''Lex mercatoria'' (from the

Latin Latin (, or , ) is a classical language belonging to the Italic branch of the Indo-European languages. Latin was originally a dialect spoken in the lower Tiber area (then known as Latium) around present-day Rome, but through the power of the ...

for "merchant law"), often referred to as "the Law Merchant" in English, is the body of commercial law used by merchants throughout Europe during the

medieval In the history of Europe, the Middle Ages or medieval period lasted approximately from the late 5th to the late 15th centuries, similar to the post-classical period of global history. It began with the fall of the Western Roman Empire ...

period. It evolved similar to English

common law In law, common law (also known as judicial precedent, judge-made law, or case law) is the body of law created by judges and similar quasi-judicial tribunals by virtue of being stated in written opinions."The common law is not a brooding omnipres ...

as a system of custom and best practice, which was enforced through a system of merchant courts along the main trade routes. It developed into an integrated body of law that was voluntarily produced, adjudicated and enforced on a voluntary basis, alleviating the friction stemming from the diverse backgrounds and local traditions of the participants. Due to the international background local state law was not always applicable and the merchant law provided a leveled framework to conduct transactions reducing the preliminary of a trusted second party. It emphasized contractual freedom and inalienability of property, while shunning legal technicalities and deciding cases ''

ex aequo et bono ''Ex aequo et bono'' (Latin for "according to the right and good" or "from equity and conscience") is a Latin phrase that is used as a legal term of art. In the context of arbitration, it refers to the power of arbitrators to dispense with conside ...

''. With ''lex mercatoria'' professional merchants revitalized the almost nonexistent commercial activities in Europe, which had plummeted after the fall of the Roman Empire. In the last years new theories had changed the understanding of this medieval treatise considering it as proposal for legal reform or a document used for instructional purposes. These theories consider that the treatise cannot be described as a body of laws applicable in its time, but the desire of a legal scholar to improve and facilitate the litigation between merchants. The text is composed by 21 sections and an annex. The sections described procedural matters such as the presence of witnesses and the relation between this body of law and common law. It has been considered as a false statement to define this as a system exclusively based in custom, when there are structures and elements from the existent legal system, such as Ordinances and even concepts proper of the Romano-canonical procedure. Other scholars have characterized the law merchant as a myth and a seventeenth-century construct.

Common law development

We find reference to the law merchant as early as 13 Edw. 4 (1473/4): "'the king has jurisdiction over them erchantsto put them to stand (estoyer) to right, etc., but this will be 'according to the laws of nature' (secundum legem naturae) which is called by some 'law merchant', which is universal law for everyone (tout le monde)." English courts applied merchant customs only if they were "certain" in nature, "consistent with law" and "in existence since

time immemorial Time immemorial ( la, Ab immemorabili) is a phrase meaning time extending beyond the reach of memory, record, or tradition, indefinitely ancient, "ancient beyond memory or record". The phrase is used in legally significant contexts as well as ...

". English judges also required that merchant customs be proven before the court. But even as early as 1608, Chief Justice Edward Coke described ''lex mercatoria'' as "a part of the common law", and

William Blackstone Sir William Blackstone (10 July 1723 – 14 February 1780) was an English jurist, judge and Tory politician of the eighteenth century. He is most noted for writing the ''Commentaries on the Laws of England''. Born into a middle-class family ...

would later concur. The tradition continued especially under

Lord Mansfield William Murray, 1st Earl of Mansfield, PC, SL (2 March 170520 March 1793) was a British barrister, politician and judge noted for his reform of English law. Born to Scottish nobility, he was educated in Perth, Scotland, before moving to Lond ...

, who is said to be the father of English commercial law. Precepts of the ''lex mercatoria'' were also kept alive through equity and the admiralty courts in maritime affairs. In the US, traditions of the ''lex mercatoria'' prevailed in the general principles and doctrines of commercial jurisprudence. Sir John Holt (Chief Justice 1689 to 1710) and

(Chief Justice, 1756 to 1788) were the leading proponents of incorporating the ''lex mercatoria'' into the common law. Holt did not complete the task, possibly out of his own conservatism (see '' Clerke v Martin'') and it was Lord Mansfield that became known as the 'founder of the commercial law of this country" (Great Britain). Whilst sitting in

Guildhall A guildhall, also known as a "guild hall" or "guild house", is a historical building originally used for tax collecting by municipalities or merchants in Great Britain and the Low Countries. These buildings commonly become town halls and in som ...

, Lord Mansfield created,

a body of substantive commercial law, logical, just, modern in character and at the same time in harmony with the principles of the common law. It was due to Lord Mansfield's genius that the harmonisation of commercial custom and the common law was carried out with an almost complete understanding of the requirements of the commercial community, and the fundamental principles of the old law and that that marriage of idea proved acceptable to both merchants and lawyers.

* Statute of Merchants 1285 (11 Edw I and 13 Edw I) aka "Statute of Acton Burnell"

International Commercial Law and Arbitration

''Lex mercatoria'' precepts have been reaffirmed in new international mercantile law. The new commercial law is grounded on commercial practice directed at market efficiency and privacy. Dispute resolution has also evolved, and functional methods like international commercial arbitration is now available. These developments have also attracted the interest of empirical sociology of law.

Present and future commercial law

''Lex mercatoria'' is sometimes used in international disputes between commercial entities. Most often those disputes are decided by arbitrators which sometimes are allowed (explicitly of implied) to apply ''lex mercatoria'' principles.Some examples of such arbitral awards
Collected by Trans-Lex.org
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References

Bibliography

* JH Baker. "The Law Merchant and the Common Law", ''Cambridge Law Journal'' 38, no. 295 (1979). * Mary Elizabeth Basile et al. ''Lex Mercatoria and Legal Pluralism: A Late Thirteenth Century Treatise and Its Afterlife''. Cambridge, MA: Ames Foundation, 1998. * Wyndham Beawes. ''Lex Mercatoria: Or, A Complete Code of Commercial Law'', F. C. and J. (Rivington, 1813) * Bruce L. Benson. "The Spontaneous Evolution of Commercial Law", ''Southern Economic Journal'' 55, no. 3 (1989): 644–661. * * Lisa Bernstein & Francesco Parisi, eds. ''Customary law and economics''. Cheltenham (UK)–Northampton, MA: Edward Elgar Publishing Limited, 2014. * Daniel R. Coquillette. �
Legal Ideology and Incorporation II: Sir Thomas Ridley, Charles Molloy, and the Literary Battle for the Law Merchant, 1607–1676
��, ''Boston University Law Review'' 61 (1981): 315–371. * C Gross & H Hall, eds., Selden Society, ''Select Cases on the Law Merchant'' (1908–32) * WH Hamilton, 'The Ancient Maxim Caveat Emptor' (1931) 50 Yale Law Journal 133, who shows that '' caveat emptor'' never had any place in Roman law, or civil law, or ''lex mercatoria'' and was probably a mistake when implemented into the common law.
G Malynes, ''Consuetudo vel lex mercatoria'' (London, 1622)
* Paul Milgrom, Douglass North, & Barry Weingast. �
The Role of Institutions in the Revival of Trade: The Medieval Law Merchant
��, ''Economics and Politics'' 2, no. 1 (1990): 1–23. * W Mitchell, ''The Early History of the Law Merchant'' (Cambridge, 1904) * Theodore Plucknett. ''A Concise History of the Common Law'', 5th edn. Getzville, NY: William S. Hein & Company, 2001. * JS Rogers, ''The Early History of the Law of Bills and Notes'' (1995) chapter 1 * John William Smith, ''Mercantile Law'' (ed. Hart and Simey, 1905). * Leon E. Trakman. ''The Law Merchant: The Evolution of Commercial Law''. Littleton, Colo.: F.B. Rothman, 1983.

External links

The Lex Mercatoria on-line

* ttp://www.econtalk.org/archives/2006/12/boudreaux_on_la.html Boudreaux on Law and LegislationPodcast on law vs. legislation, including modern applications of ''lex mercatoria'' and economic theory. EconTalk at Econlib
Trans-Lex, a research and codification platform for transnational law / ''lex mercatoria''
* Gesa Baron:

'' * Bernard Audit: '' ttp://www.cisg.law.pace.edu/cisg/biblio/audit.html The Vienna Sales Convention and the Lex Mercatoria'' * CISGbr>(text)

History and current implications of Lex mercatoria
{{DEFAULTSORT:Lex Mercatoria History of contract law Customary legal systems History of international trade