thesubject-matter ofthedispute ismostclosely connected; or "(c)thesubject-matter ofthearbitration agreement isotherwise related tomorethanoneState. "(3)Forthepurposes ofparagraph (2)ofthisarticle, ifapartyhasmore thanoneplaceofbusiness, therelevant placeofbusiness isthatwhichhas theclosest relationship tothearbitration agreement. Ifapartydoesnot haveaplaceofbusiness, reference istobemadetohishabitual residence. "*Article headings areforreference purposes onlyandarenottobe usedforpurposes ofinterpretation. "** The term'commercial' should begivenawideinterpretation soasto covermatters arising fromallrelationships ofacommercial nature. Relationships ofacommercial natureinclude, butarenotlimited to,the following transactions: anytradetransaction forthesupplyorexchange of goods;distribution agreement; commercial representation oragency, factoring; leasing; construction ofworks;consulting; engineering; licensing, investment; financing; banking; insurance; exploitation agreement or concession; jointventure andotherformsofindustrial orbusiness co-operation; carriage ofgoodsorpassengers byair,sea,railorroad." Substantive scopeofapplication: international commercial arbitration 18.Whilesomeconcern wasexpressed aboutrestricting thesubstantive Scopeof application tointernational commercial matters, theCOmmission was agreedthatthe drafttextshould begearedtoanacoveronlyinternational commercial arbitration. -6-•Theterm"commercial" 19.Divergent viewswereexpressed astotheappropriateness ofthefootnote accompanying paragraph (1)asregardsitsformaswellasitscontent, although it wasgenerally agreedthattheterm"commercial" should begivenawide interpretation. Underoneview,thefootnote should bedeleted sinceinmanylegal systems, inparticular thosewhichdidnotusethetechnique ofafootnote, it wouldbewithout legalvalue. Instead, anattempt should bemadetodefine the term"commercial" inthebodyofthelawitself. Suchadefinition might,for example, bebasedon ashortened version ofthetextcontained inthefootnote or by areference inarticle 1(1)todisputes arising fromtradeorcommerce. An alternative suggestion wastopresent theguideline forinterpretation, contained inthefootnote, inacommentary orinthereport ontheproceedings. 20.Theprevailing viewwasthatthefootnote should beretained, thoughpossibly withcertain modifications. Itwasrealized thatnogenerally acceptable definition hadbeenfoundtodateandthatanydefinition wouldentailcertain risks.Itwasfeltthatthefootnote, despite itsuncertain legaleffect, could provide usefulguidance ininterpretation, atleasttothedrafters ofanynational enactment ofthemodellaw. 21.AnumberofmOdifications wereproposed tothetextofthefootnote, whether thetextwouldberetained ina footnot~ orincorporated intothebodyofthelaw itself. Oneproposal wastoclarify that,inlinewitharticle 7(1), non-contractual relationships wereIncLuded , sincetheterm"transaction" might leadtotheopposite result. Otherproposals weretoaddtothelistofexamples suchcommercial activities asservices andprocessing aswellasagreements on international economic co-operation. 22.Inviewofthefactthatcertain national lawsofcivillawtradition drewthe linebetween commercial andciviltransactions according towhether ornotthe parties involved werecommercial persons (merchants), therewassupport forthe proposal tostateintheopening sentence thatthequalification ofarelationship ascommercial didnotdepend onthenatureorcharacter oftheparties. That proposal wasobjected toonthegroundthatsuchwording mightbeconstrued as touching uponthesensitive issueofStateimmunity. TheCommission wasagreed thattherewas nointention todealwtththatissueinthemodellawandthat,if theproposal weretobeaccepted, itwouldhavetobemadeclearthatruleson Stateimmunity werenotaffected. Another concern wasthattheillustrative list ofcommercial relationships couldbeconstrued asmeaning inpositiv~ termsthat anydispute arising therefrom wouldbecapable ofsettlement byarbitration. Asto adecision relating tothatconcern, seebelow,paragraph 29. 23.TheCommission established anad hoc working partycomposed ofthe representatives ofChina, Hungary andtheUnitedStates andrequested itto
**Analysis**
The text appears to be discussing the principles and scope of application of international commercial arbitration, including the definition of "commercial" and the types of disputes that may be subject to arbitration. The language used is formal and technical, suggesting a focus on legal and regulatory issues rather than economic development, natural resources, or environmental concerns.

**Category**
International trade, Industry