Law Applicable in the Absence of Choice – The New Article 4 of the Rome I Regulation

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Abstract:

The applicable law to a contract in the absence of the parties' choice is governed by Article 4 of the Rome Convention, which has been implemented in the UK by the Contracts (Applicable Law) Act 1990. This rule adopts the ‘closest connection principle’ as a basic principle to decide the applicable law, but also introduces specific presumptions to simplify the process. The current rule has been criticised for its uncertainty. As a result, a substantive change has been provided in the Rome I Regulation, which aims to modernise the current choice of law rules in contractual obligations and convert the Rome Convention into a Council Regulation. The new Article 4 aims to enhance certainty and to overcome the difficulties of the current rules of the Rome Convention. However, a close scrutiny of the new Article 4 shows that it does not properly achieve its aim. The article aims to critically analyse Article 4 of the Rome I Regulation and to provide suggestions for its interpretation and understanding.

Keywords: Rome Convention; Rome I Regulation; choice of law; contractual obligations

Document Type: Research Article

DOI: http://dx.doi.org/10.1111/j.1468-2230.2008.00715.x

Affiliations: University of Aberdeen

Publication date: September 1, 2008

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