54. Definition of lex mercatoria and use of lex mercatoria in modern international commerce

Modern definition lex mercatoria is used with regard to 'international legislation', i.e. conventions on commercial matters, customs, uniform practices etc which undeniably create uniform law. Some authors speak of lex mercatoria as the 'autonomous law' of international trade, the term 'autonomous' can, in the context of international legislation, only mean that we have an international instead of a national source of law. We may say that lex mercatoria thus should be used in modern times as covering both international treaties and customs codifications made by intergovernmental organizations such as ICC, for instance.

55. Unidroit Principles on International Commercial Contracts

UNIDROIT Principles are based on general principles of law. The latter express a general truth which serves as a basic guideline for the application of the law, whereas UNIDROIT rules are the practical formulation of the principle and, for reasons of expediency, may vary and depart, to greater or lesser extent, from the principle from which they spring.

UNIDROIT principles are unique in a way that they combine the general principles of law recognized by all legal systems and at the same time create quite clear rules how to use these these principles in practice when drafting a contract. The UNIDROIT Principles keep to very definite rules with a clearly defined scope of application. In addition to the provisions relating to the conclusion of contracts (Artt. 2.1 et seq.), the following articles should be mentioned in this context: Articles relating to the mode of payment (Artt. 6.1.7 et seq.), to the currency of payment (Art. 6.1.9.9), to the costs of performance (Art. 6.1.11), to the right to withhold performance (Art. 7.1.3), to a party's right to require payment (Art. 7.2.1), to a party's right to claim damages for non-performance (Art. 7.4.1), to the calculation of damages (Art. 7.4.6) and to the rules governing the calculation of interest claims (Art. 7.4.9),.

However, the UNIDROIT Principles are not restricted to the reproduction of the technicalities of conclusion of contracts by offer and acceptance and the performance of contracts and possible secondary claims. Instead, a number of general principles in the form of general clauses take precedence in the first chapter over the specific provisions in chapters 2 to 7 and are then worked through by the UNIDROIT Principles as a central theme, making assessments and comparisons between rules and general principles possible.

56. Main principles of international commercial law reflected in the unidroit principles

• Freedom of contract and mandatory law\public order:

The parties are free to enter into contract and determine its content – Article 1.1. of 2004 Unidroit contract principles. The Article 1.6. states that nothing in the principles itself shall limit the application of national, international or supranational mandatory norms which are applicable in accordance with the rules of international private law.

Freedom of contract is a main principle of commercial law and comprises freedom to choose whether one party wants to enter into contract at all, the freedom to choose contracting party, and to agree on the contents of the contract – its general and specific terms. The principle of freedom of contract also extends to the parties choice of the law to govern their contract – party autonomy.

• Good faith and fair dealing

Good faith has also been compared with unconscionability, 'fairness, fair conduct, reasonable standards of fair dealing, decency, reasonableness, decent behavior, a common ethical sense, a spirit of solidarity, community standards of fairness'8 and 'honesty in fact,' Within the context of the CISG, good faith is manifested in various forms. For example, an offer cannot be revoked where it was reasonable for the offeree to rely upon the offer being held open and the offeree acted in reliance on the offer.

• Principle of party autonomy as the Magna Charta of international contract law (Art. 1.1)

• Principle of 'pacta sunt servanda' (Art. 1.3) - parties are bound by usages recognized\established by them or by widely known usages and regularly observed in a particular trade