A Study on the Standards for the Foreseeability of Damage in CISG

Purpose – This research aims to provide standards for the judgment of “foreseeability” in the general principle of compensation for damages in Art. 74 of CISG. Design/Methodology/Approach – This research analyzes the legal interpretation of CISG’s provisions related to damage (Art.74~Art.77) and related precedents. Findings – The results revealed the “principle of rationality” as a criterion for judging the “foreseeability” of Art.74 of CISG. Research Implications – From a practical point of view, it is difficult to predict the outcome of disputes in a situation where there is no standard for “foreseeability” as to the extent of damages from the point of view of the party liable under CISG. Therefore, it can be said that the appropriate criteria for “foreseeability” are essential. This paper presents the “principle of rationality” as a standard for. The rationality principles were extracted from the following three provisions of Art.74, namely Art.75~Art.77. These criteria are that the item of recoverable loss must be reasonable, and the amount of recoverable damage must be reasonable. This research is meaningful in presenting standards of damages to trade transaction practitioners.