In an international contract between parties from different countries, there should be choice of law, also known as governing law, stating which territory’s law shall be followed to determine a dispute and jurisdictional clauses which enables parties to agree at the outset of their contractual relationship which country’s or countries’ courts are to have jurisdiction to hear disputes arising from the contract.
Globalisation of businesses from different countries has led to more emphasis being placed on choosing the governing law for international cross-border contracts. This is particularly the case should a dispute arise down the line as the choice of law and jurisdiction chosen can make or break your case.
Why is the English Law Chosen as the Standard Jurisdiction for International Contracts?
The English law is usually the standard governing law in international and cross-border contracts as it is generally seen as an attractive and pro-business proposition to govern international contracts. In some instances, the English law is the preferred governing law for international businesses even if they do not have a geographical connection with the UK.
It is with good reason that the English law is commonly the governing law in international contracts:
- The English law is widely regarded as the market standard for many industries as it provides a high degree of certainty and predictability.
- The English law is flexible as it is based on the fundamental principle of freedom of contract and can be used for a vast range of disputes.
- The English Law is continuously being developed through application of different cases and circumstances. This allows the court to react accordingly to changes in the business environment which legislators may not have foreseen.
- Proceedings are conducted in English. The English language remains to be the default language for business and commerce.
- Litigation in England is relatively quick in comparison to litigation in many other countries, with judges taking a proactive approach on cases.
- The English courts appreciates the benefits of mediation and Alternative Dispute Resolution (ADR) in settling disputes outside of the courts which can prevent costly litigation. Many international arbitral and alternative dispute resolution institutions are based in London.
English Law as an Independent Jurisdiction
One fundamental factor of using England as the governing law in international contracts is its judicial independence. Individual judges and the judiciary system are impartial, free of any improper influence and independent from external pressures and of each other which fundamentally guarantees that a case will be fair and in accordance with the law.
Incorporating English law as the governing law in international commercial contracts can provide businesses and entrepreneurs the confidence and reassurance that they can conduct their business activities without hesitation.
Specialist International Jurisdictional Advice
Monarch Solicitors specialist International Jurisdictional Solicitors provide a tailor-made approach to your needs and can help with a range of international cross-border jurisdictional issues. Please contact us by either calling 0330 127 8888 or emailing [email protected] for an initial consultation.