CIGS – Contract conclusion

Generally there are different methods adopted worldwide: a contract may be concluded either by the
acceptance of an offer or by conduct of the parties that is sufficient to show agreement. Law
applicable to the contract regulates the problem of contract validity – was it correctly concluded.
Methods usually adopted in international commercial law include:
 Offer & acceptance
This is the typical method of contract conclusion, with two declarations of will (1/ offer made by an
offeror, 2/acceptance made by an offeree). Usually not all proposals to conclude a contract are
considered by a particular law as offers; most laws require: 1/clear intention to be bound by a
contract and 2/ most important elements of the future contract; if a proposal is not an offer, it is only
an invitation to make offers. An offer binds offeror – if offeree accepts it, there is a contract
concluded, thus – it is very important to understand when one makes an offer. The contract is
concluded when acceptance reaches the offeror.
The proposal for concluding a contract addressed to one or more specific persons should be:
o Sufficiently definite (expressly indicates goods, expressly or implicitly fixes quantity and
price)
o Indicates the intention of the offeror to be bound in case of acceptance.
Under CISG there is a different approach to advertisements/catalogues/leaflets. A proposal other
than one addressed to one or more specific persons is to be considered merely as an invitation to
make offers, unless the contrary is clearly indicated by the person making the proposal.
The offer is effective when it reaches offeree, offeror is bound by its offer (art. 15). There are two
methods of cancelling an offer by the offeror:
1/ withdrawal of an offer: it may be withdrawn if the withdrawal reaches the offeree before or at the
same time as the offer (art. 15)
2/ revocation of an offer: if the revocation reaches the offeree before he has dispatched an
acceptance, however some offers are irrevocable; mainly if it indicates, whether by stating a fixed
time for acceptance or otherwise, that it is irrevocable.
Offeror is bound by its offer:
- Until he receives notice of refusal of an offer
- Until fixed period/deadline for acceptance elapses
- If no time fixed – until reasonable time passes in which offeror might have in normal course
of action, due account being taken of the circumstances of the transaction, including the
rapidity of the means of communication employed by the offeror; an oral offer must be
accepted immediately unless the circumstances indicate otherwise (art. 18).
Acceptance of an offer:
1. Statement indicating assent to an offer is an acceptance (art. 18)
2. By performing an act, such as one relating to the dispatch of the goods or payment of the
price, without notice to the offeror, only if an offer calls for it or as a result of practices
which the parties have established between themselves or of usage (art. 18.3).
3. Silence or inactivity does not in itself amount to acceptance.
Modification of an offer in acceptance (art. 19)
- A reply to an offer which purports to be an acceptance but contains material additions,
limitations or other modifications is a rejection of the offer and constitutes a counter-offer.
- Material modifications: price, payment, quality and quantity of the good, place and time of
delivery, extent of one party’s liability to the other or the settlement of disputes.
- If modification do not materially alter the terms of the offer constitutes an acceptance,
unless the offeror, without undue delay, objects orally to the discrepancy or dispatches a
notice o that effect. If he does not so object, the terms of the contract are the terms of the
offer with the modifications contained in the acceptance. Contract is concluded unless
offeror objects immediately.

 Negotionations
 Auction
 Tender