The Impact of Unconventional and Fraudulent Conduct on International Commercial Contracts under European Union Regulations

Abstract

With the expansion of commercial exchanges in the era of globalization, international commercial contracts have become increasingly exposed to the risks of unconventional and fraudulent conduct. As one of the world’s largest economic blocs, the European Union has developed specific legal mechanisms to combat such practices and protect the principle of good faith in transactions. Commercial reasonableness, as a legal principle, occupies an important position in European contract law. Given its numerous manifestations and broad scope of application, this principle has been recognized as a fundamental principle of contract law in various international instruments, including the United Nations Convention on Contracts for the International Sale of Goods, the Principles of European Contract Law, and the proposed Common European Sales Law. Employing a descriptive-analytical method and a comparative approach, this study examines the effects of fraud and fraudulent conduct on the validity, enforceability, and performance of contracts in light of instruments such as the Unfair Commercial Practices Directive and the revised Principles of European Contract Law. The findings indicate that the European Union’s approach extends beyond the mere award of damages and emphasizes deterrence, transparency, and the protection of the weaker party. The results further demonstrate that engaging in unconventional conduct may lead to the absolute or relative invalidity of a contract, the imposition of substantial administrative penalties, and the loss of commercial credibility within the European single market.