Legal Precision - Petra Ribbens
31 août 2023
Contract Management: which law shall govern your contracts?
Which law to choose as the governing law for your company’s contracts? And it is worth fighting for our choice? These are questions we get very frequently.
If given the choice, Swiss law as governing law for your contracts has many advantages.
It is codified, quite easy to understand, available in several languages (including most often an English official translation on the Swiss Government’s websites), and above all provides contracting parties with great autonomy and control over the rights and obligations resulting from the contract – more so than almost any other jurisdiction. To top it off, Swiss contract law is based on the principle of good faith, making it aligned with parties’ expectations of fairness, transparency and predictability – not to say: neutral and pragmatic.
That in itself however may not be sufficient to convince your contracting counterparty to accept your choice of law. Rest assured – the choice of governing law should not be a dealbreaker, and a choice for another jurisdiction might make total sense, taking into account a variety of factors.
Most of all: make sure you’ve got the dispute resolution mechanism right; although less visible and straightforward, it’s more often this clause that will turn out to have negative consequences for your business in case of disagreements later on.
To read more: https://www.ch.ch/en/political-system/operation-and-organisation-of-switzerland/courts/