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Arts & Communication Legal risks and art exhibition contracts

referred to as the lex causae. The determination of the lex principle of the most significant relationship. For
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causae is particularly important for international contracts. example, Article 41 of the PRC’s Law on Application
For contractual obligations, there are currently two of Laws stipulates a statutory method for determining
main principles for the application of laws: the principle the applicable law of a contract, which is neither the
of autonomy of will and the principle of the most law of the parties’ habitual residence nor the law most
significant relationship. The principle of autonomy of closely related to the contract. Clearly, in matters of
will allows contract parties to mutually agree to choose contractual obligations, international practice respects
the law governing the contract. The principle of the most the autonomy of the parties and their choice of applicable
significant relationship refers to applying the law of the law. In addition, artworks in international exhibitions
country (region) with the closest connection to the case in also involve property rights (or real rights). In general,
cases of foreign civil and commercial litigation. Article 41 artworks are considered personal property, and the
of the Law of the People’s Republic of China on Application principle of applying the law of the location of the movable
of Laws to Foreign-Related Civil Relations (hereinafter property to determine property rights is internationally
referred to as PRC’s Law on Application of Laws) allows recognized. Both the U.S. and EU countries follow this
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contract parties to freely choose the law applicable to their principle. Article 38 of Taiwan’s Law on Application of
contract. Furthermore, Article 5 of the Supreme People’s Laws also stipulates that property rights follow the law of
Court Interpretation on Certain Questions Concerning the the location of the movable property. However, Mainland
Application of the Law of the People’s Republic of China on China’s law adheres to the principle of autonomy of will
Application of Laws to Foreign-Related Civil Relations (I) when confirming property rights relationships, allowing
(hereinafter referred to as PRC’s Interpretation of the Law parties to agree on which law should apply. If the parties
on Application of Laws(I)) clarifies that even if the parties do not choose, the law of the location of the movable
choose a law not directly connected with the foreign civil property at the time the legal facts occurred will apply.
relations in dispute, the chosen law is still respected. It is important to note that lex causae refers to
The U.S. also allows parties to choose the substantive laws that regulate rights and obligations
law applicable to their contract in Article 187 of between parties, while procedural laws related to litigation
Restatement（Second）of Conflict of Laws, but it requires do not apply to the determined lex causae. Internationally,
that the law chosen by the parties must have a reasonable it is a recognized principle that procedural laws are
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connection to them. However, the revised Article 1-301 determined by the location of the court (lex fori). For
of the Uniform Commercial Code abolishes the original example, Article 122 of the Restatement (Second) of
reasonable connection requirement, and its restrictions Conflict of Laws in the U.S. declares that procedural rules
have been narrowed. are usually determined by local laws in courts. Similarly,
Article 270 of the Civil Procedure Law of the People’s
EU countries established the principle of autonomy Republic of China (2023 revision) provides comparable
of will in Article 3 of Regulation (EC) No 593/2008 (also provisions.
called “Rome I”). Rome I does not explicitly require that
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the law chosen by the parties have a practical connection In addition, if the parties have agreed on the contractual
to the contract. However, from general legal interpretation applicable law, there may be legal issues regarding the
principles and relevant literature, it appears that EU validity of this agreement. The international consensus
countries neither require nor expect the applicable law is that the legal validity of the contract does not affect
to have a practical connection. In the Taiwan Province the legal validity of the clause stipulating the applicable
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of China, Article 20 of the Law on Application of Laws to law, which can be seen as an independent “choice of
Foreign-related Civil Relations (hereinafter referred to as law contract,” no different from a general contract. This
Taiwan region’s Law on Application of Laws) also stipulates “choice of law contract” requires the parties’ expressions
that the applicable law for establishing a debt relationship of intent to be true and consistent; otherwise, the choice
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shall be determined according to the intention of the of law may be invalid. There are two main approaches
parties. to determining the validity of a choice of law clause:
one is to assess it based on the law chosen by the parties
If the parties to the contract do not choose the
applicable law, most countries (regions) adopt the 8 The relevant provisions of other countries (regions): Article
188 of Restatement (Second) of Conflict of Laws of the U.S.,
7 See Regulation (EC) No 593/2008 of the European parliament Article 4 of “Rome I” of the European Union, and Article
and of the council of 17 June 2008 on the law applicable to 20 of the Law on Application of Laws to Foreign-related Civil
contractual obligations (Rome Ⅰ), L.177, 4.7.2008, P 10. Relations of Taiwan region.

Volume 3 Issue 1 (2025) 3 doi: 10.36922/ac.2881