The Law Merchant is a body of legal principles and practices that emerged in Europe during the Middle Ages, and that governed international trade and commerce. It was created by merchants themselves, who sought to develop a set of rules and practices that could facilitate international trade and reduce transaction costs. The Law Merchant was characterized by its flexibility, informality, and commercial orientation, and it was based on principles such as good faith, fairness, and custom.

The Law Merchant evolved over time, in response to changing economic, social, and political conditions. In the 16th and 17th centuries, it was influenced by the development of mercantilism and the emergence of nation-states. In the 19th century, it was further developed by the growth of international trade and the spread of capitalism.

Today, the Law Merchant has been largely replaced by formal legal systems, such as national laws, international conventions, and the rules of international organizations like the World Trade Organization. However, many of its principles and practices continue to influence modern commercial law.

The sources of transnational commercial law are diverse, and include:

1. International conventions and treaties: These are agreements between countries that set out common rules and standards for international trade, such as the United Nations Convention on Contracts for the International Sale of Goods (CISG), which provides a uniform set of rules for contracts for the sale of goods.

2. Customary international law: This is a body of unwritten rules and practices that have developed over time, and that are recognized as legally binding by the international community. For example, the principle of good faith is a widely accepted principle of international commercial law.

3. National laws: National laws of different countries often provide the rules and standards that apply to commercial transactions taking place within their jurisdictions.

4. Case law: Decisions of national and international courts, as well as arbitral tribunals, can provide guidance on the interpretation and application of transnational commercial law.

5. Soft law: This refers to non-binding instruments, such as model contracts, guidelines, and best practices, that are developed by international organizations and industry associations, and that can be used as a reference for commercial transactions.