Key provisions
The Limitation Convention applies to contracts for the sale of goods between parties whose places of business are in different States if both of those States are Contracting States or when the rules of private international law lead to the application to the contract of sale of goods of the law of a Contracting State. It may also apply by virtue of the parties' choice.
The limitation period is set at four years (art. 8). Subject to certain conditions, that period may be extended to a maximum of ten years (art. 23). Furthermore, the Limitation Convention also regulates certain questions pertaining to the effect of commencing proceedings in a Contracting State.
The Limitation Convention further provides rules on the cessation and extension of the limitation period. The period ceases when the claimant commences judicial or arbitral proceedings or when it asserts claims in an existing process. If the proceedings end without a binding decision on the merits, it is deemed that the limitation period continued to run during the proceedings. However, if the period has expired during the proceedings or has less than one year to run, the claimant is granted an additional year to commence new proceedings (art. 17).
No claim shall be recognized or enforced in legal proceedings commenced after the expiration of the limitation period (art. 25(1)). Such expiration is not to be taken into consideration unless invoked by parties to the proceedings (art. 24); however, States may lodge a declaration allowing for courts to take into account the expiration of the limitation period on their own initiative (art. 36). Otherwise, the only exception to the rule barring recognition and enforcement occurs when the party raises its claim as a defense to or set-off against a claim asserted by the other party (art. 25(2)).