ADDITION THAT WILL BECOME PART
OF THE CONTRACT UNLESS THE OFFEROR PROMPTLY OBJECTS

16. GENERAL STANDARDS OF PERFORMANCE
•CISG IMPOSES GENERAL STANDARDS OF PERFORMANCE ON BOTH THE BUYERAND THE
SELLER
•IN GENERAL, BOTH PARTIES ARE ENTITLED TO GET FROM THEIR CONTRACTWHAT THEY
EXPECT
•A PARTY THAT FAILS TO PERFORM ACCORDINGLY IS IN BREACH OF CONTRACT
•WHEN ONE PARTY BREACHES, THE OTHER PARTY MAY AVOID THE CONTRACT OR MAKE A
DEMAND FOR SPECIFIC PERFORMANCE

17. AVOIDANCE
• IF THERE HAS BEEN A FUNDAMENTAL BREACH, ONE REMEDY AVAILABLE TOTHE INJURED PARTY IS AVOIDANCE
(I.E., NOTIFICATION BY THE PARTY THAT HE IS CANCELING THE CONTRACT)
• TO BE ENTITLED TO AVOID A CONTRACT, HOWEVER, THE INJURED PARTY MUST – IN ALL CASES – NOTIFY THE
OTHER PARTY AND BE ABLE TO RETURN ANY GOODS HE IS ALREADY RECEIVED
• WHEN A PARTY AVOIDS, ONLY THE OBLIGATION TO PERFORM IS AFFECTED– AVOIDANCE DOES NOT CANCEL (1)
ANY PROVISION IN THE CONTRACT CONCERNING THE SETTLEMENT OF DISPUTES (SUCH AS ARBITRATION,
CHOICE OF LAW, OR CHOICE-OF-FORUM CLAUSES) OR (2) ANY OTHER PROVISIONS GOVERNING THE RIGHTS
AND DUTIES OF THE PARTIES “ CONSEQUENT UPON THE AVOIDANCE OF THECONTRACT.”

18. REQUESTS FOR SPECIFIC PERFORMANCE
•CISG AUTHORIZES AN INJURED PARTY TO ASK A COURT “TO REQUIRE
PERFORMANCE” IF THE OTHER PARTY FAILS TO CARRY OUT HIS
OBLIGATIONS – DEMAND FOR SPECIFIC PERFORMANCE
•A COURT IS NOT OBLIGED TO GRANT THIS REQUEST, HOWEVER, UNLESS THE
COURT CAN DO SO UNDER ITS OWN DOMESTIC RULES

19. WHAT CONSTITUTES SPECIFIC
PERFORMANCE
• THIS VARIES FROM COUNTRY TO COUNTRY, AND THE RULE IN CISG REFLECTS THE DIFFICULTIES THE DRAFTERS
HAD IN DEFINING THIS CONCEPT
• IN COMMON LAW COUNTRIES THE CONCEPT IS FAIRLY NARROW, REFERRINGTO A COURT DECREE THAT
COMPELS A DEFENDANT TO DO A SPECIFIC ACT SUCH AS DELIVERING GOODS
• DISOBEYING THE DECREE CAN BE SERIOUS – IT IS TREATED AS A CONTEMPT OF COURT PUNISHABLE BY FINE
OR IMPRISONMENT
• IN THE CIVIL LAW COUNTRIES, THE IDEA OF REQUIRING PERFORMANCE IS MUCH BROADER AND INCLUDE SUCH
THINGS AS THE BUYING OF A SUBSTITUTE AT THE DEFAULTING PARTY’S EXPENSE; THE SANCTIONS ARE NOT AS
BURDENSOME – A COURT MAY NOT IMPOSE A FINE OR THROW A DISOBEDIENT PARTY INTO JAIL

20. PREREQUISITES TO SPECIFIC PERFORMANCE
• PREREQUISITES WILL VARY– THE UNITED KINGDOM’S SALE OF GOODS ACTOF 1893, WHICH IS WIDELY FOLLOWED IN THE
COMMON-LAW WORLD STATES THAT A COURT “IF IT THINKS FIT,” MAY ENTER A DECREE REQUIRING A PARTY IN BREACH OF
CONTRACT TO DELIVER “SPECIFIC OR ASCERTAINED GOODS.”
• THE DIFFICULTY OF DETERMINING WHEN GOODS ARE SPECIFIC OR ASCERTAINED, HOWEVER, IS A PROBLEM THAT LIMITS
APPLICATION OF THIS SECTION.
• IN THE UNITED STATES, THE UNIFORMCOMMERCIAL CODE ALLOWS FOR DECREES OF SPECIFIC PERFORMANCE THAT “A
COURT MAY DEEM JUST,” SO LONG AS THE GOODS ARE UNIQUE” OR “IN OTHER PROPER CIRCUMSTANCES.”
• IN CIVIL LAW COUNTRIES, A PARTY IS “ENTITLED” TO REQUIRE PERFORMANCE – CIVIL JUDGES DO NOT HAVE THE
DISCRETION TO DESIGNATE A DECREE AS THEIR COMMON LAW BRETHREN DO, NOR IS THE REMEDY LIMITED BY THE NATURE
OF THE GOODS INVOLVED