The Limits of Contract Laws. The control of Contractual Power in Trade Practices and The Preservation of Freedom of Contract Within Agrifood Global Supply Chains.

Fundacion Ramon Areces / Thomson REUTERS / ARANZADI

Paola IAMICELI

Global

The paper examines the architecture of contracting and the instruments to control the exercise and the abuse of private regulatory power along supply chains. The design of the contractual architecture and its implementation may cause significant unfairness in power distribution that can translate in misallocation of market opportunities, gains, and losses for chain participants.
The control of private regulatory power can protect freedom of contract and the space of choices by individual parties.
Control over the use of private regulatory power within global chains can be implemented through different mechanisms: governance and enforcement. In this chapter we have focused on the latter and examined the various available tools and their combination comparing contract laws and unfair trade practice laws, leaving competition law outside the picture.
We have suggested that current domestic and transnational contract laws present significant shortcomings and that unfair trade practice regulation can complement contract laws to ensure that private regulation of a large number of domestic and transnational contracts are regulated fairly and effectively. In particular, a supply chain approach to unfair commercial practices allows the control of the systemic effects they produce.

The limits of contract laws. The control of contractual power in trade practices and the preservation of freedom of contract within agrifood global supply chains.

Cafaggi Fabrizio