Draw up an agreement with Kazakhstan
The legal basis for any type of economic relationship is an agreement between counterparties. In all countries there is a lot of litigation about contracts, and international contracts have even more practical issues.
In the article we will tell you how to correctly draw up an international agreement with an organization from Kazakhstan, give universal instructions and tell you what you need to pay attention to.
Our law firm can also help you with this:
- we work online, all work is done online, you send technical specifications, we conclude an agreement online (exchange scanned copies), pay the invoice.
- We will study situations and documents;
- we will develop a foreign trade contract;
- we will send a report to the client;
- We will translate into foreign languages if necessary.
International agreement with an organization from Kazakhstan
In order to have economic relations with companies from different countries, the parties must understand the rights and obligations, the subject and essence of their relations. This is why an international contract is needed.
Before concluding a contract with a counterparty, many experts advise conducting due diligence of the partner. This is a financial and legal check that will help reduce risks.
So, each international contract has its own essential features. For example, in a purchase and sale agreement, these will be the subject and price of the product, equipment, and so on.
It is also worth remembering a few main principles for any international contract:
- The contract must be written and signed by both parties (If there is a legal dispute, this will be your main evidence);
- The contract must have essential terms and the rights and obligations of the parties must be clearly stated;
- In international contracts, the parties choose the law, court and application of Incoterms.
Let’s look at the example of developing an international contract for the supply of goods. This is one of the most popular types of economic relations.
1.1 Product and product price
Of course, in an international contract for the supply of goods, it is important that one party will supply the second. In legal theory, this is called the subject matter of the contract.
The contract must describe the goods in detail. Be sure to indicate the characteristics of the product, its range, quantity, weight, volume and other important indicators. The goods may be fragile and it is necessary to write about this so that the counterparty knows this during transportation.
Special mention should be made of complex products. In this case, the component parts of the product are described.
The price of a product is its value. The parties choose a currency and agree on the price of the goods in the contract. It is also important to write the quality of the product or how the quality of the product will be evaluated, according to what law or international law.
It must be remembered that not all goods can be freely exported or imported into the country. To do this, you need to study the national legislation of the counterparty. Otherwise, the contract may be declared invalid.
Also, the parties must understand the terms of payment for the goods. They must be written in the contract. You can choose the option of full or partial prepayment, payment in installments, or payment after delivery of the goods and signing of the transfer acceptance certificate.
1.2 Applicable law. Terms and conditions of delivery of goods.
In order to correctly draw up an agreement with Kazakhstan, it is necessary to select the applicable law, conditions and terms of delivery of goods. Now we’ll tell you what this means.
Applicable law is the national or international law that will apply in the contract and also if a dispute arises. (The court will decide the dispute according to the applicable law).
The international rules of Incoterms are convenient and universal norms. The rules have several versions: 2020, 2010,1990. Partners can choose any version, but they must specify the year in the contract itself.
The Incoterms rule is an abbreviation. For example, the parties choose the FCA – Free Carrier rule. This means that the Buyer is searching for a carrier, paying for transportation services, unloading in his country, and paying export duties.
The supplier must ship the goods to the carrier, fill out the transfer documents, and pay the duty.
Responsibility passes after the order is shipped to the carrier’s transport. But after going through all the necessary export procedures.
In the contract it will look like this: When delivering goods, the rules of Incoterms 2020 will be applied….. The procedure for supplying goods is determined by the FCA international rule. The place of delivery is Astana International Airport. The carrier is…...
The delivery time for the goods is chosen by the parties themselves. As practice shows, the period depends on the delivery distance and the product itself. Responsibility must be established for failure to meet the delivery deadline.
The term can also be a specific date, or a certain number of days from the date of signing the contract, or the number of days from the date of prepayment.
1.3 Forwarder and certificate of quality and quantity of goods
A freight forwarder is a person or company that organizes the transportation of goods. The parties can choose a freight forwarder in an international contract.
The freight forwarder will help counterparties in the following areas:
- Legal organization of transportation, acts of acceptance, transfer, invoices, and so on;
- Searching for the best route for delivery of goods;
- Searching for a carrier and so on.
- The forwarder can be noted in the international contract with Kazakhstan.
A certificate of quality and quantity is also a very useful function for organizing the supply of goods with a company from Kazakhstan.
For example, if the parties agreed to supply 10,000 pens, then you can choose an organization that, when receiving the goods, will count them and evaluate the quality.
These will be independent experts who will help the buyer avoid the risks of losses or overpayment for low-quality goods. The parties choose the organization that will issue the certificate and write about it in the international contract.
1.4 Liability of the parties
Responsibility disciplines international partners.
As a rule, the parties choose such types of liability as fines, penalties, penalties, compensation for expenses, and so on.
Example: For late delivery of goods, the seller must pay a penalty in the amount of 0.1% per day of the amount of the goods.
It is also common for certain types of products to have a warranty period. If the product breaks during this period, the supplier must repair it free of charge. This can be written in the contract for the supply of goods.
Force majeure is a situation that does not depend on the will of the parties. These are wars, floods, and other natural disasters.
In the contract, you can write force majeure situations or simply a reference to the fact that such situations may occur and that the parties are exempt from liability in the event of force majeure.
1.5 Choice of court to resolve the dispute
In any economic relationship there is a chance of a dispute arising. To resolve it correctly, it is necessary to select a competent authority.
The contract states: All disputes arising from the legal relationship of this Agreement will be resolved in ……………..
International partners have the right to choose a court. Now we will tell you about all the pros and cons of all options.
- Commercial arbitrations. Recognized in more than 170 countries, more expensive than state courts, you can choose a specialist arbitrator, language and place of consideration of the dispute;
- State court in one of the partner countries. Usually there are more formalities, knowledge of the legislation of that country is required, it takes longer to process, and it is cheaper than arbitration.
The choice of court can be written in the contract itself or a separate arbitration agreement can be concluded.
1.6 Details of the parties and signatures of the parties
When drawing up an agreement with Kazakhstan, it is necessary to remember the details of the parties. As a rule, they are indicated at the end of the document. Let’s give a list of important details:
- Name of international companies, their address, tax number.
- Contract number;
- Place of conclusion of the contract;
Also, the agreement must be signed by all parties. Only legal representatives of the company can sign the contract. To do this, there must be a power of attorney or a mention of this in the constituent documents of the organization.
To check powers, you can ask a representative of the counterparty for a passport.
Expertise of the agreement with Kazakhstan
If the parties already have a draft international agreement, then an international law specialist can help conduct an expertise to minimize the risks of counterparties.
The expert checks:
- Does the contract comply with the laws of the partner countries;
- Are there legal risks in the content of the contract;
- Are the rights and obligations of the parties correctly defined?
The higher the experience and qualifications of a specialist, the less chance partners have of losing money.
Conclusion
As we can see, drawing up an agreement with Kazakhstan is not an easy task. Knowledge of a foreign language, international and national law of partner countries is required.
We have given you universal advice that will help in drawing up any international agreement. Use them or ask help from a specialist.