Drafting, negotiation and litigation of international sale, distribution, agency and supply contracts.
You are facing:
- an international contract to draft or audit
- a governing law or jurisdiction clause to secure
- an Incoterm or payment method to choose
- a breach or termination by the counterparty
- a force majeure or hardship event
Short answer. The parties may freely choose the law of their contract, expressly or clearly from its terms (Article 3 of Regulation (EC) No 593/2008, Rome I); failing a choice, a sale is governed by the law of the seller’s country and a service contract by the law of the provider’s country (Article 4(1)). Between businesses in contracting States, the Vienna Convention of 11 April 1980 applies without being chosen unless expressly excluded (Article 6); its Article 79 exempts a party facing an unforeseeable and unavoidable impediment but provides no renegotiation for hardship. Abruptly ending an established commercial relationship makes its author liable under French law (Article L. 442-1, II, of the Commercial Code, version in force since 20 August 2026), but whether it applies to a foreign partner depends on the competent court and the governing law. An Incoterm allocates risk and costs; it never determines the governing law or the competent court.
A sale, distribution, agency or supply contract with a foreign partner obeys rules the ordinary domestic contract ignores: the Vienna Convention applies without having been chosen, Incoterms settle risk but not the judge, sanctions and export controls apply whatever law is chosen, and termination is judged under the law of the contract, not under the French Commercial Code.
This page describes the drafting errors behind most international disputes, what a well-built contract must contain, and how the firm intervenes, at drafting and at termination, for French and foreign companies alike.
The risk: a contract that says neither who judges nor under which law
The Rome I Regulation (Regulation (EC) No 593/2008) lets the parties choose the law; failing that, a sale is governed by the seller’s law, distribution by the distributor’s, agency by the agent’s. The Brussels I bis Regulation gives jurisdiction to the court of the place of delivery or performance, absent a jurisdiction clause. A contract silent on both points is judged by a court and under a law the company did not choose.
The Vienna Convention on Contracts for the International Sale of Goods applies automatically between professionals from Contracting States unless expressly excluded: its Article 79 excuses impediments, but hardship gives no right to renegotiation. Many contracts are governed by it without their drafters realising.
Does your situation carry this risk? A first exchange allows us to measure it and to say how the matter would be organised.
The legal answer: allocate risks before suffering them
A robust international contract contains an applicable law clause and a jurisdiction or arbitration clause consistent with each other, an autonomous force majeure clause and a quantified hardship clause, an asymmetric sanctions clause, a change of law and customs duty clause and, for sales, an Incoterm coordinated with the payment method and the documents required.
At termination, the decisive question is the applicable law: the French rule on abrupt termination of an established relationship (Article L. 442-1, II of the Commercial Code) has effect only under French law; under a foreign law, notice and compensation are calculated differently, and the French court’s jurisdiction over that claim depends on its contractual or tortious characterisation.
How the firm works
Upstream, the firm reviews or drafts the company’s standard contract and general terms from the angle of international risk, in a bilingual version where the counterparty requires it. During performance, it handles renegotiation requests, force majeure notices and formal notices, within the time limits and forms provided in the contract.
For the sale of goods, the firm publishes a practical guide to the international sale of goods (in French) and its six-point analysis.
At termination or in case of non-payment, it brings the action before the competent court or arbitrator, in France or abroad with a correspondent, and ensures enforcement of the decision, including recognition and exequatur where the debtor’s assets are outside France.
Typical cases handled
The situations below are illustrative, anonymised scenarios. They show when the firm steps in and what the work consists of.
Exclusive distributor in Germany terminated without notice
A French manufacturer terminates a German distributor after eight years. The firm determines the applicable law (German, absent a clause), assesses the goodwill indemnity due by analogy with commercial agency, and negotiates the exit.
Force majeure invoked by an Asian supplier
A supplier invokes force majeure for a raw material cost increase. The firm shows that a cost increase is not an impediment, reserves the buyer’s rights and obtains delivery at the contract price.
Battle of the forms
Buyer and seller each referred to their own general terms. The case is handled on the last-shot rule and the Vienna Convention, to determine the applicable jurisdiction clause.
Does your situation carry this risk? A first exchange allows us to measure it and to say how the matter would be organised.
On what these clauses change when a customer does not pay, see our article Foreign customer not paying: where to sue and how to recover?
On these two clauses, read our article Governing law and jurisdiction: the clause that decides the case.
Everything on international contracts
Our practical guides
Our analyses (33)
- Trade with China: since 1 May 2026, your governing-law clause no longer holds before a Chinese court
- Sealed Container Arriving Short: The “Said to Contain” Clause
- Freight Forwarder, Forwarding Agent or NVOCC in France: Whom to Sue?
- Bill of lading jurisdiction clauses: when the consignee can sue in France
- Forced labour and deforestation: what EU regulations require of importing companies
- Franchising in France: pre-contractual disclosure and leaving the network
- Limitation of liability and penalty clauses in France: what the courts strike out or reduce
- Mediation before arbitration: a useful clause, if it is well drafted
- Export agents and intermediaries: managing bribery risk under Sapin II
- EU Deforestation Regulation (EUDR): what changes for importers
- Exclusive distribution abroad: what your agreement must lock down
- Terminating a contract for breach without going to court in France: termination clause, notice and withholding performance
- US tariffs: who bears the increase under an existing contract?
- ACE Congress 2026: hardship in international law
- Buying a second-hand ship on the Norwegian Saleform 2012: key clauses and disputes
- Incoterms 2020, transfer of risk and retention of title: what your contract does not settle
- International sanctions: what a French exporter must be able to prove in 2026
- Defects of consent: the six points that decide whether your contract survives a nullity action
- My foreign distributor stops paying: where do I sue?
- My foreign partner terminates the contract without notice: what are my remedies?
- The bank refuses my documentary credit: what should I do?
- My foreign buyer disputes conformity eight months after delivery: what should I do?
- My foreign buyer refuses the goods: what should I do?
- Exporter disputes: six situations, six answers
- ICC arbitration clause in a maritime contract: what it settles, what it leaves to the court
- OHADA arbitration clause: seat, language and governing law
- SIAC arbitration clause: the six decisions to take before signing
- ICC arbitration clause: the five decisions you make before signing
- Force majeure and hardship clauses in an international contract
- International sale of goods: the six points that decide which contract binds you
- The Vienna Convention (CISG): when does it apply and how is it excluded?
- Governing law and jurisdiction: the clause that decides the case
- Maritime contracts: the six points that decide which regime applies and what it costs you
This work is part of the matters the firm handles in international trade law.
Frequently Asked Questions
Should the Vienna Convention be excluded?
Not as a reflex. The CISG applies by default to sales of goods between businesses established in different contracting States, and it offers a neutral, widely known regime with workable rules on conformity and on avoidance. Excluding it means falling back on a national law that one party will know better than the other. There are real reasons to exclude it, for instance where the contract mixes sale with substantial services, or where the parties want a national law they have already litigated under. The choice deserves a line of reasoning in the file, not a clause copied from an earlier contract.
Does the Vienna Convention apply even if I choose French law?
Yes, and this is the most common trap. The United Nations Convention on Contracts for the International Sale of Goods forms part of French law: designating French law in an international sale between parties established in Contracting States therefore amounts to designating the Convention, not the Civil Code. Its Article 6 allows the parties to exclude it, but the exclusion must be express and unambiguously drafted. The question is not theoretical: the Convention differs from domestic law on sensitive points, notably the time for giving notice of defects, the concept of fundamental breach and the conditions for avoidance. The parties must therefore decide whether to apply it or exclude it, and put that decision in writing.
Is an arbitration clause preferable to a jurisdiction clause?
It depends on where the assets are. Arbitral awards circulate under the New York Convention, which binds more than one hundred and seventy States, and that is decisive when the counterparty’s assets sit outside the European Union. Within the Union, judgments circulate almost automatically under Regulation 1215/2012, and a court is cheaper. Arbitration also offers confidentiality, a neutral forum and arbitrators chosen for their knowledge of the trade, at a cost that weighs heavily on smaller claims. The right question is not which is better in the abstract, but where a decision will have to be enforced.
Does the French abrupt termination rule apply to a foreign partner?
It may. French law sanctions the termination of an established commercial relationship without written notice sufficient having regard to the duration of the relationship, and French courts have applied that rule in international situations connected with France even where a foreign law governed the contract. The provision was recast in 2026, so notice benchmarks and wording taken from older contracts and precedents should be checked against the current text before they are relied on. For a foreign supplier or distributor, the practical lesson is that a French relationship cannot simply be ended by letter.
Which law should govern an international contract?
The one that fits the transaction and that both parties can work with, chosen expressly. Under Regulation 593/2008 the parties’ choice is respected, subject to overriding mandatory rules and public policy, and in the absence of a choice the Regulation designates a law that may surprise both sides. Choosing a law neither party knows, because it sounds neutral, is a false economy: the cost reappears as expert evidence. The clause is drafted together with the forum clause, since a French court applying English law, or the reverse, adds delay and expense to every dispute.
Can the parties freely choose the law governing their contract?
Very largely, yes. Article 3(1) of Regulation (EC) No 593/2008 of 17 June 2008 on the law applicable to contractual obligations, known as Rome I, provides that a contract is governed by the law chosen by the parties, the choice being made expressly or clearly demonstrated by the terms of the contract or the circumstances of the case. Two precautions go with this freedom. The choice must be written and unambiguous, since an implicit designation opens a costly debate. And it does not escape the applicable mandatory rules or the protective provisions that some national laws impose, so a choice of law never dispenses with examining the law of the place of performance.
What happens if the contract says nothing about the governing law?
The Rome I Regulation fills the gap, and the result is often surprising. Article 4(1) subjects a contract for the sale of goods to the law of the country where the seller has its habitual residence, and a contract for the provision of services to the law of the country where the service provider has its habitual residence. In other words, silence in principle benefits the party that provides the characteristic performance, which is not always the party paying most attention to the drafting. For a French buyer sourcing abroad, the absence of a clause therefore most often means the application of a foreign law. That is reason enough never to leave the question aside in a contract of any value.
Which clauses matter most in practice?
Governing law and forum, price and payment including security, delivery and transfer of risk through a correctly used Incoterm, limitation and exclusion of liability, force majeure and hardship, termination and notice, confidentiality, and compliance with export control and sanctions rules. Intellectual property and data clauses are added where they are relevant. Most disputes are lost in these clauses long before a court sees the file, and the great majority of them can be settled in a single negotiating pass if the points are raised together rather than one at a time.
How is payment secured across borders?
Through the instrument that matches the level of trust: advance payment, a documentary credit confirmed by a bank in the seller’s country, a standby letter of credit, an independent bank guarantee, or credit insurance. Retention of title helps only where the goods can be identified and where the law of the place they are located recognises the clause, which is not everywhere. The instrument is chosen before the price is agreed, because it has a cost and that cost belongs in the negotiation rather than in the invoice that follows.
Should the contract be drafted in English or in French?
The question is one of evidence, not style. A bilingual contract without a precedence clause creates a serious risk, because the two versions always diverge on some point, and the divergence comes to light when the dispute arises. The practical rule is simple: only one version is authoritative, designated in the contract, the others being courtesy translations. The choice of that version depends on the governing law and on the chosen forum, and consistency between the three avoids translation arguments over legal concepts that have no exact equivalent from one language to another. A precedence clause takes one line and saves months of argument.
When should a contract be reviewed by a lawyer?
Before signature, obviously, but above all before the commercial negotiation is closed. A review that comes once everything has been accepted can only record the risks, whereas an intervention at the letter of intent stage still makes it possible to allocate them. Three moments justify a review even for a company well versed in its standard contracts: entry into a new country, whose mandatory rules are unknown; a move to a volume that changes the order of magnitude of the risk; and the reuse of a template drafted under another law, whose clauses may prove ineffective once transposed. Outside these cases, an annual review of the general terms and conditions is enough.
Matters in this area are handled by Hervé Guyader, avocat at the Paris Bar and Doctor of Law. Page updated on 2 November 2026.
Read also: Force majeure and hardship clauses in an international contract
Read also: International commercial agency contract: termination indemnity and applicable law
