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The EU Council of Ministers has agreed on a proposal to harmonise the handling of contract disputes across Europe.
The Rome I rules will come into force in 18 months. They govern whose law applies in the case of a civil or commercial contractual dispute.
Contracts are currently governed by the 1980 Rome Convention, which determines which country's law applies but does not harmonise laws.
Rome I is a proposed successor and the UK government plans to seek permission to become part of the new rules after opting out in 2006.
It said at the time that the regulations affected consumer law too greatly.
Now the government says the regulations more accurately reflect the content of the Rome Convention.
The Rome Convention states that in business to business cases it is advisable to state in the standard contract terms which county's law will apply in the event of a dispute.
In a business to consumer dispute, the applicable law will be that of the consumer's country if the supplier sells to other European countries and its website is geared to doing so, or that of the supplier's country if it only intends to sell in the UK and its website reflects that.
