In the US, Texas or New York are largely considered "neutral territory" whereas in Europe, until very recently UK law was considered neutral. I think that may change with the recent political upheaval.

Or try international trade law?

www.jus.uio.no/lm/index.html

In the case of one party proposing Indian law and the other proposing Singapore law, the parties may well choose the law of England and Wales as both Indian law and Singapore law are based upon English and Welsh common law. (Note that there is no such concept as "UK law" as one commentator has suggested below).

However, a party should consider a wide range of factors before proposing a particular governing law and should weigh up the legal and commercial advantages and disadvantages of all the options.

One factor may be the degree of certainty that a contract will be interpreted in a particular way. English law adheres to the doctrine of binding precedence. Some legal systems do not. This could lead to significant uncertainty as to how the law will be applied.

In English law, it may be perceived that the courts allow a greater degree of freedom of contract. Subject to certain exceptions, freedom of contract in English law means that commercial parties are completely free to make disastrous bargains. This illustrates the comparative reluctance of the English courts to interfere on policy or other grounds to rewrite the parties' contracts for them.

For example, in English law it is possible, provided very clear wording is used, to include an exclusion clause that excludes any and all liability whatsoever, even for a deliberate breach of contract. And there is still no recognition of a duty of good faith being applied generally to commercial agreements (but watch this space!). This may or may not be an advantage to you but it remains the case that the courts are likely to give effect to the wording of the contract without imposing their opinions as to what does or does not amount to good faith.


And you may wish to consider the approach of a particular legal system to particular clauses.

For example, in English law, a liquidated damages clause will be subject to the clarification set out recently by the Supreme Court with a subsequent judgment, applying that test, indicating that a freely-negotiated LD clause is likely to be upheld subject to the requirements set out by the Supreme Court. Under UAE law, such a provision would be subject to Article 390(2) of the Civil Code and either party may apply to the court to adjust the agreed amount of compensation so it is equal to the loss. If Indian law were to apply, we would have to consider the effect of section 74 of the Indian Contracts Act 1872.

English law will also recognise an asymmetric jurisdiction clause.

And it may be that the choice of law clause will be reflected in the choice of jurisdiction. So, English law and the English courts. If the choice of courts is to reflect the choice of law, it may well be the consideration should be given to the efficacy of the court system and the technical expertise and other qualities of the judges.

Lots to consider.

Another couple of points to consider:
(1) How fast disputes can be resolved in that jurisdiction, whether through the courts or by arbitration.
(2) Intellectual property protections - ensure that any jurisdiction utilised provides sufficient protections.

Yes I agree, please share with me, I would like to see the legislation and I have recently observed the change in contractor's attitude in negotiation from UK.

The most recent change is the implementation of the European Directives into UK Law, through the issue of the 2015 Public Contracts Regulations. This dictates Government procurement rather than standard commercial arrangements. Section 83 indicates a minimum contract record retention of the contract duration where they are over a certain value: As most contracts have an extended liability life of at least 6 years and as we have a wider obligation to maintain public records, then policy in my government Department is to err on the side of caution and retain for 6-7 years. The legislation is found HERE www.legislation.gov.uk/uksi/2015/102/pdfs/uksi_20150102_en.pdf

I'm not sure what the change of law mentioned could relate to - other than what Shaun is referencing.

I would look to follow i) your organisations own information management policy (if it exists - as they should have taken account of relevant law/regulations for your company); or ii) if there is no records policy - then as Shaun says, capturing information and storing information based on the potential risk of claims which would be capped based on the Limitations Act 1980.

The only thing I'd add to point below (for England and Wales jurisdiction) is anything executed as a deed has a limitation period of twelve years rather than six.

Hi Mohammed,

Great question. You have certainly come to the right place for some expert advice. I hope others jump in as well. You can find an array of resources at your fingertips (including case studies).. if you go into the resource library (Resources > Resource Library) and search by category = Negotiation. I would particularly recommend:

IACCM Dubai Member Meeting April 2019 Presentations
Ask The Expert: Negotiating and Contracting in the Middle East
The Power of Intent Workshop - IACCM APAC Conference 2019
Do Procurement practices cause dishonesty?
Negotiating in a time of coronavirus
In Negotiations, Givers Are Smarter Than Takers

In addition, you may wish to consider our new Managing Contracts Virtually training program (which is currently included as a member benefit) .. Training > Managing Contracts Virtually.

If you need help accessing any of these materials, please contact me at info@iaccm.com.

Regards, Paul

Alma, my apologies for not spotting your post earlier!

The elements you mention are components of a Commercial Management process. To gain a comprehensive overview, you may find the IACCM 2019 Benchmark Report helpful - it sets out the various activities associated with the contracting and commercial lifecycle.

If you would like to discuss how you might best approach building the Commercial function, I'd be delighted to arrange a call. You can contact me at tcummins@iaccm.com

Hi Erik - personally I don't think that you are the last one to figure it out, and if I might observe, I believe that there are many others around the world trying to work out what it means for them.

There's two things I'd contribute to your thinking, which are caveated in the usual way (i.e. my views and not necessarily those of my employer) :
1. I think that there is a financial cost to the organisation in seeking to embed these. It's a discussion that I've found has meant that it's hard to get real traction - as whilst the requests for these initiatives come in, there has not been the additional funding provided to many Government organisations to get his going. Sure, it's argued that there are other benefits - often more widely outside of the organisation - but many organisations aren't winning the battle with their finance teams that could see this progress.
2. I have been impressed with the approach of the IRD team in New Zealand. From the presentations that I've seen from Karen Whitehouse and the team, they picked one of the UN goals that was most relevant to them, and looked to focus on that. I think this will be more effective than those who try to achieve too much by looking to incorporate too many of these goals into their procurement activities.

We've looked to take that thinking on board into our operations. Given our contracts are split into portfolios, the challenge for my team in 2020 is to get the business agreeing to an area of focus and measurements for each of these portfolios. These might be the same, or they might be different, but we're using that approach to get the business owners, as well as the leadership team to buy into it, so it's not us going it alone.

Like you, I would love to hear how others are approaching it - it's brave of you to start a topic by making yourself vulnerable, but I think that you're in good company.

Hi Darren, thanks for your contribution. I will add, in terms of motivation, that the Swedish government yesterday announced their long-term strategy towards a sustainable society in general and climate activities in particular. As always, there were many (130) activities, more or less concrete, but a very firm statement by the minister was that they will demand from all public procurement to embed the Agenda and thereby drive the change process.

Obviously, there are a zillion question marks on how to do it (sounds a bit like "how to eat an elephant") and I believe that selecting the goal(-s) that are most relevant would be a decent strategy with a good chance to succeed. I looked at the IRD homepage but could not see a whole lot. Is there a write-up of some kind that I could get access to.

Btw, I am glad to see NZ being active, Tim mentioned it to me and I really believe that us smaller countries are quicker to decide and get going rather than just talking. Denmark is also, as I understand it, acting in the same direction and I honestly believe that we together could put together an IACCM statement of some kind, given that we find more material.

Hi Erik,

You've hit on a really good topic. As I sit here in Australia in the areas affected by fire and storms the need for broader outcome as part of public spending is not lost on me. So much so I recently wrote an article on my blog (www.performancebasedcontracting.com) on this topic. I also mentioned that this is being used, or trying to be used. I'd be happy to provide more details directly if you need. Key thing is that it is possible, just not typical. And I hope we can all change that!


Regards
Dr Andrew Jacopino, IACCM Fellow

Hi Andrew and thanks for your encouraging article. We seem to have things bubbling here and there in the world and I understand that Tim Cummins is taking a lead from an IACCM perspective, that you are involved and that I will try to contribute to the best of my capability.

Meanwhile, I continue to make myself present in the public domain, an interesting effort after 44 years in the private sector. There is no doubt in my mind that the "public muscle" is a major enabler to introduce a more targeted, ambitious and future-focused trading practice.

In addition, I hear more and more that having a common purpose and an encouraging, visible leadership is more engaging and motivating to coming generations entering the labour market than career paths, personal benefits and generic power and status symbols. Without a clear purpose and professional leadership "the good ones" are gone. Yesterday, the CEO of Scania, producer of heavy trucks, buses and other machinery, said exactly this in a TV interview. My contacts with leaders in the public sector say the same.

Tomorrow, I will meet with a few like-minded people in Copenhagen and look forward to continues communicating with you and others in IACCM on the subject. A "viral approach" will be very important, I believe!! There are big and well funded opponents to a change in the current activities.

Best regards, Erik

I never saw such clauses

Dear Carrie, I have experience from pricing changes both during the negotiation process and during the contract lifecycle. Our clients have especially found this as an effective tool during negotiations to demonstrate risk/work-impact if the other party is requesting terms transferring an extensive part of the risk/work to them. By showing the cost-impact, the incentive for price increase becomes rather obvious which strengthens your negotiation position. Kind regards, Madeleine Willyams - Advokatfirmaet Negota AS, Norway.

1) This is novel to me. Reading your post, your organisation is on the supply side. If I am right, I work for an organisation on the buying side and will want to know how this can be of benefit for one on the buying side.

2) Is it possible to see a sample of just one of such clauses, to see how it was drafted?

I believe I found it. www.iaccm.com/resources/

Personally, I would say the 10 are still applicable today (Jan 2020). I also think the point about how fast the world is moving - particularly technology wise - is true and it has only sped up even more in the past 5 years.