This European Union Committee report considers the proposal for a Draft Common Frame of Reference in respect of European contract law. The Draft contains principles, definitions, and model rules in the form of a code covering wide areas of Civil Law. The Committee sets out a number of conclusions and recommendations: the Committee notes some significant issues relating to the general approach the Draft adopts, along with differences between the model rules set out in the Draft and the provisions of English common law; the Committee remains opposed to a harmonised code of European contract law and does not believe the European Commission has a useful role in promoting or developing an alternative set of contractual terms for use by contracting parties; the Committee believes one way forward may be for the Commission to identify particular key areas that give difficulty under existing Community law or are likely to require legislative intervention; and, the Committee recognises the value of the Draft as an academic work by presenting useful material for discussion and believes that it can act as an aid to the mutual understanding of the diverse legal systems represented in the European Union.