Three Contract Clauses You Can’t Forget

When signing a contract with a Brazilian company, there are three contract clauses you can’t forget. Two you’ll likey find in most contracts, but one is particularly relevant for international agreements.

Governing Law

Most contracts include a governing law clause. For example, it might say that the contract will be construed in accordance with the laws of California. But what happens if one of the parties is from Brazil? Perhaps you’ll end up with a contract that’s governed by Brazilian law. That’ll be up to the parties to negotiate. No matter what you decide, make sure you know what law will apply.

Venue

Like governing law, venue clauses are critical in international contracts. If there’s ever a dispute, you’ll need to know where to file your complaint. Will you be litigating in the courts of Rio de Janeiro? Maybe you’ll be in New York? Here again, it’s up to the parties to agree on the location (taking into account jurisdictional issues).

Prevailing Language

Contracts between American and Brazilian companies are often drafted in both English and Portuguese. Yet translations can be flawed, and they can lead to conflicting interpretations of the same text. So it’s wise to include a prevailing language clause too. That way you’ll know which language controls in case there’s a dispute.

These three contract clauses - governing law, venue, and prevailing language - are key when signing international contracts. Taking the time to negotiate and clarify these clauses upfront can save you time, money, and stress in the long run.