Laws on contracts are set by individual member states in the European Union (EU). However, the EU has harmonised some aspects of contract law across the whole of the European Community. In addition, some EU legislation affects contract law because it takes precedence over national laws.
If you deal with a business in another EU country, there is a choice about where the contract is made - ie, under which jurisdiction the terms are agreed. Alternatively, the EU has produced a standard contract - called the "Principles of European Contract Law" - the terms of which can be included in any EU contract if both sides agree to it.
This guide explains about contracts and the EU single market, and discusses in detail the Principles of European Contract Law as defined by the European Commission.