South African Fruits Pty Ltd ("SAF") is a company registered and operating in South Africa. It is in the business of growing and exporting strawberries from Cape Town to various countries internationally. The delivery point of the strawberries is always at the buyer's home port and payment is made by Electronic Funds Transfer into SAF's account in Cape Town. A series of contracts between SAF and Duvel BV, a company situated in Antwerp, Belgium were concluded. Disputes have arisen in one of the contracts between the parties. In the contract SAF agreed to hold some of the arbitral hearings in Antwerp but chose Johannesburg as the legal seat of the arbitration with the arbitration to be administered under the UNCITRAL Arbitration Rules 2010. The parties did not choose a substantive law of the contract. SAF is concerned about the failure to include a choice of law clause and approaches you for an opinion. SAF thinks that it may be able to convince Duvel to accept a choice of lex mercatoria as the governing law of the contract. Advise SAF on whether this is a suitable choice and, if not, how the tribunal should embark on designating the applicable law in the absence of choice.

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The selection of Lex Mercatoria the law of merchants as the governing law of the contract can be a suitable choice in international commercial arbitra... View the full answer