Import-Export Service Agreement

What a good one includes

• Explicit incorporation of standard Incoterms to define exactly where ownership and risk of loss transfer from seller to buyer.
• A detailed breakdown of logistics responsibilities, including who secures customs clearance, pays import duties, and handles local warehousing.
• Clear payment terms specifying the accepted currency, payment milestones, and methods used to handle international wire transfers or letters of credit.
• Compliance clauses ensuring both parties adhere to international trade laws, export controls, sanctions lists, and anti-bribery regulations.
• A dispute resolution clause that names the governing law and designates a specific international arbitration venue to avoid costly foreign court battles.
• A robust force majeure clause that explicitly covers shipping bottlenecks, port strikes, government embargoes, and natural disasters.

Common mistakes to avoid

• Omitting or incorrectly applying Incoterms, which leaves both parties exposed to massive financial losses if cargo is damaged in international waters.
• Failing to specify the governing law and jurisdiction, leading to chaotic jurisdictional disputes across different countries if the relationship sours.
• Neglecting to clarify who is responsible for regulatory compliance and import documentation, which often results in expensive port storage fees and customs seizures.
• Forgetting to include currency fluctuation clauses, leaving your profit margins highly vulnerable to sudden shifts in foreign exchange rates.

Frequently asked questions