UNIVERSITÉ DE MONTRÉAL

Faculté de droit

Droit des contrats internationaux

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Business law
DRT6458
Fall 2023

Professor Lukas Vanhonnaeker Class 1

11/09/2023
lukas.vanhonnaeker@umontreal.ca

© Lukas Vanhonnaeker 2023

 General Overview of the Course

• Course Outline ;
• Compulsory readings and other documents ;
• Examinations.

© Lukas Vanhonnaeker 2023

 Introduction
International Business Transactions

• Preliminary question: what are international business transactions?

 What is international contract law?
• Section 1. Brief history of international trade and international
business law
• Antiquity: development and downfall of international trade
• Middle Ages and the big trading cities
• Renaissance, Modern Times and the internationalization of trade on a large scale

© Lukas Vanhonnaeker 2023

 Introduction
International Business Transactions

• Chapter II – Of the Spirit of Commerce

• Peace is the natural effect of trade. Two nations who traffic with each other become reciprocally
dependent; for if one has an interest in buying, the other has an interest in selling: and thus their
union is founded on their mutual necessities.
• But if the spirit of commerce unites nations, it does not in the same manner unite individuals. We see
that in countries2 where the people move only by the spirit of commerce, they make a traffic of all the
humane, all the moral virtue; the most trifling things, those which humanity would demand, are there
done, or there given, only for money.
• The spirit of trade produces in the mind of a man a certain sense of exact justice, opposite, on the one
hand, to robbery, and on the other to those moral virtues which forbid our always adhering rigidly to
the rules of private interest, and suffer us to neglect this for the advantage of others.
Montesquieu, The Spirit of Laws (1748)

© Lukas Vanhonnaeker 2023

 Introduction
International Business Transactions

• Section 2. The actors of international trade

• States ;
• International organisations ;
• Private actors.

© Lukas Vanhonnaeker 2023

 Introduction
International Business Transactions

• Section 3. International contracts

• What is an international contract?
• Different approaches and definitions (ex. CISG vs. Rome 1) but, generally speaking, an
international contract is a contract that has « contact points » with more than one
State.
• Why enter into a contract?
• To define the content and modalities of a given transaction and ensure that it can be
enforced.

© Lukas Vanhonnaeker 2023

 Introduction
International Business Transactions

• Where does the binding nature of an international contract come from?

• Two approaches:
• 1st approach : linking the international contract to the domestic legal regime of a State.
• 2nd approach : linking the contract to international law.
• Advantages and disadvantages of each approach.

© Lukas Vanhonnaeker 2023

 Introduction
International Business Transactions
• Section 4. General principles applicable to international contract – From a domestic
perspective
• Link with State courts
• Article 3148 CCQ
In personal actions of a patrimonial nature, Québec authorities have jurisdiction in the following cases:
(1) the defendant has his domicile or his residence in Québec;
(2) the defendant is a legal person, is not domiciled in Québec but has an establishment in Québec, and the dispute relates to its activities in Québec;
(3) a fault was committed in Québec, injury was suffered in Québec, an injurious act or omission occurred in Québec or one of the obligations arising from a
contract was to be performed in Québec;
(4) the parties have by agreement submitted to them the present or future disputes between themselves arising out of a specific legal relationship;
(5) the defendant has submitted to their jurisdiction.
However, Québec authorities have no jurisdiction where the parties have chosen by agreement to submit the present or future disputes between themselves
relating to a specific legal relationship to a foreign authority or to an arbitrator, unless the defendant submits to the jurisdiction of the Québec authorities.

© Lukas Vanhonnaeker 2023

 Introduction
International Business Transactions
• Link with State laws
• Choice of the law applicable to the dispute by the parties.
• Article 3111 CCQ
A juridical act, whether or not it contains any foreign element, is governed by the law expressly
designated in the act or whose designation may be inferred with certainty from the terms of the
act.
Where a juridical act contains no foreign element, it remains nevertheless subject to the mandatory
provisions of the law of the State which would apply in the absence of a designation.
The law may be expressly designated as applicable to the whole or to only part of a juridical act.

© Lukas Vanhonnaeker 2023

 Introduction
International Business Transactions
• Link with State laws
• Can we choose non-state laws?
• Can we “petrify” the applicable law?
• Can we “split” (dépeçage) the law applicable to the contract?
• See article 3111(3) CCQ
• Quid if the parties do not choose the applicable law?
• Articles 3112-3113 CCQ
3112. If no law is designated in the act or if the law designated invalidates the juridical act, the courts apply the law of the State with
which the act is most closely connected in view of its nature and the attendant circumstances.
3113. A juridical act is presumed to be most closely connected with the law of the State where the party who is to perform the
prestation which is characteristic of the act has his residence or, if the act is concluded in the ordinary course of business of an
enterprise, has his establishment.

© Lukas Vanhonnaeker 2023

 Introduction
International Business Transactions
• Link with State laws
• Mandatory provisions: rules which cannot be derogated from by contract.
• See Article 3111 QCC
• Overriding mandatory norms (« Lois de police ») and the « theory of laws of immediate application »
• Functional definition: a law that applies to the contract regardless of the law chosen by the parties to the
contract.
• Substantive definition: a mandatory law or provision whose compliance is considered crucial for safeguarding
public interests.
• Article 3076 QCC : The rules contained in this Book apply subject to those rules of law in force in Québec which are
applicable by reason of their particular object.
• Lex fori overriding mandatory provisions and foreign overriding mandatory provisions (Article 3079 QCC).

© Lukas Vanhonnaeker 2023

 Introduction
International Business Transactions

• Link with State law

• The concept of “ordre public”: set of mandatory rules adopted in the general
interest in order to allow for the organisation of the State and societal life.
• Difference with overriding mandatory provisions: overriding mandatory
provisions are of immediate application (the court does not have to analyse the
content of the applicable law).

© Lukas Vanhonnaeker 2023

 Introduction
International Business Transactions

• Section 5. General principles applicable to international contracts – From an international

perspective
• Dispute resolution: arbitration (and alternative means of dispute resolution)
• Institutional arbitration
• Ad hoc arbitration
• International substantive regulation of international contracts
• International conventions and treaties
• Professional practices / usages
• Model contracts and model laws
• General principles

© Lukas Vanhonnaeker 2023