An optional EU-wide contract law moved a step closer last week when the European parliament approved the measure by a strong majority.

A plenary session backed the Common European Sales Law (CESL) by 416 votes to 159, with 65 abstentions.

Conservative MEPs had opposed the law, claiming it is based largely on civil rather than common law, and that the City of London would lose out to the US if the law became a default for cross-border contracts across the EU.

The Law Society said it does not believe that a need for a single law has been demonstrated.

Viviane Reding (pictured), European Commission vice-president and justice commissioner, said the law ‘will cut transaction costs for small businesses while giving Europe’s 507 million consumers greater choice at cheaper prices when shopping across borders’.

Under the proposed law, businesses and consumers have the choice of using a single European sales law for cross-border contracts when offering goods across the EU.

‘This innovative and subsidiarity-friendly approach leaves national legislation untouched and provides an incentive to develop a high-standard law that is appealing to traders and consumers – because only then will they choose to use it instead of national law,’ the commission said.

To become law the proposed regulation will now have to be adopted by the Council of Ministers.

European contract law expert Chantal Mak, visiting professor at the Center for Transnational Legal Studies in London, said the vote gives democratic legitimacy to the adoption of the instrument and has strong symbolic value.

‘The debate on the CESL has regularly made reference to the relation of private law to the nation-state and national legal cultures. The strong backing of the CESL by parliament shows that there is significant support for a transnational instrument of contract law, which may inspire the further evolution of a European legal culture.’

Meanwhile, in a rare concession to the value of EU-wide judicial competence, the UK government announced it is opting in to measures to expand the use of the European Small Claims Regulation.