Contract terms and conditions Sales contracts are usually agreed between a seller and buyer acting in their normal course of business, rather than between private individuals. Moreover, many sellers and buyers have their own standard conditions of sale and purchase. These set out the terms on which they normally conduct business and will typically be included by reference in a sales contract. Problems can arise, however, because there are likely to be some differences between the standard terms of the seller and those of the buyer. The two parties may well exchange these standard terms during pre-contract negotiations. If the differences are not resolved at this stage, problems can arise later if there is a dispute. This is because it can be difficult to establish which set of conditions, if either, will apply to the transaction. In extreme cases, the dispute will be taken to a court or tribunal, where a judge or arbitrator might decide that no contract was ever concluded because the seller and buyer did not agree on the applicable conditions. In practice, however, a judge or arbitrator is likely to try to seek a resolution by determining one or other set of conditions applies, or even that both sets of conditions apply to the extent that they do not conflict. The law governing contracts In most cases, sales contracts are governed, at least in part, by the laws of the country in which one of the parties involved is located. The seller and buyer may themselves agree which law is to apply by including a specific provision in the sales contract. If there is no such agreement or provision, then in the event of a dispute a judge or arbitrator may first have to determine the governing law. In these circumstances, a judge or arbitrator will often decide to apply the law of the country most connected with the contract, which may be the country to which the goods are being delivered. The use of trade terms (Incoterms – see section 5.3) determines the point at which delivery is deemed to have occurred, for example a seller fulfils its delivery obligation when the goods are loaded on board a ship at the named port of loading under both CIF (‘cost, insurance and freight’) and FOB (‘free on board’) Incoterms. There have been a number of attempts to introduce an international law for export sales. The latest is the United Nations Convention on Contracts for the International Sale of Goods (CISG), signed on 11 April 1980 in Vienna and which came into force as a multilateral treaty on 1 January 1988, after being ratified by 11 countries. The CISG provides a standardised set of legal rules for import–export transactions. As of July 2015, 83 countries had ratified the Convention.