In an international sale contract the seller undertakes to deliver the subject of the sale to the buyer whereas the buyer undertakes to pay the sale price of the subject of the contract to the seller. In the beginning stages of ordinary commercial sales, when the parties come to an agreement on the sale of the goods, they decide on the conditions to renew or amend the agreement, the delivery of the goods, the type of payment, distribution of the risks and resolution of the possible disputes. In the event that the sale and delivery operations are to be carried overseas, the parties should also include in the contract the additional conditions such as sharing the costs, shipping documents and insurance policy. These are conditions specifically agreed upon for each sale, based on the requests of the parties.
Although international traders generally use standard form contracts drafted by the International Chamber of Commerce with their own set of norms, from time to time they also require tailor-made contracts for their individual needs and circumstances of the sales. Due to the reason that these individual contracts are drafted separately for each sale, they prolong the preparation and negotiation phase. This is the reason that many organizations, institutions and chambers of professions formed by international traders use standard contracts rather than individual contracts for standardizing the conditions based on sectors, locations, subject of sale, type of delivery. Today, sale subjects such as agriculture, textile, spice, sugar, energy and metal all have their own standard contracts drafted by international institutions.
Drafting contracts properly in international trade agreements is essential in commercial law. Drafting and reviewing obligations set out in international commercial agreements vary according to the applicable law. This is why International Chamber of Commerce introduced to the commercial life a set of notions that determines the delivery and payment methods and are adoptable to contracts. These notions, also known as INCOTERMS across the world, determine delivery and payment methods while also being updated according to the latest technological and commercial developments. For more information on INCOTERMS, please check this LINK.