Feasibility Study of Contract Divisibility in the Iran Mercantile Exchange: A Comparative Study of Iranian Legal System and the United Nations Convention on Contracts for the International Sale of Goods (CISG)

Commodity exchanges, being among the key foundations of the capital market, hold a crucial role in the country’s economic development. The prospect of their internationalization necessitates the study of relevant global laws and regulations, along with establishing frameworks to apply these laws within the exchanges. One such law is the severability of contracts, which is mentioned in the United Nations Convention on Contracts for the International Sale of Goods (CISG-۱۹۸۰). Research indicates that, in contrast to the Convention, which permits the buyer to terminate the entire contract under specific conditions, the current settlement and clearing regulations of the Iranian commodity exchange prevent the buyer from canceling the entire contract in the event of partial delivery delays. Instead, the buyer is only able to cancel the undelivered portion and seek penalties. Conversely, the regulations of the Iranian commodity exchange have overlooked the concepts of severability and partial termination of contracts by the seller. In cases where the buyer fails to deposit a portion of the payment into the clearing house account, the entire contract is automatically terminated, with no provision allowing the seller to deliver goods corresponding to the amount received. This descriptive-analytical study aims to investigate this issue in depth.

Keywords:

Convention of sale , Iran Commodity Exchange , Settlement and clearing , Severability of contracts