International Sales Agreement

An agreement between a seller and a buyer for the sale of goods. The contract should, at a minimum, identify the seller and buyer, the quantity and type of product, delivery time, price and conditions of payment. In addition, a well-constructed international sales contract will reference the governing body of law, the forum where any disputes are to be resolved and the method of dispute resolution, such as arbitration as opposed to litigation. For international sales of goods, the body of law will often be the UN Convention on Contracts for the International Sale of Goods (CISG), known as Vienna Convention.

Contracts for the international sale of goods should also indicate the terms of sale, preferably one of the 11 Incoterms. Sales contracts covering goods that are not shipped under a negotiable marine bill of lading should also specify when (time and place) and/or how ownership passes from seller to buyer.

Often international transactions are conducted without the benefit of an international sales contract. Instead the seller provides a quotation (often in the form of proforma invoice) and the buyer responds with a purchase order.

This may be sufficient for repeat sales between well acquainted parties that have developed a basis of previous dealings. However, it can lead to unanticipated problems in case of disputes. Major issues not covered in the international sale contract and without precedence in previous dealings between the parties will be “filled in” by the dispute resolving authority, often with surprising consequences.

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