Identities in Contract: Merchant Law in Europe and the Future of European Contract Law
| Author | Maren Heidemann |
| Published date | 01 August 2016 |
| Date | 01 August 2016 |
| DOI | http://doi.org/10.1177/1023263X1602300406 |
| Subject Matter | Article |
23 MJ 4 (2016) 667
IDENTITIES IN CONTRACT: MERCHANT
LAW IN EUROPE AND THE FUTURE
OF EUROPEAN CONTRACT LAW
M H*
ABSTRACT
e European Union legislator has concentrated on the consumer contract neglecting its
counterpart, the commercial contract, the B2B transaction. e result is the absence of
any dedicated EU commercial contract law. By contrast, international codi cation work
has concentrated only on commercial contract law. A new dichotomy of consumer and
trader or entrepreneur has thereby emerged. is is not part of the tradit ional legal orders
of the EU Member States. Most European jurisdictions except the UK maintain another
dichotomy, that of merchant and non-merchant. Another distinction remains, that of the
objective and subjective approaches ta ken towards de ning commercial transactions. is
article observes that only the subjec tive approach has inspired EU legislation which has led
to an identity-based str ucture of European contract law of which the trader and consumer
dichotomy is one expression. e author criticizes this approach and proposes to explore
the objective basis for future European cont ract law.
Keywords: commercial contract; comparative law; consumer; European contract law;
Merchant law
§1. IN TRODUC TION
Commercial contracts do not receive t he same amount of attention from cur rent
European law reform that is expended on its counterpart, t he consumer contract. In
fact, neither of the two ter ms – ‘commercial contract’ and ‘consumer contract’ – receives
an o cial fre e standing de nition in any of the modern EU legal acts or indeed national
* Assessor Iuri s, PhD, LLM (Notti ngham), Institut e of Advanced Lega l Studies, School of Adv anced
Studies, Universit y of London, England; mheider a@aol.com.
Maren Heidemann
668 23 MJ 4 (2016)
legislation . e term ‘commercia l contract’ does not seem to be understood as a te chnical
term but merely as a general descriptor use d for book titles or titles of legal rules such a s
the UNIDROIT Principles of Internat ional Commercial Contracts (UPICC).1
Traditional European contract laws have not distinguished between commercial
and non-commercial contract s even though they o en contain ru les governing contract
types. is ty pology does not extend to the commercial/non-commercial distinction,
however, but rather to the content of the contracts, such as contract for sales, services,
construction, la ndlord and tenant, employment and so forth. Eu ropean laws have however
traditionally entertained a separate and distinct body of merchant law o en codi ed
in commercial codes.2 While comprising more than just rules on contract law, these
Commercial Codes do include such special rules that only apply to contracts between
merchants. Typical contract rules will relate to inspection duties, silent acceptance and
limitation periods. ere are two major approaches to the de nition of merchant law in
Europe known as the subjec tive and the objective approach. According to the subjective
approach established by those commercial codi cations that are based on the German
and Austrian traditions,3 the de nition centres around the person or ‘ identity’ of the
merchant. e objective approach wa s classically established by t he ‘Napoleonic’ French
Commercial Code4 and centres bot h on the contract and its purpose as well as a spects of
the person, or the ‘identity ’ of the merchant.
is latter objective model was largely as sociated with the republica n, revolutionary
spirit of the Napoleonic legislation of the time, spearheaded by the 1804 French civil
code (Code Civil).
5
Some European countries t herefore developed lively debates in the
course of the 19
th
century about which model to follow, the traditional ‘monarchic’
one created within the Austrian and Germa n Empires or the ‘republican’ model of
the French commercial code (Code de Commerce).
6
It is therefore interesting to
1 International I nstitute for the Uni cat ion of Private Law (UN IDROIT), 1 Augu st 2010,
www.unidroit .org/english/pri nciples/contracts/pri nciples2010/integralver sionprinciples2010-e.pd f.
2 Johannes W Flume o ers an historic overview in J.W. Flume, ‘Law and Commerce: e Evolution of
Codi ed Business L aw in Europe’, 2 Comparative Legal Hist ory (2014).
3 K. Schmidt, ‘“Unter nehmer” – “Kaufma nn” – “Verbraucher”’, 60 Betriebsberater (2005), p. 840. He
observes that t his distinction has now rm ly established its elf within the academic cu rriculum and
o ers some compa rative analysis d rawing on both Ger man and Austria n law and scholarship. See a lso
J. Hamel, G. Laga rde and A. Jau ret, Droit Commercial (Dalloz, 1980), p.77.
4 Code de Commerce, rst enacte d in 1807. See for a concise evalu ation of the early imp act and signi cance
of the Napoleonic code s F. Wieacker, A History of Private Law in Europe (OUP, 1995), p.269–275. See
also J. Hamel, G. Lagarde and A. Jau ret, Droit Commercial, p.75–77 for a brief overvie w over the
reception of the French Code de Commerce in Europe and be yond and a comparative account of ot her
European and A nglo-American sys tems from a French perspect ive.
5 Text available at ww w.legifrance.gouv.fr/a chCode.do?cidTexte=LEGITEXT000006070721.
6 See for instanc e the development of the Spani sh Commercial Code s from the r st enactment of 1829 to
the Code of 1885 which is t he basis for the present d ay Spanish Codigo de Comercio in the description by
T. Rodriguez De La s Heras Ballell , Introduction to Spanis h Private Law: Facing the S ocial and Economic
Challenges (Routledge Cavendish, 2010), p.3: ‘ e Spanish Commercial C ode of 1885 constitutes a at
rejection of the for mer professional model of Commercial Law c lass-based legal system an d a warm
Identities in Cont ract: Merchant Law in Eu rope and the Future of Europ ean Contract Law
23 MJ 4 (2016) 669
note that the European legislature has largely followed the subjective ‘Germanic’
model
7
as re-enacted in the rst nationwide code by the German commercial code
of 1895 (Handelsgesetzbuch, HGB)
8
rather than the French objective approach. is
is expressed by the creation of ‘identities’ in contract law regulation created by the
EU in the last decades
9
where the focus is generally kept on the description of the
contractual parties as a speci cation or connecting factor rather than the contract
itself and its purpose. e use of connecting factors is of course a tech nique used in
private international law which has received legisl ative input from the EU law making
process.
10
A shi can be observed in EU private international law away from the traditional
continental and common law principles look ing to the contract itself in order to nd the
‘proper law of the contract’ towards ndi ng the ‘proper law of the parties’ instead.11 It i s
now the parties themselves who decide the applicable law, in the absence of an express
choice, by their physical presence (habitua l residence) in any one jurisdiction, rather
than the content of their contrac t.
In a similar way, the parties themselves determine the nature of a contractua l
relationship and the associated lega l rights and obligations in EU contract law by way of
the properties assig ned to them rather than the content or purpose of t he contract itself.
is has been achieved by creating ‘identities’, characters or descriptors of contractua l
parties dependi ng on each contract type. Other than t he character of the ‘merchant’
in traditional European merchant law, these descriptors var y throughout the legal
welcome to an act-based mod el, to be applied to any so-ca lled commercial t ransaction rega rdless of the
condition of the involved p arties.’
7 J. Hamel, G. Laga rde and A. Jau ret, Droit Commercial, p.77 refer to t he laws in uenced by the Germa n
Handelsges etzbuch (HGB) as ‘groupe germa nique’.
8 e HGB was published in May 1897 and entere d into force partl y in January 1898 a nd fully from
Jan 1900. e German original is available electronically at www.gesetze-im-internet.de/hgb/
BJNR002190 897.html, with an o cially endors ed English translat ion of only its Book Five (Maritime
Trade) at www.gesetze-im-internet.de/englisch_hgb/index.html.
9 is body of regulatory law is o en calle d European private law whic h is misleading as its lega l nature
is clearly public. S ee on this point and gene rally in relat ion to the most recent and comprehen sive
EU harmoniz ation project in consumer law, M.W. Hesselink, ‘Towards a Sha rp Distinction betwe en
B2b and B2c? On Consumer, Com mercial and Gener al Contract L aw a er the Consumer Rights
Directive’, Centre for the S tudy of European Contract Law Working Paper Se ries No. 2009/06 (20 09),
http://papers.ssrn.com/sol3/paper s.cfm?abstract_id=1416126, p.11.
10 Startin g with the 1980 Convention on t he law applicable to contrac tual obligation s (Rome Convention)
and culmi nating in the mo st recent so calle d ‘Brussels IV ’ Regulation, t he Regulation (EU ) No.
650/2012 on jurisdict ion, applicable law, recogn ition and enforcement of deci sions and accepta nce
and enforcement of authent ic instruments in mat ters of succession and on the crea tion of a European
Certi cate of Succession, [2012] OJ L 201/107.
11 According to Ar ticle4(1)-(3) of Regulation (EC) No. 593/2008 of the Europ ean Parliament and of the
Council of 17June 2 008 on the law applicable to contrac tual obligations (Rome I Regu lation), [2008]
OJ L 177/6. Article4(4) Rome I Regulation re ec ts the traditional r ule to apply the law of the countr y
with which t he contract is most closel y connected, the proper l aw of the contract. is has now become
a ‘rule of last resor t’.
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