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International contractual disputes arise between individuals or organisations from different countries. The parties involved have to deal with many complex issues in different jurisdictions. In order to protect your interests, it is advisable to make clear agreements with specific terms and clauses which can help in case of disputes. There are three major factors to be considered while forming an international contract.
1) Who will govern it?
Different countries have different law; therefore, it is very important to clearly mention in the contract which set of law will govern it. Especially in cases where the contract is made between several places or countries it is necessary to clearly mention the governing law in the contract. The governing law will determine which legal rules will be applied to the contract and the rules to be applied in case of breach of contract. Since every country has their own set of legal rules, the final conclusion may vary despite the same set of evidences and facts.
2) Under whose jurisdiction?
It is also important to include the jurisdiction clause in the contract when a dispute arises. Despite both parties being in other countries, the UK is often used as the jurisdiction of choice for its perceived stability and fairness.
Once the court has given its judgement in your favour, the defaulter party has to pay a certain amount as compensation and abide by the court order. Most of the commercial disputes are monetary or financial in nature but in certain cases the court may decide an injunction, this is an authoritative warning from the court which will refrain them from beginning or continuing any act that might invade your legal right.
Clearly international disputes pose another level of legal complexity and costs. If you have a dispute involving an international party then get in touch with PowerLegal for a free appraisal towards our No-Win No-Fee commercial litigation.