In that respect, the convention is applicable in Aruba, the Caribbean Netherlands, Curaçao, Sint Maarten (Kingdom of the Netherlands), Faroer (Denmark), Saint-Pierre and Miquelon, Saint Barthélemy, French Polynesia, Wallis and Futuna and New Caledonia (France).

In addition, a number of issues with a separate characterisation are excluded, namely: Article 3 states the general rule that the parties to a contract have freedom of choice over the applicable law.

To exercise this choice either express words may be used or the intention should be demonstrated with reasonable certainty by the terms of the contract or the circumstances of the case.

For these purposes, it is presumed that the contract is most closely connected with the lex loci solutionis, i.e. the law of the place where the contract is to be performed, or the law of the habitual residence of the person who is to perform, or, in the case of a body corporate or unincorporate, where its central administration is located.

In deciding whether rules are mandatory in the lex fori or a law with which the contract has a close connection, regard shall be had to their nature and purpose and to the consequences of their application or non-application.

But, if this would produce an obviously unfair result, a party may rely upon the law of the place of habitual residence to establish that he did not give a free consent.

The Applicable Law of the transfer will determine the mutual obligations of assignor and assignee as against the third party, i.e. "the debtor".

Under Article 16, the forum court may invoke its own public policy as a justification for refusing to apply the lex causae.

The convention was signed by Belgium, Germany, France, Ireland and Italy, Luxembourg and the Netherlands on 19 June 1980, followed by Denmark and the United Kingdom in 1981, thus covering all members of the European Communities.