International Contract Law

In the gobalized economy many contracts concern more than one country: The parties of the contract might be in different countries or the object of the contract (i.e. delivery or other performance) is related to another place.

Each country has its own laws and regulations. An international law in the real sense of the word does not really exist with some exceptions based upon international conventions like the United Nations Convention on the International Sale of Goods (CISG) . Otherwise we understand international private law as rules regarding the conflicts of law, meaning conflicts of the laws of different countries. But even those conflict of law rules are basically national laws with the laws of other countries. While within the EU there is a certain harmonization of this international private law, the conflict rules of two countries can be in conflict themselves.

In international commercial transactions it is therefore important to forsee those potential hurdles and to consider them beforehand in the contract itself. It can be a mistake to just use a domestic contract form and to expect the same rules to apply.

The parties should also agree on the proper forum (meaning the competent court) to handle possible disputes or to include an arbitration clause. Arbitration can be a more efficient, less costly and less public way to settle a problem.

Again, each situation is different and the desirable might be limited by the possible, like the bargaining power of a party. Contract negotiations should in general respect the economical background and not destroy the marketing efforts. A contract is part of the deal making and should not be deal breaking.

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