International contracts
You can also find many free contract templates online, but it is important to assess your sources critically. We recommend several sources where you can find reliable, balanced international contract templates.
Below, you will find a simple introduction to the key points to consider in the most common export contracts.
This section covers the fundamentals of direct sales, where the exporter and importer trade directly without intermediaries. Although the main focus is on goods, some of the points below will also be relevant to service exporters.
Key topics in direct sales agreements include
- definitions
- terms of delivery
- payment terms
- protection of intellectual property rights
- conflict resolution mechanisms
Definitions
Parties
Clearly identify both the seller and the buyer to ensure financial and political security.
Products/services
Detailed and accurate descriptions are essential. Including the HS code (the first six digits of the customs tariff number) can help prevent future disputes.
Quantities
Specify measurable quantities and use standard units. If you cannot provide exact quantities, give a range.
Delivery terms
Incoterms 2020
Use these international rules to define the responsibilities of sellers and buyers. Always specify the place and time of delivery and the applicable rules. Example: FCA, Norgesfabrikken AS, Blomsterveien 30, Drammen, Incoterms 2020. Read more about delivery terms and Incoterms 2020.
Commercial documents
Agree which documents the seller will provide and which the buyer will provide. These may include, for example:
- commercial invoice
- transport document
- packing list
- certificate of origin
- Additional documents may include insurance certificates and inspection reports.
Payment terms
Price
Consider all factors that affect the price, such as quantity, delivery costs and inflation. Quote prices in a freely convertible currency, excluding import duties.
Interest on late payment
Include a clause on interest for late payments in accordance with the EU's 'Late Payment Directive', which allows payment terms of up to 60 days and interest rates above the central bank's reference rate.
Retention of title
Including a clause stating that 'the goods shall remain the property of the seller until the price has been paid in full' can protect the seller, although its legality varies from country to country.
Protection of intellectual property rights
It is important to protect intellectual property, such as trademarks, patents and know-how, in international contracts. Include a clause stating that 'the seller shall remain the sole owner of all intellectual or industrial property rights relating to the goods' to protect your ideas, trademarks and designs. Read more about protecting intellectual property.
Dispute resolution mechanisms
Conflicts may arise due to late delivery or issues with quality or quantity. Clear contractual terms and reference to Incoterms 2020 can help resolve disputes. Avoid 'full compensation' clauses and consider including force majeure clauses for unforeseen events such as natural disasters, war, embargoes, etc.
Termination clauses
Include terms that allow either party to terminate the contract early under specific circumstances, such as late delivery or non-payment.
Choice of law
It is essential to specify which country's laws will govern the contract. If the parties cannot agree, they can choose the laws of a third country. Consider using international legislation such as United Nations Convention on Contracts for the International Sale of Goods (CISG), but be aware of differences in local laws.
Dispute resolution venue
Choose a neutral and effective venue for dispute resolution, such as Stockholm, Paris or London, rather than less reliable jurisdictions.
Arbitration
Arbitration is a preferred method for resolving disputes confidentially and efficiently in an international context. It is a private tribunal with appointed arbitrators. Arbitration is often faster and more specialised than proceedings before ordinary courts, but usually more expensive. Arbitral awards can also be enforced in more countries than judgments issued by ordinary national courts.
Make sure your contract complies with the regulations in both the importing and exporting countries. This includes competition law, health and safety standards, and import restrictions. Obtain the necessary approvals from the relevant authorities.
Agents promote sales in a specific market and act as representatives of the seller.
Commission
Agents usually earn commission, often based on sales volume. To ensure that agents prioritise profitable sales, commission must be linked to payments actually received.
Del credere
In some cases, agents may guarantee payment, but this is subject to local laws and applies only to undisputed claims.
Agent protection
Be aware that agents in many countries, particularly within the EU and EEA, have strong legal protection against termination without compensation. Agents may be entitled to a termination payment when the contract is terminated.
Distributors that buy products from the exporter and resell them usually handle local distribution and hold stock.
Competition law
Make sure your distribution agreement complies with local competition law, particularly within the EU and EEA. This is especially important when setting the prices at which the Norwegian exporter wants the distributor to sell products and services.
Detailed terms and conditions
Specify product descriptions, pricing, marketing responsibilities and inventory management in the contract or in a detailed appendix.
Both the International Chamber of Commerce (ICC) and Orgalim offer a range of contract templates for different types of sales and distribution agreements. You can purchase these from the ICC and Orgalim websites.
Examples: