European Sales Law Announced

The European Commission is proposing an optional Common European Sales Law (CESL) to break down barriers and give consumers more choice and a high level of protection.

The new proposal aims to facilitate trade by offering a single set of rules for cross-border contracts in all 27 EU countries, and comes in response to a 2009 Commission Report saying that cross-border e-commerce is failing.

E RADAR investigates...


What's the problem?


UK consumers not fully benefiting from the EU’s Single Market.

  • At present, only 9 % of British consumers buy online from other EU countries, while 53 % buy in the UK.
  • Legal barriers mean businesses sometimes refuse to sell to consumers living abroad – around 3 million European consumers are affected each year in the EU, and nearly 310,000 of them are in the UK.
  • UK companies are not taking advantage of the full potential of the EU’s Single Market.

Key concerns


Business-to-consumer transactions (B2C)

  • 64% of British retailers (EU: 55%) active or interested in selling to consumers outside their national market said they were held back by a range of contract-law related obstacles
  • 64% of British retailers (EU: 55%) active or interested in selling to consumers outside their national market said they were held back by a range of contract-law related obstacles
  • Complying with different consumer protection rules abroad 52% (EU: 38%)
  • Finding out about foreign contract law 45% (EU: 40%)
  • Obtaining legal advice on foreign contract law 45% (EU: 35%)
  • Solving cross-border contractual disputes 42% (EU: 34%)
  • 49% (EU: 71%) of British businesses said they would use a single EU contract law for cross-border sales to consumers.

Business-to-business transactions (B2B)

  • 50% of British businesses (EU: 49%) active or interested in selling to businesses outside their national market named a variety of contract-law related obstacles as a barrier to cross-border trade;
  • Obtaining legal advice on foreign contract law 39% (EU: 31%)
  • Finding out about foreign contract law 36% (EU: 35%)
  • Agreeing on which contract law should apply 36% (EU: 30%)
  • Resolving cross-border disputes 31% (EU: 32%)
  • 44% (EU: 70%) of British traders would use a single EU contract law for cross-border transactions with businesses.

Suggested improvements for UK consumers


  1. The Common European Sales Law will encourage consumers to buy across borders by offering them a set of rights that ensure a high level of consumer protection, especially when buying online.
  2. It will increase the goods and services that are on offer. With businesses competing on a broader market, the consumer will have more choice of goods at lower prices.
  3. Under the Common European Sales Law, if a business fails to deliver the goods, a consumer can require the business to do so. Such a general right does not exist in the UK: courts will almost invariably offer a financial compensation to the consumer instead of imposing the delivery of the goods. In certain circumstances, this is less convenient and effective for the consumer as he will have to look for another seller of the same good, at the same conditions and conclude a new transaction.
  4. Under the Common European Sales Law, British consumers making a purchase under the Sales Law have more certainty when a trader makes a statement about a product before purchase. This will become part of the contract and the seller will be obliged to honour the obligation deriving from that statement. Current UK law does not provide the same legal certainty.

Suggested improvements for UK companies and SMEs


  1. At a time when Europe is recovering from a deep economic and financial crisis, the EU must do all that it can to help remove unnecessary costs and expand opportunities for business to export into new markets.
  2. British businesses exporting to new markets can rely on a comprehensive set of identical contract law rules that they can use no matter where they trade in the EU.
  3. Under the Common European Sales Law, in business-to-business deals, firms will benefit from clearer information about the main characteristics of goods and services they can expect to receive before concluding a contract. If the required information is missing, the firm could have the right to avoid the contract or even obtain damages. Existing UK provisions do not give such a direct right to information before the contract is signed.
  4. Under the Common European Sales Law, smaller firms are strengthened in cases where a business imposes unfair terms or conditions in a contract. If a large company uses terms which grossly deviate from good commercial practice and are contrary to good faith, the other party will not be bound by them. Existing UK law does not contain such a control of unfair standard contractual terms.

UK response


The UK Government's response to the proposed European sales law is being managed by the Ministry of Justice with E RADAR participating in the stakeholder group.

The general attitude of stakeholders appears to be against the proposal due to lack of need and an incorrect legal basis. However, some business associations clearly welcome a proposal to help small and medium-sized businesses compete better across the Single Market, especially doing business online. E RADAR also supports this view. However, without empirical data and supporting evidence, we cannot yet determine whether the sales law proposal will help, hinder, or do nothing for online business.