Enterprise and business
Commercial contracts
Commercial contracts – pre-contractual stage, contractual stage, post-contractual stage and legal conflict
When drawing up international commercial agreements, it is important to first determine exactly what the parties are intending and what the goal is they want to work towards. Below is an overview of the different moments when drawing up a commercial agreement is important. The purpose of all agreements mentioned is to protect your company as well as possible from a legal point of view and to create clarity between the parties what has been agreed and what the mutual expectations are. Generally speaking, there are four stages with regard to drawing up an international commercial agreement.
Four stages in the drafting of international commercial contracts
- Pre-contractual phase – the preliminary phase of an international commercial agreement. This is where the parties want to establish their intention to do business together, by means of a Letter of Intent. It is also possible, for example, that parties already have an agreement in certain areas, in which case it is more convenient to draw up a Memorandum of Understanding. Also called a MOU.
- Contractual phase – drawing up an international commercial agreement. This is when the parties have reached agreement on commercial matters and there is a need to lay down the agreements that apply at that time. A number of examples of this type of commercial agreements or contracts are long-term agreements, fixed-term commercial agreements, buy/sell agreements, joint-venture agreements, etc. If it concerns the sale of certain products and/or services of your company, this would be a purchase or sale agreement of certain products or services or if it concerns indirect sales, an agency agreement, distribution agreement or franchise agreement.
- Post-contractual phase – the phase after the agreement or contract has been concluded. This is the phase where the agreed commercial agreement is carried out by the parties. It may be that adjustments have been made by both parties with regard to the implementation of the commercial agreement, then it is possible to draw up an Addendum to be attached to the commercial agreement.
- Legal conflict after the commercial agreement has been concluded. This is the phase where the parties are no longer in accordance with the applicable agreements or when one of the parties has a different view of the applicable agreements. In such cases, the attorney at law will be able to advise your company about which agreements have been made and what the possibilities are to, for example, terminate or cancel the commercial agreement.
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Furkan Alkilic
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