"A well-drafted contract is not just a formality; it's the cornerstone of trust in any business relationship, laying out clear expectations and responsibilities for all parties involved."
Ellie van der Aa
– International Legal Safeguard
International contracts
The linchpin for sustainable business success
Ink it, don’t just think it
In international business, proper legal preparation is essential for success. Surprisingly, however, this aspect often receives insufficient attention in practice due to financial constraints or convenience, underestimating the importance of well drafted contracts.
Contrary to common misconceptions, contracts hold significant importance even in regions like the Middle East. They serve as crucial documentation in case of disputes and can sway judgements in your favor if properly drafted and enforceable. While some may view contracts as a sign of mistrust, they provide assurance for both parties, ensuring that each receives what they have bargained for. Through my involvement in various disputes, particularly in the construction sector, I’ve witnessed firsthand the importance of solid contracts with your international partners. It prevents a lot of trouble afterward.
‘Do it your-self’ contract
One of the most significant pitfalls in international contracts is the temptation to resort to 'do-it-yourself' contracts to cut down on legal expenses. While copying and pasting may seem straightforward, it's unwise to proceed without legal expertise or experience in contract drafting. For instance, a simple error in outlining liabilities could lead to substantial financial losses down the line, outweighing any initial cost-saving measures.
In practice, we've witnessed numerous cases of how things can go wrong when legal preparation is inadequate. For example, one of our clients entered into a partnership with a Saudi company, to establish a manufacturing facility. The contract lacked clarity regarding the allocation of profits and decision-making authority. Disputes arose over revenue distribution with the Saudi company claiming a larger share based on cultural expectations of hospitality and relation-based business practices. The lack of clear contractual provisions led to strained relations between parties. Eventually, the project stalled, resulting in financial losses for both parties and managing their reputations in the region.
Understanding applicable laws
In international business, different legal systems have their own rules and details. Figuring out which law applies is crucial because it decides what rights and duties each party has. Negotiations often focus on this, so it’s important to think carefully and make smart decisions.
The battle beyond the courtroom
Winning in court is only part of the battle; making sure the judgment is enforced is just as important. A Dutch builder experienced this firsthand when he tried to enforce a judgement won in the Netherlands in Saudi Arabia. He quickly realized it wasn’t as easy as he initially thought. It took a lot of time and money, and by the time he also got a favorable ruling from the Saudi judge, his Saudi partner had already taken measures to evade it.
A Dutch builder experienced this firsthand when he tried to enforce a judgment won in the Netherlands in Saudi Arabia. He quickly realized it wasn't as straightforward as he initially thought. It took a lot of time and money, and by the time the judgment against his Saudi partner could be enforced, the partner had already taken measures to evade it. This highlights the importance of comprehending foreign legal systems and preparing for enforcement in contracts.
Understanding applicable laws
In international business, different legal systems have their own rules and details. Figuring out which law applies is crucial because it decides what rights and duties each party has. Negotiations often focus on this, so it’s important to think carefully and make smart decisions.
The battle beyond the courtroom
Winning in court is only part of the battle; making sure the judgment is enforced is just as important. A Dutch builder experienced this firsthand when he tried to enforce a judgement won in the Netherlands in Saudi Arabia. He quickly realized it wasn’t as easy as he initially thought. It took a lot of time and money, and by the time he also got a favorable ruling from the Saudi judge, his Saudi partner had already taken measures to evade it.
A Dutch builder experienced this firsthand when he tried to enforce a judgment won in the Netherlands in Saudi Arabia. He quickly realized it wasn't as straightforward as he initially thought. It took a lot of time and money, and by the time the judgment against his Saudi partner could be enforced, the partner had already taken measures to evade it. This highlights the importance of comprehending foreign legal systems and preparing for enforcement in contracts.
What’s in a name
Contract language can be confusing, especially in international deals with English terms. Words like 'time is of the essence' might mean different things in different legal systems, so it's crucial to use clear and precise language in contracts.
Without a proper contract and its effective management, you may soon find yourself in court. However, by then, the costs for your company will have significantly increased, and the outcome is uncertain!
Your legal partner in the Middle East and Europe
But fear not! At International Legal Safeguard we’ve got your back. With our extensive experience in international contracts combined with our deep understanding of cultural nuances in Europe and the Middle East, we’re here to guide you every step of the way.
Whether you’re a multinational, or a small or medium-sized enterprise, we tailor your legal services to meet your specific needs. And with offices in the Netherlands, Spain and Dubai, we’re well equipped to handle your international legal matters wherever you may be.
By choosing International Legal Safeguard, you gain a trusted legal partner who not only understands the complexities of international law but also the cultural sensitivities that can make or break a deal. With us by your side, you can confidently expand your international business to the Middle East or Europe, knowing that your legal interest are in capable hands.
Curious about your legal implications of your plans in the Gulf region and Europe? Click here to find out.
