Passing of Risk in International Sales under the Vienna Convention (CISG)

The United Nations Convention on Contracts for the International Sale of Goods, commonly known as the Vienna Convention or CISG, has been part of Turkish law since Turkey became a party to it, and it has applied in Turkey since 1 August 2011. Our Turkish article examines one of its most practical questions for exporters and importers: the point at which the risk of loss of or damage to the goods passes from the seller to the buyer.

The article first sets out when the Convention applies, looking at its territorial, personal, temporal and subject-matter scope. It then explains the concept of risk, distinguishing between the risk relating to the goods themselves and the risk of having to pay the price even though the goods have been lost or damaged.

The core of the article is an analysis of Articles 67, 68 and 69 of the Convention. Article 67 governs sales involving carriage of goods, where risk generally passes when the goods are handed over to the first carrier. Article 68 deals with goods sold while in transit, and Article 69 covers the remaining cases, where risk generally passes when the buyer takes over the goods or fails to do so in time.

Since the allocation of risk determines who bears the loss when goods are damaged on the way, it is worth reviewing the relevant contract terms, including any Incoterms used, before the goods are shipped.

This is a short English summary of our article published in Turkish.