High Caliber Legal Service

Challenges of international business disputes

On Behalf of | Jun 21, 2021 | Business Law |

Texas companies are increasingly participating in the global economy for a variety of benefits. International trade opens the possibility to share technology, locate top talent and access new markets.

When a problem arises, however, this resource can create hurdles for a business. Whether the dispute involves a manufacturer, vendor or partner, geography can change how the owner needs to approach the situation.

Different jurisdictions

Domestic disputes are simpler to take to court because the relevant laws and procedures already apply to both parties. If a Texas-based retailer faces litigation with their Shanghai-based supplier, however, which region’s court may take the case? A court’s favoritism for whichever party is locally based could taint the outcome.

For this reason, many companies opt to arbitrate these disputes when possible. Arbitration can navigate around differences between jurisdictions while evading possible bias. Be aware that international arbitration also has unique rules, including enforcement.

Ineffective contracts

If the opposing companies are disputing a breach of contract, the terms of the contract will likely direct the process more than the laws of one specific government. For this reason, business owners should confirm that all drafted contracts are fully enforceable before presenting them to a foreign affiliate. A professional review can spare both parties the headaches of cross-border debates down the line.

What remains the same?

Although working with a foreign party can complicate the issue, these disputes are still the same at their core. Each group wants to come to a resolution that’s most advantageous to them. Each group will also seek skilled legal representation to protect its interests – sometimes above the fairness of the resolution.

As with any commercial dispute, Texas companies must abide by the proper legal procedures while developing a strong strategy. Informal negotiation is often worth an attempt, but it might not provide the solution your business needs. Even if the argument spans nations, keeping a local advocate in your corner can make all the difference.

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