It can also ensure that its governing law provisions mirror its jurisdiction clauses. A party can choose a governing law with which it is comfortable and familiar. Doing so allows parties to achieve greater certainty as to the extent and scope of their relationships with their counterparties. In almost all cases where commercial parties are negotiating a contract with an international element, it will be prudent to include a governing law clause. Such a choice must be made expressly or clearly demonstrated by the terms of the contract or the circumstances of the case (a slightly different test to that applied under the Rome Convention). Article 3(1) of Rome I therefore provides that a contract will be governed by the law chosen by the parties. The cornerstone of Rome I is the principle of party autonomy. Where neither the Rome Convention nor Rome I apply, the English courts will generally look to the common law. The governing law of contracts entered into prior to 17 December 2009 will continue to be determined by reference to the Rome Convention, to the extent that such contracts fall within the scope of that Rome Convention. Rome I will be applied to contracts entered into on or after 17 December 2009. The governing law of contractual obligations determined under Rome I will govern not only questions of interpretation and performance, but also factors such as how obligations can be extinguished and the assessment of damages (in so far as it is governed by rules of law). Further, the courts of Member States will also apply Rome I even if some or all of the parties appearing before them are non-European. Where a contractual obligation falls within the scope of Rome I, its rules will be applied by the courts of Member States even if the application of those rules results in a non-EU law (eg Indian law) being the governing law of any contractual obligations. These exclusions should be considered in detail when determining whether Rome I applies to a particular matter. By way of further example, it also excludes arbitration agreements and agreements on choice of court, and certain company matters. For example, Article 1(2)(d) excludes contractual obligations “arising under bills of exchange, cheques and promissory notes and other negotiable instruments to the extent that the obligations under such other negotiable instruments arise out of their negotiable character”. There are, however, a number of specific exclusions. Rome I applies to contractual obligations arising in civil and commercial matters. There are some important changes which will have practical implications for commercial parties.
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