INTRODUCTION TO THE OPEN-PRICE CONTRACT PROVISION IN THE CISG

a. Article 55 CISG, which addresses the issue of open-price terms, is a highly debated provision in light of Article 14(1) CISG, which describes the requirements of an offer. Yet, a close link between these two provisions is evident. The main controversy concerning the interaction between these provisions and their proper application derives from the fact that, at first sight, Articles 14(1) and 55 contradict each other, and therefore the application of Article 55 seemingly makes no sense. A theoretical debate between a broad (e.g., Honnold) and narrow (e.g., Farnsworth) interpretation has been going on for some time, but the controversy remains. It is, therefore, necessary to examine whether Articles 6:104, 6:105, 6:106, and 6:107 of the PECL may be used to help interpret the provision of open-price terms in the CISG.

BROAD AND NARROW INTERPRETATION OF ART. 55

b. Before comparing the relevant provisions of the CISG and the PECL, this chapter discusses the problem with interpreting Article 55 CISG. The question whether or not Articles 14(1) and 55 CISG should be read together arose because these two articles deal with very similar issues. Article 14(1) implies that for an offer to be sufficiently definite, which is a pre-condition for concluding a valid contract, among others, the price shall be expressly or implicitly fixed or a provision shall be made to determine the price.