Success in Global Trade: International Trade Disputes in 8 Points

Success in Global Trade: International Trade Disputes in 8 Points. Global commerce is expressing economic activities that are transcending country borders, and in these activities, parties that are subject to different legal systems are being brought together. International commerce can bring many legal problems with it, from payment difficulties to breach of contract. The solution of these problems is not only requiring commercial knowledge, but also the complex rules of international commercial law. In this article, the most frequently encountered problems in international commercial lawsuits, the legal ways of solution for these problems, how the competent court and the applicable law are being determined, alternative solution mechanisms such as arbitration, and the importance of legal counseling are being examined in detail.

1. The Challenging Paths of Global Commerce: The Role of Law

International commercial law is a branch of law that is regulating the commercial relations between parties who are subject to the laws of different countries. This branch of law is comprising a wide area from international sales contracts to transportation and payment methods. The question of in which country’s court the dispute that is arising will be solved and which country’s laws will be applied can fundamentally change the outcome of the lawsuit.

2. Common Problems in International Sales Contracts

The most frequently encountered legal problems in international commerce are generally occurring during the performance of sales contracts.

• Goods Being Delivered Defective or Contrary to the Contract: It is the situation where the imported goods are not complying with the features (type, quantity, quality) stated in the contract. In this situation, the buyer is having the right to terminate the contract or to request compensation.
• Delay in the Delivery of the Goods: It is the situation where the seller is not delivering the goods on the date stated in the contract. This delay can lead to pecuniary damages for the buyer side.
• Payment Not Being Made on Time: It is the situation where the buyer is not fulfilling their payment obligation after the delivery of the goods.

3. The Competent Court and the Determination of the Applicable Law

Before an international commercial lawsuit is being filed, an answer must be given to two basic questions: in which country’s court the lawsuit will be heard (competent court) and which country’s law will be applied.

• Jurisdiction Clause in the Contract: The parties to the contract are generally determining in which country’s court the dispute will be competent in the event of a dispute. This is facilitating the solution of the dispute.
• International Private Law: If a competent court has not been determined in the contract, the competent court and the applicable law are being determined according to the rules of international private law. This can be a complex and long process.

4. Arbitration: An Alternative Solution in International Commercial Disputes

Arbitration is a way that is often being preferred for the solution of international commercial disputes. The parties are deciding to solve their disputes in front of an impartial arbitration tribunal instead of state courts.

• The Advantages of Arbitration:
  • Confidentiality: The arbitration process is generally being carried out confidentially.
  • Speed: It can be concluded faster than court lawsuits.
  • Flexibility: It is possible for the parties to determine the arbitration rules and the arbitrators.
  • Finality of the Decision: Arbitration decisions are binding like court decisions.

5. The Collection of Evidence and the Burden of Proof

The collection of evidence in international commercial lawsuits can become difficult due to geographical distances and different legal systems.

• Evidentiary Value of Evidence: Documents such as e-mail correspondences, invoices, freight documents, and customs declarations are being accepted as the most important evidence sources for the proof of the lawsuit.
• The Burden of Proof: In general, the party who is making a claim must prove their claim. For example, the buyer who is claiming that the goods are defective must prove this defect.

6. The Law Applied in International Sales Contracts

International sales contracts are generally being subject to the rules of the United Nations Convention on Contracts for the International Sale of Goods (CISG).

• CISG: This convention, to which Turkey is also a party, is regulating the provisions of international sales contracts. The existence of the convention is eliminating the ambiguity of the applicable law.
• Freedom of Contract: It is possible for the parties to state in the contract that the CISG will not be applied and to choose the law of a different country.

7. The Importance of Legal Obligations and Legal Counseling

In international commerce, the legal obligations of the parties are being determined with international agreements, laws, and contracts. The non-compliance with these obligations can lead to commercial damages as well as serious legal problems.

• The Requirement of Expertise: International commercial law is an area that is requiring expertise. Legal counseling being taken from a lawyer in this area is of vital importance for contracts to be prepared correctly, for risks to be managed, and for strategic steps to be taken in the solution of disputes.

8. Incoterms: The Common Language of Commerce

In international commerce, Incoterms (International Commercial Terms) are being used to clarify the rights and obligations of the parties. Incoterms are standardizing subjects such as the place of delivery of the goods, when the risk will pass, and by whom the expenses will be met.

Success in Global Trade: International Trade Disputes in 8 Points. International commercial lawsuits are difficult processes that are containing many legal uncertainties and complexities. However, with a good understanding of these processes and a correct legal strategy being determined, the risks of commercial activities can be minimized. The meticulous preparation of international sales contracts, the preference of alternative solution ways such as arbitration, and legal counseling being taken are being accepted as the most important steps that must be taken to reach success in global commerce.