A declarative approach to business rules in contracts

We address why, and especially how, to represent business rules in e-commerce contracts. By contracts, we mean descriptions of goods and services offered or sought, including ancillary agreements detailing terms of a deal. We observe that rules are useful in contracts to represent conditional relationships, e.g., in terms & conditions, service provisions, and surrounding business processes, and we illustrate this point with several examples. We analyze requirements (desiderata) for representing such rules in contracts. The requirements include: declarative semantics so as to enable shared understanding and interoperability; prioritized conflict handling so as to enable modular updating/revision; ease of parsing; integration into WWW-world software engineering; direct executability; and computational tractability. We give a representational approach that consists of two novel aspects. First, we give a new fundamental knowledge representation formalism: a generalized version of Courteous Lugic Programs (CLP), which expressively extends declarative ordinary logic programs (OLP) to include prioritized conflict handling, thus enabling modularity in specifying and revising rule-sets. Our approach to im-