There are four elements of contracting negligence liability caused by counter party in the process of signing contract of international sales of goods.

Firstly, both parties prepare or negotiate to sign contract. Secondly, counter party has fault of violating the principle of honesty and credibility. Thirdly our party suffers damages. Last our damages are caused by fault of counter party.

The fault of violating the principle of honesty and credibility consists of three main aspects. The first is the duty of care based on the principle of honesty. For example, both parties have the obligation to inform and instruct something important with the affairs of contracting truthfully. Also neither party may disclose or inappropriately exploit or let any third party exploit business secrets obtained in the process of signing a contract no matter the contract is executed or not. The second is to negotiate maliciously which means one party negotiates with the other party in the guise of contracting while actually doesn’t have the willing of contracting from the beginning. The third is to break off the negotiation of contracting on special occasions that violating the principle of honesty considering the type of contract, degree of negotiation progress, trust and transaction convention of counter party.

One party who believe the contract is established without fault can claim for damages including direct loss and indirect loss when it is the fault of counter party. There are three kinds of direct loss. First is the contracting cost, for example reasonable cost like post and telecommunication cost, travelling expenses etc. Second is the cost preparing for fulfilling the contract, like reasonable expenses of delivering the goods or cost for receiving the goods. The third is the interest of the aforesaid cost. Indirect loss is mainly including the loss of forfeiting and giving up the opportunities to make a contract with a third party. However loss that can claim by one party should be reasonable and predictable.

If there is contracting negligence behavior in the process of signing a contract, but the contract is still established, parties can seek more ways to claim the damages, including cancellation of a contract due to fraud and the warranty liability for detect and so on.

There are no uniform provisions in CISG about this because different countries have different definition or legal consequence of contracting negligence liability. But Principles of International Commercial Contracts has provisions of negotiation in bad faith and obligation of keeping secret.