INVESTIGATING COMPATIBILITY OF SAUDI DOMESTIC LAW WITH THE UN’s CONTRACT FOR INTERNATIONAL SALE OF GOODS

Abstract

With the changing business environment, various disputes arise in the contracts for the international sale of goods. Some of these disputes relate to the conformity of the goods and the parties' rights to the contract. The conformity of goods is crucial in domestic and international sales of goods given changing business environments. This thesis aims at explaining the similarities and differences between the United Nations Convention on the international sale of goods (CISG) and the provisions in the Saudi Arabian laws of contract. Since most Saudi Arabia laws are derived from the Shariah law, the study seeks to identify and recommend appropriate ways to harmonize the two legal provisions for better international dealing and solving disputes in international trade due to the worldwide acceptance of CISG. The thesis is divided into six chapters, with each chapter explaining the fundamental aspects of the international sale of goods contract and identifying the most crucial instruments to consider. Throughout this paper, the two most important aspects discussed are the seller's obligations and buyer's remedies in the sale of goods contract. These two elements will be analyzed in a comparative study of Islamic law. The CISG will seek to determine the compatibility of the two legal frameworks on buyer's remedies and seller's obligations. The first chapter provides the background of the two legal frameworks and sets the course of the study. It also explains the basic similarities and differences in principles between Saudi law and CISG. The second chapter introduces one of the fundamental aspects of the sale of goods contract- the seller's obligation to deliver. When a contract of sale of goods is completed, an exchange between the buyer and the seller involves various obligations on both parties. The seller's underlying principles to deliver and conform to the contract are examined from the two legal systems in chapters two and three.

Throughout the thesis, the main issue of seller's obligation to the contract, conformity of goods to the contract and law, issue of third party rights, and remedies whenever the seller fails to perform their obligations are extensively examined. The two legal systems' differences are found to produce various disputes in the international sale of contracts from the analysis. However, the study also shows that the differences can be harmonized with a well-designed plan because the two laws have similar intentions but different approaches. For example, Saudi law emphasizes the contract's certainty (avoiding gharar sale) and the role of customs and traditions in contractual obligations. It is important to note that Saudi laws are tied to the Islamic teachings and provisions of the Shariah law, making the law more of a custom. On the other hand, the CISG has its roots in western civilization and common law. The apparent differences in the origin of the laws elicit differences in their approach to contractual obligations. However, the Saudi law has shown remarkable flexibility, which allows for recognizing the CISG principles given the right interpretation. In conclusion, the study has shown no substantial barriers to harmonizing the Saudi law with the CISG provisions. Even though there is a need for further research on the impacts of adopting these principles in a society where religion and law are intertwined, there is sufficient evidence that Saudi Arabian making international trade will benefit from the CISG provisions. Therefore, the Saudi government should reflect adopting the CISG recommendations.